The remarkable rally in cobalt prices is now reversing course. With battery metal exports from the Democratic Republic of Congo recovering under its new, stricter regulatory framework, the world’s top producer is facing a serious challenge to its attempt to control the market.
Since early 2025, the DRC has implemented restrictions on exports to reduce oversupply and increase the value of its output, starting with a blanket ban and followed by a quota system that remains active today. This prompted a massive price surge, with cobalt hydroxide, the country's primary export product, more than tripling in value by April. However, prices have since fallen by almost 30% as shipments have picked up following the initial adjustment period, compounded by worries over global demand and pressure from recycled supply.
Significantly, this price correction has occurred even though Congolese miners have shipped less than their government-approved allowances while adapting to the new rules, with export volumes still well below levels seen a few years ago. This suggests that prices could slide further if companies exhaust their full quotas and accelerate shipments in the coming months. Such a possibility is likely forcing the DRC to make crucial decisions about its future intervention strategies. The central issue revolves around how the country's influential regulatory body will handle the surplus metal that has accumulated from unused quotas and is theoretically available for export.
Prices Retreat After a Sharp Rally
Government figures indicate the DRC exported roughly 41,500 tons of cobalt between the resumption of shipments in December and the end of June. However, this amount represents only about two-thirds of the export volumes approved for companies by the authority, known as ARECOMS. According to statistics compiled by the Congolese Ministry of Mines, the world’s two largest cobalt mines, operated by CMOC Group and Glencore, shipped only about 60% of their approved quotas during this timeframe.
Even with monthly exports from the DRC doubling to 11,800 tons in June, the regulator declined to grant miners another extension at the end of the second quarter. Instead, it demanded that these companies hand over all their unused quotas to the government body’s own “strategic” reserve. The regulator, which does not operate mines or possess a trading arm, has not yet revealed whether or how it plans to utilise this expanded allocation. Previously, it has indicated that the metals would be used to support projects aimed at “promoting local processing of strategic minerals” and protecting the DRC’s economic interests.
Export data shows that a state-owned enterprise with a monopoly on purchasing artisanal cobalt has a separate quota, which was nearly fully utilised by the end of June. As cobalt is mined as a by-product of copper in the DRC, mines continue to churn out substantial volumes of the metal, and CMOC has been building up large stockpiles. The Chinese company produced over 65,000 tons from its two mines in the first half of the year but exported less than one-fifth of that volume.
Still, the amount of metal leaving the country remains modest compared to the production surge of 2024, which initially prompted the government’s restrictive measures in response to a price slump. Most of the material heads to China, where it takes months to appear in trade data due to long shipping distances. After a total of only 6,200 tons imported in the first half of the year, China’s cobalt hydroxide imports, measured by contained cobalt content, climbed to 4,852 tons in July, according to customs data.
Prices Under Pressure from Supply Outlook and Demand Concerns
Consultancy Beijing Antaike Information Co. has stated that despite lower-than-expected Chinese imports, prices may still face further downward pressure in the near term. “Downstream demand remains weak, the peak consumption season for consumer electronics has not yet started, and purchasing activity in the battery sector continues to be sluggish,” the consultancy wrote in an August report.