(Ecofin Agency) - • DRC’s cobalt output forecast to drop 45% by 2030 due to declining ore quality
• Indonesia’s cobalt production projected to rise 80% by 2040 as a nickel byproduct
• Shift may reduce DRC’s global supply share and affect mining revenue dynamics

The Democratic Republic of Congo (DRC), currently the world's leading cobalt producer, is expected to cede its top position to Indonesia by the 2040s, according to the International Energy Agency (IEA). This revelation is part of the IEA's Global Critical Minerals Outlook 2025 report, published on May 21.

At present, the DRC is responsible for over two-thirds of the world's cobalt output. However, the IEA anticipates a production decline by 2030 due to a decrease in the quality of the ore mined. Specifically, the agency expects a significant drop of 45% in the country's cobalt volumes by the 2030s.

Contrasting with this trend, Indonesia, the world's leading nickel producer (with cobalt as a byproduct), is projected to see its cobalt production grow by nearly 80% until 2040. Indonesia is thus set to surpass Congolese production.

This forecast aligns with the Cobalt Institute's Cobalt Market Report 2024, which predicts the DRC's share in global cobalt supply to shrink from 76% in 2024 to 65% by 2030. Meanwhile, Indonesia's share of the market should expand from 12% last year to approximately 22%.

While a reduction in production could signify a diminished influence of Kinshasa on the cobalt supply chain, its impact on the Congo's mining revenue remains difficult to assess. In 2022, the Congolese Central Bank estimated that cobalt accounted for roughly 21% of the DRC’s exports. However, due to economic diversification over the next decade and announced disinterest in the metal, cobalt may become less critical for the country preceding its loss of leadership.

The electric vehicle market, the main driver of cobalt demand, is already showing signs of slowdown. Furthermore, energy storage projects are increasingly favouring lithium-iron-phosphate (LFP) batteries over traditional cobalt- or nickel-based ones.

"We have witnessed a truly monumental decrease in the intensity of nickel and cobalt use in battery demand," explains Martin Jackson, a commodities consultant at London-based firm CRU.

Kinshasa’s approach to navigating these shifts remains uncertain. The government's current efforts to enhance the DRC’s position in downstream stages of the value chain, such as refining or materials production for batteries, appear to be viable alternatives for cushioning the incoming shocks.