Coronavirus threatens cobalt supply in the DRC

: Metals
20/03/23

A coronavirus outbreak in the Democratic Republic of Congo (DRC) could threaten global cobalt supply as the government identifies cases in the southern mining region.

Authorities in the DRC today put the province of Haut-Katanga in the south of the country under a temporary lockdown because of a potential coronavirus outbreak. Lubumbashi, the DRC's second largest city and a cobalt transport hub, is now on lockdown. Cobalt mining firm Chemaf, which is located in the province, is complying with the order, according to multiple sources.

Two people tested positive following a flight from Kinchasa that contained over 70 people.

The neighbouring province of Lualaba is home to mines belonging to trading firm Glencore, Eurasian Resources Group (ERG) and diversified metals producer China Molybdenum, and provides the bulk of the DRC's cobalt. Most concessions are located around the city of Kolwezi.

The lockdown of Haut-Katanga and in particular Lubumbashi will make it difficult to move material through regular trade routes during the next 48 hours. It is unclear whether the lockdown will continue for longer.

The prospect of a wider outbreak in the DRC was described as "terrifying" by one cobalt buyer in Europe familiar with the region. It added that given the level of development in the country, "some seriously bad things could happen" if an outbreak were to occur in a similar way to Italy. Traders in Europe became increasingly reluctant to sell cobalt metal today as news of the lockdown spread, aware that prices could rise sharply if supply from the DRC is cut off.

Glencore confirmed that none of its operations have been closed, and so far China Molybdenum and ERG have not announced any shutdowns. One producer in the Kolwezi area said "all the evidence from other outbreaks points to the situation getting worse before it gets better."

Elsewhere in the cobalt supply chain, ports in South Africa are being subjected to tighter restrictions

Argus last assessed cobalt hydroxide prices at $9.80-10.60/lb cif China on 17 March, down from $10-11.20/lb cif China at the beginning of March.

By Thomas Kavanagh

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24/11/12

EU steelmakers ask for scrap export curbs

London, 12 November (Argus) — European steel producers association Eurofer continues to lobby the European Commission to curb scrap exports as the industry looks to decarbonise. On 12 November, Eurofer reiterated its view that the commission "recognise steel scrap as a strategic secondary raw material under the critical Raw Material Act, ensure the robust implementation and effective enforcement of the revised EU Waste Shipment Regulation to ensure compliance with the EU environmental standards in third countries and avoid circumvention, while securing a sustainable and diversified raw materials supply by leveraging bilateral Free Trade Agreements, granting reciprocal market access and eliminating illegal export bans and other distortions." EU scrap consumption is due to increase significantly in the coming years. "Scrap exports to third countries without comparable environmental and social standards [therefore] need to be restricted to ensure that the use of ferrous scrap generated in the EU contributes to sustainability objectives aligned with the EU ones," Eurofer said. The EU has long been a net exporter of ferrous scrap, with outflows of the material standing just shy of 11mn t in the first eight months of this year, customs figures show. Last year the EU exported 17.67mn t of ferrous scrap, a 5pc rise on the year. The bloc's trade has always been heavily focused on Turkey, the world's largest importer of ferrous scrap, with annual trade ranging from over half to two-thirds of total exported volumes in the past five years. Turkey, with around three-quarters of steel production based on electric arc furnace route, is heavily reliant on European-origin material. Turkey's share of EU exports increased in recent years after the UK left the EU, but the share of shipments from the bloc started rising from the second half of the mid-2010s, when Russia, another major ferrous scrap supplier to Turkey, started restricting exports. Russian exports of scrap to Turkey fell from around 2.5mn t in 2018, to 1.9mn t in 2019 and 2021 and to just over 400,000t in 2022-24. The EU's major trading partners for scrap include Egypt, India and Pakistan, all of which are third countries to the EU and non-OECD countries whose import volumes have been increasing as Asia continued to grow its steelmaking capacities, mostly through the IF (induction furnace) route. The EU's intention to restrict scrap exports has been deeply unsettling for the many developing markets' representatives, as much as its movement towards the implementation of CBAM (Carbon Border Adjustment Mechanism), which will reduce the possibility of exports to the EU from countries where steelmaking processes and carbon emissions are not compliant with the EU's stricter standards. By Corey Aunger and Katya Ourakova Annual EU-27 ferrous scrap exports metric tonnes Country 2020 2021 2022 2023 2024 Turkey 11,247,281.0 12,676,091.0 10,327,403.0 10,088,491.0 6,826,876.0 Egypt 1,076,930.0 1,810,866.0 1,431,831.0 1,570,352.0 1,237,722.0 India 443,130.0 294,994.0 1,108,881.0 1,906,608.0 576,008.0 Pakistan 853,178.0 727,466.0 700,879.0 731,182.0 371,943.0 Switzerland 455,034.0 511,098.0 463,440.0 339,894.0 355,709.0 Norway 314,627.0 294,956.0 396,933.0 451,873.0 309,299.0 Morocco 197,803.0 329,901.0 556,417.0 442,498.0 258,630.0 UK 361,741.0 307,281.0 307,173.0 275,125.0 203,786.0 US 622,523.0 574,264.0 316,077.0 694,507.0 182,064.0 Moldova (Rep. of) 251,184.0 344,609.0 79,788.0 192,964.0 179,579.0 Republic of North Macedonia 74,951.0 106,400.0 112,176.0 165,404.0 115,626.0 Bangladesh 107,611.0 149,570.0 700,108.0 388,936.0 91,410.0 Total 16,371,459 18,542,680 16,843,989 17,674,602 10,822,245 2024 data for January to August — Customs and Eurostat data Turkey's total and European scrap imports, 2010-24 Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Japan’s scrap export tender slips in November

24/11/12

Japan’s scrap export tender slips in November

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Peru bets on trade ties with Asia as Apec starts

24/11/11

Peru bets on trade ties with Asia as Apec starts

Lima, 11 November (Argus) — Heads of 16 countries are in Peru this week to kick off the Asia-Pacific Economic Cooperation's (Apec) annual Leaders Week, as government officials in Lima look to grow their partnerships with Asia while staving off potentially disruptive strikes. The summit comes at a fragile time for Peru, where President Dina Boluarte has a historically low presidential approval rate of 4pc and bus drivers and small business owners are demanding protections from a wave of extortion. The event begins today with meetings among senior officials of the 21 member countries and closes on 16 November with the leaders' meetings, the pinnacle Apec event. With the confirmed arrival of Chinese president Xi Jinping later this week, the summit is likely to strengthen ties between Peru and Asia, amid US concerns of China's growing influence in Latin America. US president Joe Biden is also expected to travel to Lima from 14-16 November, according to the White House. He is then slated to go to Manaus and Rio de Janeiro to meet with Brazilian president Luiz Inacio Lula Da Silva. This week is also the scheduled ribbon-cutting of the Chancay megaport, a $1.3bn commercial hub north of Lima that will cut the transport time between Latin America and Asia from 35 days to 25 days. Cosco Shipping, the Chinese state-owned port operating company, owns 60pc of the project and the rest is owned by Peru mining company Volcan. It aims to become the main commercial port in the Pacific for neighboring Brazil and has a 17.8-meter depth, the greatest in Latin America. While the port will be inaugurated on 14 November, Cosco Shipping has said operations are expected to begin in early 2025. Peru's priorities for Apec include trade investments and the energy transition, with a focus on its critical mining sector — and workers' transition to the formal economy in Peru, where the informality rate is about 73pc. These goals extend to the CEO Summit, which is running simultaneously and will host hundreds of business leaders from Asia looking to invest in Peru's energy and mining sectors. Angel Manero, Peru's agriculture minister, said last week the government expects to approve sanitary protocols with China to export nuts, with the potential of expanding to meat imports, according to the official gazette. He added there are talks with China about attracting investments through the creation of Special Economic Zones. Peru last hosted the Apec in 2016. This time, workers in Lima — led by bus drivers' unions — have vowed a three-day strike during Apec to call attention to a string of killings they say are linked to resistance to extortion. Among their main asks is repealing a recent law approved by congress that they say weakens prosecution of organized crime by, among other things, changing its definition to exclude crimes of extortion. Prime Minister Gustavo Adrianzén has repeatedly asked workers not to strike to avoid "a bad show" during the high-level meetings. By Bianca Padró Ocasio Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

UK's Liberty Speciality Steel could go insolvent

24/11/11

UK's Liberty Speciality Steel could go insolvent

London, 11 November (Argus) — The UK's Liberty Steel's Speciality Steel business is likely to go insolvent if its creditors do not approve a restructuring plan, the company said in a letter to creditors. The company's creditors will vote on the restructuring plan in the coming months and, if accepted, the plan will be in action on about 12 February 2025. Liberty Speciality's electric arc furnace, at Rotherham in Yorkshire, has melted less than 50,000t this year and has not operated since July, sources close to the company told Argus . The plant has capacity of more than 1mn t/yr. In its letter to creditors, Liberty said part of its financial distress "stems in part from a change in the appetite of some of its largest customers to continue to pre-fund" and pay prices agreed in July 2023. The company has been concentrating solely on the aerospace industry, where some of its customers had been making pre-payments of up to 80pc. Speciality Steel at present is subject to a winding up petition, filed on 8 October, by Harsco Metals Group and supported by other creditors Swallownest Engineering, Kings of Rotherham and RS Components. Harsco is owed about £4mn, according to sources close to the company. The petition is listed for a hearing at the High Court on 20 November, and the company intends to seek the withdrawal of the petition or adjournment of the hearing pending the outcome of its restructuring plan. Some creditors have already stated their intention to support the plan, Liberty said. Two Liberty customers have agreed, in principle, to make funding available to allow Speciality to continue trading "up to and beyond the point at which it is currently anticipated that the restructuring plan would come into effect", the company said. This would involve two upfront cash payments and "accelerated delivery premiums". Liberty's parent company, the Gupta Family Group Alliance, has reached an agreement in principle with two prospective lenders for Speciality and is in negotiations with a third. The funding, none of which is committed at present, is subject to the restructuring plan being sanctioned. The plan has no impact on the company's employees, Liberty said. The company has been operating its own short-time working policies at Speciality given low production levels. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

China, Indonesia to strengthen mineral, renewable ties

24/11/11

China, Indonesia to strengthen mineral, renewable ties

Beijing, 11 November (Argus) — China and Indonesia have agreed to strengthen co-operation in the critical mineral and renewable energy sectors, during new Indonesian president Prabowo Subianto's first visit to the country since taking power last month. "The two sides will tap the potential to co-operate in new energy vehicles, lithium batteries and photovoltaics," according to a joint government statement issued during Prabowo's visit to Beijing on 8-10 November. China will support Indonesia's efforts to speed up the transformation of its energy sector and will carry out more "high-quality" co-operation with Indonesia in the digital economy, clean energy industry and energy infrastructure sectors, the statement said. "Indonesia welcomes Chinese enterprises to invest in Indonesia and we look forward to closer co-operation in various fields," Prabowo said at a China-Indonesia business forum on 10 November. Prabowo chose China as his first overseas destination as president, reflecting growing investment ties between the two countries. Chinese companies have set up more projects in Indonesia in recent years, especially in the electric vehicle power battery industry and steelmaking sectors. Major Chinese lithium cathode precursor manufacturer Green Eco-Manufacture (GEM) signed a deal with mining firm Vale Indonesia to develop a high-pressure acid leaching (HPAL) project in Sulawesi during Prabowo's visit. The project will produce mixed hydroxide precipitate (MHP), a key feedstock in the production of battery cathodes. Indonesia is the world's largest nickel producer. The country's share of global output could reach 60.6pc in 2024 and 62.8pc in 2025, mainly thanks to rising production from Chinese-backed projects, according to the International Nickel Study Group (INSG). Chinese battery cathode material producer Changzhou Liyuan in early October signed an agreement with the Indonesia Investment Authority (INA) consortium to expand capacity of its lithium iron phosphate plant in Indonesia to 120,000 t/yr by 2025, from 30,000 t/yr in the existing first phase. The Indonesian project is likely to become the biggest LFP plant outside China. Chinese companies are also seeking to secure more aluminium supplies from Indonesia. East China-based Nanshan Aluminium is expanding production capacity at its alumina refinery in Indonesia's Bintan industrial park and is also building a 250,000 t/yr refined aluminium plant in the country. State-owned Chalco is building a 1mn t/yr metallurgical alumina plant in Indonesia, while Tianshan Aluminium is working on an alumina plant in the country that will produce 1mn t/yr in its first phase. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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