Apple is going to buy cobalt exclusively from mining companies

Despite the fact that our planet is very large, there are still a limited amount of resources on it. Yes, for the present there is no critical shortage of any elements, minerals and other resources (of course, there are exceptions). But looking at the scale of the current industrial production, it becomes clear that the crisis is not far off. Many companies also understand this. One of them is the Apple corporation, which is now trying to negotiate with the mining companies about buying cobalt from them. This metal is very valuable - it is used in many industries.

But most of all it requires the battery industry. And since Apple is the largest manufacturer of mobile devices, it also requires a huge amount of cobalt. The situation with the deficit of this element (so far it is only planned) is intensified with the development of electric vehicles.

Massive batteries of such machines require large amounts of cobalt, so that manufacturers of mobile devices and batteries to them almost have to stand in a queue. In order not to stand in this queue along with everyone, Apple and conducts the negotiations in question. By the way, the production of batteries for mobile devices takes about a quarter of all the cobalt mined in the world. The growth of consumption of this element is growing all the time, and by 2030 it will exceed 300 thousand tons per year.

Apple needs several thousand tons of cobalt per year, which is quite a lot. And for this reason, the company, by hook or by crook, tries to negotiate with the companies that extract this element. And the negotiations did not begin now, the company began to make proposals to mining companies about a year ago. But then the agreement did not work out, so now I had to go on a new round of negotiations.

Among those who are trying to negotiate with cobalt suppliers are such giants as BMW AG, Volkswagen AG and Samsung. All these companies, and such many others, smaller in size, are competitors. And not only in the car or mobile devices market, but also in the mining market.

One of the world's largest cobalt mining companies is the Australian Mines Ltd. She has already agreed to cooperate with the South Korean company SK Innovation Co. The essence of the contract - direct supply of cobalt and nickel. Well, the amount agreed by the parties is $ 3.9 billion. SK Innovation Co. Will use these elements for the production of batteries for electric vehicles. Production is established in Hungary, so the company will redeem all cobalt and nickel produced by the partner for 13 years.

BMW is also close to concluding a similar deal for a period of 10 years. This became known thanks to the German media, who told about everything in early February. Interestingly, the phone's battery contains only 8 grams of cobalt. But in the battery of an electric vehicle it is 1000 times larger, so the desire of manufacturers of electric vehicles to obtain cobalt reserves becomes clear.

The cobalt price in the previous 18 months has tripled, reaching $ 80,000 per ton. Two thirds of the supplies come from factories and plants from the Democratic Republic of Congo. The situation in this country is not the most peaceful, therefore, by the way, there is always the threat of stopping mining.



Another problem for the final recipients of cobalt is that the supply chain of this element is quite large. And suppliers are often accused of cooperating with the governments of countries where child labor is permitted. In some cases, the regulator imposes a certain kind of sanctions, and the supply chain, if not broken, then passes along much less needed goods per unit of time than before.

Therefore, many companies are trying to find solutions to the problem, and in many different ways. Last year, the same Apple corporation began negotiating with companies that recycle old batteries. As for child labor, the corporation promised that it would “look after” the mines in the Congo, where cobalt is mined. True, this will happen only if Apple can negotiate with the mining companies.