The Democratic Republic of Congo (DRC), the world's largest producer of cobalt, is contemplating extending its suspension of cobalt exports beyond the initially planned four-month period, as announced by President Felix Tshisekedi. The decision stems from an urgent need to bolster prices for this crucial electric-vehicle battery material amidst an oversupply that has hit the market.
Since implementing the export ban on February 22, 2025, cobalt prices have skyrocketed by more than 50%, recovering from a two-decade low, which has raised concerns over global supply and prompted significant interest from major international players. As reported by Bloomberg, the benchmark price for cobalt reached $16.10 per pound on March 24, 2025, a stark contrast to the sub-$10 prices seen just weeks earlier.
In a statement to his cabinet, Tshisekedi emphasized the country's intent to maintain higher cobalt prices as a part of a broader economic strategy. "The ultimate goal remains complete control of the cobalt value chain," he said, highlighting the government's focus on not only immediate price stability but also long-term industrialization of the local mining sector.
Following the planned four-month assessment, the DRC government is expected to decide whether to extend the export ban further or implement alternative strategies aimed at market stabilization. These strategies may include independent assessments and proposed export quotas that would allow the government to exert greater control over the prices of cobalt, ensuring a balance between supply and demand.
Underpinning this shift in policy is DRC's control over a significant portion of the global cobalt market—approximately three-quarters of world production. The country's decision to halt exports has inevitably impacted the global supply chain, inciting sharp price increases, particularly as China has been aggressively purchasing cobalt to replenish its own stocks. This strategic move to limit supply comes off the back of rising demand largely fueled by the booming electric vehicle market.
The DRC regulator, known as ARECOMS, has recently introduced stricter regulations governing the domestic cobalt industry. A significant policy change includes prohibiting the mixing of cobalt sourced from artisanal mines with that mined industrially, aimed at ensuring quality and integrity within the market.
Additionally, collaboration with other leading cobalt producers, such as Indonesia, is in the works to help stabilize prices further and regulate export supply on a broader scale, recognizing that international cooperation may yield more favorable outcomes for price management.
Since the commencement of the export ban, reports by DRC's Government Spokesperson Patrick Muyaya indicated a continuous rise in cobalt prices, reflecting a market that is quickly reacting to policy changes. It is reported that cobalt futures prices in China surged more than 9%, driven by strategic purchasing efforts and discussions surrounding the potential extension of the DRC's export ban.
This response strategy has not only brought immediate effects on pricing but has also raised questions about the future dynamics of the cobalt supply chain in an era that increasingly demands sustainability and ethical sourcing practices. Following the evaluation period planned at the end of the four months, the DRC government may announce further measures reflecting the nuanced balance between economic necessity and market volatility.
The shift in DRC's export policies and the country's strategic decisions will certainly have lasting effects on global cobalt prices and the electric vehicle industry, with implications for consumers and producers around the world. As critical as cobalt is for battery production, the regulated market aimed at maintaining a sustainable output will be pivotal as demand continues to rise.
In conclusion, the Democratic Republic of Congo's potential extension of its cobalt export suspension reflects a keen attempt to grasp control of its rich mineral resources while aiming to stabilize a rapidly fluctuating market. With careful assessment and strategic planning, the DRC hopes to build a foundation for sustainable industrial growth that benefits both local economies and international stakeholders equally.
