Where is the bottom ???, page-89

LME and world cobalt supplies

I do not mean to sound negative about ethical cobalt. I just believe that there will be a lot of unvetted cobalt that will continue to find its way to market.

It is my impression that the LME wants to expand the products they offer in cobalt, and perhaps offer a cobalt sulfate
contract also. This is also positive; and I noted that RF had been in London, possibly to discuss the underwriting of LME cobalt and nickel contracts. But it is also my impression that the LME does not exactly dominate the cobalt market. They are relatively small and new, looking to build up their importance in cobalt.


Depending on one's sources, we can suppose that world cobalt production is about 100,000 metric tons, with about 60,000 MT coming from DRC.

I checked today and the LME stocks of cobalt are 644 MT. I do not know their annual volume, but I would be surprised if it is a major factor currently in terms of world transactions.

The fact that majors are going directly to cobalt miners highlights the fact that LME is not yet a viable mechanism for majors to rely on for supply. Most of the world transactions in cobalt do not appear to flow through the LME.

Maybe they will get a lot of the growth, and it will be in ethical cobalt. Very well, and I hope it comes true. But there are other market mechanisms for cobalt to get sold besides the LME. And there are lots of manufacturers we have never heard of, who do not sell consumer products into countries with high concerns about ethical cobalt.

In passing, the issue at the LME on their website is slave labor, not child labor. Ethical cobalt is more than child artisianal miners.