Cobalt is important for U.S. national security. It is a key element in advanced technologies, including lithium-ion batteries in electric vehicles, superalloys in jet engines, and permanent magnets in missile motors and wind turbines. Yet, the United States depends 100 percent on foreign imports and secondary scrap materials for its cobalt consumption because there’s presently no cobalt refining here. Furthermore, the federal government has sold 13,000 tons of cobalt from the National Defense Stockpile, depleting reserves to only 333 tons. In short, the United States lacks both cobalt reserves in the National Defense Stockpile and cobalt refining capacity.
Last Tuesday, U.S. Representative Byron Donalds (FL-19) introduced the “Cobalt Optimizes Batteries and Leading Technologies Act,” or “COBALT Act,” which authorizes $800 million of already appropriated funds for the acquisition of domestically refined cobalt for the National Defense Stockpile. This bill will both increase cobalt reserves in the National Defense Stockpile while encouraging cobalt refining in the United States amid intensifying US-China competition. Notably, Westwin Elements will soon break ground on a major cobalt refinery in the United States. Therefore, Congress can increase reserves in the National Defense Stockpile to Cold War levels by solely purchasing domestically refined cobalt.
Cobalt is a performance-enhancing element. It is magnetic, heat-tolerant, and corrosion-resistant. Its composition in technologies may be small, but it is necessary for technologies to function properly. As David Weight of the Cobalt Institute, a global cobalt trade association, said, “It’s small amounts [of cobalt] that make critical differences in processes and products.” In the United States, batteries represent the largest end-use for cobalt at 52 percent, while superalloys are the next largest end-use at 31 percent. Globally, the largest end-use sectors for cobalt are electric vehicle batteries (34 percent), other battery applications (31 percent), industrial metals (14 percent), industrial chemicals (11 percent) and superalloys (11 percent).
China, however, refines 72 percent of the world’s cobalt, while the United States refines zero virgin cobalt. Consequently, from 2015 to 2018, 11 percent of U.S. imports of refined cobalt were from China. Today, most of the refined imports of the commodity come from Norway (20 percent), Canada (16 percent), Japan (13 percent), and Finland (11 percent), but Chinese-backed firms own or have financial interests in 15 of 19 cobalt mines in the Democratic Republic of the Congo, the number one cobalt-producing country. In brief, China—despite only producing 1 percent of the world’s cobalt ore—controls both cobalt mining and refining.
In addition to geopolitical risks, cobalt supply chains face market risks, namely electric vehicle demand. In a newly released academic article, T.E. Graedel and Alessio Miatto of Yale University write, “[T]he global supply of cobalt is thought likely to be insufficient to meet anticipated increases in battery use and perhaps in other applications.” While some companies like Tesla seek to substitute or reduce cobalt in electric vehicle batteries, overall demand for EV batteries will still increase cobalt demand. In fact, the International Energy Agency projects that cobalt demand in 2040 will range from 6 to 30 times higher than today’s levels.
The federal government needs increased cobalt reserves in the National Defense Stockpile because they’re at historic lows, and it needs domestic cobalt refining because cobalt is necessary in advanced technologies affecting our national security. Just like the United States stockpiles and manufactures military ammunition domestically since it is critical for security, the U.S. should also refine cobalt domestically—rather than depend on foreign countries like China. Thus, the COBALT Act will strengthen both U.S. national security and American industry.
