Congo Engages Indonesia for Support in Stabilizing Cobalt Market

The DRC is seeking Indonesia’s support to stabilize the cobalt market after a temporary export suspension led to price rebounds. Proposed measures include export quotas and increased domestic processing, aimed at managing resources and preventing oversupply post-ban.

The Democratic Republic of Congo (DRC) has approached Indonesia for assistance in stabilizing the cobalt market amidst concerns of oversupply. Following a temporary export suspension, cobalt prices have experienced a rebound due to weakened demand from automakers and global surpluses. The DRC has proposed additional measures to strengthen this ban, particularly focusing on collaboration with Indonesia, which is the second-largest supplier of cobalt.

In its efforts, the DRC plans to impose export quotas on cobalt, implementing a partnership with Indonesia as a strategic move to regulate the global supply and stabilize prices. The DRC halted shipments in February, responding to a significant price decline prompted by an oversupply. As a result, the government is now seeking long-term strategies to enhance the value of their cobalt resources.

Congo’s Economic Situation Committee, under Prime Minister Judith Suminwa Tuluka, has made recommendations for effective management during the export suspension. A crucial point of discussion is securing Indonesia’s cooperation, which has seen its cobalt supply share grow to 11 percent last year, according to Darton Commodities. This partnership aligns with the DRC’s objective to maintain its dominance in the cobalt market while navigating rising competition from Indonesia.

Cobalt is primarily extracted as a byproduct in both countries; in Congo, it is coupled with copper, whereas in Indonesia, it is alongside nickel. The DRC government intends to introduce export quotas and elevated domestic processing requirements to ensure market stability. Ultimately, these strategies reflect Congo’s aim to strengthen its control over the cobalt industry in light of fluctuating global demand.

In summary, the Democratic Republic of Congo is proactively seeking Indonesia’s support to stabilize the cobalt market following a period of oversupply and price decline. Proposed measures include export quotas and increased domestic processing, driven by a commitment to manage resources effectively. This collaboration aims not only to stabilize prices but also to enhance the DRC’s capacity to control its cobalt industry amidst growing international competition.

Original Source: africa.businessinsider.com