Cobalt prices fall below 21-year lows! Congo urgently suspends cobalt exports for four months to save the market.

The Democratic Republic of Congo has announced it will suspend cobalt exports for four months in order to control the oversupply of battery metal in the international market. Congo's cobalt production accounts for about three quarters of the global supply for electric vehicle batteries. In recent years, the increase in production at two large mines in the country by CMOC Group Limited has led to an oversupply of cobalt, causing prices to plummet and production to soar in Congo. The Chairman of the Strategic Mineral Market Regulatory Authority (ARECOMS) in the country, Patrick Luabeya, stated, "Exports must be aligned with global demand." According to Luabeya, these measures came into effect on February 22nd. The day before, the Prime Minister and Minister of Mines signed a decree allowing regulatory agencies to take temporary measures, including export bans, "to prevent any disruption to market stability." Based on Fastmarkets data, the price of cobalt has dropped to below $10 per pound, the lowest in 21 years, except for a brief decline at the end of 2015. Congo is the main source of cobalt, and the price of cobalt hydroxide has fallen to below $6 per pound. The Congo government is also the world's second largest copper producer. Luabeya stated that the government has been closely monitoring market dynamics for a year. He said that the situation requires "immediate action" because years of illegal mining and uncontrolled exports by industrial and semi-industrial producers have led to oversupply, posing a "serious threat to the country and its domestic and foreign investors." Cobalt is a byproduct of Congo's copper production. Luabeya stated that while the ban on cobalt exports "applies unilaterally, without exception" to all producers, it does not restrict production, and copper exports should not be affected. "Because copper and cobalt are sold separately, copper exports can continue." The two major cobalt miners after CMOC Group Limited are Glencore and Eurasian Resources Group. Luabeya stated that the decision will be reviewed within three months. In the meantime, the agency is preparing additional measures to balance the cobalt market, promote more processing of strategic minerals in Congo, and achieve a "transparent and fair pricing mechanism."