China runs the kitchen of the global cobalt market, sort of. It refines 78% of the world's supply but barely digs any of it up.
That weak spot is now showing. The Democratic Republic of Congo, where most of the raw material comes from, just handed Chinese miner MMG a quota the company says doesn't work, and MMG is asking Kinshasa for clarity along with the rest of China's battery supply chain.
The Congo Squeeze
Congo banned cobalt exports in February 2025 to push prices back up after a years-long glut. In October 2025, it swapped the ban for a quota system that lets shipments leave but only in capped amounts.
The 2026 cap is 96,600 tons total, with a 10% strategic allocation set aside by the government. Each company's slice is based on what it shipped over the three years through 2024.
The squeeze worked. The CME cobalt price has climbed from $10 a pound in early 2025 to $25 today.
Cobalt hydroxide, the raw input most Chinese refiners use, is now trading at 100% of the metal price after sitting at 55% in February, which means refiners are paying roughly double for the same input.
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Why China Is Stuck
China spent years buying up huge pieces of Congo's mining sector. CMOC Group alone has put roughly $9 billion into Congolese copper-cobalt projects, and under the new rules, CMOC can only export about a quarter of what it shipped in 2024.
The backup supplier is Indonesia, which mines cobalt as a byproduct of nickel. Even with higher Indonesian output this year, the gap from Congo is too big to close.
US policy is making the squeeze worse. Washington helped broker a peace deal between Congo and Rwanda, and it's also taking a stake in a joint venture to market Congo's government share of copper and cobalt, with right of first refusal going to US buyers.
That sets up direct competition for the same Congolese metal Chinese refiners are scrambling for.
Worth Noting
China runs the kitchen of the cobalt market, and Congo runs the farm. The kitchen is just learning the farm can name its price.
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