Short-Term Excess Cobalt Supply Masks Long-Term Trend, Study Says

The latest study from the Cobalt Institute shows that the global demand for cobalt exceeded 200,000 tons for the first time in 2024, marking a 14% annual increase.

However, it was the third consecutive year in which supply additions outpaced demand growth, resulting in a market surplus of 36,000 tons, up from 25,000 tons in 2023.

The research highlights that the main reason for the oversupply of cobalt is the increased production at CMOC's CMCLF KFM mine in the Democratic Republic of Congo (DRC), the world's leading producer. Even though prices plummeted to historic lows by the end of 2024, the Institute is confident that the demand fundamentals are still robust. 

Last year, the electric vehicle (EV) sector accounted for 43% of cobalt demand, and it's expected to rise to 57% by 2030. EV sales jumped by 26% compared to the previous year, and cobalt-based battery chemistries dominate Western markets.

Over 90% of North America and Europe EV batteries utilize cobalt-rich NCM or NCA chemistries. On the flip side, China's widespread shift to cobalt-free LFP batteries has led to a decline in the global market share of cobalt-based chemistries.

Beyond the EV market, cobalt is vital in various battery applications, including portable electronics and non-battery uses like aerospace and defense. Cobalt-based superalloys are crucial for jet turbines, unmanned systems, and control magnets. With the commercial aviation sector expected to bounce back in 2024, demand in this area is projected to rise by 5%.

According to Custom Market Insights, the global civil aviation market is set to grow at a compound annual growth rate of 8.1% until 2034, indicating this sector could further boost cobalt demand.

DRC remains the leading global supplier, but its market share is anticipated to drop from 76% in 2024 to 65% by 2030 as Indonesia boosts its output. In early 2025, the DRC implemented a four-month export ban to tackle oversupply and stabilize prices, which had plummeted by 22% over the year.

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This effort stabilized the market and caused a price surge from below $22,500 to over $33,000 per ton.

The government-backed Entreprise Générale du Cobalt has secured exclusive rights to purchase and export hand-dug cobalt. Through this initiative, the government wants to tackle safety and environmental concerns while integrating artisanal production into global supply chains. Additionally, the US is exploring possibilities to stop regional conflicts and diminish Chinese influence in the DRC's critical minerals sector.

Washington's support for DRC's attempts to prevent Chinese companies from acquiring strategic cobalt assets aligns with President Donald Trump's broader initiative to ensure domestic access to essential minerals crucial for national security and industrial competitiveness.

With demand projected to grow at a 7% CAGR and reach 400,000 tons by the early 2030s, a market deficit is likely by the next decade, and meeting this demand will require substantial investment in new mining and processing capacity.

The Cobalt Institute will discuss these challenges at the ongoing three-day Cobalt Congress in Singapore, which is gathering industry leaders, including DRC Minister of Mines Kizito Pakabomba Kapinga Mulume.

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