After the price of cobalt hit a record high of US$90,000/mt in May 2018, oversupply and limited investor stockpiling set prices crashing over an extended period that intensified throughout the first half of 2019. The fact that the ramped up production was due to faulty predictions of supply shortage made investors wary of the difficulty of predicting the battery prices and the volatility brought on by industry frenzy. Adding to the depressed sentiment is the rapidly changing nature of the battery industry in which technology advances entail additional investor risks. However, with cobalt prices have steadily recovered since the July 2019-record low, there is reason to hope for a bullish 2020.
Predictions of cobalt becoming obsolete are another fear born of unsubstituted speculation. "While companies are probing into the possibility of partly replacing cobalt, I do not see this new technology entering to the DRC within the next two or three years," said Wouter Jordaan, partner and principal environmental scientist at SRK Consulting. "Companies have invested in the current technology, so they must repay any existing loans or debt before being in a position to invest in new technologies. In addition, research is being conducted into new potential uses for cobalt and new areas of usage are likely to emerge."
