The Cost of Cobalt

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Today we’re talking about Cobalt. Aside from having a cool af name, Cobalt is a key element used in the manufacturing process for lithium-ion batteries. In other words, across consumer devices such as phones, laptops, electric vehicles etc. there are lithium-ion batteries, and by extension, Cobalt being used. It’s in hot demand.

What’s the big deal?

It’s just more metal right? Well sure, but Cobalt is particularly interesting as it is a rare-earth metal with highly limited global supply. In fact, 76% of global supply (and over 60% of global reserves) are concentrated in the Democratic Republic of Congo (DRC).

With Bloomberg projecting that demand for Cobalt is poised to grow 47 times by 2030, it’s clear that Cobalt will become a more and more sensitive economic and geopolitical topic. In fact, the U.S. and China have both been actively pursuing access to cobalt reserves in DRC over the last decade and it’s a source of great tension.

Some analysts are worried that these supplies won’t be sufficient and will lead to long-term battery shortages similar to challenges faced with semi-conductors.

A challenging history

Cobalt mining has been marred with a number of issues including worker exploitation and environmental mishaps. This includes the use of child miners as young as 6 working in dangerous conditions. In fact, many critics argue that the Cobalt industry is doing more harm than good. The Strawman isn’t happy about how this has all played out…

There are options to improve the social and environmental impact of Cobalt. For example, improved oversight and regulation for mining as well as the development of batteries that use alternatives to Cobalt. After all, the majority of mining players in DRC are international and can be regulated from their HQ countries. It’s likely will see this emerge over the next couple of years.

Another focus, has been to recycle the Cobalt used through our consumer devices. Just this week, Apple announced that 100% of the Cobalt used in batteries will be recycled by 2025. We can imagine that many more big tech players will follow suite to reduce their dependency on the uncertain world of Cobalt.

Until next time,

The Strawman