Cobalt

Cobalt Demand

Cobalt applications can be subdivided into two broad segments, chemical and metallurgical.

  1. Cobalt for chemical applications dominated by the rechargeable batteries segment.
    Key sectors include Li-ion batteries for electric vehicles (EVs), Li-ion batteries for other applications (laptops, PCs, smartphones etc.), polyester and tyres.
  2. Cobalt for metallurgical uses primarily in high temperature alloys.
    Key sectors include Superalloys (aerospace rotating parts, defense, power generation, thermal sprays, prosthetics etc.), high-speed (HS) steel, carbide and diamond tools and magnets.

Dominated by Batteries

Total cobalt demand to exceed 120,000 tonnes per annum by 2020, up approximately 30% from the 93,950 tonnes consumed in 2016 (Darton Commodities, 2016).

Expectation for projected battery consumption will account for ~60% of all cobalt demand in 2020, representing a 58% increase in battery demand from 2016 levels (Darton Commodities, 2016).

New Battery Capacity Coming Online

Battery Costs are Falling

This growth in battery consumption is expected to principally come from increased electric vehicle demand. The rechargeable battery segment has become both the largest and potentially fastest growing end-use of cobalt.

The use of lithium-ion batteries in the electric vehicle market has become the most important growth driver for cobalt demand.

Driven by Demand

At the end of 2016, the number of EVs in existence reached in excess of two million with approximately 737,000 EVs and plug-in hybrid electric vehicles (PHEV) were sold around the world in 2016 (Darton Commodities, 2016.

Growing market adoption has been supported by the development of a reduction in EV battery pack systems cost vehicles, infrastructure along with government incentives.

At the current rate of improvement, EV drivetrains are forecast to become competitive with combustion engines within 5 to 10 years.

Industrial and home grid energy storage systems like the Tesla Powerwall, are increasingly using lithium-ion batteries due to their charge acceptance, longer shelf life, reliability and lower total cost of ownership.

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