Must adapt to shifts in innovation, geopolitics, and ethics.

Cobalt is undergoing a strategic transformation in 2025 as evolving battery chemistries, reshaped supply chains, technological advances, and stricter regulations shift its role in the energy transition. As market forces change, cobalt's importance is less about supply volume and more about resource security and geopolitical factors.

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The United States remains a marginal producer of cobalt. In 2024, just 300 metric tons were recovered, mostly from processing stockpiled material after the nation's only burgeoning primary cobalt mine, Jervois Global's Idaho Cobalt Operations, was idled in 2023 amid price slumps and tough market conditions.

However, with renewed federal interest and growing awareness of domestic supply risks, another attempt to advance Idaho Cobalt to commercial production is increasingly plausible.

In the meantime, Lunding Mining's Eagle Mine recovered some cobalt as a byproduct of the copper and nickel.

"In 2024, the Eagle Mine, a nickel-copper mine in Michigan, produced cobalt-bearing nickel concentrate, which was exported to Canada or overseas for processing," according to the United States Geological Survey (USGS). "About five companies in the United States produced cobalt chemicals."

An estimated 8,500 metric tons (18.7 million pounds) valued at $260 million was consumed in the U.S. during 2024. Roughly 2,000 metric tons (4.4 million lb) of that cobalt was recovered through recycling, especially from spent lithium-ion batteries.

"In 2024, cobalt content of purchased scrap represented 25% of estimated cobalt consumption," the USGS reported.

While U.S. cobalt mining is in a holding pattern, Canadian projects are supporting the development of North American electric vehicle battery supply chains.

Electra Battery Materials is completing the continent's first battery-grade cobalt sulfate refinery in Ontario, backed by over $30 million from the U.S. Department of Defense and Canadian agencies. Electra is also piloting a co-located modular recycling plant to recover cobalt and other battery materials, while advancing exploration at Idaho's Iron Creek deposit to support its refining operations.

Meanwhile, Fortune Minerals' NICO project in the Northwest Territories is progressing toward construction, aiming to supply a vertically integrated mine-to-refinery supply chain for cobalt, gold, and bismuth by mid‑2026. A $7 million DOE-backed demonstration plant in Missouri is also being developed to test new hydrometallurgical techniques for cobalt and nickel separation.

A resource in conflict

Much of the world's cobalt still comes from the Democratic Republic of Congo (DRC), despite mounting pressure over labor practices and environmental concerns. While the U.S. sources from allies like Norway, Canada, and Japan, the upstream supply often traces back to Congolese mines, many of which remain mired in human rights controversies.

A 2024 Amnesty International report revealed persistent abuses, despite a decade of reform promises. For example, Ford, Volvo, and LG Energy Solution have partnered with Circulor and the Responsible Minerals Initiative to implement blockchain-based certification, which tracks cobalt from the mine through processing and into finished products.

Tesla has also made public commitments to sourcing cobalt only from large-scale industrial operations verified for ethical and environmental compliance.

While much of the attention has focused on DRC, Indonesia has quickly become a cobalt heavyweight, producing more than 28,000 metric tons in 2024, according to Nasdaq. Since its 2020 nickel ore export ban and a wave of Chinese investment, its battery metals sector has seen a staggering 937% increase in mined cobalt output since 2021.

Meanwhile, China continues to dominate cobalt refining and trade, prompting Western countries to accelerate investment in alternative processing and sourcing.

In the DRC, the introduction of new environmental rules and export controls in 2025 added fresh uncertainty and costs to the cobalt pipeline. A four-month export ban imposed in February aimed to stabilize prices, which had cratered amid oversupply. In June, the DRC government extended this export ban out to September.

As a result, prices nearly doubled between February and May, rising from $5.60 to $11.80 per pound, according to S&P Global. As of June, cobalt sits at around $15/lb. In parallel, the DRC is implementing a new quota system in an effort to stabilize the market while preserving revenue.

Fair Cobalt Alliance

For companies, investors, and policymakers, the question is whether the cobalt industry can adapt to a green global economy.

Market volatility and pressures

Despite its growing association with EVs, cobalt remains a staple of high-tech manufacturing, with over half of U.S. cobalt demand still coming from superalloys used in jet engines and defense systems, another quarter going into chemical applications, and the remainder being used in cemented carbides, magnets, and advanced electronics.

These industrial uses underpin cobalt's strategic importance, particularly for U.S. aerospace and defense industries, regardless of battery trends.

Still, batteries are driving the largest increases in demand, especially for EVs and grid storage. Yet even in America, the grip of cobalt is loosening, with a shift toward cobalt-light and cobalt-free chemistries, such as lithium-iron-phosphate (LFP), gaining traction in low- and mid-tier EVs.

"The talk of engineering cobalt out of batteries has been going on for years," Fastmarkets' analyst Robert Searle said. "But the fact of the matter is that NCM chemistries are still expected to play a significant role in Western EV markets, and the DRC remains the major source of mined cobalt extracted by Western, non-Chinese companies."

Cobalt prices in 2025 have seen modest rebounds from the last two years' lows but remain volatile. Oversupply lingers, and the outlook will likely depend on how fast EVs scale, how efficiently materials are recycled, and how supply chains evolve.

Strategic stockpiling by the U.S., EU, and China is also adding another layer of complexity, with traders divided: will the market plateau, or tighten as battery chemistry innovation slows and demand settles into new norms?

Going green

As the race to electrify industries intensifies, attention is turning not only to how much cobalt can be secured, but also to how sustainably it can be sourced. Recycled, or "green," cobalt is gaining traction as a lower-emissions alternative to mined supply, offering a path to reduce environmental impact without sacrificing performance.

According to the EU's Joint Research Centre, cobalt recovered through recycling generates up to 70% fewer greenhouse gas emissions than its mined counterpart. That environmental edge is driving a wave of investment in closed-loop systems designed to reclaim battery materials at scale.

In Europe, Umicore's Hoboken facility is expanding to meet this rising demand, supplying recycled cobalt to automakers like BMW and Volkswagen that are under pressure to decarbonize their supply chains.

A similar push is underway in South Korea, where industrial leaders such as POSCO and SK Innovation are building national battery recovery networks to feed the country's growing electric vehicle sector.

This global pivot toward greener supply aligns with broader efforts in the U.S. to reduce import reliance and reinforce domestic control over strategic materials. With cobalt designated as critical to both energy security and national defense, federal agencies like the Department of Energy and Department of Defense have prioritized efforts to shore up supply chains at home.

Support is also coalescing around a mix of policy incentives and targeted investments, with pilot projects, including Xerion's advanced refining facility in Ohio, reflecting a growing focus on next-generation processing capabilities.

At the same time, tax incentives are drawing cobalt infrastructure to battery manufacturing corridors in Arizona and Michigan, reinforcing regional hubs of strategic capacity.

To further insulate supply from geopolitical risk, members of Congress have proposed building national cobalt stockpiles – a measure that underscores how deeply intertwined recycled, refined, and reserved materials have become in shaping a more resilient and self-directed cobalt future.

A proposed minerals-for-security partnership

With supply chain resilience now a priority for Western powers, cobalt is no longer just a commodity – it is a strategic asset.

TRT Afrika / Statista

The U.S. and EU are pushing for domestic sourcing, ally-only trade partnerships, and increased recycling. At the same time, the governments of DRC and Zambia are asserting more control over their resources, reshaping the power dynamics of the cobalt trade.

In a bold and timely diplomatic move, DRC President Félix Tshisekedi has offered the U.S. a sweeping strategic partnership centered on critical minerals and security cooperation, proposing a deal that would grant American companies exclusive extraction rights to the DRC's vast reserves of cobalt, lithium, copper, and tantalum in return for military assistance to combat the M23 rebel group, along with support to develop the Banana deep-water port, an infrastructure project with major geopolitical implications.

President Tshisekedi proposed that under a formal security pact, "I think that the U.S. is able to use either pressure or sanctions to make sure that armed groups who are in the DRC can be kept at bay."

The proposed agreement also includes the creation of a joint U.S.-DRC strategic mineral stockpile and expanded military cooperation, including training programs and the potential establishment of American bases on Congolese soil.

The initiative reflects the DRC's growing desire to diversify its foreign partnerships and reduce its economic dependence on China, which currently dominates mineral refining and infrastructure development in the country.

If realized, the pact could significantly reshape the global cobalt supply chain and deepen U.S. influence in the region.

The proposed partnership reflects a shift in U.S. foreign policy, open to transactional relationships that secure strategic resources. By engaging directly with the DRC, the U.S. aims to counter China's influence in the global supply of critical minerals, which are vital for clean energy technologies and defense industries.

However, the proposition has raised concerns among civil society groups and analysts, who warn of potential exploitation and continued dependency, echoing historical patterns of resource extraction in Africa.

The success of such a partnership will depend on transparent agreements that prioritize the DRC's development and sovereignty.

Maturing in 2025 amid shifting supply chains and rising environmental and ethical scrutiny, cobalt faces a defining test – whether it can evolve to meet the demands of a cleaner, more conscious, and increasingly competitive global economy.