Open interest has grown exponentially from 2,385 contracts in May last year to 16,970 contracts at the end of January. Volumes more than quadrupled to 17,119 contracts last year and January's activity was a fresh monthly record with 5,127 contracts traded. Industrial users seem to have switched en masse to the CME product, launched at the end of 2020 and cash settled against Fastmarkets' assessment of standard-grade metal in warehouse in Rotterdam.
Volumes last year were just 290 contracts and registered stocks have dwindled to 157 tonnes, or just 46 tonnes, excluding metal awaiting physical load-out. The issue was the trigger for the LME's move to incorporate responsible-resourcing criteria into all its listed metal brands but the cobalt contract never recovered. The London Metal Exchange (LME) got there first with a physically delivered contract making its debut as far back as 2010.Īctivity grew steadily before peaking in 2018, when concerns emerged that some of the LME's registered cobalt brands were sourced from Congo's artisanal mining sector and associated with human rights abuses. One beneficiary of this turnaround in cobalt market dynamics has been the CME (CME.O), which has seen activity in its cobalt contract mushroom since the middle of last year.ĬME wasn't the first exchange to launch a cobalt contract. Operations are continuing for now but exports remain blocked by a dispute between state mining company Gecamines and China's CMOC Group (603993.SS).Ī closure of Tenke, which produced 18,500 tonnes of cobalt in 2021, would be price supportive in the short term but the longer-term picture is one of accumulating supply surplus, according to Macquarie. The status of the giant Tenke Fungurume mine in the Congo is a supply wild card. Supply, by contrast, is growing fast thanks to restarted capacity in the Democratic Republic of Congo and a new generation of Indonesian nickel plants producing cobalt as a by-product. Overall demand growth fell sharply to 7.8% last year from 19.3% in 2021 and will likely slow again to 5.9% this year, according to Macquarie Bank. The changing mix of chemistries explains why lithium prices are still holding their highs while cobalt prices have been on the slide.Ĭobalt usage has also been dented by falling sales of electronic items such as mobile phones and a slow COVID recovery in the aerospace sector. Lithium-iron-phosphate (LFP) batteries now represent around 30% of the total market, a share that is likely to grow as auto-makers seek to lower costs in an increasingly competitive arena. That eye-watering growth rate would be stronger still were it not for a shift towards non-cobalt battery chemistries, led by China, the world's largest EV market.
#San patrick cobalt price full
Sales of new energy vehicles rose by 56% year-on-year in the fourth quarter of 2022 and usage of cobalt in EV batteries jumped by over 60% over the full year, according to the Cobalt Institute's latest quarterly report. CME cobalt price, total volume and market open interest CHANGE OF GEARĬobalt's fortunes are still tied to the EV sector but the relationship is changing.
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