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Volkswagen's talks with cobalt producers end without deal

Metal News - Published on Thu, 30 Nov 2017

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Reuters quoted cobalt industry source said that meetings last week between major cobalt producers including mining giant Glencore to supply the world's largest automaker Volkswagen with the material used to make batteries for electric vehicles ended without a deal. The talks last week in Wolfsburg, Germany, where VW is headquartered, had aimed to thrash out cobalt supply deals with Glencore, China's Huayou Cobalt, commodity trader Traxys, US miner Freeport-McMoran and Eurasian Resources Group.

Reuters reported exclusively that VW was moving to secure long-term supplies of cobalt for the group's ambitious electric vehicle plans. Earlier this month Volkswagen approved a 34 billion euro spending plan by the end of 2022 to accelerate its efforts to become a global leader in electric cars.

A VW spokesperson said that "We have requested different options for a hedge from the raw materials industry in the context of a tender ... We have already had constructive talks with the well-known suppliers and will continue those discussions. Besides supplies and costs, other topics in discussion include future capacity expansion, sustainability and transparency."

Cobalt metal prices at around USD 30 a lb are up from below USD 10 a lb in December 2015 and the highest since October 2008. Prices surged last year as auto makers and governments around the world started to promote electric vehicles in earnest as a means of cutting noxious fumes from cars fuelled by diesel- and petrol-powered engines.

Sources were unclear about whether VW was planning to buy the cobalt directly or indirectly for chemical and battery makers.

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Posted By : Rabi Wangkhem on Thu, 30 Nov 2017
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