Glencore Plc’s Katanga Mining Ltd. recorded its biggest two-day rally in seven years on news it’s ready to
restart copper production and will soon become the biggest producer of the world’s most sought-after battery ingredient, cobalt.
Katanga has jumped 49 percent since the start of the week, to close at C$1.68 on Tuesday in Toronto. The stock rallied so dramatically yesterday that it triggered a circuit breaker, briefly halting trading.
The rally followed news on Monday that the miner is ready to restart production at its Kamoto project in the Democratic Republic of Congo and will ship a record 34,000 metric tons of cobalt in 2019. That’s approximately 10,000 tons more than the world’s current biggest cobalt mine and significantly higher than the output guidance given by Glencore Chief Executive Officer Ivan Glasenberg in August. Glencore owns 86 percent of Katanga.
Read: Glencore to Double Cobalt Output on Electric Vehicle Demand Cobalt prices doubled this year on demand from automobile and battery manufacturers, rising more than 20 percent in the past month alone. About two-thirds of cobalt supply comes from Congo, where another Glencore mine is currently the biggest producer.
Glencore suspended production at Katanga in 2015 to invest in new processing facilities, which will also see the
miner double copper output to 300,000 tons.
Still, it’s not all plain sailing. Katanga is currently under investigation by Canadian authorities for alleged compliance problems that saw three of Glencore’s non-executive directors resign from the Katanga board last month.
Peter Grauer, the chairman of Bloomberg LP, the parent of Bloomberg News, is a senior independent non-executive director at Glencore.