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Sherritt Corrects Misleading Information Regarding its Junior Notes
Sherritt International Corporation ("Sherritt" or the "Corporation") (TSX:S) today issued the following statement in response to misleading information that has come to its attention in connection with its 10.75% unsecured PIK option notes due 2029 ("the Notes"). The Corporation reconfirms that it is not currently, nor has it ever been in breach of the Notes indenture and notes that all payment obligations thereunder have been settled in accordance with the terms of the Notes indenture.
The Corporation cautions holders of the Notes on the misleading information and reminds all stakeholders to rely on information provided through Sherritt's official communications channels, including its public filings and corporate website.
About Sherritt
Sherritt is a world leader in using hydrometallurgical processes to mine and refine nickel and cobalt – metals deemed critical for the energy transition. Sherritt's Moa JV has an estimated mine life of approximately 25 years and is advancing an expansion program focused on increasing annual MSP production by 20% of contained nickel and cobalt. The Corporation's Power division, through its ownership in Energas S.A. ("Energas"), is the largest independent energy producer in Cuba with installed electrical generating capacity of 506 MW, representing approximately 10% of the national electrical generating capacity in Cuba. The Energas facilities are comprised of two combined cycle plants that produce low-cost electricity from one of the lowest carbon emitting sources of power in Cuba. Sherritt's common shares are listed on the Toronto Stock Exchange under the symbol "S".
View source version on businesswire.com: https://www.businesswire.com/news/home/20250213467531/en/
For further information, please contact:
Tom Halton
Director, Investor Relations and Corporate Affairs
Email: investor@sherritt.com
Telephone: (416) 935-2451
www.sherritt.com
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Fortune Minerals
Investor Insights
The NICO project’s receipt of substantial government funding to date and Fortune Minerals’ strong relations with the Indigenous and local communities in the Northwest Territories create a compelling case for investors considering a battery metals play with significant gold reserves.
Overview
Cobalt is an often-overlooked critical mineral in the transition to clean energy, required to make the cathodes of many lithium-ion batteries used in electric vehicles (EVs), stationary storage cells and consumer electronics. Cobalt is also used in superalloys for the aerospace industry, cemented carbides, cutting tools, permanent magnets, surgical implants, catalysts, pigments and agricultural products.
The global cobalt market is expected to reach a volume of almost 306,000 metric tons by 2028. Cobalt outlook in the long-term is expected to double by 2030 with the EV segment accounting for 89 percent of growth, energy storage at 3 percent and superalloys at 2 percent.
Fortune Minerals (TSX:FT,OTCQB:FTMDF) is a Canadian mining company developing its wholly owned, vertically integrated NICO primary cobalt project in Canada to produce cobalt chemicals for the rapidly expanding lithium-ion battery industry. The NICO mineral reserves also contain 1.1 million ounces (Moz) of gold, 12 percent of global bismuth reserves, and copper as a minor by-product. NICO comprises a proposed mine and mill in the Northwest Territories that will produce bulk concentrates that will be shipped to a planned refinery in Alberta. The concentrates from the mine will then be processed into energy and eco-metals for the growing clean energy economy.
NICO is a primary cobalt deposit, but the mineral reserves also contain 1.1 Moz of gold as a countercyclical and highly liquid co-product that can be easily converted to cash. The gold contained in the NICO deposit stands out among other cobalt projects, where the metal is produced primarily as a by-product of copper or nickel.
NICO is also the largest known deposit of bismuth in the world with about 12 percent of global reserves – even though it represents only about 10 percent of the company’s projected revenue from operations at recent metal prices.
The cobalt, bismuth and copper contained in the NICO deposit are all classified as critical minerals by Canada, as they have essential use in new technologies, cannot be easily substituted with other minerals, and because supply chains may be threatened by geopolitical issues.
The mineral reserves for the NICO deposit were estimated in compliance with NI-43-101 and total 33.1 million tonnes (Mt), containing 82.3 million lbs (37,341 tonnes) of cobalt, 1.1 Moz of gold, 102.1 million lbs (46,325 tonnes) of bismuth and 27.2 million lbs (12,296 tonnes) of copper to support a 20-year mine life at a mill throughput rate of 4,650 metric tons of ore per day.
Sums of the combined reserves may not exactly equal sums of the underground and open pit reserves due to rounding errors.
The mineral reserves are based on 327 drill holes plus surface trenches and underground test mining verifying the deposit grades, geometry and mining conditions. Both of Fortune Minerals’ deposits are open for potential expansion, extending the deposits with additional drilling or identifying new zones or deposits.
The Government of Canada is providing funding of up to $714,500 for the planned cobalt sulphate process pilot and other metallurgical test work at the NICO project. Additionally, the Government of Alberta, through the Alberta Innovates, has also approved additional funding contributions of up to $172,670 toward the budgeted program costs under its Clean Resources Continuous Intake Program. The funds will be used to support a mini-pilot at SGS Canada to confirm certain process design criteria and improvements to the NICO project metallurgical processes.
Fortune Minerals also received an C$8.74 million grant from the United States Department of Defense to expand the domestic capacity and production of cobalt for the battery and high strength alloy supply chains. The company recently secured a total of C$17 million in financial support from the Canadian and US governments to advance the NICO project.
The company’s other assets include the Sue-Dianne deposit, which has near-surface, copper-silver-gold deposits that can feed into the NICO mill.
Company Highlights
- Fortune Minerals is building a reliable, vertically integrated North American critical minerals project to produce cobalt chemicals for the rapidly expanding lithium-ion battery industry.
- The NICO project is one of a few advanced-stage cobalt projects outside the Democratic Republic of the Congo, with an average annual production of approximately 1,800 tons of cobalt units in the first 14 years of the 20-year mine life.
- The company's flagship asset’s primary cobalt production is independent of nickel and copper mining and contains more than 1 million ounces (Moz) of in-situ co-product gold.
- Fortune Minerals has received environmental assessment approval for the mine, concentrator and access road in the Northwest Territories.
- The company has developed strong relationships with Indigenous and local communities and governments, which paved the way for federal, Northwest Territories and Tlicho Governments' approval of the project and financial support for local infrastructure, including the $400 million Tlicho all-season highway project to Whati that recently opened to the public, and more than $800,000 in federal and provincial funding for exploration work at NICO.
- Collaboration with Rio Tinto to assess options to improve recovery of bismuth and cobalt contained in Rio Tinto’s Kennecott smelter waste streams.
- Fortune Minerals recently secured a total of C$17 million in funding from the Canadian and US governments to advance the NICO project.
- An experienced management team leads Fortune Minerals towards fully developing and capitalizing on its assets.
Key Project
NICO Cobalt Project and Reserves
The NICO cobalt-gold-bismuth-copper deposit is an IOCG or Olympic Dam-type mineral deposit situated on 5,140 hectares of mining leases, located 160 kilometers northwest of the City of Yellowknife and 50 kilometers north of Whati in Canada's Northwest Territories.
Fortune Minerals has spent more than C$135 million preparing technical, environmental and social studies to support the development of the NICO cobalt-gold-bismuth-copper project. Environmental assessment approval and the major mine permits have been received for the planned facilities in the Northwest Territories. The project is expected to be a reliable North American producer of critical minerals with supply chain transparency and custody control of ethically produced metals from ores through to the production of value-added metals and chemicals.
Project Highlights:
- Excellent Infrastructure in Place and Under Development: There is all-season road access to Whati via Highway 9, a $400-million design/build/operate/maintain private-public partnership between the Government of the Northwest Territories and North Star Infrastructure. The federal government contributed up to $53 million of the project's capital costs through the Canadian Infrastructure Fund. Fortune Minerals has received environmental assessment approval to build a 50-kilometer spur road from Whati to the mine site, which is included in the mine site capital costs. With the construction of the road, Fortune will be able to transport metal concentrates from the mine to the railway at Enterprise or Hay River and deliver them by rail to the company's planned refinery in Alberta. The NICO leases are located 25 kilometers west of the Snare hydro complex and electrical grid servicing Yellowknife.
- Large, Well-defined Polymetallic Deposit: NICO and the company's satellite Sue-Dianne copper-silver-gold deposit are classified as iron oxide-copper-gold (IOCG)-type deposits with world-class global analogs, including Olympic Dam in South Australia, the Salobo and Sossego deposits in Brazil, and the Candelaria district deposits in Chile. They occur in clusters of multiple deposits, commonly aggregating more than a billion tonnes in similar tectonic and geological environments.
- Encouraging Results from 2021 Exploratory Drilling: The company’s exploratory drilling program consisted of 13 drill holes totaling 2,482 meters. Promising results from the campaign include:
- 3.17 meters, averaging 0.42 percent cobalt, 0.55 g/t gold, and 0.37 percent bismuth at a depth of 28.7 meters, including 1.05 meters, grading 0.99 percent cobalt, 0.25 g/t gold, and 0.56 percent bismuth;
- 4.8 meters, averaging 0.12 percent cobalt and 0.50 g/t gold at a depth of 8 meters, including 1.98 meters, averaging 0.26 percent cobalt and 1.13 g/t gold;
- 2.31 meters, averaging 0.11 percent cobalt and 0.87 g/t gold at a depth of 139.6 meters, including 1.16 meters, grading 0.20 percent cobalt and 1.63 g/t gold.
- 2014 Micon NICO Feasibility Study: A positive feasibility study was completed in 2014 by Micon International Limited that identified the mineral reserves to support a 20-year mine life at a mill throughput rate of 4,650 metric tons of ore per day. The feasibility study and previous front-end engineering and design study by Aker Solutions contemplated combined open-pit and underground mining during the first two years of the mine life, followed by open-pit-only mining. The company has retained Worley Canada Services to lead the preparation of an updated Feasibility Study that will include project optimizations, current capital and operating costs, and current commodity prices.
Fortune Minerals entered into a new option agreement with JFSL Field Services ULC to purchase the brownfield industrial site in Lamont County, Alberta where it plans to construct its hydrometallurgical facility (Alberta Facility). The Alberta Facility would process metal concentrates from Fortune's planned NICO cobalt-gold-bismuth-copper mine and concentrator in the Northwest Territories. It will also provide a reliable domestic supply of critical minerals for the energy transition and other new technologies.
Alberta Hydrometallurgical Facility Site
The Alberta Facility will produce cobalt sulphate for the North American lithium-ion battery industry, bismuth ingots (12 percent of global reserves) and copper cement - with more than one million ounces of in-situ gold as a countercyclical and highly liquid co-product. Fortune also has a process collaboration with Rio Tinto examining the feasibility of processing materials produced from Kennecott Smelter wastes in Utah at the Alberta Facility to increase cobalt and bismuth production.
Fortune Minerals is advancing the NICO Project toward a construction decision with US and Canadian government financial support from critical minerals supply chain security programs. The company has retained Worley Canada Services to conduct additional engineering and lead the preparation of an updated Feasibility Study for the NICO. Worley will further assist the company in processing the permits for the brownfield site to host the proposed hydrometallurgical facility.
Sue-Dianne Copper Deposit
The Sue-Dianne copper-silver-gold deposit located near the NICO deposit belongs to IOCG class of deposits with world-class global analogues and is a potential future source of incremental mill feed to extend the life of the NICO mill and concentrator.
Management Team
Mahendra Naik - Chairman and Director
Mahendra Naik is a chartered accountant and was one of the founding directors and key executives who started IAMGOLD Corporation, a TSX and NYSE-listed gold mining company. As chief financial officer from 1990 to 1999, he was involved in the negotiations of the Sadiola and Yatela mine joint ventures with Anglo American, and the US$400 million project debt financing for the development of the mines. In addition, he was involved in more than $150 million in equity financings including the IPO for IAMGOLD. Naik is currently the chief executive officer of FinSec Services., a private business advisory company and a director and member of the audit and compensation committees for IAMGOLD. In addition, Naik is a director and member of audit, compensation and risk/control committees of FirstGlobalData Limited, Goldmoney Network Limited and Jameson Bank.
Robin E. Goad - President, CEO and Director
Robin Goad is a professional geologist with 30 years of experience in the mining and exploration industries. Before founding Fortune in 1988, Goad worked for large companies, including Noranda and Teck, as a consultant in the resource industry. Goad is a director of the NWT and Nunavut Chamber of Mines and has served as president and director of other TSX-listed mineral exploration and development companies.
Patricia Penney - Interim CFO
Patricia Penney is a chartered accountant with 20 years of accounting and audit experience. Before Fortune, she was a senior manager with Caceis Canada., an alternative fund administrator.
Richard Schryer - Vice-president of Regulatory and Environmental Affairs
Richard Schryer is an aquatic scientist with more than 25 years of experience in mine permitting, environmental assessments, environmental studies and monitoring. Schryer also worked with Golder Associates.
Alex Mezei - Chief Metallurgist
Alex Mezei is an independent metallurgical consultant with 40 years of international process engineering experience, providing general and specialized services in metallurgical process flowsheet testing, design, development, derisking and implementation. Mezei has been involved in process economics assessment for several projects. Specific technical expertise includes hydrometallurgy, liquid-solid separation, rheology, and mineral processing. Projects and commodities include extraction of cobalt, lithium, nickel, graphite, manganese, as well as base, rare and precious metals. In addition, Mezei provides specialized expertise in recycling, oil sands and carbon capture projects. Mezei is a Qualified Person for the purposes of National Instrument 43-101.
David Knight - Corporate Secretary
David Knight is a partner with WeirFoulds LLP. David is widely recognized for his more than 30 years of experience. He specializes in securities law, including public and private financings, mergers and acquisitions, stock exchange listings and regulatory compliance and acts for investment dealers and issuers. Knight is a member of the Law Society of Upper Canada.
Troy Nazarewicz - Investor Relations Manager
Troy D. Nazarewicz has 30 years of experience in the capital markets as a portfolio manager with MacDougall, MacDougall & MacTier and in his investor relations role at Fortune. He also worked as a business development manager with a design and marketing firm.
Cobalt Investor Report
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Cobalt Market Forecast and Cobalt Stocks to Buy in 2025
Table of Contents
Cobalt Market 2024 Year-End Review
Cobalt Market 2024 Year-End Review
Cobalt prices started 2024 trading at the US$29,151.50 per metric ton (MT) level, the highest price point the battery metal achieved for the year. By December, it had contracted by 16.68 percent to US$24,287.90.
Prices remained under pressure due to oversupply, with the Democratic Republic of Congo (DRC) maintaining its dominant position as the world’s largest producer. Meanwhile, efforts to diversify supply chains and reduce reliance on the DRC gained momentum, with new projects and funding infusions announced in Canada and the US.
On the demand side, the rise of lower-cobalt battery chemistries weighed on consumption. Lithium-iron-phosphate (LFP) batteries continued gaining market share globally, pressuring cobalt’s role in the electric vehicle (EV) sector.
However, cobalt’s use in high-performance batteries for smartphones and other electronics remained resilient, offering a counterbalance to declines elsewhere. Geopolitics and policy added another layer of complexity, with China expanding its influence in African mining regions and western nations pursuing stricter supply chain transparency laws.
These dynamics are expected to shape cobalt’s role in the critical metals market into 2025 and beyond, as stakeholders grapple with the metal’s evolving importance in a decarbonized economy.
2024 cobalt supply and demand trends
Residual oversupply from 2023 prevented any price positivity in the cobalt market through 2024.
According to the US Geological Survey's annual cobalt report, mine supply of the battery metal ballooned in 2023, growing 16.75 percent year-on-year, from 197,000 MT in 2022 to 230,000 MT in 2023.
Over the last three years, annual mine supply has soared, from 142,000 MT to 230,000 MT, up 61 percent.
For 2023, 170,000 MT were mined in the DRC; the African nation is home to the five largest cobalt mines in the world. These high-grade areas have attracted the attention of Chinese mining companies, particularly China Molybdenum (SHA:603993,OTC Pink:CMCLF), which is one of the largest cobalt producers in the DRC and the world.
In recent years, cobalt-mining practices in the DRC have come under fire from international rights groups concerned that artisanal and small-scale cobalt-mining operations are using child labor.
In October 2024, the US Department of International Labor concluded a six year program entitled Combating Child Labor in the Democratic Republic of the Congo’s Cobalt Industry (COTECCO).
Its key achievements include supporting the creation of an inter-ministerial commission to monitor child labor, and setting up a provincial commission in Lualaba. Since its inception in 2018, the project has trained 458 stakeholders from the government, civil society and the private sector on fighting child labor. It has introduced tools like the Bureau of International Labor Affairs' Comply Chain to 28 mining entities in Lualaba and Haut-Katanga.
Additionally, COTECCO has collaborated with the DRC government to establish a Child Labor Monitoring and Remediation System (CLRMS), training 110 officials to operate it. By March 2024, the CLRMS database had registered 5,346 children, and was officially handed over to the mines ministry for sustained management.
Cobalt fundamentals tightly tied to EV sector
Combating child exploitation in the cobalt supply chain will be paramount moving forward, as demand from the EV sector alone is expected to increase substantially, rising by 60 to 70 percent by 2040.
The DRC is projected to play a vital role in supplying the 214,000 MT of cobalt demand expected by 2030.
“It’s hard to understate just how much demand will be added to the cobalt market by the EV industry,” said Roman Aubry, Benchmark Mineral Intelligence pricing analyst, in an April email.
“Already it has become the largest demand sector, and its dominance is only set to grow.”
In 2024, global EV sales reached a third consecutive record high, with China leading the surge. The China Association of Automobile Manufacturers reported a 5.3 percent increase in passenger vehicle sales, totaling 23.1 million units, with EVs and hybrids accounting for 47.2 percent of the market — a 40.7 percent rise from the previous year.
Elon Musk's Tesla (NASDAQ:TSLA), a dominant player in the EV sector, experienced a 1.1 percent decline in worldwide sales, delivering 1.79 million vehicles compared to 1.81 million in 2023.
This downturn was attributed to increased competition and market saturation.
However, other automakers reported significant growth. General Motors (NYSE:GM), for instance, achieved a 50 percent increase in its Q4 EV sales, driven by models like the Chevrolet Equinox EV SUV.
Analysts suggest that while Tesla's sales dip impacted overall market perceptions, the broader EV market remained robust, with traditional manufacturers gaining traction.
Another notable development in the EV sector in 2024 was the April announcement from Honda (NYSE:HMC) that it will invest C$15 billion to build a comprehensive EV value chain in Ontario, Canada.
The plans include an EV assembly plant and a standalone battery manufacturing facility. Joint ventures will add a cathode active material processing plant and a separator plant. The assembly plant aims to produce 240,000 vehicles annually, while the battery facility will have a capacity of 36 gigawatt hours.
Government funding supporting cobalt market growth
Due to its critical mineral designation, the cobalt sector has been the recipient of government funding.
In May, the US and Canada partnered for a co-investment to enhance the North American critical minerals supply chain. The collaboration will benefit Fortune Minerals (TSX:FT,OTCQB:FTMDF) and Lomiko Metals (TSXV:LMR,OTCQB:LMRMF), with the latter set to receive up to C$7.5 million from the Canadian government, matched by an additional US$6.4 million from the US Department of Defense’s Defense Production Act Investments Office.
The funding is part of the Canada-US Energy Transformation Task Force.
“Canada is positioning itself as a global leader in the supply of responsibly sourced critical minerals for the green and digital economy,” said Jonathan Wilkinson, Canada's minister of energy and natural resources.
“Through our work with the United States and other allies, we are developing secure critical minerals value chains that will power a prosperous and sustainable future," he added.
In August, Electra Battery Materials (TSXV:ELBM,NASDAQ:ELBM) secured a US$20 million grant from the US Department of Defense to aid in the construction and commissioning of “North America’s only cobalt sulfate refinery."
“Electra is committed to strengthening the resiliency of the North American battery supply chain,” said Electra CEO Trent Mell about the Ontario-based refinery. “We are grateful to the US Department of Defense for its support. On issues of national security, there are no borders between Canada and the United States. We are proud to partner with the US Government to build a strong North American supply chain for critical minerals.”
Cobalt catalysts to watch in 2025
Despite positive catalysts on the horizon, the cobalt market is facing immense pressure from substitution.
The shift toward LFP batteries, which omit cobalt, has drastically reduced demand in EV battery production.
By the third quarter of 2024, LFP batteries dominated 75.2 percent of the market, while nickel-manganese-cobalt batteries fell to 24.6 percent, according to data from S&P Global.
The declining role of cobalt in EV batteries was further highlighted in correspondence between China's CMOC (OTC Pink:CMCLF,SHA:603993), the world’s largest cobalt-mining company, and Bloomberg in late 2024.
“We predict that EV batteries will never return to the era that relies on cobalt,” said Zhou Xing, a spokesperson for CMOC. “Cobalt is far less important than imagined.”
However, even though cobalt's future in EVs looks clouded, demand persists in the consumer electronics segment, which relies on lithium-cobalt-oxide batteries, and in superalloys for aerospace and military applications.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Fortune Minerals is a client of the Investing News Network. This article is not paid-for content.
The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Cobalt Market Forecast: Top Trends for Cobalt in 2025
Oversupply and shifting battery chemistries are set to define the cobalt market in 2025. Prices — subdued by excess supply since 2023 — are expected to remain stable, with limited volatility.
The rise of lithium-iron-phosphate (LFP) batteries, particularly in China, continues to suppress demand for cobalt chemicals, challenging sulfate refiners. Meanwhile, on the supply side, Indonesia's rapid expansion in mixed hydroxide precipitate (MHP) production offers an alternative to the contentious Democratic Republic of Congo (DRC).
Even so, the DRC is expected to remain the primary producer of cobalt in the near to medium term.
“Oversupply has been the dominant driving force for cobalt prices since 2023, and this is likely to persist in 2025,” Roman Aubry, price analyst at Benchmark Mineral Intelligence, said. “As this single factor is so overwhelming, it has stifled much of the volatility in the market in 2024, and it is likely this will be the case in 2025 as well.”
Cobalt demand projected to rise long term
Critical minerals have become a key focus as nations look to fortify domestic supply chains. The cobalt sector’s production concentration in the DRC makes it even more prone to geopolitical upheaval.
According to the International Energy Agency’s (IEA) 2024 Global Critical Minerals Outlook, the cobalt market has a heightened geopolitical risk rating because 84 percent of production is focused in a single country.
Despite the current cobalt glut, the IEA is projecting that demand will soar from 213,000 metric tons in 2023, rising to 344,000 metric tons in 2030 and then to 454,000 metric tons in 2040.
This steep uptick has prompted the IEA to project a potential 16 percent shortfall by 2035.
Although countries like Indonesia and Australia are starting to see cobalt sector growth, experts agree that the DRC will continue to be the dominant player in the industry into the future.
“The DRC is going to maintain its position for the foreseeable future; however, Indonesian MHP is rapidly growing as an alternative source of cobalt in the market. In line with this, we’ve seen an influx of cobalt metal from Indonesia becoming more prevalent in recent months, being aggressively marketed by Indonesian producers,” said Aubry.
Those circumstances mean Indonesia could capture a larger piece of market share this year.
“With CMOC (OTC Pink:CMCLF,SHA:603993) not planning any new expansions this year, it is unlikely we'll see any significant growth from the DRC in cobalt production in 2025,” he added.
Refinement capacity will also play an important role in meeting growing cobalt demand.
Australia’s Cobalt Blue Holdings (ASX:COB,OTC Pink:CBBHF) is advancing plans for the Kwinana cobalt refinery near Perth, proposing an initial production capacity of 3,000 metric tons of cobalt sulfate and 500 metric tons of nickel metal annually. Construction is slated to commence in H1 2025, with completion expected within 12 months.
Changing battery chemistries threaten cobalt demand
In 2024, record-breaking global electric vehicle (EV) sales helped solidify cobalt's role in the energy transition. China is spearheading a 40.7 percent surge in EV and hybrid adoption, supported by aggressive pricing and subsidies.
China remained the largest growth market as domestic automakers outpaced foreign rivals. European sales rebounded from setbacks early in the year, with stricter emissions penalties set to drive further adoption in 2025.
Despite US market uncertainties, growing EV demand globally will sustain cobalt's importance, although supply chain challenges and alternative battery technologies may influence its trajectory.
“As LFP becomes increasingly dominant in China, sentiment for cobalt chemicals used in batteries has turned more bearish,” Aubry said. “A downturn in demand may put sulfate refiners under additional pressure, particularly at a time where the current market dynamics already present significant challenges due to prices.”
Rising copper, nickel production boosts cobalt glut
Another factor that could lead to additional cobalt surpluses is the production correlation with copper and nickel.
A November 2024 Fastmarkets report notes that 76 percent of global cobalt supply comes from copper-cobalt mines in the DRC. This by-product status exposes cobalt to market dynamics in the copper space.
In 2024, copper production in the region was on the rise, which in turn weighed on the cobalt market.
“But with cobalt demand remaining decidedly sluggish, copper’s upward trajectory will continue to fuel cobalt oversupply and, combined with the fact that copper production is poised to expand further, this will keep cobalt prices under pressure,” the Fastmarkets report reads.
A similar picture is playing out in Indonesia, where cobalt is mined as a by-product of nickel.
Indonesia’s rise as a cobalt powerhouse is poised to reshape the market, fueled by its booming MHP production. In 2024, the country supplied 10 percent of global cobalt, up from 7 percent in 2023, driven by Chinese-backed investments in nickel laterite ore projects using high-pressure acid leach technology.
Despite weak nickel prices, these projects are ensuring long-term cobalt output growth, with MHP-derived cobalt production projected to rise by a sizeable 17 percent in 2025.
Producers are increasingly favoring cobalt metal over sulfate due to higher profitability and easier storage.
Additionally, cobalt from Indonesia may be immune to US tariffs — that's in contrast to Chinese cobalt, which faces a 25 percent import tariff, as per Fastmarkets. “That possibility could raise concerns about shifting global supply dynamics and increase the pressure on cobalt prices," the firm explains.
Due to these factors, Fastmarkets is expecting a continued surplus of 21,000 metric tons in 2025, a slight decrease from 2024’s glut of 25,000 metric tons. Increased copper and nickel production is driving this trend, but challenges loom.
Weak nickel pricing, driven by Indonesia’s rapid growth, is squeezing producers in higher-cost regions like Australia and Canada, threatening project viability. Meanwhile, geopolitical tensions, trade barriers and a strong US dollar could further disrupt cobalt flows, especially from Chinese-backed Indonesian operations. The market’s trajectory will depend heavily on economic conditions, trade dynamics and evolving technologies, the report concludes.
Ethical supply concerns continue
As the global mining sector faces increased scrutiny for its extraction practices, the DRC’s cobalt industry has proven to be a focal point for sustainability and social governance concerns.
Child labor at artisanal and small-scale cobalt mines in the country has drawn international attention, prompting the US Department of International Labor to establish a program to fight cobalt-related child labor in the DRC.
Since its inception in 2018, the project has trained 458 stakeholders from the government, civil society and the private sector on fighting child labor. Its other accomplishments include introducing tools like the Bureau of International Labor Affairs' Comply Chain to 28 mining entities in Lualaba and Haut-Katanga.
While these are moves in the right direction, the long-running negative attention that the DRC’s cobalt sector has faced could be a deterrent to new capital entering the country.
“Alternatives to the DRC are likely to become more attractive to investors if it can sidestep other potential pitfalls, such as high refining energy costs. Until a more sustainable supply chain is embedded, or there are more substantial regulations implemented to limit the prevalence of artisanal mining, prices are unlikely to see a premium for sustainably sourced cobalt in the immediate term,” Aubry told the Investing News Network.
Trump’s tough tariff talk
Although Indonesian supply may be exempt from current US trade rules, that could change in the near term.
The re-election of US President Donald Trump has introduced significant uncertainty into the cobalt market, particularly concerning the future of electric vehicle (EV) policies and potential trade measures.
Industry participants have expressed concerns that Trump may reverse existing EV legislation, notably the Inflation Reduction Act, which has been instrumental in channeling approximately US$312 billion into US EV production and infrastructure. The American president has previously indicated intentions to "end the electric vehicle mandate on day one" in a bid to "save the auto industry from complete obliteration."
Despite these statements, the proliferation of EV manufacturing facilities in predominantly Republican states suggests that any policy reversals could face resistance due to the economic benefits they bring to local communities.
Stricter tariffs on Chinese-origin cobalt and EVs is also a concern among market watchers.
Don’t forget to follow us @INN_Resource for real-time updates!
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Fortune Minerals and Mawson Finland are clients of the Investing News Network. This article is not paid-for content.
The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
Top 3 Canadian Cobalt Stocks
The first months of 2024 saw cobalt take a bearish stance, constrained by excess supply and eroding demand.
Cobalt prices faced many headwinds at the beginning of the year, and they pulled the value of the battery metal down by 2.01 percent between January and the end of March. After starting the calendar year at US$29,134 per metric ton (MT), cobalt metal prices had fallen to US$28,548 by the end of the three month session.
The sluggish market conditions were attributed to reduced demand from the battery sector and oversupply of material. As a result, prices remained under pressure, with limited signs of improvement expected in the near term.
“Electric vehicle and electronic batteries still comprise a large portion of cobalt demand, although the power battery production landscape in China encountered challenges in the past year,” a January report from S&P Global Commodity Insights states. “A notable decline in growth rates, particularly in the production of batteries with a nickel-manganese-cobalt chemistry, has led market sources to hold a cautiously optimistic outlook for Q1.”
Concerns over the economic impact of the Russia-Ukraine conflict have also added to the market uncertainty.
The first 30 days of Q2 haven’t offered relief to the cobalt market, with prices falling below US$28,000 in mid-April.
These tough market conditions were reflected in the performance of the sector’s exploration and mining companies. However, despite the challenges, three companies have been able to make gains in the current market.
Below is a look at the three top cobalt stocks on the TSX and TSXV by share price performance so far this year. All year-to-date and share price information was obtained on May 1, 2024, using TradingView’s stock screener, and all companies listed had market caps above C$10 million at that time. Read on to learn more about their activities.
1. Electra Battery Materials (TSXV:ELBM)
Year-to-date gain: 15.38 percent; market cap: C$32.94 million; current share price: C$0.60
Canada-based exploration and development company Electra states it is actively involved in processing low-carbon, ethically sourced battery materials. The company is working to develop North America's sole cobalt sulfate refinery while operating a black mass recycling demonstration plant. Black mass is obtained from end-of-life lithium-ion batteries.
Electra is also progressing exploration efforts at its Iron Creek cobalt and copper project in the Idaho Cobalt Belt, and expanding its cobalt sulfate processing capabilities in Bécancour, Québec.
In early February, Electra released an update on its black mass demonstration plant near Toronto. The overview notes that recent optimizations have enhanced the recovery of lithium, nickel, cobalt and other essential minerals, improving the quality of saleable end products. Further optimization studies will include metal recovery from internal recycling streams, and Electra said preliminary lab results suggest positive prospects for isolating cobalt from nickel in the leach liquor.
On February 9, the company received a C$5 million investment from the Canadian government for the construction of its cobalt sulfate refinery. The refinery, which will be situated in Temiskaming Shores, Ontario, aims to supply roughly 5 percent of the world's battery-grade cobalt essential for electric vehicles. The C$5 million grant is being dispersed through the Federal Economic Development Initiative for Northern Ontario.
“Canada has surpassed China as the top jurisdiction in the global battery supply chain, given its strength in raw materials mining and processing,” Trent Mell, Electra’s CEO, said. “Today’s investment from the Government of Canada means that Northern Ontario will seize the economic opportunities created by Canada’s transition to a green economy.”
Shares of Electra reached a year-to-date high of C$0.97 on February 15.
2. FPX Nickel (TSXV:FPX)
Year-to-date gain: 6.67 percent; market cap: C$87.67 million; current share price: C$0.32
FPX Nickel is currently advancing its Decar nickel district in BC, Canada. The property comprises four key targets, with the Baptiste deposit being the primary focus, alongside the Van target.
FPX Nickel also has three other nickel projects in BC and one in the Yukon, Canada. While nickel extraction is its main focus, the company plans to produce cobalt as a by-product from future mining operations at the Baptiste site.
In mid-January, FPX secured a C$14.4 million strategic equity investment from Sumitomo Metal Mining Canada, a subsidiary of Japanese nickel miner Sumitomo Metal Mining (TSE:5713).
Martin Turenne, president and CEO of FPX, noted that Sumitomo's investment is a substantial validation of Baptiste, highlighting Sumitomo Metal Mining's expertise in nickel production and supply chain diversification.
Shortly after the Sumitomo news, FPX announced the “company’s three strategic investors have fully exercised their participation rights to re-establish their respective initial ownership interest in FPX’s issued and outstanding common shares.” The exercise resulted in the completion of an additional private placement, where a total of 8,981,971 common shares were issued to the strategic investors at C$0.48 each, generating C$4,311,346 in proceeds.
With approximately C$45 million on hand, including the proceeds, FPX expects to be fully funded for its 2024 and 2025 activities. Shares of FPX spiked following the news and reached a year-to-date high of C$0.40 on February 5.
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3. Sherritt International (TSX:S)
Year-to-date gain: 5 percent; market cap: C$123.16 million; current share price: C$0.31
Sherritt International is a leading global player in hydrometallurgical processes for nickel and cobalt extraction. At its Moa joint venture, located in Cuba, Sherritt is pursuing a 25 year expansion program to boost annual mixed sulfide precipitate output by 20 percent, equating to 6,500 MT of nickel and cobalt.
On January 15, Sherritt announced it was implementing organization-wide cost-cutting measures to enhance operations in response to market conditions. Part of these efforts included a corporate restructuring and a 10 percent reduction in Canadian staff. In February, the company released its 2023 results and 2024 guidance. In the report, Sherritt notes that total cobalt production on a 100 percent basis was 2,876 MT, “slightly below their annual guidance ranges.”
For 2024, the company is anticipating an uptick in nickel and cobalt production “due to increased feed of mixed sulphides from the Moa mine site to the refinery as a result of access to additional ore sources.”
Sherritt shares marked a year-to-date high on April 10 of C$0.36.
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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: FPX Nickel is a client of the Investing News Network. This article is not paid-for content.
