A snippet from the Weekend Australian, p33 "New ideas offer new ways to lose cash".
Commodity research house Wood Mackenzie, which has estimated that battery production drove 49% of cobalt demand in 2017, believes battery demand will drive 61% of demand in 2022. But it also predicts that a significant surplus will begin to accumulate in 2019 onward, driving a reduction in price.
So, what impact would that future surplus have on CCZ? Should the price slump as predicted by WM and have a flat/negative future from there on, it might be that the hoped for cobalt would not be exciting enough to dig out the ground, assuming it exists. Does anybody have any thoughts about the prospective cobalt resources production costs i.e. low, medium or high compared to today's major producers? Food for thought.
The article also mentions the regulatory uncertainty in DRC, where most of the world's cobalt production is currently from. I guess that this presents an opportunity for those producers not in DRC to have a competitive advantage unrelated to the usual costs and hazards of getting a metal out of the ground.
The immediate driver for CCZ is Cangai and I am still buzzed about that. A significant Co find would be boost, but might evaporate over the next year.
I would be interested to hear the thoughts of those with more knowledge of the mining and minerals game - would a slump from a high be a problem?
Regards,
Keith.
CCZ Price at posting:
4.5¢ Sentiment: Hold Disclosure: Held
