Dive into the fierce battle between CMOC and Glencore for cobalt supremacy in the Democratic Republic of Congo
At the heart of the energy transition, the mining sector of the Democratic Republic of Congo is experiencing real excitement. Two giants of the sector, the Chinese CMOC and the Swiss Glencore, are engaged in a merciless battle to establish themselves as the industry leaders.
With its Kisanfu copper-cobalt mine, based in the Haut-Katanga province, CMOC becomes the world’s leading producer of cobalt. Its site, inaugurated in 2023, has a production capacity of 30,009 tonnes and allowed CMOC to total 55,526 tonnes of cobalt in 2023, an increase of 174% compared to the previous year.
For its part, Glencore has not yet published its production results for the 2023 financial year, but expectations are high. The 55,526 tonnes of cobalt produced by CMOC far exceed Glencore’s forecasts, which expected 42,000 tonnes.
According to the British agency Reuters, Glencore produced 20,400 tonnes of cobalt (+7%) in the first half of 2023, with a small contribution of 5,800 tonnes coming from its Mutanda mine. However, cobalt recoveries at the Katanga Copper Company (14,600 tonnes) offset this drop in production. Unfortunately, at the end of 2023, Glencore faced a significant deficit caused by the decline in ore grade of the Mutanda mine deposits, which is expected to result in a drop in production of up to 15% per year.
This battle for cobalt supremacy has also had an impact on prices. According to Bloomberg, the global cobalt market saw one of its largest surpluses at the start of 2023, and additional CMOC production contributed to a 30% drop in prices throughout the year. Macquarie analysts even predict that this surplus should reach 17,000 tonnes in 2023 and continue to increase in 2024.
CMOC, formerly China Molybdenum Company Limited, is one of the world’s largest molybdenum producers. Listed on the Hong Kong Stock Exchange and the Shanghai Stock Exchange, the company invested $1.8 billion in the Kisanfu project, which began in 2021.
This battle between CMOC and Glencore for cobalt supremacy in the Democratic Republic of Congo shows the growing importance of this country in the mining industry. As demand for cobalt increases due to the energy transition, the DRC is in a favorable position to benefit from this trend. However, it is essential that players in the sector can find a balance between economic competitiveness and environmental sustainability, in order to guarantee sustainable development for the country and its inhabitants.