Congo Seeks Indonesia’s Support to Stabilize Cobalt Market Amid Oversupply

The Democratic Republic of Congo is proposing measures to stabilize the cobalt market by securing Indonesia’s support following a suspension of cobalt exports. This partnership aims to address global oversupply and improve pricing. The DRC has gained insights into managing cobalt exports efficiently while seeking to exert more control over the industry.

The Democratic Republic of Congo (DRC) is actively seeking Indonesia’s support to stabilize the global cobalt market amid current oversupply issues. Following the suspension of cobalt exports, there has been a resurgence in prices due to weakened demand from automakers. To reinforce a temporary ban on cobalt exports, the DRC has proposed collaborative measures with Indonesia, the world’s second-largest supplier of this essential battery metal.

The DRC’s prime minister has indicated plans to impose export quotas on cobalt, which follows a four-month export ban initiated in late February due to a significant price drop attributed to excess global supply. As part of its strategy, the DRC government aims to establish partnerships to manage the cobalt supply effectively.

Led by Prime Minister Judith Suminwa Tuluka, the DRC’s Economic Situation Committee has recommended strategies for the effective management of the ongoing export suspension. Securing Indonesia’s cooperation for regulating cobalt supply and stabilizing prices is a significant step in their recommendations. Indonesia has increasingly contributed to the cobalt market, enhancing its global share to 11% last year.

Cobalt extraction is a crucial economic activity for both nations: in Congo, it is primarily sourced alongside copper, while in Indonesia, it is extracted with nickel. Following the export suspension, cobalt prices have shown signs of recovery from recent lows. Additionally, the committee’s proposals include the introduction of export quotas and enhanced domestic processing obligations, although specific details remain undisclosed.

The DRC government has been deliberating production and export restrictions for over a year in pursuit of greater oversight and influence over the cobalt market. This strategic approach aims to optimize the value derived from its cobalt resources and mitigate potential oversupply once export activities resume.

In conclusion, the Democratic Republic of Congo is strategically positioning itself to stabilize the cobalt market through a potential partnership with Indonesia. The proposed measures, including export quotas and collaboration with Indonesia, seek to effectively manage the cobalt supply amidst current oversupply challenges. These developments may significantly influence global cobalt prices and the economic dynamics of both nations in the future.

Original Source: africa.businessinsider.com