Lithium-ion batteries require lithium, graphite and cobalt, among other components, and demand for these metals is expected to surge as electric vehicles become more mainstream. Anticipated demand and limited supply have led to strong gains for cobalt in particular this year, and investors are becoming more interested in this metal.
With that context, here’s a look at the top 10 cobalt-producing countries of 2016, as identified by the US Geological Survey. Cobalt is usually produced as a by-product of copper and nickel, so countries that produce high quantities of those metals generally put out a lot of cobalt as well.
1. Democratic Republic of Congo (DRC)
Mine production: 66,000 MT
The DRC is the world’s largest producer of cobalt, accounting for roughly 53 percent of global production. The country has been the top producer of the metal for some time. The DRC’s output in 2016 increased by 3,000 MT compared to 2015.
According to Mining Weekly, the DRC will receive increasing amounts of foreign investment in the coming years, mostly from China, as a result of its low production costs and high-quality minerals. But cobalt mining in the DRC has also been related to human right abuses — earlier this year, Apple (NASDAQ:AAPL) announced that it has temporarily stopped buying cobalt mined by hand in the DRC.
Mine production: 7,700 MT
China saw no change in its cobalt production from 2015 to 2016. Much of the country’s output comes from ore and partially refined cobalt imported from the DRC, though scrap and stocks of cobalt material also contribute to its output, the US Geological Survey says. The Asian nation is the world’s leading refined cobalt producer, and is the top supplier of cobalt to the US.
Mine production: 7,300 MT
Canada’s cobalt production increased in 2016, rising from 6,900 MT the year before to 7,300 MT. Canadian cobalt comes mostly from large nickel and copper mines that produce cobalt as a by-product of their normal operations. Some of these major nickel and copper deposits are Kidds Creek, Sudbury and Raglan. Several companies are now rushing to Canada stake land in the hunt for cobalt. In the coming years, the country’s production is likely to expand as new sites are identified.
Mine production: 6,200 MT
Russia bumped Australia out of the number-four spot to become the world’s fourth-largest cobalt producer in 2016. Russia’s production remained the same from 2015 to 2016, at 6,200 MT. That said, the country plans to significantly increase its cobalt production over the next several years, as per a statement from an official spokesperson for Denis Manturov, Russia’s minister of industry and trade.
Mine production: 5,100 MT
Australia saw a drop in cobalt production from 2015 to 2016, with output sinking from 6,000 MT to 5,100 MT. Like many other countries on this list, Australia’s cobalt is a by-product of copper and nickel mining. The country’s nickel mines are located in the western part of the country, mostly around the Kalgoorlie-Leonara regions.
Mine production: 4,600 MT
In 2016, Zambia climbed the ranks to become the world’s sixth-largest cobalt producer. The country’s cobalt production for 2016 remained the same as it was in 2015 — it came in at 4,600 MT for both years.
Mine production: 4,200 MT
Cuban cobalt production remained fairly steady in 2016 at 4,200 MT; that’s up slightly from 4,300 MT in 2015. The country’s Moa region is home to a joint venture nickel-cobalt operation between Canadian firm Sherritt International (TSX:S) and General Nickel Company of Cuba. The venture struggled last year due to a bridge collapse brought on by Hurricane Matthew; it resulted in the deaths of four employees.
Mine production: 3,500 MT
Last year, the Philippines produced 3,500 MT of cobalt, down 800 MT from the amount produced in 2015. The fall was largely due to the country’s decision to shut down 28 mines due to environmental concerns. The Chamber of Mines of the Philippines has since warned that the value of the country’s metallic mineral production could go down by as much as 50 percent this year. The fate of mining in the Philippines is up in the air as President Rodrigo Duterte and recently appointed Environment Secretary Roy Cimatu deliberate over a country-wide ban on open-pit mining.
Mine production: 3,300 MT
Madagascar’s cobalt production dropped in 2016 from 3,700 MT to 3,300 MT. According to MBendi Information Services, the Ambatovy nickel-cobalt mine is the largest and most advanced mineral project in the country. It is located about 80 kilometers east of Antananarivo.
Sherritt International owns 40 percent of Ambatovy, which cost more than $5 billion to develop. Last year, the company announced a C$1.6-billion writedown of the value of its stake in the mine.
10. New Caledonia
Mine production: 3,680 MT
Rounding out the list is New Caledonia, whose cobalt production dropped slightly from 3,650 MT in 2015 to 3,300 MT in 2016. A subsidiary of France’s Eramet (EPA:ERA) mines substantial deposits of oxidized ore (garnierites) at four mining centers located in the north and south parts of the country. The ore is processed at the company’s Doniambo smelter, which is the world’s largest ferronickel-producing plant.
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This is an updated version of an article first published by the Investing News Network in 2015.
Securities Disclosure: I, Sivansh Padhy, hold no direct investment interest in any company mentioned in this article.