The 2021 edition of the Cobalt Conference – the only worldwide event that brings the entire cobalt industry and value chain together – has become a platform for the high-level state officials, industry executives, market analysts, NGOs, and policymakers to discuss the role of cobalt in ensuring a sustainable future.
A special focus was given to the critical role of cobalt in enabling electric mobility across the globe: the latest European legislative and regulatory developments impacting the battery value chain, as well as the Chinese perspective on it. The various sessions examined all aspects of the cobalt value chain and exchanged views on how the industry is positioning itself to address the upcoming challenges.
- Joseph Ikoli Yombo Y’Apeke, the Democratic Republic of the Congo’s Secretary General of Mines, insisted on win-win partnerships and presidential support for relationships between the DRC state and mining companies.
- Mark Brown, Prime Minister of the Cook Islands, spoke about the country’s deep sea mining potential and the nation’s efforts to sustainably and responsibly develop its vast resource as a means to provide much needed economic security and support the global transition to a low-carbon economy.
- The European Commission announced an update of the REACH directive at the end of 2022, which will restrict the use of hazardous substances unless considered “essential”, which they indicated cobalt would likely be.
- Jean-Dominique Takis, CEO Entreprise Générale du Cobalt, demonstrated the DRC’s efforts to formalize the artisanal and small-scale mining, as well as to ensure traceability and to strengthen the reputation of the DRC and attract investment.
- David Brocas, Chair of the Cobalt Institute Executive Committee and Lead Cobalt Trader, Glencore, argued that long-term (5 years) commitment from customers is needed to encourage mining companies to re-open mines.
- Market analysts from Roskill and CRU agreed that the demand for cobalt is expected to increase, driven by demand from electric vehicles in China and Europe. William Adams from Fastmarkets estimated the need of 4 million tons of cobalt for the 10-year period until recycling become large scale at the end of the life cycle of the first generation of EVs.
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The topic of responsible sourcing featured prominently at the Cobalt Institute’s Conference with a special focus on artisanal and small-scale (ASM) cobalt production in the Democratic Republic of the Congo, which is an important source of cobalt and a lifeline for 1-2 million Congolese who live in extreme poverty.
The Responsible Sourcing Afternoon kicked off with a keynote from Jean-Dominique Takis, General Manager of the Entreprise Générale du Cobalt (EGC). EGC, a subsidiary of GECAMINES, holds the monopoly for the purchase, process and sale of all cobalt produced by artisanal miners or companies involved in ASM in the DRC.
Mr. Takis highlighted that central to fulfilling EGC’s mission is improving artisanal miners’ working conditions and protecting vulnerable populations, increasing income from artisanal mining and ensuring traceability of operations. EGC’s actions hope to improve the country’s reputation and attract investment in the mining industry.
The Cobalt Institute’s Head of Responsible Sourcing and Sustainability, Susannah McLaren, moderated a multi-stakeholder session that looked at the contribution of ASM to sustainable livelihoods and how the industry is engaging collaboratively to achieve positive outcomes on the ground.
- OECD’s policy analyst Ben Katz underlined the speed at which change was taking place in the DRC, noting that recent government reforms provided avenues for making progress. He remarked that although ASM was labor intensive, it was economically important and complementary to industrial mining.
- The panel continued with interventions from Pact DRC, the Responsible Cobalt Initiative (RCI), the Cobalt Action Partnership, Glencore, Trafigura and Assent Compliance. Speakers were unanimous in their message that avoiding ASM was not the solution, and that instead actors needed to engage in collective action to support the formalization of ASM and address the root causes that stem from poverty.
- Other key takeaways included the need for better reporting, communication and education around the issue, as well as more convergence of existing frameworks and initiatives.
The Responsible Sourcing Afternoon concluded with a lively conversation between the Cobalt Institute’s communication manager, Marina Demidova, and an engineer turned film producer, Marc Muller, to discuss his award-winning documentary on ASM cobalt in the DRC. Conference participants were also treated to an abridged screening of the film, which takes a closer look at the information disseminated in the media and the reality on the ground.
The Cobalt Institute published its first “State of the Cobalt Market 2020 Report” in May 2021. The report looks at the global trends in cobalt consumption, supply and production in 2020 and is the most comprehensive publicly available market overview to date.
According to the report, the cobalt market grew by 5% year-on-year. The major driver for this growth was the demand for cobalt in lithium-ion batteries for electric vehicles. It accounted for 57% of the total cobalt consumption in 2020, followed by nickel-based alloys and tool materials (13% and 8% respectively).
The cobalt market also remained robust despite the challenges brought about by the pandemic: the Covid-19-related shutdowns, and weaker demand in certain segments such as aerospace.
Overall, the Cobalt Institute expects to see a greater increase in the use of cobalt in batteries, with the report projecting demand for electric vehicles growing by nearly 30% annually to 2025. Combined with the expectations for traditional cobalt applications – such as aerospace and tooling – to recover from the pandemic, prospects for the cobalt market look bright for the coming years.
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China was the main participant in the global cobalt market despite the reduced imports of cobalt due to the pandemic, argues Chinese research center Antaike.
In 2020, China was the major participant in the global cobalt market. Refined cobalt production was 100kt in China, which represents an 11% increase year-on-year, accounting for around 69% worldwide. Cobalt consumption in Chinese cobalt market was 78kt, up 10% year-on-year, accounting for 55.3%.
In line with the global trend, batteries were the main driver of the cobalt consumption in 2020, accounting for 84.4% of the cobalt market.
The pandemic weighed down the imports of cobalt to China. The total import volume of cobalt raw material in China edged lower 2.4% year on year and import volume of cobalt concentrate and hydro-smelting intermediates was 18kt in Q1 2021, down 2% over the same period last year. However, according to Antaike’s s survey of the major Chinese firms investing in the DRC, the impact of the pandemic on the cobalt production is easing.
12 June marks the World Day Against Child Labour, which aims to raise awareness and activism to prevent child labor. A member of the Global Battery Alliance, the Cobalt Institute joins the 2021 Action Pledge to eliminate child labor in the battery supply chain.
The Global Battery Alliance and the industry will focus on four areas of action:
- Development of a digital Battery Passport to track and authenticate the absence of child labor in the sourcing of cobalt and sustainability criteria of the batteries;
- Contributing to the sustainable development of responsible artisanal and small-scale mining (ASM) and surrounding communities through the Cobalt Action Partnership;
- Raising millions of dollars for The Fund for the Prevention of Child Labour in Mining Communities – A Global Battery Alliance Collaboration; and
- Convening policymakers to accelerate adoption of best practices to formalize lead-acid battery recycling.
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“When working to address child labor, the rights of children should always be given the highest priority. For this reason, it is important to fully understand who are those children that are working, why they are working and what will happen to them once they stop working,” argue Fabiana Di Lorenzo and Blanca Racionero Gomez from a social venture Levin Sources in their guest blog discussing the problem of child labor in the artisanal mining sector. They call for collective and systemic efforts to end child labor in a sustainable way.
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What is the best method to estimate the carcinogenic potency of chemicals? This was the question that a special expert group moderated by the European Chemicals Agency (ECHA) was tasked to answer.
The Cobalt Institute’s Ruth Danzeisen represented the inorganics industry in this group and helped define a robust approach to calculating Concentration Limits of substances shown to be carcinogenic in rodents. The concentration limit is relevant to mixtures containing these substances, or if a carcinogenic substance occurs as an impurity.
The group was formed in 2017 with the mandate to review the existing measurement method, T25, that is criticised for its simplified methodology that may lead to imprecise results. Specifically, the T25 method assumes there is no safe threshold below which the adverse effect would be triggered and compares inhalation studies to oral carcinogenicity studies.
In three years of scientific discussions and research, the group has identified a sufficient number of inhalation carcinogenicity studies and generated a curated database of these studies. Further, the experts concluded that the Benchmark Dose model, a dose response method allowing for the consideration of thresholds, when present, and including all datapoints of a given study, is best suited to calculate Concentration Limits of carcinogens.
This conclusion may lead the scientific and regulatory community to recognise that the carcinogenic potency of substances may differ across the exposure routes (i.e. inhalation, oral or dermal) and the Specific Concentration Limit should be calculated on the basis of the relevant exposure route.
With regards to cobalt, this work may result in recognising the need to generate carcinogenicity evidence via the oral route instead of relying on inhalation carcinogenicity data for the risk assessment of all exposures, including oral or dermal.
The final report from the ECHA Expert Group is expected in autumn 2021.