SREMF - Cobalt Miners News For The Month Of January 2023

Summary

• Cobalt spot prices were lower for the month, LME inventory was lower for the month.
• Cobalt market news - BMI anticipates that cobalt prices will fall in early 2023 given surplus forecasts. Project Blue forecasts cobalt prices should strengthen as the year goes on.
• Cobalt miners news - CMOC mining mill trial starts running at the KFM world-class mine in DRC. Huayou Cobalt could raise US$500m to US$1b of global depository receipts.
• Electra launches Battery Materials Recycling Demonstration Plant at its Ontario Refinery Complex.

Welcome to the January 2023 cobalt miners news.

The past month saw industry experts forecasting a weak cobalt market in early 2023, with potential to improve later in 2023 if the consumer electronics sector recovers. It was a quiet month for company news.

Cobalt price news

As of January 23, the cobalt spot price was at US$21.92/lb , down from US$23.24/lb last month. The LME cobalt price is US$49,000/tonne . LME Cobalt inventory is 159 tonnes, down from the 165 level from last month. More details on cobalt pricing (in particular the more relevant cobalt sulphate), can be found here at Benchmark Mineral Intelligence or Fast Markets MB .

Cobalt spot prices - 5-year chart - USD 21.92 ( source )

Cobalt demand v supply forecasts

BMI 2022 forecast for cobalt - Deficits building starting from 2024

Trend Investing v IEA demand forecast for EV metals ( Trend Investing ) ( IEA )

2021 IEA forecast growth in demand for selected minerals from clean energy technologies by scenario, 2040 relative to 2020 - Increases Of Lithium 13x to 42x, Graphite 8x to 25x, Cobalt 6x to 21x, Nickel 7x to 19x, Manganese 3x to 8x, Rare Earths 3x to 7x, And Copper 2x to 3x

2022 - BMI forecasts we need 330+ new EV metal mines from 2022 to 2035 to meet surging demand - 62 new 5,000tpa cobalt mines (drops to 38 if include recycling)

Cobalt market news

On January 2, Investing News reported :

Cobalt market forecast: Top trends that will affect cobalt in 2023....For Benchmark Mineral Intelligence, sectors such as aerospace, military and medical are anticipated to remain robust, and all of them will help keep the market for cobalt fairly tight next year...new mine projects are required if supply is to meet demand," said Bedder, noting that the two key projects to watch are Chemaf’s Mutoshi and CMOC Group’s (OTC Pink:CMCLF, SHA:603993) Kisanfu...Excluding the DRC, the main area of growth for cobalt supply is currently Indonesia..... Looking at what might be ahead for cobalt prices in 2023, Bedder expects them to fall back a little further in Q1. “They should strengthen as the year goes on — and as demand picks up,” he said. “But for now I think there is sufficient intermediates, metal and chemical supply.” Benchmark Mineral Intelligence also anticipates that prices will fall in early 2023 given surplus forecasts.

On January 6, Fastmarkets reported :

Cobalt ends year on volatile note; some long-term negotiations drag on: 2023 preview. Supply tightness, geopolitics and logistics constraints pushed prices to record highs in the first half of 2022. In the second half of the year, fundamentals across the cobalt value chain flipped weak demand following Covid-related lockdowns in China while bearish global macroeconomics pushed prices down steeply...Cobalt standard grade shows a fall of 51% in December from its high in May 2022... Fastmarkets research forecasts that cobalt demand should increase to 194,000 tonnes in 2023, from an estimated 177,000 tonnes in 2022. But total cobalt supply is also forecast to increase, up to 209,000 tonnes from an estimated 182,000 tonnes in 2022, leaving a surplus of 15,000 tonnes.

On January 10 Financial Post reported :

India's foray into the EV battery market lacks some key ingredients. Shortages of raw materials from lithium to copper are hampering a multi-billion dollar bid to circumvent China’s hold on the supply chain.....The world’s second most populous country has only a fraction of the raw materials needed to satisfy domestic demand for lithium-ion batteries — forecast by Crisil to grow 100 fold by 2030 — let alone produce on a global scale...As the world moves away from gasoline-fueled combustion engines, demand for lithium, nickel, cobalt and other metals that go into lithium-ion batteries is soaring. BloombergNEF estimates that global appetite for the metals used in next-generation batteries increased 50% last year alone and will nearly quadruple by the end of the decade. Supplies are getting tight, and that’s already driving up costs. “The entry barriers are quite high,” said Jasmeet Singh Kalsi, director of Manikaran Power Ltd., which is setting up India’s first lithium refinery and scouting for nickel, cobalt and copper assets overseas. “China has captured most of it.” Manikaran could buy spodumene, a source of lithium, for $500 a ton in 2019. “Today,” said Kalsi, “the prices are around $5,000 a ton.”

On January 12 Mining.com reported :

Metals prices could spike with markets so tight, Trafigura says....His comments come as mining executives warn that much more investment is needed to ensure the world has enough supplies of energy-transition metals in the next decade.....

On January 19, Reuters reported :

Exclusive: Congo sees deal on $6 bln China mining contract overhaul this year -FinMin. Democratic Republic of Congo expects to reach an agreement on overhauling $6 billion of an infrastructure-for-minerals deal with Chinese investors this year, Finance Minister Nicolas Kazadi told Reuters in an interview.

Cobalt company news

Glencore [HK:805] [LSE:GLEN] ( GLCNF )

No significant news for the month.

CMOC Group Limited [HKSE:3993] [SHE:603993] ( CMCLF ) (formerly China Molybdenum)

On January 5, Citic Heavy Industries reported :

Mining mill starts running in KFM world-class mine in DR Congo..... marking the beginning of the trial run of the KFM copper-cobalt mine project of CMOC Group Limited (hereafter referred as CMOC) in the DR Congo and the important progress of the project construction. The ore resources of KFM copper-cobalt amount to 365 million tons, which is one of the world's large and high-grade undeveloped copper-cobalt ore projects, and is an important support for CMOC to realize the three-step development path of "making the foundation, making progress and leaping forward". As a generous project of overseas mine construction and strategic resource development, it bears the good expectation of customer to become the world's leading cobalt supplier.....

Zheijiang Huayou Cobalt [SHA:603799]

On January 4, Zhejiang Huayou Cobalt announced :

Views of Huayou Cobalt] Huayou Cobalt promotes the integrated development of the industrial chain by signing a three-year sales agreement for more than 170,000 tons of Ternary Precursors..... According to the Sales Agreement, Huayou Cobalt and its subsidiaries will supply about 160,000 tons of ternary precursors of Li-ion batteries to POSCO from January 2023 to December 2025, and about 15,000 tons of ternary precursors of Li-ion batteries to POSCO-Huayou ESM.

On January 13, Bloomberg reported :

Huayou Cobalt picks Citic for up to $1 billion Zurich GDR sale, sources say. China’s Zhejiang Huayou Cobalt Co. has picked Citic Securities Co. to handle a sale of global depository receipts in Switzerland, people with knowledge of the matter said. The Shanghai-listed mining firm could raise $500 million to $1 billion.

Jinchuan Group International Resources [HK:2362]

On January 9, Jinchuan Group Co., Ltd. announced :

Jinchuan contributes to new chapter in China's nickel cobalt industry..... Jinchuan will ensure that the total R&D investment at the end of the 14th Five-Year Plan (2021-25) period is no less than 5.5 billion yuan (about $810 million), strive to undertake more than 5 national major projects and 20 provincial key projects, and achieve a conversion rate of scientific and technological achievements of more than 65%.....

Chemaf (subsidiary of Shalina Resources)

No news for the month.

GEM Co Ltd [SHE:002340]

On January 4, GEM Co Ltd announced : "GEM Wuhan Power Recycling passes SGS Carbon Neutrality Certification, aims to build new zero carbon demonstration park."

On January 7, Market Screener reported :

Fire breaks out at GEM's cobalt refinery in eastern China..... a spokesperson from GEM said the core processing of cobalt products would be unaffected by the fire.

Investors can read more about GEM Co in the Trend Investing article: " A Look At GEM Co Ltd - The World's Largest Battery Recycling Company " when GEM Co was trading at CNY 5.08.

Eurasian Resources Group ("ERG") - private

ERG own the Metalkol facility in the DRC where ERG processes cobalt and copper tailings with a capacity of up to 24,000 tonnes of cobalt pa.

No news for the month.

Umicore SA [Brussels:UMI] ( UMICY )

On December 21, Umicore SA announced :

Umicore and Nano One enter into Joint Development Agreement for battery materials process technology...announce the signing of a non-exclusive Joint Development Agreement (JDA) on production process technologies for cathode active materials [CAM] for lithium-ion batteries. Under the agreement, Umicore will evaluate Nano One’s patented M2CAM® One-Pot process technology with the intention to integrate it with Umicore’s proprietary process technology for the production of high nickel NMC (nickel, manganese, cobalt) CAM. With the agreement both parties aim to leverage their respective technologies and know-how to further increase the throughput rate while reducing the costs and environmental footprint of CAM production.

On January 18 Umicore SA announced :

Global Battery Alliance launches World’s First Battery Passport Proof of Concept. “The Battery Passport will raise standards to achieve truly clean e-mobility...Transparency on a battery’s lifecycle enables consumers, companies and regulators to make well-informed choices, propelling decarbonized electric driving. This makes the Battery Passport key to reducing climate change." Mathias Miedreich, CEO of Umicore, founding member of the Global Battery Alliance.

Sumitomo Metal Mining Co. (TYO:5713) ( STMNF )

No news for the month.

MMC Norilsk Nickel [LSX:MNOD] [GR:NNIC] ( NILSY ) (ADRs to remain in circulation until April 28, 2023 )

On December 22 MMC Norilsk Nickel announced : "«Nornickel» successfully placed CNY 5 billion exchange-traded bonds....."

On January 16 MMC Norilsk Nickel announced : "Nornickel tests new technologies as Norilsk is undergoing a makeover."

OZ Minerals [ASX:OZL] ( OZMLF )

On December 22 OZ Minerals announced : " Proposed acquisition of OZ Minerals by BHP progresses to signed Scheme Implementation Deed." Highlights include:

• "..... The Scheme is subject to various conditions including approval by OZ Minerals shareholders at a Scheme Meeting expected to be held in late March to early April 2023, with a Scheme Booklet and independent expert’s report to be provided to shareholders ahead of the Scheme Meeting. Implementation of the Scheme is expected to occur in mid to late April 2023.
• OZ Minerals’ Directors unanimously recommend that OZ Minerals shareholders vote in favor of the Scheme, in the absence of a superior proposal and subject to the independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of OZ Minerals shareholders ."

Sherritt International [TSX:S] ( SHERF )

No significant news for the month.

Nickel 28 [TSXV:NKL] [GR:3JC] ( CONXF )

No news for the month.

Investors can view the company presentations here .

Jervois Global Limited [ASX:JRV] [TSXV: JRV] ( JRVMF ) [FRA: IHS] (formerly Jervois Mining)

No news for the month.

Upcoming catalysts include:

• End Q1, 2023 - Idaho Cobalt Operations to reach nameplate capacity production.
• Q1, 2024 - First production targeted from the São Miguel Paulista Refinery.

Electra Battery Materials [TSXV:ELBM] ( ELBM )

On December 22 Electra Battery Materials announced :

Electra launches Battery Materials Recycling Demonstration Plant at its Ontario Refinery Complex.....“Pending completion of the demonstration plant and a review of project economics, success would pave the way towards commercialization and the buildout of a 5,000 tonne per annum black mass processing facility within our battery materials park in Ontario using existing infrastructure, personnel, and lab facility. Combined with our planned production of cobalt, nickel, and manganese sulfates, commercialization of our black mass recycling capabilities will diversify our cash flow and customer base.” said Trent Mell, Electra’s CEO.

January 4 Electra Battery Materials announced : "Electra disposes of non-core Canadian mineral properties; retains royalty interest." Highlights include:

• "Electra has granted to Kuya the right to acquire a 100 percent interest in its remaining assets in the Canadian Cobalt Camp.
• To exercise this right, Kuya is required to make a payment in cash or in the equivalent value of its shares totaling $1 million to Electra on or prior to January 31, 2023. The equivalent value of Kuya’s shares will be based on the share price equivalent to the earn-in volume weighted average price prior to the issuance.
• Kuya has also agreed to enter into a royalty agreement with Electra whereby it will grant Electra a two percent royalty on net smelter returns from commercial production derived from the remaining assets.
• Electra will retain a right of first offer to refine any base metal concentrates produced from the Assets at Electra’s Ontario refinery."

January 11 Electra Battery Materials announced : "Electra releases Inaugural Sustainability Report, committing to Net-Zero Greenhouse Emissions by 2050."

Upcoming catalysts include:

• Early 2023 - Target to have their Ontario cobalt refinery operational with ore feed from Glencore.

Investors can view the company presentations here and a recent Trend Investing article on Electra here .

Possible mid-term producers (2024 onwards)

Sunrise Energy Metals Limited [ASX:SRL]( SREMF )(formerly Clean TeQ)

Sunrise Energy Metals has 132 kt contained cobalt at their Sunrise project.

On January 17, Sunrise Energy Metals Limited announced : " Quarterly activities report." Highlights include:

• " The Company continues to progress discussions with potential equity funding and offtake partners for the Sunrise Project.
• Award by the Department of Regional NSW of a $500,000 grant towards the Sunrise Project Oversize Transportation Corridor Study.
• Conditional approval by the Department of Regional NSW of the Company’s application for a further $10 million grant to support the development of the Sunrise Project electrical transmission line (ETL).
• Ongoing work streams to advance the fully integrated Sunrise Project continued with activities focused on: Work on the necessary NSW electricity grid connection agreement and power systems studies that are required as part of the ETL work scope. Commencement of the detailed Oversize Transportation Corridor Study. Test work and process development assessing opportunities for the potential recycling of spent battery materials.
• Field exploration activities were restricted during the quarter due to high rainfall experienced during the period. Key activities for coming quarters will focus on further drilling, sampling, analysis and geological interpretation activities across the Company’s large tenement package in the Macquarie Arc ."

Upcoming catalysts include:

• 2023 - Possible off-take agreements and project funding/partnering.

Investors can also read the latest company presentation here.

Australian Mines [ASX:AUZ] ( AMSLF )

On January 13, Australian Mines announced :

Federal Court approves resolution of ASIC action against Australian Mines.....The Federal Court today approved the previously announced agreement between Australian Mines and ASIC to resolve the Proceedings by the Company making certain admissions of contraventions of its continuous disclosure obligations, and paying a penalty of $450,000. The Company will also pay ASIC’s costs in the amount of $55,550.

Investors can read the latest company presentation here.

Upcoming catalysts include:

• End March 2023 - Targeted Collaborative Partnership agreement and Sponsorship to fund the company through to FID for the Sconi Project in Q1 FY26

Ardea Resources [ASX:ARL] ( ARRRF )

In total, Ardea has 5.9mt of contained nickel and 380kt of contained cobalt at their KNP Project near Kalgoorlie in Western Australia. Ardea is also exploring for gold and nickel sulphide on their >5,100 km2 of 100% controlled tenements in the Eastern Goldfields region of Western Australia.

No significant news for the month.

Upcoming catalysts include:

• 2023 - Possible off-take partner and funding for the GNCP Project. Further potential exploration results including also for lithium, rare earths, and nickel sulphide.

Investors can read the latest company presentation here.

Cobalt Blue Holdings [ASX:COB] ( CBBHF )

Cobalt Blue has 81.1kt of contained cobalt at their 100% owned Broken Hill Cobalt Project [BHCP] (formerly Thackaringa Cobalt Project) in NSW, Australia. LG International is an equity strategic partner.

For further details see: