MMG has suspended operations at its Kinsevere cobalt processing plant in the DRC due to slumping cobalt prices and a recent export ban from the Congolese government. The investment in the plant, estimated at $600 million, led to an early transition to care and maintenance mode. The DRC’s oversupply crisis has compelled authorities to impose an export ban, while MMG plans to increase copper output by 40% this year.
China’s state-controlled mining enterprise, MMG, has suspended operations at its cobalt processing plant at the Kinsevere mine in the Democratic Republic of Congo (DRC) due to prolonged unfavorable market conditions. Bloomberg reports that operations were halted shortly after the plant’s launch in September 2023, as cobalt prices have experienced a significant decline, compounded by a recent export ban imposed by the Congolese government.
The company allocated approximately $600 million to enhance copper production and initiate cobalt processing at the Kinsevere site. However, despite this considerable investment, the cobalt facility transitioned to a care and maintenance status in December 2024. The DRC has seen a notable increase in cobalt production, primarily attributed to the CMOC Group of China, leading to an oversupply that has suppressed prices.
In response to the oversupply issue, the Congolese government implemented a four-month ban on cobalt exports to regain control over pricing and manage the excess production in the market. MMG’s spokesperson indicated that the company will utilize a flexible production strategy, intending to resume cobalt processing contingent upon market conditions, while concurrently aiming to boost copper production by at least 40% in the current year.
Last year, MMG reported cobalt production of 1,600 tonnes at the Kinsevere mine and copper production of 380,000 tonnes across its operations worldwide. MMG’s most significant asset is the Las Bambas mine located in Peru. Additionally, the DRC has established a state monopoly, with the Entreprise Generale du Cobalt gaining exclusive rights to oversee the export of artisanal cobalt, thereby centralizing control over this pivotal resource.
The suspension of MMG’s cobalt operations at the Kinsevere mine underscores the challenges faced by the cobalt market, particularly in light of oversupply and drastic price reductions. The Congolese government’s recent export ban aims to stabilize the market and enhance pricing control. Despite difficulties in cobalt processing, MMG plans to increase copper production, showcasing the company’s adaptive production strategies amidst turbulent market conditions.
Original Source: www.mining-technology.com
