Abstract
Optimistic short-term outlook for cobalt prices
World production of cobalt has increased steadily year-on-year, and has almost
trebled from around 20,000t in 1995 to an estimated 54,000t in 2005, an
average rate of growth of over 12%py. Since 2002, the strongest growth in
production of cobalt has come in China, where output grew at over 60%py to
12,700 in 2005, as a result of expansions by domestic producers. Other recent
increases have come from new projects including Voisey' s Bay in Canada (Inco),
Coral Bay in the Philippines (Sumitomo) and Sally Malay in Australia (Sally
Malay and Sumitomo). Estimates put world demand for cobalt at around 56,000t
in 2006, up from around 54,000t in 2005 due to continuing demand from Asia.
The major end-use for cobalt continues to be in superalloys, which, after a
recovery in the aerospace industry since 2002, represented 22% of total
consumption in 2006. However, growth in the secondary battery market,
particularly lithium-ion products, has caused demand in that sector to rise
rapidly from 11% in 2003 to almost 22% in 2006. The short-term outlook for
cobalt prices seems optimistic as demand for cobalt is expected to continue to
grow strongly in 2007 and 2008, while supply may struggle to keep up, as most
of the major projects in development are not due on-stream until 2008.
The key trends, issues and developments in the market are analysed in this
major new report from Roskill. It provides a clear insight into the industry
and its trends, and an authoritative analysis of the prospects for the future.
What the report gives you
- Independent, in-depth research and analysis
- Essential market intelligence for successful business planning
- Detailed survey of production and processing in 35 countries
- Up-to-date profiles of the activities of over 90 current and potential
cobalt producing and processing companies, including OM Group, Jinchuan
Non-ferrous Metals, CVRD Inco Ltd. and ZCCM
- Forecasts for end-use consumption and world supply and demand
Report highlights
Growth in future production of cobalt is increasingly dependent on nickel and
copper projects, which are themselves dependent on demand for the primary
metals produced. The potential additional capacity for 2007 is around 5,500t
with the Ravensthorpe and Browns nickel-cobalt projects in Australia almost
certainly coming into production However, the timing of these projects may
mean that output from these projects will not enter the market until 2008.
Global demand for cobalt was split fairly evenly in 2001, with Europe leading
the way, accounting for around 30% of consumption, followed by the Americas
(29%) and Japan (20%), while the rest of the world represented less than 20%
of demand. By 2006, the breakdown of world cobalt consumption had changed
significantly, principally due to rapid growth in demand in emerging Asian
economies. China' s share of world consumption of cobalt increased from 3% in
1997 to 20% in 2006.
Demand for cobalt in catalysts has exhibited significant growth in recent
years on the back of strong demand for cleaner fuels, particularly low-sulphur
diesel, polyester fibre and PET production, and in the gas-to-liquid
conversion process.
While the developed economies in North America and Europe are forecast to show
lower rates of growth in demand for cobalt pigments, the developing economies
in Asia and other regions have a much greater potential for growth. Overall,
growth in these markets will probably be around 4%py worldwide, adding around
1,000tpy to cobalt demand in pigments by 2011.
The medium-term outlook for demand for cobalt appears to be optimistic,
although there could be some factors that slow any growth. While high oil
prices could affect world economic growth, there may also be a desire on the
part of the Chinese government to control any further development in order to
prevent the economy overheating.
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