As the Democratic Republic of Congo (DRC) continues its on-again, off-again export ban of this critical metal, cobalt prices are skyrocketing. This crucial material is vital for electric vehicle (EV) batteries. On July 10, the European spot price for cobalt reached over $17.50 per pound. That’s a stunning increase of nearly ½ (or 50%) since the beginning of state fiscal year 2025. Prices have increased considerably since reaching a low of around $11.50 per lb at the beginning of the year. It represented the lowest point reached since 2016.
The DRC, which is responsible for 76% of global cobalt mine production in 2024, plays a crucial role in the cobalt supply chain. The U.S. Geological Survey points out the strategic importance of the production of cobalt in the Congo. They caution that any change in this output can lead to volatility in global prices. An export ban that continues indefinitely poses profound, increasing uncertainty for manufacturers and investors. They know that they’re increasingly reliant on Congolese cobalt when it comes to making EV batteries.
In short, heightened demand for electric vehicles is pushing up the price. This rapid increase in demand has triggered a global boom in battery production. We’re finally starting to see automakers react to the obvious, surging consumer demand for electric vehicles (EVs). Now, they’ve turned their sights toward cobalt, another critical factor in battery technology. Despite international pressure, the DRC has decided to uphold its export restrictions. With this decision, the competition between buyers for the already diminished supply, including cash and large-buyer competitors, increases.
Furthermore, the cobalt market has been marked by instability in the past few years. These effects, compounded by economic pressures, regulatory changes, and demand dynamics shifts have all played a tragic role in pricing trends. That increase, like the most recent coordinated price spike reflects nefarious collusion of many causes. All of this underscores the need for vigilant oversight of what’s transpiring inside the DRC.
Industry analysts predict that price momentum will continue so long as Congo remains committed to its export ban. Manufacturers would be motivated to find other sources or to pour more money into recycling technologies in order to reduce their reliance on Congolese cobalt. These alternatives are unlikely to deliver near-term relief, while the scale and reliability of available substitutes are not well known.