What's Happening?
The Democratic Republic of Congo is preparing for the first cobalt shipment by Chinese company CMOC under a new quota system. The system, launched in October, allocates a quota of 18,125 metric tons for the fourth quarter and caps annual exports at 96,600
tons from 2026. Congo, which produces over 70% of the world's cobalt, has faced a months-long export ban that increased cobalt prices. CMOC and Glencore, the largest cobalt producers, received the largest allocations. Sampling for CMOC's shipment has begun, with the first shipment expected in January.
Why It's Important?
Congo's new quota system aims to regulate cobalt exports, a critical component in electric vehicle batteries. The system's implementation could stabilize cobalt prices and ensure a steady supply for global markets. However, the export ban and new requirements, such as a 10% royalty prepayment, have raised concerns about potential delays and disruptions in the supply chain. The outcome of this new system could influence global battery production and the electric vehicle industry, impacting manufacturers and consumers worldwide.
What's Next?
As Congo begins exporting under the new system, stakeholders will closely monitor its impact on cobalt prices and availability. The Congolese government and mining companies may need to address compliance challenges and legal ambiguities to ensure smooth operations. The success of this system could serve as a model for other resource-rich countries seeking to manage their exports more effectively. Ongoing discussions between Congo's mining ministry and industry representatives will be crucial in resolving any issues that arise.
