Is cobalt the commodity of the future?
If the vision of Elon Musk comes to fruition, cobalt will become an important commodity for the mining industry in the future.
The billionaire genius recently unveiled Powerwall, a home battery that give homeowners the ability to get off the commercial power grid entirely by storing surplus electricity generated from solar panels during the day or from the utility grid when rates are low.
Unlike Tesla's electric cars, Musk has stated Powerwall will use a more powerful battery consisting of nickel, manganese and cobalt. If the home battery takes off like many people expect it to (there are 38,000 reservations for the home battery pack so far), Tesla may require up to 10,000 tons per year of cobalt. At that rate, Tesla will account for roughly 10 percent of the current global market.
“The new currency for smart commodity investors will be cobalt, which is poised to play a growing role in everyone’s life if the vision of American billionaire Elon Musk to have a Tesla Motors battery powering homes comes to fruition,” said Andrew Critchlow, commodities writer for The Telegraph.
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Cobalt is commonly produced as a by-product from either copper or nickel. According to the U.S. Geological Survey, the Democratic Republic of Congo accounted for half of the global production for cobalt in 2014. Current leading producers include Freeport-McMoRan, Lundin Mining and Fortune Minerals.
In their recent market overview report for investors, commodities team at Macquarie wrote: “Many peer commodities would be more than happy with that relative growth coming from all consumer sectors combined, never mind just one alone. With a steadily improving demand profile, we do expect it to receive increased attention over the coming two years.”
Musk continues to thrust the renewable energy industry forward and the payoff could be in the hands of the mining industry.
As the demand for electric cars continues to grow -- 740,000 units sold last year -- and new incentives to consumers to shift away from fossil fuels for transport and electrification are on the horizon, more mining companies are preparing for a climate change in business.
Cobalt is the one commodity that should be on everyone’s radar.
Axora launches global challenge for digital technology
Axora is launching the world’s first international competition to discover new cost-saving digital technology for industrial companies, which can produce rapid benefits within a year.
The Metals & Mining and Oil & Gas sectors have recently experienced budget cuts of 20% on average, driven by a variety of factors including the global pandemic, slump in demand and price wars. The Axora Cost-Saving Technology Challenge aims to transform these industries by discovering innovative, digital solutions that reduce cost fast and pay for themselves, whilst achieving the same or improved productivity, health and safety and sustainability standards.
“While digital solutions can help to get work done quicker and more cost-effectively, they typically require a three-year ROI, and if there’s no flexibility in the budget, a full budget planning cycle is needed to get things moving”, said Dr. Nick Mayhew, Chief Commercial Officer, Axora.
“Yet, extra financial cost is often incurred in delaying digital projects, so customers have asked us to highlight solutions that can have an ‘in year payback’ whereby the cost spent on the solution and deployment will be more than recovered within the budget year - this accelerates the timeline and drives positive business impact, quickly.”
The Axora Cost-Saving Technology Challenge
Axora is keen to learn of any digital cost-saving innovation which: meets the 12-month payback timeframe; can be deployed in any part of the value chain including upstream, downstream or midstream oil and gas, metals processing or mining; and is ready for market. The Axora Cost-Saving Technology Challenge is open to entrepreneurs, start-ups, academics and sector leaders across the world. The competition will be judged by a panel of leading industry experts.
“We’re passionate about supporting our industries and customers through all forms of digital transformation and the cost-saving solutions we are searching for could also provide a lifeline to many mining and metals and oil and gas companies in the current economic climate,” added Dr. Mayhew.
Improving productivity, safety and sustainability
Up to ten finalists will be chosen to pitch their solutions at a digital pitch day later this year, after which Axora will validate the ROI models and vet the solutions. The winner will receive the ‘Axora Market Accelerator’ sales and marketing package worth £10,000. This includes a two-hour workshop, promotion through Axora’s thought leadership content and inclusion into its digital demand engines, providing the opportunity for the winning solution to benefit thousands of industrial companies. Entries are open until May 31. Full details of the competition including terms and conditions can be found here.
To learn more about the Axora B2B digital solutions marketplace read our feature in the latest issue of Mining Global magazine.