Ethical Supply: The Search for Cobalt Beyond the Congo

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The following content is sponsored by Fuse Cobalt.

Ethical Supply: The Search for Cobalt Beyond the Congo

Each new generation finds new uses for materials, and cobalt is no exception.

Historically, potters and painters used cobalt as dye to color their work. Today, a new cobalt supply chain is emerging to build the next generation of clean energy.

However, there is lack of transparency surrounding the current supply chain for cobalt, as the metal is subject to a number of ethical issues from its main country of production—the Democratic Republic of Congo (DRC).

Today’s infographic comes to us from Fuse Cobalt and uncovers the potential for new sources of cobalt beyond the Congo.

Cobalt’s Growing Demand

Cobalt’s specialized properties make it crucial for rechargeable batteries, metal alloys, and EVs:

  • Thermal stability
  • High energy storage
  • Corrosion resistance
  • Aesthetic appeal

As the markets for EVs and rechargeable batteries grow, the demand for cobalt is expected to surge to 220,000 metric tons by 2025, a 63% increase since 2017.

But can industry meet its demand with a supply of ethically mined cobalt?

A Precarious Supply Chain

In 2019, the DRC produced 70% of global mined cobalt—a majority of which went to China, the leading importer of mined cobalt and an exporter of refined cobalt.

Moreover, 8 of the 14 largest cobalt mines in the DRC are owned by Chinese companies, resulting in a highly controlled supply chain.

Why the Democratic Republic of Congo?

When it comes to cobalt reserves and concentrations, DRC looms over the rest of the world as a clear leader.

CountryCobalt reserves as of 2019 (tons)
Congo (Kinshasa)3,600,000
Australia 1,200,000
Cuba500,000
Philippines260,000
Russia250,000
Canada230,000
Madagascar120,000
China80,000
Papua New Guinea56,000
United States55,000
South Africa50,000
Morocco18,000
Rest of the World500,000
World total (rounded)7,000,000

The African Copper Belt hosts the majority of the DRC’s cobalt deposits, where it is primarily mined as a by-product of copper and nickel mining.

Low labor costs, loose regulations, and poor governance in the DRC allow for the flourishing of artisanal mining and cheap sources of cobalt.

However, cobalt from the DRC is tainted by ethical and humanitarian issues, including:

  • Child labor
  • Corruption
  • Crime
  • Poverty
  • Hazardous artisanal mining

With the current supply chain of cobalt facing scrutiny and criticism, a transformation in the cobalt universe is well underway.

Cobalt’s Changing Landscape

As consumers become aware of the dirty costs of cobalt mining in the DRC, battery and EV manufacturing companies are looking for ethical sources.

Tesla, BMW, Ford, and Volkswagen are part of more than 380 companies that have committed to responsible sourcing through the Responsible Minerals Initiative. Responsible sourcing entails increasing supply chain transparency and searching for sources of cobalt outside the DRC.

Here’s how some companies are leading the way:

  • Ford, Huayou Cobalt, IBM, LG Chem, and RCS Global are using blockchain technology to improve transparency and trace the sources of cobalt.
  • BMW signed a $110 million deal for cobalt from Morocco’s Bou Azzar Mine, in an effort to avoid cobalt sourced from the DRC.
  • Tesla agreed to buy 6,000 tonnes of cobalt annually from Glencore, a multinational company financing North America’s first cobalt refinery.

The U.S. recently added cobalt to its list of critical minerals—minerals for which it seeks independence from imports. The effort aims to reduce its net import reliance of 78% for cobalt, encouraging more localized and reliable production.

As a result of these shifts, the entire supply chain is beginning to reconsider cobalt sources in better-managed jurisdictions.

Cobalt Beyond the Congo: Why Not North America?

North America has comparable sources of cobalt to what is found in the Congo. As of 2019, Canada had 230,000 tons in cobalt reserves, whereas the U.S. had 55,000 tons.

Canadian Opportunity

Ontario hosts some high-grade cobalt deposits such as the Cobalt Silver Queen, Nova Scotia, Drummond, Nipissing, and Cobalt Lode mines.

In fact, Bill Gates, Jeff Bezos, and other billionaires from the Breakthrough Energy Fund are already fueling the exploration and development of cobalt deposits in North America.

Unsung North American Potential

The United States is home to 60 identified deposits of cobalt. These sources along with Canada’s deposits, should provide explorers and miners with a massive opportunity to develop cobalt mining in North America.

As the EV industry booms with gigafactories in construction, will North American carmakers and other battery makers be able to pivot to ethical, local raw materials?

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How is the renewable energy shift unfolding? This exploration highlights the market and governmental forces in action.

eToro Renewable Energy Shift Shareable

As the impacts of climate change and the importance of decarbonization have started to become clear, it’s hard to ignore the ongoing shift towards embracing renewables.

Today, the renewables energy market has already become the energy industry’s biggest driver of growth, and both governments and businesses have been pressed to solidify their commitments to green energy.

This infographic from eToro highlights the many developments propelling the shift towards renewable energy, and shines a spotlight on what investors should expect in the market.

Renewable Energy’s Growing Market Presence

Investments in clean energy have been growing both quickly and consistently.

Before 2010, annual global investment in clean energy climbed from just tens of billions to $177 billion in 2009. But in the following decade, annual investment in renewables regularly surpassed $200 billion, reaching $303.5 billion in 2020.

Early spending in the field was led by the EU, but recently China and the U.S. have become the world’s largest spenders in clean energy.

As interest in renewables has grown, so has the sector’s impact on capital markets. Of the 174 announced M&A deals in the U.S. power and utilities industry slated for 2021, 83% involve renewables.

Combined with increasing pressure from shareholders of public companies (and especially energy producers) for climate-related resolutions, 2021 is expected to be the first time renewable energy surpasses oil & gas as the energy industry’s largest area of spending.

At the same time, governments are feeling pressured to commit to the Paris climate accords beyond mere statements, with many countries signing net-zero emission laws.

CountryNet-Zero Emissions Target Year
Sweden2045
Denmark2050
France2050
Hungary2050
Germany2050
New Zealand2050
Spain2050
U.K.2050

Wind and Solar Lead The Renewable Energy Shift

Knowing where the shift towards clean energy is happening is equally as important.

Early investments in clean energy transitions were spread out across many promising sectors, including hydro, nuclear, and carbon-capture for fossil fuel production. But over the past 10 years, wind and solar energy have been leading the charge.

Levelised costs for solar electricity are already estimated as lower than gas or coal as of 2020, thanks to rapidly dropping output costs.

Electricity SourceEstimated Levelised Cost per MWh (2019)
Solar PV
(China & India)
$20-$40
Solar PV

(U.S. & Europe)

$30-$60
Gas$50-$90
Coal$50-$120

In terms of capacity, the global installation of wind and solar has already eclipsed hydro electricity, and is expected to pass both gas and coal by 2024.

Expected increases in renewable energy capacity are estimated to almost match the increasing global demand for energy. However, much of that demand is still expected to be met by fossil fuels, especially for regions with massive, scalable demand.

But as the renewable energy shift continues to pressure greater adoption of clean energy measures, further investment in renewable production and cost cutting, the market demand is expected to shift to green as well.

How Can Investors Take Part?

eToro’s RenewableEnergy CopyPortfolio* gives investors direct access to the valuable renewable energy market.

Curated by experienced and proven investment teams, the thematic portfolio offers exposure to both veteran companies and up-and-coming pioneers in the renewable energy space, with no management fees.

*Your capital is at risk.
CopyPortfolios is a portfolio management product, provided by eToro Europe Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.

CopyPortfolios should not be considered as exchange traded funds, nor as hedge funds.

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COVID-19 has only accelerated online fraud. Here’s a closer look at how your business can prevent future cyber attacks.

Online Fraud

COVID-19 has created a watershed moment in the shift to digital, triggering a wave of online fraud in the process.

Direct messages can be accessed, and passwords changed—with critical infrastructure at stake. By way of social engineering, perpetrators exploit human weakness and vulnerabilities. It raises an unsettling prospect: as the world becomes increasingly digital, what does this mean for security?

Leveraging a rich dataset, this infographic from Equifax unearths several new trends in digital fraud, and shows how businesses can prevent online scams without impacting user experience.

Understanding How Online Fraud Affects You

Here are just a few of the trends impacting lenders, service providers, and the U.S. government.

Credit Cards

Credit card fraud is not a new phenomenon. The COVID-19 era, however, has accelerated it for both businesses and consumers. Credit card fraud on new accounts has spiked 88% since 2018, impacting roughly 250,000 U.S. individuals. This is where scammers use a stolen, synthetic identity to open a new account and maximize credit limits.

Meanwhile, consumers are turning to ecommerce experiences more so than ever before to purchase necessities, entertainment, and more. This means shopping with new vendors and making more card-not-present purchases.

With an increase in transactions comes an increase in chargebacks, either from friendly fraud or legitimate disputes. It’s something that hasn’t gone unnoticed: In fact, 40% of businesses have noticed an increase in chargebacks since January of 2020.

Number of Victims

Overall, the number of fraud victims has jumped 20% according to reported fraud victim alerts. In 2019, the most reported fraud alerts affected those aged between 60-69, with an average of $600 in losses.

AgePercentage of LossesMedian LossTotal Losses
19 and under3%$200$14M
20-2913%$448$124M
30-3916%$379$168M
40-4915%$410$178M
50-5916%$500$186M
60-6920%$600$223M
70-7912%$800$150M
80 and over5%$1,600$72M
Total (across all age groups)100%$448$1,115M

*Based on 1,697,934 fraud reports in 2019, with 51% including age information
Source: Federal Trade Commission (Jan, 2020)

Now, fraudsters are using phishing schemes and COVID-19 scams by setting up fake websites with false COVID-19 information.

Synthetic Identity Risk

Often used in credit card fraud, synthetic identity theft happens when criminals construct a fake identity—based on both real and fake information—to make fraudulent purchases. Synthetic identity fraud can include account piggybacking, setting up a fake business, or teaming up with corrupt merchants. Scams that manipulate people with good credit have shot up 36% since 2018.

Authorized User Abuse

As the pandemic has unfolded, authorized user abuse has increased more than 20%.

Authorized user abuse occurs when low-risk primary card owners “rent” their tradelines with extensive credit histories, high credit limits and solid repayment profiles to others, often, knowingly, to fraudsters.

So how can businesses protect themselves against these increasingly sophisticated tactics?

Navigating the Right Balance

Preventing fraud is simple: stop accepting transactions or allowing new account creation. But, that stifles business growth. More friction isn’t the answer either. Businesses need to navigate the balance of delivering seamless experience and fraud prevention.

To improve online security for any business, it’s important to understand the consumer lifecycle journey. Typically, pain points across this cycle fall within two camps: customer experience or security protections.

TypePain PointSolution
Customer experienceDelivering an optimal experience
  • Businesses can ask consumers to supply less personal information
  • Apply behind-the-scenes data collection to verify identity
  • Conduct passive checks, which collect data without direct interaction with the end user, before verifying identity

  • SecurityRegistration
  • Utilize identity information to streamline the registration/sign-up process, which can reduce the amount of input a consumer needs to input

  • Log-in or Authentication
  • Leverage device facial recognition, fingerprints for login ease

  • Payment
  • Use digital signals such as device or location without compromising risk

  • As a result, these can improve businesses’ monetization value and help the bottom line.

    Pinpointing these specific, layered solutions can make the difference between winning over a new customer or not—without sacrificing your security.

    Online Fraud: What Happens Next?

    Still, striking the right balance between customer experience and security can be challenging.

    But when these solutions are implemented, a 73% drop in fraud report incidents is reported by some users. Along with this, a double-digit jump in credit approvals takes place, while overhead costs linked to expensive application reviews sink 30%.

    To mitigate threats and prevent consumer bottlenecks, businesses can apply solutions such as:

    • Account verification
    • Digital identity trust
    • Document verification
    • Multi-factor authentication

    Further, businesses can look to establish the level of trust or risk at every interaction across the customer journey, from account creation and login to payment transaction.

    High-trust interactions can move along a seamless, VIP experience, while riskier interactions can be dynamically challenged with friction. A vast identity trust network combined with adaptive AI helps businesses to make appropriate decisions at each interaction. This protects both the business and customer experience.

    Combined, they provide the early warning technology that thwarts online fraud and digital attacks—with lasting implications for businesses in the COVID-19 digital era.

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