Tesla joins Fair Cobalt Alliance in Congo
Tesla has recently appeared on the list of members on the Fair Cobalt Alliance (FCA) website. It joins companies including the mining major and trader Glencore and the Chinese cobalt refiner Zhejiang Huayou Cobalt in backing the initiative, which aims to improve working conditions and end child labour in mines in the Democratic Republic of Congo (DRC).
The DRC produces approximately 70% of the world’s cobalt, but the industry’s clients - predominantly makers of cars and batteries - have become concerned by reports of unethical practices in the country’s mines. Child labour is particularly widespread at informal, artisanal mines, where cobalt is often dug by hand.
Rather than refusing to work with small mines, which creates tens of thousands of jobs in DRC, the Organisation for Economic Cooperation and Development (OECD) has said that it is better for companies to engage with the informal cobalt sector, to try to push for changes. The Fair Cobalt Alliance has been created to make this happen, by lobbying for smaller mines to pay fairer wages and adhere to international practices.
Global demand for cobalt is predicted to grow in the next few years, as Tesla expands into China and Europe, and Volkswagen and BMW develop their own ranges of electric vehicles.
Lynas revenue jumps 21% as rare earth prices jump
Australian miner Lynas Rare Earths posted a 20.6% rise in revenue in the March quarter as selling prices for the key metals it mines hit record highs amid strong demand, particularly for neodymium and praseodymium (NdPr).
NdPr is used in magnets for electric vehicles and windfarms, in consumer goods like smartphones, and in military equipment such as jet engines and missile guidance systems.
The company said it plans to maintain production at 75% however, as it seeks to continue to meet covid-19 safety protocols and grapples with shipping difficulties. Shares in Lynas fell 6.1% after the results.
“They have faced a few logistics issues, and it would be good to know when they are going to start lifting their utilisation rates a bit,” said portfolio manager Andy Forster of Argo Investments in Sydney.
“Pricing has been pretty strong although it may have peeled back a bit recently. I still think the medium, long-term outlook is pretty good for their suite of products.”
Lynas post ed revenue of A$110mn ($85.37mn) for the three months to the end of March, up from A$91.2mn a year earlier as prices soared.
It said its full product range garnered average selling prices of A$35.5/kg during the March quarter, up from $23.7 in the first half of the financial year. “While the persistence of the covid crisis, especially in Europe, calls for careful forecasts for our business ahead, we see the rare earth market recovering very quickly,” said Lynas, the world’s largest rare earths producer outside China.
Freight demand has spiked during the pandemic, while the blockage of the Suez Canal in March delayed a shipment to April.
Lynas’ output of 4,463 tonnes of rare earth oxide (REO) during the quarter was marginally lower than 4,465 tonnes from a year earlier.