- DRC cobalt ban is steadily spiking prices for the critical mineral.
- DRC, Indonesia, Chile in talks to form a ‘critical minerals OPEC’.
- To counter the blow, US starts domestic refining.
The Democratic Republic of the Congo (DRC) has banned the export of cobalt in a move designed to push prices up. And, it is working: “There’s been a significant jump,” said Thomas Kavanagh, editor of battery metals at Argus Media, a market intelligence firm.
According to the market expert, after the export ban was instituted in February, “…the price of a key cobalt compound rose by more than 80 per cent. And it could be just the start,” he warns.
According to the expert, “the DRC’s export ban created immediate ripples throughout global commodity markets, triggering significant price volatility and prompting reassessment of supply chain stability for battery manufacturers and other end users.”
In his review, cobalt prices surged dramatically in response to the export ban; “increasing by 39 per cent from US$24,495 per metric tonne in January to US$34,040.40 by the end of Q1 2025.”
“This sharp reversal highlights the market’s sensitivity to supply disruptions, particularly when they originate from the world’s dominant producer.” Worse still; “there’s actually been some talk of the DRC and Indonesia maybe teaming up and creating sort of an OPEC for minerals,” Kavanagh cautions.
The DRC cobalt ban came into effect since February and the DRC is reported to be considering extending it. However, the mineral rich country is not alone nor is the move unique to the country.
“Countries restricting mineral sales to influence prices on the global market has become something of a trend. And it’s going to affect the U.S. economy big time, since we don’t produce much in the way of critical minerals on our own,” writes Daniel Ackerman for Market Place in reference to Trump’s ongoing tariffs.
DRC cobalt power
Cobalt is the mineral of modern times, it is found inside lots if not almost all modern technology including mobile phones, electric car batteries, wind turbines, and airplanes among others.
“I would be exaggerating, but only slightly, if I said that airplanes would fall out of the sky without cobalt,” said Dinah McLeod, head of the Cobalt Institute, a trade group.
At the moment, more than two-thirds of the world’s cobalt is mined in the DRC, which makes a very powerful country currently. “DRC really depends on the tax revenues that are associated with mining. The government took this decision to try to prop up the price of cobalt,” the expert details.
Since the start of export restrictions, cobalt prices have gone up 80 per cent and could raise further should DRC and countries like Indonesia team up. According to Cullen Hendrix, a senior fellow at the Peterson Institute for International Economics, the teaming up could include looping the world’s top nickel and copper producer, Chile.
“There hasn’t yet been OPEC-level coordination among mineral producers. But governments these days are taking more control of their mining sectors,” the expert says, adding: “They are seizing this moment where there’s such an emphasis on critical minerals to really re-evaluate their development models.”
“One goal is to ensure that the minerals mined in those countries get refined there, too,” Hendrix adds, but in the same sentence, he points out that that is exactly what the U.S. President Donald Trump administration wants, “to increase refining here in the U.S.”
“That is now putting the United States in direct competition with the policy ambitions of many of these mineral rich countries that are also trying to move into the processing space,” he added..
“Because when it comes to critical minerals,” Hendrix said “the real money isn’t in digging them out of the ground. It’s in turning them into something the world can use.”
DRC reaping benefits of cobalt export ban
According to the DRC cobalt ban review, after prices surged in the last two months, “Industry observers are closely monitoring potential implementation of export quotas after June, which could support elevated prices throughout 2025 and into 2026.”
In his comments, Fastmarkets analyst Rob Searle said the ban “will likely lead to a significant price correction that could rebalance market fundamentals after years of oversupply. Market participants were caught by surprise by the DRC’s decisive action.”
However, he also describes the move as ‘a long time coming’ action. “Many market players describe it (DRC cobalt export ban) as the first sign of life in what had become an increasingly stagnant market environment” he details.
According to the analyst; “the situation bears some resemblance to Indonesia’s 2022 nickel export ban, which triggered a 45 per cent price spike and fundamentally reshaped global nickel trade patterns.”
Well with DRC, Indonesia and Chile in talks, the export ban of critical minerals is only just beginning. “A key concern for market stability involves the stockpiling occurring during the ban period,” he explains. The the end result of stockpiling could create future supply fluctuations when exports eventually resume.
“Regional price disparities have also emerged, with Chinese spot prices showing greater volatility than European contract prices, creating arbitrage opportunities for sophisticated traders,” he concludes.
DRC cobalt: Major producers and their influence
CMOC (China Molybdenum Co.) has emerged as the dominant cobalt producer globally, with output reaching 114,000 metric tonns in 2024, representing approximately 40 per cent of the DRC’s total production, market reports show.
“The company’s Tenke Fungurume mine faced litigation challenges in 2023 that temporarily disrupted approximately 15 per cent of global supply, highlighting the fragility of concentrated production networks,” the report warns.
Titled, DRC Cobalt Export Ban: Global Market Impact and Price Volatility the report says; “since the DRC controls approximately 60 per cent of global production, the DRC cobalt output creates significant supply chain concentration risks for downstream industries.”
“This dominance gives the country substantial leverage in global markets, which it has now demonstrated willingness to exercise through critical mineral export restrictions,” the report admits
It goes on to point out that Chinese companies have established substantial investments in DRC cobalt operations, with Chinese firms controlling an estimated 80 per cent of the country’s mining assets according to Benchmark Mineral Intelligence.
“Beyond mining, Chinese refiners like GEM Co. process approximately 70 per cent of global cobalt, creating potential bottlenecks in the supply chain,” cautions the report.
So what is the overall effect? “Western manufacturers face potential disruptions due to this supply chain concentration, prompting initiatives like the U.S. Department of Energy’s US$2 billion grant program for domestic refining infrastructure development.”
What this means is that, the US is only now coming into terms with the fact that it needs to refine its own cobalt, what with Chinese companies controlling the market, this has become a US priority.
“Emerging producers like Jervois Global are attempting to establish operations in jurisdictions like Idaho, though these remain modest compared to DRC output,” the report concludes.
Read also: The $78M AfDB fix taking child labourers off DRC’s cobalt mines to schools
