Why does Congo have a near monopoly in Cobalt extraction? Is all the Cobalt in the world really only in Congo? Or is it something else? Congo produces 80% of the global cobalt supply. Why only Congo? Is the entirety of cobalt located ONLY in Congo?
In: Earth Science
It’s like the rare earth metals coming from China. Rare earth metals are not actually rare but China is a cheap source of them so they dominate the market. Congo is the cheapest place to produce cobalt and can produce enough to meet demand. If another place could produce cobalt but it’s even a little bit more expensive it wouldn’t make money. It is much cheaper for an existing operation to ramp up to meet demand than for a new mine to start production.
It’s different for something like copper or aluminum. We use so much of these and our consumption is based in part in price. So a new mine can still be profitable by increasing global supply. We don’t use nearly as much cobalt so the few operating mines can supply our needs. We could get it other places but it doesn’t make sense to make that investment just to be undercut but existing operations.
The copper belt of southern Congo has both a high concentration of cobalt and a lot of it.
When you mine cobalt, you pull out cobalt with other rocks – copper and rocks you don’t want. The percentage of cobalt in the rocks in southern Congo (and the percentage of copper) is among the highest in the world.
Not only is there a lot of cobalt in the rock, there’s a lot of it, these deposits are massive, spread out over hundreds of thousands of square kilometers.
So you have some of the largest (if not the largest) deposits of cobalt in the world and they have some of the highest concentrations of cobalt in the world. That makes mining in Congo attractive even though it is one of the most challenging and expensive places for miners to operate.
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Cobalt is mostly a by-product of copper and nickel mining. There are massive copper and nickel deposits in the Congo. However, another major factor is the lack of much mining and environmental regulation in the Congo. They can mine a lot of cobalt, cheap, because they pay the workers low wages, to work in dangerous conditions, with little regard to the effects to the local environment. So, it’s simply cheaper for companies to buy Cobalt from the Congo than from many other places.
Thus, it’s much like two farms in your town growing apples. If Farm A can sell its apples for much less than Farm B, then Farm A is going to sell far more apples, even if Farm B can produce just as many apples as Farm A.
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