China's CMOC raises January-September cobalt output

Chinese diversified minerals producer China Molybdenum (CMOC) reported higher cobalt output during January-September.

The firm produced 11,100t metal equivalent of cobalt during January-September, up by 5.65pc from a year earlier in line with steady output growth at its Tenke Fungurume copper-cobalt mine (TFM) in the Democratic Republic of Congo (DRC).

Argus assessed prices for 30pc minimum cobalt hydroxide at $23.50-24/lb cif China on 26 October, up by 85pc from $12.50-13.20/lb cif China at the start of the year, mainly driven by slower than expected expansions of feedstock output capacity and shipment delays at South Africa's Durban port, a main transshipment port from the cobalt production hub of DRC to key cobalt feedstock consuming countries such as China and Finland, caused by the impact of the Covid-19 pandemic.

CMOC produced 15,436t metal equivalent of cobalt from TFM in 2020, down by 4.11pc from 16,098t in 2019. The company in February raised its cobalt production guidance to 16,500-20,100t of metal equivalent for 2021, up from 14,000-17,000t in 2020, because of a scheduled boost in its TFM output this year, which was delayed by the pandemic in 2020.

The firm in August unveiled a plan to invest $2.51bn in a new mixed ore processing project at its TFM copper-cobalt mine. The project will raise TFM's capacity by 200,000 t/yr metal equivalent for copper and 17,000 t/yr metal equivalent for cobalt when it starts production in 2023, from more than 200,000 t/yr for copper and 20,000 t/yr for cobalt currently.

CMOC is a major mining company for cobalt, copper, tungsten, molybdenum and niobium, owning mines in China, the DRC, Australia and Brazil. The firm acquired a 56pc stake in TFM from US-based base metals miner Freeport-McMoRan in 2016 and increased its stake in the mine to 80pc in 2017.

CMOC's other copper and cobalt assets include the Kisanfu copper-cobalt mine (KFM) in the DRC. CMOC acquired a 95pc share in KFM from Freeport-McMoRan by paying $550mn last December. It is partnering major Chinese battery manufacturer Contemporary Amperex Technology to develop the KFM mine.

CMOC also has a 30pc stake in Huayue Nickel Cobalt, a joint venture with China's key cobalt producer Huayou Cobalt and stainless steel producer Tsingshan in Indonesia's Sulawesi. Huayue is constructing a high-pressure acid leaching plant to produce mixed hydroxide precipitate in Indonesia, which has a capacity of 60,000 t/yr of nickel metal equivalent and 5,000 t/yr of cobalt metal equivalent. It is scheduled to come on stream by the end of this year.