Core Viewpoint - The cobalt supply chain is undergoing significant changes due to the lifting of the export ban by the Democratic Republic of the Congo (DRC) and the implementation of an export quota system, which is expected to lead to a substantial increase in cobalt prices in the coming years [2][4][10]. Export Ban and Quota Management - The DRC announced that the cobalt export ban, which lasted for nearly eight months, will be lifted on October 16, with an annual export quota management system introduced [2][3]. - The export cap for the remainder of 2025 is set at 18,125 tons, with future quotas for 2026 and 2027 being significantly lower than the country's production capacity [3][4]. - The quota system is based on the export performance of companies in 2022, 2023, and 2024, with penalties for non-compliance [3][4][7]. Price Impact and Market Dynamics - The lifting of the export ban and the introduction of quotas are expected to tighten global cobalt supply, leading to a projected shortage of 122,000 tons, 88,000 tons, and 97,000 tons in 2025, 2026, and 2027 respectively [2][10]. - Cobalt prices have already doubled this year, with the latest price for electrolytic cobalt in China reaching 349,500 yuan per ton [9]. - Analysts predict that the combination of supply constraints and rising demand from sectors like electric vehicles and consumer electronics will further drive up cobalt prices, potentially exceeding 400,000 yuan per ton [9][10]. Strategic Implications for Companies - Major cobalt producers like Luoyang Molybdenum and Glencore are set to receive significant export quotas, but these may still fall short of their production capacities [10]. - The DRC government aims to control global cobalt prices through flexible supply adjustments, which could benefit companies with operations in Indonesia and those holding mining rights in the DRC [10].