Company consolidating general interest investment partnership
Through years of working with downstream users, including its strategic partnership with Beijing Easpring Material Technology Co.
(Easpring), the Company recognized that there is a pressing need to create a diversified, viable supply of material to offset the reliance from DRC sourced cobalt.
GEMC’s partnership with the battery cathode manufacturer is unique.
The company went downstream, direct to the supply chain to ensure that it receive project finance, metallurgical and feasibility support for projects and material purchase.
In addition to the demand from rechargeable batteries used in consumer electronics continues to be robust, the prospect of a booming Electric Vehicle market is expected to further increase upside demand potential with some estimates indicating that demand for cobalt to grow at an average rate of approximately 5-8% per annum for the next several years.
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).
Cobalt deposits can be found throughout the world and are most prominent in the African Copper Belt with over 60% of global cobalt production from a single country – the Democratic Republic of the Congo (DRC).
The use of lithium-ion batteries in the electric vehicle market has become the most important growth driver for cobalt demand.China controls the majority of refined global cobalt output and is reliant on the DRC for over 90% of its cobalt supply.There is a strong possibility of future geopolitical risk in the DRC resulting in significant material disruption to cobalt output with potential for a serious global cobalt supply squeeze In 2016 approximately 60% of cobalt mined was as a by-product of copper, 38% as a by-product of nickel, and the remaining 2% from primary cobalt mines.Expectation for projected battery consumption will account for 59% of all cobalt demand in 2020, representing a 58% increase in battery demand from 2016 levels (Darton Commodities, 2016).This growth in battery consumption is expected to principally come from increased electric vehicle demand.