Chinese Mining Giant’s Control Over Cobalt Supply Sparks US Concerns

A Chinese mining company, CMOC Group, has gained control of more than a third of the world’s cobalt supply, causing concern in the United States over the implications for key industries, the Wall Street Journal reports.

Cobalt, a critical metal used in electric vehicle (EV) batteries and military technologies such as jet fighters and drones, is now largely in the hands of CMOC, whose dominance is raising alarms about the US and other countries being cut off from essential supplies.

CMOC’s rapid rise in the global cobalt market, largely through its acquisitions in Africa, has prompted US officials to accuse the company of market manipulation. By flooding the market with cobalt, critics argue, CMOC is discouraging other investors from producing the metal, making it more difficult for competitors to operate. Jose Fernandez, US State Department undersecretary for international energy policy, described the company’s actions as “predatory,” warning that it could undermine America’s transition to cleaner energy.

CMOC, however, defends its position, saying its increased cobalt production is a natural consequence of its copper mining operations, as cobalt is often a byproduct of copper extraction. The company insists that its actions are driven by responsible business practices and denies attempting to corner the cobalt market. A representative from CMOC noted that cobalt demand is evolving, with cobalt-free EV battery chemistries becoming more common, which reduces the significance of their cobalt dominance.

The company’s prominence stems from major deals made in the Democratic Republic of Congo, including the purchase of a massive cobalt mine from US-based Freeport-McMoRan. These acquisitions have allowed CMOC to surpass Switzerland-based Glencore as the top cobalt producer globally, with plans to control 38% of the global cobalt supply by 2024.

The expansion of CMOC highlights China’s broader strategy of securing resources essential for its manufacturing sector, especially in the growing electric vehicle market. China’s largest EV battery maker, CATL, owns a significant stake in CMOC and holds two seats on its board, further strengthening China’s grip on the cobalt supply chain.

As cobalt prices have dropped to eight-year lows, Western officials argue that CMOC’s continued production surge is discouraging investment in alternative cobalt sources. In the US, efforts to establish domestic cobalt production, such as Jervois Global’s operations in Idaho, are facing challenges due to unprofitable market conditions.

In response to China’s dominance, the US and its allies, including Canada and Australia, have launched initiatives to secure critical minerals like cobalt. Vice President Kamala Harris has proposed creating a national stockpile of such resources, reflecting growing concern over supply chain vulnerabilities. Some industry experts argue that without stronger intervention, the US may struggle to compete with China in securing a reliable cobalt supply.

CMOC’s rise reflects broader trends in China’s global expansion, supported by state-backed loans and strategic investments in resource-rich regions. With its growing influence in both cobalt and copper markets, CMOC’s operations are closely aligned with China’s national ambitions to lead in electric vehicle production and advanced technologies.