Congo Gambles on Cobalt as US-China Metals Fight Heats Up

Bloomberg

20-05-2025

In the middle of a trade war, Congo is trying to woo Trump's White House without risking critical investment from Beijing.
Photography by Arlette Bashizi
Along the 63-mile highway between the towns of Kolwezi and Fungurume sit two towering symbols of China's stranglehold over resources in the southeast corner of the Democratic Republic of Congo: huge copper and cobalt mines owned by CMOC Group Ltd.
But they only tell part of the story. A closer look reveals a road peppered with factories and warehouses for construction firms from Beijing, industrial equipment makers based in Shandong, and steel operators from the northern Chinese province of Hebei. State-owned behemoths rub shoulders with fortune-seekers from small-town China who have set up trading depots, casinos and hotels.
In less than two decades, China has embedded itself at every level of the resources business in Congo's copper belt from the roadside artisanal-metal dealers to wholesalers and multinationals like Shanghai-headquartered CMOC, the biggest producer of cobalt in the world after usurping Glencore Plc in 2023.
The country's politicians are now looking for new friends and have turned to an unlikely ally: Donald Trump's White House.
Congo shocked commodity markets by banning all cobalt exports in February. CMOC executives in Shanghai only learned about the measure from a Bloomberg report, the company says. The four-month suspension was designed to resuscitate prices which had fallen toward record lows. It was also interpreted as a rebuke to CMOC — now an integral part of the Congolese economy — for far exceeding its already ambitious output targets and contributing to the freefall in prices.
The move, authorized by President Felix Tshisekedi, reflected frustration that although Congo produces three-quarters of the world's cobalt, it is Chinese companies — not politicians in the capital Kinshasa — that shape global prices of a metal critical to the battery, defense and aerospace industries.
The export ban, and the implicit criticism of Beijing, is a high-stakes gamble by Tshisekedi, say analysts and traders.
'The issue of African critical minerals has been a thorn in US-China relations,' says Yun Sun, director of the China program at the Stimson Center in Washington. 'The Trump Administration has made it a priority.'
But China is decades ahead of the US when it comes to critical minerals.
A potential White House deal for a stake in Congo's mineral output 'risks offending China,' adds Yun Sun.
Without investment from China — CMOC alone has plowed about $9 billion into its mines since 2016 — Congo wouldn't have been able to triple its production of copper and boost cobalt output by almost as much in a decade. The two metals are extracted together in the country. Exports of copper and cobalt are equivalent to about 40% of Congo's GDP, according to the International Monetary Fund. The value of trade between the two countries stood at almost $27 billion in 2024, while Congo's trade with the US was just $820 million over the same period.
Congo proposed a minerals-for-security deal to the US — inspired by a similar arrangement being discussed at the time with Ukraine — shortly before Washington unleashed its global trade war focused on Beijing in April. In theory, it would offer US companies access to Congo's minerals in exchange for unspecified support to end a conflict in the east of the country, where a rebel group backed by neighboring Rwanda has taken control of two major cities and multiple gold, tin and tantalum mining areas. The assault poses a serious threat to the Tshisekedi government.
Congo's Soaring Production
The foreign ministers of Congo and Rwanda travelled to Washington in late April to sign a 'declaration of principles' witnessed by Marco Rubio, the US Secretary of State, that committed both sides to working toward a peace agreement. Massad Boulos, Trump's senior adviser for Africa, said on April 17 that he and Tshisekedi had 'discussed a minerals deal and charted a path forward' that could see institutions like the US International Development Finance Corp. support private investments in Congo's mining sector and infrastructure.
The US State Department was more blunt about the purpose of any deal, accusing Beijing of restricting access to key minerals and metals: 'China's control over critical mineral supply chains poses a significant threat to US industrial and technological capacity and cannot continue,' said a State Department spokesperson.
The Chinese government disputes those claims. 'The international community can see clearly who is playing zero-sum games and who is profiting from conflict,' the country's foreign ministry said in a statement. It added that China's role in Congo has been 'open, transparent and lawful.'
Dubbed the 'Saudi Arabia of cobalt', Congo is home to around 110 million people, and a vast array of mineral resources to power everything from wind turbines to next-generation weapons systems. In addition to cobalt, the country is the second-largest producer of copper, another critical ingredient in efforts to drive 21st century technologies. But concerns about conflict and corruption — amid grinding poverty and inadequate infrastructure — have often scared off Western companies.
The country's leadership — which has improved relations with the West since Tshisekedi took office in 2019 — now see an opportunity to capitalize on Washington's open distrust of China's dominance in numerous metals markets. In March, with US support, Congo killed off the acquisition of a local copper-cobalt producer by a subsidiary of the Chinese weapons manufacturer Norinco Group, which already owns mines near Kolwezi. However a US-backed alternative bid is yet to materialize.
CMOC's Congo Mines Dominate the Global Cobalt Market
Any US push begins at a major disadvantage. China and its citizens have built an infrastructure of businesses, big and small, that have learned to thrive in Congo's challenging environment, which requires dealing with everything from corruption to rogue soldiers, potholed roads and political instability.
Beijing's power over pricing also stems from the processing plants, battery facilities and electric vehicle factories it has spent decades building at home. More than 80% of global cobalt refining occurred in China last year, according to trading house Darton Commodities.
This dominance has been cemented with cash. China extended $56.9 billion of credit and aid into 'transition mineral' projects worldwide between 2000 and 2021, according to AidData, a think-tank at William & Mary university in Virginia.
'Being dependent on one country puts you in a state of vulnerability,' says Christian-Geraud Neema Byamungu, an expert on Beijing's mining investments in Congo at the China-Global South Project, a research group.
Belatedly, President Joe Biden's administration sought to counter China's grip amid escalating fears of supply shortages for some minerals. He introduced financial incentives to bolster domestic refining in the US, which doesn't possess the capacity to process cobalt. Investment for the Lobito Atlantic Railway, which links Kolwezi to the Angolan coast, was also pledged as Biden urged Western miners to reconsider getting involved in Congo's natural resources.
Arizona-based EVelution Energy is vying to be one of the first US companies to open a domestic commercial-scale cobalt refining facility. It plans to begin in 2027 and expects to import from Congo. Gil Michel-Garcia, the firm's executive vice president, says a 'peace-for-minerals' deal would help 'secure vital critical minerals' for the US automotive, aerospace and defense industries, and 'derisk America's cobalt supply chain from China.'
Boulos's emphasis on using the Development Finance Corp. echoes an approach that failed to spur any major US mining investments in Congo during Biden's term. Still, KoBold Metals, backed by Bill Gates, the Microsoft founder, and Amazon's Jeff Bezos — which had previously shown interest in Congo — says it now wants to invest more than $1 billion to develop a lithium deposit located 270 miles north east of Kolwezi.
The government in Kinshasa is walking a tightrope. It wants to dilute the influence of Chinese companies over the nation's mining sector by attracting other outside investors, but without souring relations with its key trading partner.
The talks with the US are part of Congo's wider push to diversify the economy, says Kizito Pakabomba, the country's mines minister, who wants to use any extra revenues from the sector to boost other areas including, 'agriculture, tourism and many other industries.'
Cobalt and copper are exempt from the Trump tariffs but Moody's, the rating company, initially warned — before the cooling off in the US-China trade war last week — of the 'potential adverse effects' of the tariffs on demand for Congo's commodities if global growth is hit.
Congo doesn't want to be in a position where it has to pick sides or swap one overmighty group of investors for another.
'The ultimate objective remains complete control of the cobalt value chain,' Tshisekedi told a meeting of his ministers in March. The country 'must cease to be a simple supplier of commodities and become a key actor in refining strategic minerals.'
China's Stranglehold,
From Pit to Processing
That's easier said than done. For three decades until the 1990s, the US supported dictator Mobutu Sese Seko. Companies like General Motors Co., General Electric Co. and Citigroup Inc. all had operations or major projects in the country. Foreign investor interest waned as multilateral institutions turned away from Congo towards the end of the kleptocratic dictator's rule and the country veered towards civil conflict.
After Mobutu was overthrown in 1997, Western companies flooded into Congo, trying to secure its mining assets on the cheap. Many eventually left, discouraged by the difficult business environment. Almost all that's left from the Mobutu era is a small Citibank branch in Kinshasa.
During the 18-year presidency of Joseph Kabila, Tshisekedi's predecessor, this disengagement left the door open for Beijing, which has sought raw materials in its breakneck push for economic growth since the end of the twentieth century. China now dominates Congo's copper and cobalt sector both as miner and consumer.
'We have a good relationship with the Chinese,' says Angelo, a mining cooperative coordinator, who declines to provide his full name due to his involvement in illegal artisanal mining. He watches dozens of young men wearing sandals and broken plastic boots emerge from an illegal open-pit mine, close to CMOC's giant Kisanfu operation. On their backs, they carry dirty white sacks of raw copper and cobalt ore.
'We make a good living doing this,' he says of his workers who operate 24 hours a day, seven days a week. 'Our life is stable because of this.'
The artisanal sector — which is loosely regulated and often generally in breach of Congolese laws that prohibit small scale mining on industrial sites — accounted for about 10% of Congo's cobalt output in 2018, but falling prices and attempts to formalize the sector mean that has shrunk to about 2%, according to Benchmark Mineral Intelligence. But it remains significant to the local economy.
Angelo says he handles the logistics for 30,000 artisanal workers — who dig for ore using rudimentary tools. Some estimates suggest there could be well over 200,000 artisanal cobalt miners in the country. They often work in dangerous conditions for uncertain income, and the government has struggled to keep child laborers away from the sites.
In front of Angelo, groups of women and men crush rocks with pickaxes before the material is transported to mainly Chinese wholesalers.
At a makeshift metals depot outside Kolwezi, a hand-written sign on the wall lists the prices offered for the ore with copper grades from 1% to 20%. A neighboring rival depot — one of dozens — lists grades of up to 30%, a purity unheard of anywhere else in the world. 'Only in Congo,' one Chinese buyer says admiringly.
A neighboring depot is owned by Kwanga — an adopted name for a wholesaler called Li who hails from the industrial city of Shijiazhuang, in northern China. He declines to give his full name to avoid attracting the attention of the authorities. Li sells the ore to one of the many Chinese-owned processing plants around Kolwezi with access to refiners at home.
'We weigh it, assess the quality and then offer a price,' says Li, as he paces around the depot, smoking and dictating instructions into his phone in Mandarin and Swahili. Gesturing toward a Chinese employee behind a mesh fence, he adds: 'If they don't accept the price, they go elsewhere.'
Several artisanal miners point out that they have nowhere else to go to sell their cobalt and copper, other than the ubiquitous Chinese wholesalers.
The illegal Shabara artisanal copper-cobalt mine near the Congolese town of Kolwezi.
Workers assemble at the Shabara mine, preparing to dig on land where a Glencore subsidiary has the only official mining permit. The commodity trader has previously tried to stop the artisanal mining at the site.
A Shabara miner holds a lump of raw copper and cobalt. More than 200,000 artisanal cobalt miners work in Congo, often in dangerous conditions for uncertain pay.
Miners pack bags of ore in the Shabara mine which will later be broken up before being sold to wholesalers, likely in Kolwezi.
Miners queue at a sales counter while staff negotiate a price for the ore they have brought in. The artisanal sector accounts for an estimated 2% of production.
How CMOC Left
Glencore Flatfooted
No company has done more to supercharge the creation of the industrial side of this ecosystem than CMOC, which now dominates global cobalt production.
It began life in 1969 as a state-owned producer of molybdenum, a steelmaking ingredient, in the central province of Henan. A steady expansion in the 2000s led to a listing on the Hong Kong Stock Exchange in 2007 which valued the company at around $1 billion.
After buying mining assets in Australia and Brazil, it was investments in Congo that announced it as a global deal-maker. In 2016 it took over the Tenke Fungurume mine near Kolwezi in a deal with the American miner Freeport-McMoRan Inc. and Canada's Lundin Mining Corp. that totaled $3.8 billion. In 2020 it paid Freeport another $550 million for the Kisanfu license and last year became a top-10 copper producer.
In an industry where turning promising geology into an actual mine can take decades, CMOC's progress in building Kisanfu shocked rivals. The facility — now the biggest cobalt mine in the world — was brought into production in little more than two years.
The speed left competitors flatfooted. The deluge of cobalt worsened a slump in prices which fell by around 75% from a May 2022 peak, falling below $10 a pound in February. The financial hit for Congo was significant: mining royalties from cobalt hydroxide fell more than 40% to $409 million in 2023, according to Resource Matters, a research and advocacy group, even as production grew by almost one fifth.
However, the lower prices were good news for Chinese battery makers. Contemporary Amperex Technology Co. Ltd., or CATL — the world's largest manufacturer of EV batteries — owns around a quarter of CMOC's shares and a separate 25% stake in the Kisanfu mine.
Jose Fernandez, US under secretary for economic growth, energy, and the environment under Biden, accused CMOC last year of using 'predatory' tactics to depress cobalt prices and discourage Western companies from developing a rival supply-chain for the metal.
Source of Cobalt Demand
Glencore — which had been the top cobalt producer for at least 15 years — saw its power to dictate prices evaporate. The Swiss commodity trader cut output at one of its Congolese mines as the market weakened in an attempt to support prices. But the effort was futile. CMOC last year produced three times more cobalt in Congo than Glencore. Chinese miners were also left reeling: some slashed exports while state-backed MMG Ltd. mothballed a new cobalt plant in December.
CMOC — which turned down a request for access to its Kisanfu mine for this story — denies deliberately crashing the price. It describes the glut as an unavoidable consequence of its push to produce more copper. "We develop the mine assets in the DRC for copper,' CMOC said in an emailed response to questions. 'Cobalt is only a byproduct.'
The export ban is scheduled to be lifted in late June, although Tshisekedi has warned that it could be extended. Bloomberg Intelligence estimates that the suspension — if it is extended to the end of 2025 — could cost Congo as much as $400 million.
More permanent options to exert greater control over prices, including export quotas, are being discussed. Around Kolwezi, miners continue to ship copper while storing cobalt on site. Congolese politicians — happy that the hydroxide price has doubled since the ban was introduced — know flooding the market the moment it's lifted would take them back to square one.
While Congo says it simply wishes to restore balance between supply and demand, analysts have warned that overly stringent controls could hasten a shift by EV battery makers towards cobalt-free alternatives.
Andre Wameso, Tshisekedi's powerful deputy chief of staff for economic affairs, told a cobalt industry conference in Singapore last week that the ban is part a 'broader strategy.'
'Congo is considered a land where one comes to source raw materials to build other economies,' the president's adviser said as he referenced the role played by the country's resources from rubber to diamonds in earlier periods of global change, which have not translated into prosperity for its people. 'We understand that a new revolution is coming. You've talked about it. It's the energy transition, the green revolution, and once again the raw materials that will serve this industrial revolution are in Congo.'
'We are thinking about how to implement the right policies,' he went on, 'so that not only can the mining industry develop and obviously recover capital, but also this time benefit the Congolese people.'
Assist: Annie Lee, Jing Li
Editor: Tom O'Sullivan
Photo editor and production: Jody Megson
More On Bloomberg
Terms of Service Do Not Sell or Share My Personal Information Trademarks Privacy Policy
Careers Made in NYC Advertise
Ad Choices
Help ©2025 Bloomberg L.P. All Rights Reserved.