Cobalt prices have dropped sharply, according to Trading Economics. A tonne of the ‘blue metal’ now costs about 36,000 dollars, down 31 percent since the start of the year and 56 percent since the peak in the spring and summer of last year. Thus, a once-feared obstacle to the energy transition appears to have been removed.
Used in lithium-ion batteries, demand for cobalt started to climb as work-from-home policies boosted portable-electronics sales. By now, those markets are in a slump. Additionally, manufacturers of electric vehicles have adopted new battery technologies that require less cobalt.
Meanwhile, supply is rising. Congo, the world’s biggest cobalt exporting nation, will expand production by 38 percent this year, according to a report in The Economist. Indonesia has started up mining operations from scratch and China is planning new facilities. Cobalt is often a by-product in the extraction of other metals, dampening the incentive to lower production in response to price drops.