Second mention this week so far of cobalt in Bell Potter's daily...

Second mention this week so far of cobalt in Bell Potter's daily summary - must be starting to hot up

China's cobalt prices shoot up on higher import costs, DRC concentrate export uncertainties (Metal Bulletin)
Domestic Chinese cobalt prices jumped this week, largely due to increasing import costs and the misinterpretation of a document on cobalt concentrate exports from the Democratic Republic of Congo (DRC) which has been widely circulated since Monday evening.
The China cobalt metal price leapt to 286,000-290,000 yuan ($41,299-41,877) per tonne on Wednesday January 11, up nearly 4% from Friday to its highest since June 2011. Strengthened demand and expectations of tightness of raw materials have continued to push up international cobalt prices.
Metal Bulletin’s low-grade cobalt price rallied to $14.7-15 per lb from $14.3-15 previously, while the high-grade price rose 3.1% to $15 to $15.4 per lb on January 6.
"Metal Bulletin’s low-grade cobalt price increased four cents [on the low end]; we have not come across such a big growth in recent years," a cobalt trader from China said.
"The cost to import cobalt metal has increased continuously. As a result, we need to lift our offer [prices] accordingly," he added.
Meanwhile, bullish sentiment has continued to overwhelm the cobalt market. "Market participants share higher expectations for cobalt metal, and remain upbeat," another cobalt trader from eastern China said. "With this expectation, no traders are willing to liquidate their stocks," he explained.
DRC export policy concerns
A document related to a cobalt concentrate export ban by the DRC has generated much panic among Chinese market players and supported prices higher after the document was misinterpreted as meaning a ban is imminent. However, the document issued by the Ministry of Finance and Ministry of Mines of the DRC was later found to be similar to the order issued last year.
The proposed ban on copper and cobalt concentrate exports from the DRC that was postponed until December 2016 has again been put on hold, with no specific date for its implementation. Meanwhile, the market still holds concerns about the unclear outlook on the DRC government’s export policy for various minerals.
"The document didn’t clarify when the postponement of the export ban will expire this time; therefore, uncertainties will be prolonged throughout the year of 2017 as it has been very hard to predict the policy after Joseph Kabila took the presidency," an analyst at a cobalt refinery in China told Metal Bulletin.
Despite the rapid rise in cobalt prices in China, trade activities were thin. Only several small volumes of trades were reported to Metal Bulletin in this pricing session. "The prices for every type of cobalt products are running higher, not only for cobalt metal, but also for cobalt chloride, cobalt sulfate, etc. And consumers need time to digest all those price rallies," a trader said.


Source: Bell Potter