Flash | 16 Nov 2025 15:34:41 ET │ 10 pages CMOC (3993.HK) What's New from Citi 2025 China Conference: KFM Phase 2 in Operation in 1H27E CITI'S TAKE We hosted meetings for CMOC on Nov 13th at our China Conference in Shanghai. Ms. Xinyi Liu, IR Manager, and Ms. Anna Zhu, IR Manager, attended the meeting. Below are our key takeaways. 3Q25 result – The higher net profit QoQ in 3Q25 and better than market expectation profit is mainly driven by lower effective tax rate, some realized cobalt sales volume, and stro ...

Core Viewpoint - The Democratic Republic of Congo (DRC), the world's largest cobalt producer, is set to end its months-long export ban and implement a strict export quota system starting October 15, 2023, which aims to manage cobalt supply and stabilize prices in the market [1][5]. Group 1: Export Quota Details - The new regulations allow mining companies in DRC to export slightly over 18,000 tons of cobalt for the remainder of the year, with annual export quotas set at 96,600 tons for 2026 and 2027 [2]. - This quota is significantly lower than DRC's projected cobalt production of nearly 220,000 tons in 2024, which accounts for about three-quarters of global output, indicating that future export quotas will not meet even half of the anticipated production [2]. Group 2: Quota Allocation and Adjustments - The export quotas will be calculated based on each company's historical export volumes, and 10% of the authorized export volume for 2026 and 2027 will be allocated for national strategic projects [3]. - The regulatory body, ARECOMS, retains the authority to adjust overall quotas based on market trends or the potential for local processing of cobalt hydroxide into higher-value products [3][4]. Group 3: Market Impact and Price Recovery - The export ban, initially implemented in February 2023 due to a price drop, has led to a price rebound of over 60% for cobalt, with prices for cobalt hydroxide more than doubling since the ban [5]. - The DRC's policy shift is interpreted as an effort to consolidate price recovery and establish market dominance, which will significantly impact the cost and supply chain strategies of global electric vehicle manufacturers and battery producers [5]. Group 4: Future Market Balance - The DRC government aims to achieve market balance through the new policy, with a target to reduce global cobalt inventories to approximately one month's demand [6]. - However, analysts warn that strict supply controls and high prices may drive battery manufacturers and automotive companies to accelerate the development of cobalt-free battery technologies, potentially diminishing DRC's strategic importance in the global cobalt market in the long run [6].