SunSirs: Darton Report: Cobalt Supply Shortage Drove Up Prices

In its latest report, commodities trading firm Darton Commodities noted that since the Democratic Republic of the Congo implemented export restrictions, benchmark cobalt prices have cumulatively surged by over 160%, while the price of cobalt hydroxide has more than quadrupled. Global refined cobalt production is projected to decline by approximately 20% in 2025—marking the first contraction in five years—resulting in a supply deficit exceeding 82,000 tonnes. Darton forecasts that, although the magnitude of the deficit is expected to narrow this year, the supply shortage will persist annually through 2030. This supply crisis is now cascading downstream along the value chain. According to Darton, as the impact of raw material shortages continues to deepen, downstream markets are facing mounting price pressures. Concurrently, the inherent fragility of supply chains has prompted the industry to ramp up investment in product diversification and material substitution—a trend that could, in the long term, dampen demand growth in certain end markets.

Analysis and Commentary

The article indicates that, following export restrictions in the Congo, benchmark cobalt prices have surged by over 160%, while the price of cobalt hydroxide has quadrupled. By 2025, global refined cobalt production is projected to decline by 20%, resulting in a supply deficit of 82,000 tons. This shortage is expected to persist until 2030; although the supply gap is anticipated to narrow, the crisis is currently cascading downstream, thereby intensifying price pressures. Consequently, spot cobalt prices are benefiting from strong upward support, with bullish factors currently dominating the market. While material substitution may exert long-term downward pressure on certain segments of demand, the severity of the near-term supply shortage far outweighs these potential negative impacts, thereby serving as a significant bullish catalyst for the cobalt market outlook.

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