Apple is reportedly in talks to sign long-term agreements to buy up vast amounts of cobalt directly from miners in order to protect its supply line.
The Californian tech-giant has normally relied on the companies which make its batteries to source their own materials. The talks, which are confidential, are likely to see Apple secure five years’ worth of supply of cobalt which is expected to be into the thousands of metric tonnes.
The move is expected because of fears of a cobalt shortage as the auto-industry looks to replace fossil-fuel cars with vehicles that run on electricity. BMW and Volkswagen, as well as rival phone manufacturer Samsung, are all in the process of signing long-term agreements as buying it from source will enable the company to formulate long-term plans based on the resources it controls.
Apple is one the biggest consumers of cobalt in the world. The metal is a key ingredient for use in lithium-ion mobile phone batteries which takes up an estimated quarter of the world’s cobalt output. Although mobile phones only take up eight grams of the metal, at present car batteries take up over 1,000 times more.
Cobalt has tripled in price over the past 18 months and is presently trading at $80,000 per metric tonne.
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