The DRC seeks Indonesia’s aid to stabilize cobalt prices amid oversupply. Proposals include permanent export quotas and cooperation with Indonesia to regulate supply, following a recent ban on shipments due to price declines. These measures aim to enhance control over DRC’s cobalt resources and market dynamics.
The Democratic Republic of Congo (DRC) is seeking Indonesia’s support to stabilize the cobalt market, which is currently experiencing an oversupply. This initiative includes a temporary ban on cobalt exports, a measure proposed by a Congolese ministerial committee to boost market stability. The ongoing oversupply and reduced demand from automakers have driven cobalt prices down, prompting a reevaluation of export strategies.
The DRC’s Prime Minister, Judith Suminwa Tuluka, outlined plans to impose export quotas on cobalt after a four-month halt on shipments. This strategy aims to manage the global supply and stabilize prices by collaborating with Indonesia, the world’s second-largest cobalt supplier. The suspension of cobalt shipments was implemented in February due to a substantial price drop caused by oversupply and lackluster demand.
To optimize its cobalt resources and mitigate oversupply risks when the ban concludes, the DRC is considering long-term strategies. The Economic Situation Committee, led by Tuluka, advocates for improved export management and is focused on collaborating with Indonesia to regulate the supply and stabilize cobalt prices.
While the DRC holds a dominant position in the cobalt sector, Indonesia’s market share is increasing, accounting for 11% of global cobalt supply last year, according to Darton Commodities. In both countries, cobalt is mined alongside copper in the DRC and nickel in Indonesia, with prices recovering since the export suspension was enacted.
The committee has also proposed introducing export quotas and enhancing domestic processing requirements, though specific details are yet to be revealed. Over the past year, the DRC has been considering various production and export restrictions in its quest to gain better control over the cobalt market.
The DRC is actively pursuing measures to stabilize the cobalt market, through collaboration with Indonesia and adjustments to export policies. As cobalt prices rebound following their lows, the focus remains on managing oversupplies efficiently. The partnership aims to regulate global supply and enhance price stability amid growing global demand for cobalt in battery production.
Original Source: africa.businessinsider.com
