Cobalt Part Two

The last post put Cobalt into a general value area. Now let's look at the supply/demand. This is tricky since it depends on a forecast of electric vehicle demand. Here's my best estimate. Just remember that this is subject to wide ranges.

'000 tonnes of refined metal equivalent

	2017	2025
DEMAND
Batteries	38	117
Superalloys	35	44
Tools etc.	21	14
Others	42	48
Total	136	223
SUPPLY
Existing Mines	120	110
New Glencore/ERG		44
Other New Mine		11
New Artisanal		12
Recycling	13	22
Total	133	199
BALANCE	-3	-24

So there's about 24 K tonnes that has to be satisfied by new mines or additional recycling that have not yet been committed. I think that this can be done without a major price rise. OTOH, it's hard to see the price go down much unless there is a change in the EV outlook. If it did, the necessary new supply would evaporate.

My best guess is that Cobalt will move in a wide band for the next few years, with no major bull or bear market. We are probably near the bottom of the range.