Reviewing Twenty Years of China’s Nickel-Cobalt Competition: Glencore Is a Single Enterprise Advancing; China Is an Entire Supply Chain Evolving

This process has naturally been accompanied by much-criticized cutthroat competition. Yet such cutthroat competition is also a byproduct of supply chain security. Through this process, China has likewise gained greater dominance. The Philippines also possesses abundant nickel resources—but as a small country mired in geopolitical disputes, it has missed the opportunity to transform its mineral wealth into downstream industrialization. Indonesia, by contrast, has leveraged stable industrial policies and pragmatic diplomacy to play a solo leading role in global nickel markets. It banned raw nickel ore exports and retained nickel refining industries domestically. This strategy of ‘downstreaming mineral resources’ has achieved tremendous success—few countries can rival it. Even the Philippines’ nickel must now be shipped to Indonesia for processing, relegating the Philippines to merely a raw-material supplier. You profit from information asymmetry—while others are born creators of information. Every metal’s surge is driven simultaneously by three dimensions: end-use markets, technological pathways, and mining-sector hegemony. In cobalt’s application markets, every shift on the periodic table clearly coincides with the emergence of epoch-making new products. Over the past nearly 30 years, the first major factor driving cobalt prices upward was lithium-ion polymer batteries—specifically, lithium cobalt oxide (LCO) batteries. In 1991, Sony invented liquid-state lithium-ion batteries, initially used in small devices like handheld camcorders. However, their form factor was wholly unsuitable for mobile phones and laptops, which continued predominantly relying on bulky, heavy, low-energy-density nickel-metal hydride (NiMH) batteries. In 1999, Sony commercialized its LCO batteries, triggering a broad industry shift from NiMH to LCO in mobile phones and laptops. Cobalt consumption began rising dramatically. Glencore commands roughly 30% of the global cobalt market, while Freeport-McMoRan began establishing cobalt production capacity in 2006. With stockpiling capability and control over resource trade logistics, these firms have skillfully exploited information asymmetry to generate extraordinary profits. Glencore maintains close cooperation with the Democratic Republic of Congo (DRC) government, launching a sharp, high-stakes information war within the framework of peaceful trade. The DRC government frequently issues policy announcements threatening to ban cobalt ore exports. Each such announcement triggers market panic and pushes cobalt prices upward. Yet these policies rarely endure implementation. Many unenforced directives do not simply expose the DRC government’s lack of control—rather, they reinforce an aura of mystique. Indeed, each announcement bears the unmistakable imprint of Glencore’s meticulous calculations. In real-world commerce, people assess business opportunities through information asymmetry. Glencore, however, occupies the apex of the information pyramid: Glencore itself manufactures information. It manipulates the timing and differential disclosure of information as effortlessly as shifting gears in a manual transmission—accelerating, decelerating, even issuing contradictory statements. These deliberately inconsistent messages provoke successive waves of market sentiment—euphoria or panic—and Glencore, along with other commodity traders like Trafigura, profits handsomely from the resulting volatility. In Africa’s cobalt market, large commodity traders lurk beneath price fluctuation curves. What observers see are merely the dorsal fins of deep-sea sharks deliberately breaking the ocean surface—clues, yet fraught with peril. Cobalt finds widespread application in China. Beyond lithium cobalt oxide batteries, cobalt is also used in drill bits for printed circuit board (PCB) manufacturing.

How Is the U.S. Gaining Access to African Copper-Cobalt Mines? A Full Breakdown of the Four Pillars

Competitive Landscape: China Is Doing the Same Thing. In September 2025, China, Zambia, and Tanzania signed a $1.4 billion agreement to modernize the Tanzania-Zambia Railway (TAZARA), executed by China Civil Engineering Construction Corporation (CCECC), which secured a 30-year concession. The TAZARA spans 1,860 kilometers, linking Zambia’s copper belt to the Indian Ocean port of Dar es Salaam in Tanzania. The project officially launched in November 2025, aiming to raise freight volume from 100,000 tons to 2.4 million tons within three years. The competition between these two corridors is fundamentally a contest over export routes—one oriented toward the Pacific, the other toward the Atlantic. For Chinese enterprises, the TAZARA route to Dar es Salaam enables sea transport to China in approximately 20 days; the Lobito Corridor to the Atlantic allows sea transport to the U.S. East Coast in about 14 days. Whichever corridor completes construction first, achieves operational capacity sooner, and offers more competitive freight rates will gain decisive logistical advantage. Pillar Three: Strategic Reserves Aligned with End-User Demand Who Is Doing It: The U.S. Export-Import Bank (EXIM) and a private-sector supplier coalition. On February 2, 2026, former President Trump announced the launch of the ‘Treasury Vault Initiative’—officially titled the ‘U.S. Strategic Critical Minerals Reserve.’ This is a public-private physical mineral reserve program. EXIM provides a $10 billion loan—the largest single loan in the bank’s 92-year history—supplemented by approximately $2 billion in private capital. Manufacturers including GE Vernova, Western Digital, Boeing, and General Motors have expressed interest in participating. Commodity trading firms Hartree Partners, Mercuria Americas, and Traxys handle procurement and warehousing operations. Modeled after the U.S. Strategic Petroleum Reserve (SPR), the Treasury Vault Initiative targets civilian industrial use—not military applications. Participating companies may purchase minerals from the reserve at pre-agreed prices, providing a buffer against supply disruptions or extreme price volatility. The impact on Chinese enterprises is indirect but profound. The Treasury Vault Initiative creates a $12 billion ‘anchor buyer,’ enabling U.S. manufacturers—assured of government-backed mineral reserves—to sign longer-term off-take agreements with greater confidence. This means U.S.-aligned mining projects secure more favorable financing terms at earlier stages, backed by certainty of end-market demand. Pillar Four: Security Partnerships to Secure Resource Access Who Is Doing It: The U.S. Department of State and Department of Defense. At the end of 2025, the United States and the Democratic Republic of Congo (DRC) signed an Economic and Security Partnership Agreement. Its quid pro quo is direct: the U.S. provides security assistance to counter the M23 rebellion and Rwandan-backed armed groups in eastern DRC; in return, the DRC opens its mineral investment sector to U.S. entities and cooperates with U.S. preferences in asset transactions. The Virtus Minerals acquisition of Chemaf exemplifies this mechanism. Virtus Minerals—a firm founded in 2022 by former U.S. Special Forces personnel—paid $30 million to acquire approximately 95% of copper-cobalt producer Chemaf, while also committing to assume over $900 million in debt and invest roughly $750 million in subsequent development.

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