2025-09-22 02:02Summary of Key Points from the Conference Call Industry Overview - Industry: Cobalt and Nickel Production in the Asia Pacific region, specifically focusing on the Democratic Republic of the Congo (DRC) and its impact on Chinese producers [2][8] Core Insights - Cobalt Export Ban: The DRC has extended its cobalt export ban until October 15, 2025, which will be followed by export quotas [2][8] - Global Production Impact: The DRC accounted for over 70% of global cobalt production in 2024. The new quotas are expected to lead to a significant supply decline in 2026-27 [2][8] - CMOC Sales Projections: CMOC sold 109,000 tons (kt) of cobalt in 2024 and 46kt in the first half of 2025. Assuming a quota similar to the national level, CMOC could sell approximately 8.6kt in Q4 2025 and around 43.6kt in 2026-27 [2][8] - Nickel Smelters' Advantage: Nickel smelters in Indonesia using laterite nickel ore and the High Pressure Acid Leach (HPAL) method can obtain about 10% cobalt as a byproduct. This is expected to benefit them from potential cobalt price increases [3][8] - Production Estimates: Huayou's cobalt production from its Indonesian smelting operations is estimated to be around 20kt in 2025 (11kt attributable), while GEM's production is estimated at 12kt (6kt attributable) [3][8] Additional Important Information - Export Quota Details: The maximum export amount is set at 18,125 tons for 2025, with a breakdown of 3,625 tons for October and 7,250 tons for both November and December. For 2026-27, the maximum export amount is projected to be 96.6kt, which is about 40% of normal production levels [8] - Quota Distribution: Quotas will be allocated to companies based on historical export volumes, excluding those that exported less than 100 tons in 2024 or whose cobalt resources have been depleted [8] Industry Rating - Overall Industry View: The Greater China Materials sector is rated as Attractive, indicating a positive outlook for the industry over the next 12-18 months [5]