Katanga Mining Ltd Ord KATFF

Cobalt Price Forecast

[Sogosohubidu201]

"China Molybdenum warned in its annual report that it expected cobalt prices to decline in the first half of 2019 as supplies of metal and upstream cobalt products continue to outweigh demand. Plus, metals analyst firm CRU has forecast there will be a small surplus in supply over the next few years before moving into under supply over the mid-term as demand from electric vehicles starts to really take off. China Molybdenum has said ‘consensus price forecasts suggest cobalt prices should range between $20-$30’ per pound (note: $44,000 - $66,000 per tonne) going forward, suggesting there is room for the price to improve from its current low level."

[Lech1988]

I wonder how they came up with this "small surplus" estimation.  The market is oversupplied this year despite KAT export issue.  If the build up of production from 4Q18/Cal19 (circa 30kt) is exported in 1Q19 (doubtful) and they are free to export freely all new production in Cal20 this is an enormous amount of supply hitting the market.  There is nothing "small"

[Sogosohubidu201]

@Lech, if you dig further, actually CRU's estimates are not unreasonable. The key is that cobalt use in EV was double last year from 8k tonnes in 2017 to 16k tonnes in 2018, and looks like going to be double again this year over 2018 from 16k tonnes in 2018 to 32k tonnes in 2019 based on the preliminary data in the first three months of GWH installation in EV. When I have time later, I can add

[Lech1988]

Ok if those are the true demand estimates than the numbers certainly make more sense.  Just read this on BBG this morning from the Shanghai Battery Metals Conference; "Cobalt had rocketed to a decade-high of about $44 a pound last April amid fears of a shortage as the electric-vehicle industry expanded in China, but the spike also supercharged mining activity in the Democratic Republic

[Sogosohubidu201]

Re: Lech. One of the best persons to judge the supply and demand of cobalt is Nick French who has been trading cobalt for his entire career.  He is sitting in the board of Cobalt 27. So investors and traders need to pay attention to Cobalt 27 CEO who predicted early this year that cobalt price would rise to $25 per pound ($55,000 USD per tonne) in the 2nd half of this year and next year, but

[Cassius1977]

Just one thing I'd like to clear up.  I believe the 27 000 tonnes of cobalt KAT has is cobalt hydroxide, which is about 50% heavier than Cobalt.  In other words the cobalt contained in the stockpile is about .66 of the weight........still a big stockpile,  but not as large as some might think.