Cobalt produced by China’s Lygend in Indonesia skirts Trump tariffs

Written by Pratima Desai

LONDON (Reuters) – Three sources said directly with direct knowledge of this article.

US president Donald Trump has imposed an additional tariff for importing Chinese goods since he took office in January, in addition to placing fees on a major commercial partner in Canada, another major source of cobalt, used in space, for the sake of the United States

Industry sources say that Cobalt metal production in Indonesia precedes the latest customs tariffs.

The sources said that the traders who ship the cobalt are using a tariff -free position in Indonesia to sell minerals at a cheap price for American customers who face fees on the Chinese and Canadian offer.

“American consumers can get cheaper cobalt than Lygend – the metal comes from Indonesia, not China,” said a source in the cobalt industry. “Now there is a tariff for Canadian imports, more American buyers will look forward to Indonesia.”

Lygend did not respond to the suspension requests.

Chinese companies dominate the production of cobalt in Indonesia, as it is a secondary result of Nickel.

Although it is still small, the metal cobalt sales have multiplied more than twice by January from the first delivery operations in November, as it rose to 121 out of 58 metric tons, with a total of three months worth 9.6 million dollars, according to data from the information provider data control (TDM).

Cobalt shipments to the United States fell directly from China, the best producer in the world, after US President Trump imposed a 10 % tax on Chinese imports in 2018 and raised them to 25 % in 2019.

With the latest increase of 10 %, American importers will have to pay a 35 % tariff on Chinese cobalt shipments, which are used in electric vehicle batteries and defense equipment.

Darton Commodities, the specialized supplier of cobalt minerals, estimates that the production of cobalt bombed in Indonesia amounted to 30,920 tons or 11 % of global supplies last year, compared to 18,900 tons or 8 %, respectively in 2023.

Canadian cobalt exports last year reached more than 1700 tons of 18 % of the total shipping to the United States, according to TDM, making it the fourth largest source of minerals for American consumers.

The installation supplies from Indonesia and the Democratic Republic of the Congo (DRC) contributed to increasing the global supply of cobalt, prompting prices to a decrease to nine years of about 10 dollars for raising or $ 22,000 per metric ton in February.

Prices have been recovered since then because the Congo government suspended the Cobalt exports for a period of four months to curb excess.

However, industry sources say this will not make a big difference in the market where supplies are much greater than demand.

The best Cobalt producing companies in the Congo, as it is a secondary result of copper, includes London’s mineral miners and the CMOC group in China.

Norway, Japan and Madagascar were the best three cobalt minerals for the United States last year.

(Prazima Desai reports participated in additional reports by Amy Lev in Beijing and Bernadette Christina in Jakarta; edited by Veronica Brown and Jean Harvey)