March 19, 2018

Electric vehicle boom prompts Apple to get serious about securing cobalt

22 February 2018, 01:00 | Sam Montgomery

Apple reportedly looking to buy cobalt directly from miners

Apple believed to be trying to deal with cobalt miners

Citing anonymous sources, Bloomberg reports that the company is trying to secure contracts for several thousand tonnes of cobalt for five years or longer.

Bloomberg's source reported that Apple may not actually go ahead with a deal, as the parties involved are still only in the discussion phase.

Companies are rushing to get cobalt amid fears of a potential shortage, with the rising use of electric cars - whose batteries also use the metal - potentially limiting its supply.

Cobalt prices have skyrocketed of late due to an expected growth in demand for electric vehicles powered by lithium-ion batteries. Apple is one of the largest users, and until now it has been buying metal through the companies that make batteries for its devices. But as battery science continues to improve and battery quality control becomes ever more important, it's easy to believe Apple could want to exert more and more control over the manufacturing process - and locking down the necessary resources to do so would be a good first step.

Some materials companies are working on ways to recover and recycle cobalt from old and faulty batteries as alternatives to mining new supplies.

About Making Comments on our Site: Patently Apple reserves the right to post, dismiss or edit any comments. BMW is also close to securing a 10-year supply deal with an unnamed supplier in February. And yet, cobalt prices have tripled over the past 18 months.

Talking to reporters in London last December, Glasenberg said the company had held talks with Apple, Tesla (TSLA.O) and Volkswagen (VOWG_p.DE) as part of ongoing discussions with industrial clients.

Cobalt is a byproduct of copper and nickel mining, used until recently to harden steel and before its ability to efficiently conduct electricity was discovered.

"The problem has nothing to do with the amount of cobalt in the ground but rather the number of mines now producing cobalt", said Trent Mell, CEO of First Cobalt Corp, the world biggest cobalt exploration company. About 60 percent of the world's cobalt supply comes from the Democratic Republic of the Congo, and about 20 percent of it is mined by hand by children, Amnesty International reported in 2016.

Apple has increased its engagement with cobalt miners in recent years due to scrutiny from global human rights organizations.

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