Glencore issues force majeure on cobalt supply after South Africa flooding

The world's largest cobalt producer Glencore is unable to fulfil contractual deliveries of cobalt hydroxide out of the Democratic Republic of Congo after severe flooding in South Africa hit warehoused goods and impacted logistics.

Heavy rainfall started on April 8 and has caused widespread damage throughout the KwaZulu Natal province, including Durban, which hosts the main port for cobalt hydroxide exports trucked from the DRC.

"The force majeure is Durban related, nothing to do with production," a source with knowledge of the matter said.

Moving product to the ports and on to vessels was a "disaster" while there was damage to inventories in "one warehouse", the source added.

"Everyone is in assessment mode," a second supplier added.

Cobalt hydroxide prices are currently at record levels.

Platts assessed 30% Co cobalt hydroxide at $34/lb CIF China April 19 for spot cargoes aligned to Platts methodology, loading 15-60 days out, according to S&P Global Commodity Insights.

This price has held flat since March 29, but was up from $10/lb on May 6, 2021, when S&P Global's assessment began.

Glencore produced 31,300 mt of cobalt in 2021, up 14% on the year after the limited restart of Mutanda in the DRC.