Back in 2020, the electric vehicle sector witnessed a major evolutionary change after leading EV makers started using cobalt-free batteries at scale. Back then, Tesla Inc. (NASDAQ:TSLA) officially shifted to Lithium Iron Phosphate (LFP) for its standard-range vehicles while its leading Chinese rival, BYD Company (OTCPK:BYDDF), introduced its famous “Blade” batteries, triggering mass adoption of LFP batteries for electric vehicles by other automakers. LFP batteries have helped EV manufacturers to lower production costs, eliminate reliance on expensive and ethically fraught materials like cobalt and nickel and improved battery durability. Still, ~45% of EVs manufactured today rely on traditional cobalt chemistries, primarily Lithium Nickel Manganese Cobalt (NMC) and Lithium Nickel Cobalt Aluminum (NCA), thanks to their greater energy density. And now a new study has found that this tranche of EV makers are in greater danger of facing acute supply chain disruptions than previously thought.
这 study conducted by the Chinese Society for Environmental Sciences found that the global cobalt network is far more interconnected and vulnerable than previously assumed, and a single disruption in the cobalt supply chain would trigger a global ripple effect.
The cobalt market’s vulnerability is geographic bottlenecks. The Democratic Republic of the Congo (DRC) dominates the global supply chain, and it’s about as fragile as they come.
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DRC accounts for roughly 70% to 75% of the world’s raw cobalt output, with supply lines in the Katanga and Lualaba Copperbelt highly vulnerable to strikes, geopolitical shifts and export caps.
Previously, we 据报道 that DRC miners are aggressively pivoting away from cobalt and towards copper, driven by a surge in copper prices amid a global electricity drive, as well as global cobalt oversupply.
Unlike other primary commodities, roughly 94% of cobalt is produced as a byproduct of copper (50%) and nickel (44%) mining, with only about 6% coming from dedicated cobalt operations. This means that cobalt mine production is mainly driven by the macroeconomics of copper and nickel prices instead of direct EV battery demand. That means a crash in copper or nickel markets could choke off cobalt output.
Unfortunately, midstream and downstream cobalt operations aren’t any less vulnerable.
China holds a near-monopoly on the chemical refining and manufacturing of cobalt battery materials, controlling the overwhelming majority of the downstream steps needed to fuel lithium-ion electric vehicle battery manufacturing. A comprehensive study by the U.S. Geological Survey (USGS), shows that while China lacks abundant domestic reserves, it has consolidated control over the global supply chain through aggressive foreign mining acquisitions and a heavily subsidized domestic refining infrastructure. Through the “Going Out” strategy and the Belt and Road Initiative (BRI), Chinese state-backed firms bought out Western and local operators. Today, Chinese companies own or finance approximately 15 of the 17 largest cobalt mining operations in the DRC, securing upstream feedstock directly for Chinese industries.
China has demonstrated time and again its willingness to weaponize critical minerals in trade: Last year, China re-introduced export controls, banning or restricting exports of gallium, germanium, and antimony to the U.S. due to their critical role in computer chips, fiber optics and advanced ammunition.
In April 2025, Beijing restricted sales of samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium, before adding holmium, erbium, thulium, europium and ytterbium to the list. Similar export controls on cobalt and other critical minerals can easily upend the global EV sector.
According to the study, cobalt supply chains exhibit a “robust-yet-fragile” structure, meaning the system can withstand multiple, small and random disruptions but remains highly vulnerable to targeted shocks affecting critical nodes.
The researchers found that supply disruptions in cobalt and other critical minerals spread far beyond direct trade relationships. Once a disruption starts, it can cascade through the supply chain, creating a network of potential failures about four times larger than the physical trade network itself.
Indeed, traditional trade metrics like volume and direct export/import data pass over key secondary and tertiary supply relationship data. This leads to a severe underestimation of how a failure in one part impacts the rest.
Countries with large production or refining bases like China and the U.S. can cause massive global disruptions through policy changes, while countries with lower production volumes but high dependencies like South Africa, Indonesia and Mexico are highly exposed to random shocks.
作者：查尔斯·肯尼迪，来源：Oilprice.com
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