In this technologically advancing world with new inventions every day, cobalt will always be a highly sought-after mineral resource. In Europe, the increased production of electric cars, computers, and cell phones is a testament to the importance of cobalt. In a recent study by the World Economic Forum’s Global Battery Alliance, the demand for cobalt will increase fourfold by 2030 due to the increased production of electric cars.
Although the global cobalt market is expected to be more balanced in 2022 and 2023 as supply additions keep up with growing demands following the 14,000t deficits of 2021, the Cobalt Institute’s latest report suggests a deficit in 2024. With the recent development in 2022 following supply chain bottlenecks, war, and elevated prices, prices are expected to stabilize later in the year.
However, from 2024, the market is forecast to shift back into a deficit. This is because the supply growth will not be able to keep up with the demand. According to the Cobalt’s Institute, “From 2024-26, supply growth will average 8% per year, compared to more than 12% for demand. Prices will remain elevated to incentivize further investment to prevent wide deficits from developing. Supply side investment remains critical to ensure sufficient supply into longer term as cobalt demand continues to rise even higher.”
Far East Capital Analyst Warnick Grigor, in a weekend note on which ASX stock will benefit more from Labor win, said, “There will be winners on the bourse with Labor taking control. Foremost of these will be alternative energy companies as Labor promises to fight climate change.”
Global electric vehicle sales doubled in 2021 to 6.6 million, an impressive 10% growth. But to hit the 2050 target set by the IEA, massive mining of battery materials such as cobalt has to be increased. Although sales have been strong so far, sales have to be better to hit this target. “The IEA’s Announced Pledges Scenario based on existing policy commitments projects the EV share will fall short of what is required globally to reach net-zero CO2 emissions by 2050,” Argus said.
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