Market diagnosis: The global cobalt market has entered a structural deficit driven by the DRC's 96,600t/year export quota — less than half of 2024 production levels. With LME cash at $56,290/mt and a projected deficit of ~10.7kt (Fastmarkets), the supply pipeline from the DRC is critically constrained. Indonesian MHP growth provides partial offset but cannot close the gap. This report provides procurement-specific guidance with quantified scenario analysis and forward contract recommendations.
The deficit is structural through at least end-2027 under current quota framework. Glencore's 2027 allocation (18,800t, -17.5% vs 2026) signals further tightening. The buyer position is DEFENSIVE — maintain coverage at current levels while preparing for asymmetric upside risk if quotas are tightened further or administrative delays compound on the June 30 forfeiture deadline.