Thursday, August 12, 2010

Cobalt before price explosion?

Do you know how cobalt get its name? No? Console yourself, until recently, I knew not yet. In the Middle Ages thought the miners, cobalt was bewitched by goblins in worthless rock silver or copper, because it is confused in its natural ore the two metals to the leaves look similar, but foul odors when heated. Today we know better of course. Especially now, no one gets the idea to look at the raw material to be worthless. After all, the prices in the past twelve months have almost doubled and the "bull market" could well go a bit.

Soaring demand


For the cobalt demand is steadily increasing. Will use the metal as an alloy including an addition. The addition of cobalt can be manufactured very hard and heat-and corrosion-resistant steel. Cobalt is also becoming more popular in the high-tech industry. It is mainly used to produce ever smaller and more powerful batteries for cell phones or laptops. The use in this area has almost tripled since 2004. A huge additional demand boom expected to trigger the expected victory of hybrid technology in vehicle. By 2012, market leader Toyota to annually produce one million environmentally friendly cars. This also means that each year one million high-performance batteries, the need to develop, for the cobalt trading is essential. Experts expect a result so that the demand by 2015 will double from the current 60,000 to over 120,000 tons per year, more than. This represents an annual increase of around eight percent.


Tight supply situation

Even if the world's total deposits are relatively abundant, with an estimated 15 million tons, the supply situation is quite tense. Reason: Most reserves are in politically less stable regions of Africa. But in Congo mining companies promote third of the global total output. Among other things involvement in appropriate mining stocks (derivatives on cobalt are there any) subject to considerable risks. Recently, for example, withdrew from the Congolese Government to an undertaking times just the mineral rights for one of the main mines, after which the price fell almost into the abyss. Only after a lengthy court proceedings, it gave back the licenses. Investors with a weak heart, I can recommend the purchase of Cobalt shares is very limited, although I expect the metal in the longer term with further price increases.

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