CMOC Group Anticipates Easing Cobalt Supply Pressure in H2 2024
China’s CMOC Group, the world’s largest cobalt producer, expects cobalt supply pressures to ease in the second half of 2024.
Cobalt, essential in batteries and alloys, has seen prices plummet to near an eight-year low due to a surge in production outpacing demand, according to Fastmarkets data. CMOC forecasts that global supply growth will gradually stabilize.
“Global cobalt resources are concentrated, and after the current supply surge, no significant new resources are expected for a long time,” CMOC stated while announcing a record first-half profit. “This should support medium- and long-term price stability.”
The Chinese mining giant, which includes the world’s largest battery maker Contemporary Amperex Technology Co. among its shareholders, reported a seven-fold increase in earnings to 5.4 billion yuan ($757 million) compared to the same period last year.
CMOC doubled its cobalt production in the first half of the year to 54,024 tons, driven by ramped-up operations at two major mines in the Democratic Republic of Congo, surpassing Glencore to become the world’s top cobalt producer. The company also doubled its copper output to 313,788 tons.
CMOC expects strong price support from a recovering Chinese economy, a stabilizing property market, and a more accommodative monetary environment. Additionally, the energy transition, artificial intelligence, and power grid expansion are anticipated to further boost demand.
CMOC’s metals trading arm, IXM, posted a first-half profit of 664 million yuan on operating revenue of 93.9 billion yuan.
