Chapter 3. Energy Conversion and Minerals Used for Materials
B. Characteristics and price trends of mineral materials
펌프 Pump
자연건조 Natural evaporation 부산물제거 Separation of waste
추출 Extraction
탄산리튬 Lithium carbonate 수산화리튬 Lithium hydroxide
파분쇄 Crushing
가열 Heating
제분 Milling
선광후정광 Drying in the sunlight and concentration
추출 Extraction
As forcobalt,110,000 tons were produced worldwide in 2017, of which 64,000 tons (slightly over 58%) were produced in the Democratic Republic of the Congo (refer to Table 3-5). Cobalt reserves are located in countries with high political risk, such as the DR Congo and Cuba, but also in more stable countries such as Australia and Madagascar. These countries—the DR Congo, Cuba, Australia, and Madagascar—account for around 87% of the world’s total reserves (refer to Table 3-5).
Table 3-5. Global Cobalt Production
Country 2016 2017 Reserves (tons)
South Africa 2,300 2,500 29,000
New Caledonia 3,390 2,800
Russia 5,500 5,600 250,000
Madagascar 3,800 3,800 1,500,000
Zambia 3,000 2,900 270,000
Canada 4,250 4,300 250,000
DR Congo 64,000 64,000 3,500,000
Cuba 4,200 4,200 500,000
Papua New Guinea 2,190 3,200 51,000
Philippines 4,100 4,000 280,000
Australia 5,500 5,000 1,200,000
Other 8,290 6,550 583,000
Total 111,000 110,000 7,100,000
Source: Reorganized by the author, USGS (2018) p.51.
Cobalt is mainly produced as a by-product in nickel and copper mines. Around 60% of the world’s cobalt is produced in copper mines, while 38% is produced in nickel mines. Only around 2% is produced in mines where cobalt is the primary mineral.66
66Korea Resources Corporation (KORES), 2017 Market Report (Cobalt) p.152.
Figure 3-28. Cobalt Development Process
Source: BNEF (2017a) p.8.
니켈황화물 Nickel sulfide 니켈라테이트광석 Nickel Laterite 니켈-구리-
코발트황화물
Nickel – Copper – Cobalt Sulfide
파쇄 Crushing
파쇄 Crushing 고압황산침출 HPAL
부유선광 Flotation 분리 Extraction
제련 Smelting 정련 Refining
정련 Refining 코발트비소광석 Cobalt Arsenide
구리-코발트황화물 Copper – Cobalt Sulfide 파쇄 Crushing
파쇄 Crushing 배소 Roasting
배소 Roasting 고압황산침출 High Pressure Sulfur
Leaching
침출 Leach 분리 Extraction
석출 Precipitation 정련 Refining
황산코발트 Cobalt Sulfide
In terms of material prices, lithium prices almost quadrupled from 2015 to 2018, increasing from CNY 39 /kg in January 2015 to CNY 153 /kg in December 2017 (refer to Figure 3-29). Similar to the prices of other resources, lithium prices plummeted during the global economic recession in 2008 but gradually recovered. Lithium supplies have also increased, but increased lithium demands—driven by the need for lithium ion batteries—have exceeded the available supply, which have led to price increases.
In 2015, the capacity of lithium conversion facilities in China was 825,000 tons LCE (Lithium Carbonate Equivalent), but the actual operation rate was only 495,000 tons LCE (or 60% of total capacity).67
Changes in cobalt prices are relatively recent. As seen in Figure 3-29, the price of cobalt, which was USD 23,400 per ton in January 2016 more than tripled to USD 90,400 per ton in May 2018.
67Korea Resources Corporation (KORES), Lithium Market Analysis Report (2016) p.16.
Figure 3-29. Changing Trends in Lithium and Cobalt Prices
Source: Korea Mineral Resource Information Service (KOMIS),
https://www.kores.net/komis/price/mineralprice/raremetals/pricetrend/rareMetals.do, accessed on July 30, 2018.
Understanding cobalt prices requires understanding the political situation of the DR Congo, which plays a significant role in the supply and demand of cobalt worldwide. The biggest importer of cobalt is China. China not only represents the largest proportion of global cobalt demand but also refines cobalt and supplies it to secondary cell industries in China and the U.S. Aiming to lead the EV market, China has been stock piling a stable supply of cobalt, working to amass a total of 5,000 tons, the amount needed to supply the entire world with cobalt for 15 days.68 These rising demands by China and other countries have been a major driving factor behind the instability of the cobalt supply in DR Congo. Gecamines SA, a government-owned mining company in DR Congo, claims that the cobalt mines in the country should be re-nationalized.69 DR Congo also amended its Minerals Act to raise royalties on its major minerals. This amendment went into effect in June 2018 and increased royalties on nonmetals and nonferrous metals from 2% to 3.5%, and increased royalties for precious metals from 2.5% to 3.5%.
The DR Congo government can levy a royalty of 10% on strategic minerals, and cobalt is currently classified as a strategic mineral.70 These changes are expected to have significant impact on cobalt production as also affect the operation of cobalt mines. Other contributing factors to the instability of the cobalt supply in DR Congo include local wars and the country’s lack of power infrastructure. In addition to these challenges, there is yet another issue that has gripped the attention of the global community. About 20% of the cobalt produced in DR Congo is produced in small conventional mines through the use of child labor.71 The international community has attempted to halt the distribution of cobalt produced by child labor in DR Congo. This international political risk is yet another factor affecting the supply of cobalt from the DR Congo.
68https://www.wsj.com/articles/theres-a-global-race-to-control-batteriesand-china-is-winning- 1518374815?mod=searchresults&page=1&pos=6, accessed on February 12, 2018.
69Korea Resources Corporation (KORES) (2018) p.4.
70https://www.businesslive.co.za/bd/world/africa/2018-09-16-drc-to-declare-cobalt-and-other-minerals-as-strategic-this- week/, accessed on September 30, 2018.
71https://www.cbsnews.com/news/cobalt-children-mining-democratic-republic-congo-cbs-news-investigation/,accessed on June 20, 2018.
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Cobalt Lithium(RHS)
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