Glencore's Katanga cuts could give impetus to cobalt

Trading company and producer Glencore’s immediate suspension of cobalt metal output at Katanga Mining in the Democratic Republic of Congo will tighten the market and support sentiment, market sources said.

Glencore announced on Monday that it is immediately suspending copper production at Mopani Copper Mines in Zambia and Katanga Mining in the Democratic Republic of Congo, with output of by-product cobalt also stopping at the latter.
The move comes at a crucial time in the cobalt market, where low-grade metal prices assessed by Metal Bulletin slid to $12.20-12.85 per lb on Friday September 4 from $12.50-13.40 in the previous session, the lowest level since April, when prices dropped to under $12 per lb.

The recent pressure on prices has resulted from three factors: first, good availability from producers looking to maximise sales as prices of other commodities flounder. Nickel, for example, has fallen by around one third to $9,830/50 per tonne on a three-month basis, compared with $14,970/15,000 on January 2. Second, the diminution of SFP's role in the market has also reduced its capacity to...

Published

September 07, 2015

16:53 GMT

London