Tell me—what do Tesla, Apple, and Samsung have in common?
- They are global tech leaders
- Their stocks have done incredibly well in the last 5 years
- They all use cobalt
And as a group, they are about to cause one of the Great Commodity Squeezes of all time—in cobalt. In fact, it’s already happening. Look at this price chart of cobalt:
That is a bullish chart. Just like the lithium price chart, there has been no meaningful pullback at all since a massive price increase in the last year.
The Great Cobalt Squeeze so far is fundamental, as I’ll quickly explain. But the most intriguing part—and probably the most lucrative—will be political. And this is happening right now too—it’s coming from the Apples, Samsungs and Teslas of the world.
I think the tight fundamentals of the cobalt market right now are well known to this audience.
Battery demand from Electric Vehicles (EVs) just rises and rises; cobalt supply will struggle to keep up.
In 2016 the battery market ate up 48,000 tonnes of cobalt. By 2020 that will have ballooned to 75,000 tonnes – 50% growth in three years.
By 2025 the battery market will need 123,000 tonnes of cobalt.
Yes, battery cobalt demand is going to grow 150% in just eight years.
As a result, cobalt production has gone almost straight up in the last 20 years—because it had to.
Fundamentally, the cobalt market is tight already.
And it’s getting tighter, thanks to a report by Amnesty International and the response by Fortune 100 Companies.
In February 2016—just as the lithium and cobalt stock market boom started—Amnesty International issued a report that documented in print and video that thousands of child laborers worked in dangerous conditions to supply a meaningful chunk artisanal cobalt supply in the DRC. And they were able to trace it through the supply chain to companies like Apple, Samsung and Daimler.
These companies who were named in Amnesty’s report responded—and are now very aware that both investors, the media and society in general are watching them.
They are pressuring their supply chain—as are the American and Chinese governments—to only use “ethical” cobalt, that has no unsafe or unsavory business practices involved.
This is what is causing The Great Commodity Squeeze—and it’s in cobalt.
Asian, America and European companies are now working in the DRC want to source ethical cobalt. In fact, they are desperate for it. The DRC government is giving them big pressure to prove—to get proper papered certification—that they are using ethically sourced cobalt.
And surprise surprise, that’s hard to do.
And you know what the ironic thing here is? There is actually spare capacity at the refineries in the DRC that produce cobalt!
Yes, cobalt demand is outstripping supply but refineries are running half empty because their owners can’t find enough legitimate ore.
The refiners can sell every pound of cobalt they produce, because the market is hungry. But lack of legitimate ore limits what they can produce – and is creating the Great Cobalt Squeeze.
That is a sure sign that Amnesty International’s campaign is working. And that’s awesome. But how does the industry—who desperately need supply—deal with this?
Well, I think I found The Company with the solution. And not only is this Company going to be A Major Stock Market Win—it’s one of the best feel-good stories in the EV Trade; indeed in all of energy and mining globally.
This company is positioned to be THE outsourced group who develops ethical cobalt within the DRC. They have a good team, who have been on the ground in the DRC for years. They have a good plan—and they’re already working it.
That plan involves creating ethical cobalt and selling it to a hungry group of local competitors–and there are at least 10–in the cobalt refining sector in the DRC.
As the Market learns of this team and their plan, there will also be a lot of competition for the stock. I’m going to give you the name and symbol of this soon-to-be-sought-after investment on Thursday.
