Trafigura to Invest in Project to Monitor DRC Artisanal Cobalt Production

- October 9th, 2018

The Geneva-based company is set to pilot the project at the Mutoshi mine in the DRC. It aims to train, provide protective equipment to and organize cobalt miners into licensed cooperatives.

Commodity trading company Trafigura is investing in a project to monitor artisanal and small-scale cobalt miners in the Democratic Republic of Congo (DRC), the company said on Monday (October 8).

The Geneva-based company is set to pilot the project on the Mutoshi mine in the DRC and aims to train, provide protective equipment to and organize cobalt miners into licensed cooperatives, the company’s CEO, Jeremy Weir, told a seminar hosted by the London Metal Exchange.

More than 50 percent of the world’s cobalt supply comes from the DRC, the world’s top cobalt-producing country, with about 20 percent extracted by artisanal miners, which carry higher risk of using child labor.

Cobalt Stocks Have Grown 100% in the Past Year


Get insights into cobalt's future in our free report


As demand for cobalt, a key element in lithium-ion batteries used to power electric cars, continues to surge, the need to ensure cobalt supply chains are free from human right abuses and child labor is critical.

“[The project is] not perfect, but it’s a big step towards regularising this industry,” Weir said.

“I’m completely clear about the risks and other problems involved in artisanal and small-scale mining. It would obviously be preferable if we could secure all the needed supplies through industrial mining operations. But the fact is that we’re not in that happy position.”

The CEO said the answer was not to shun subsistence mining or exclude it from the supply chain but to see if artisanal and small scale-produced cobalt can be sourced in a responsible way, by improving conditions and safety for workers but stopping short of regulation.

According to CRU Group, it is believed that as many as 100,000 diggers, sorters and washers are likely to be involved in the artisanal mining trade in the DRC.

“The reality is that there are hundreds of thousands of people in the DRC who earn a living through work in the [artisanal, small-scale mining] sector. It’s illegal in many cases; it’s unregulated and can be very dangerous. But it can’t be wished away,” Weir added.

Trafigura’s move comes just a few days after the LME announced it is preparing plans that will allow it to clamp down swiftly on cobalt brands on its approved list thought to be tainted by human right abuses. Moreover, the LME is proposing suspending brands trading at a significant discount on the grounds that they may be seen as tainted.

Cobalt miner Eurasian Resources Group (ERG) is also working to address the critical issue, planning to use a blockchain-based tracking system that would guarantee the “ethical purity” of its cobalt, CEO Benedikt Sobotka told Reuters.  

The global mining and metals group is looking to raise cobalt production in the DRC fivefold to 20,000 tonnes next year, supported by the launch of the Metalkol facility.

Don’t forget to follow us @INN_Resource for real-time updates!

Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

Battery Metals in 2018


Click to download your free report


Get the latest Cobalt Investing stock information

Get the latest information about companies associated with Cobalt Investing Delivered directly to your inbox.

Cobalt Investing

Select All
Select None

By selecting company or companies above, you are giving consent to receive email from those companies. And remember you can unsubscribe at any time

Leave a Reply

Your email address will not be published. Required fields are marked *