Investors are becoming increasingly worried that South Africa’s recent decision to close 20 land ports will adversely impact the flow of cobalt from mines in the DR Congo to customers in China. President Cyril Ramaphosa on Monday announced a series of new lockdown measures in an effort to contain the rapid spread of COVID-19 in the country.
But, the president’s measures did include a number of exceptions, including rail cargo for commodities like cobalt, which will continue to move to the Port of Durban.
The markets don’t seem convinced though and are pushing up the price of the strategically vital metal that’s a key ingredient to make the lithium-ion batteries used to power electric vehicles.
There was also some concern that Chinese officials would halt all maritime imports from South Africa due to concern that the new South African strain of the virus would somehow make it into the country, but traders now think that’s unlikely.
Why is Congolese Cobalt So Important to China These Days?
- SURGING EV DEMAND: The acceleration to a low-carbon economy in 2021 will bolster electric vehicle (EV) demand, and with it demand for essential battery metals, such as lithium, cobalt and nickel. (MINING WEEKLY)
- CHINA TAKES THE LEAD IN BATTERY TECHNOLOGY: “China’s capture of the lead in battery technology is a crucial feat. EVs and batteries are among the most important aspects of a tension-filled, U.S.–China contest for supremacy in the technologies of the future, which also include artificial intelligence, robotics, quantum computing, and biotechnology.” (THE MOBILIST)
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