China Moly boosts Q3 cobalt output by around 20% from previous quarter

Credit: REUTERS/Jake Spring

Oct 28 (Reuters) - China Molybdenum Co 603993.SS, 3993.HK lifted its July-September cobalt output by 21.2% from the previous quarter, data released on Wednesday showed, putting the company back on course to hit its full-year production target for the battery metal.

China Moly, which operates the Tenke Fungurume mine in the Democratic Republic of Congo (DRC), one of the world's biggest copper-cobalt deposits, said it produced 10,507 tonnes of cobalt metal in the first nine months of 2020, which was down 16.7% year-on-year, although sales were up 15% at 12,794 tonnes.

The nine-month production number implies third-quarter output of 3,964 tonnes, up from 3,299 tonnes in the second quarter and roughly flat versus 3,997 tonnes a year earlier.

A China Moly spokesman said the quarter-on-quarter rise was due to a change in transit and sales methods instigated by the company's trading arm, IXM.

A strict coronavirus lockdown in South Africa disrupting ports there in late March had forced miners to look for other routes to get their minerals to international markets.

Cobalt prices on the London Metal Exchange CBD0 rose by 19.2% over the third quarter on expectations China is stockpiling the metal and amid concerns of disruption to DRC supply because of the coronavirus.

China Moly's annual production target for cobalt, a key ingredient in batteries for electric vehicles, was set at 14,000-17,000 tonnes for 2020.

Meanwhile, copper metal production at Tenke Fungurume rose 8.3% to 141,966 tonnes in January-September, China Moly said. That implied third-quarter output of 50,994 tonnes, up 19.6% from a year earlier.

The company's annual target for Tenke Fungurume copper production is 163,000-200,000 tonnes.

(Reporting by Tom Daly; Editing by Mark Potter)

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