When the Democratic Republic of Congo imposed an export ban on cobalt in February 2025, then replaced it with strict quotas, it triggered a 130 percent price surge that exposed just how fragile the global battery supply chain has always been. The IEA's July 2026 Global Critical Minerals Outlook confirms the shock was not an accident or an anomaly; it was a policy decision by a sovereign government that controls 70 percent of the world's cobalt, and it has permanently altered the economics of electric vehicles, energy storage, and Western industrial strategy.
Introduction
On a February morning in 2025, somewhere in the labyrinthine administrative corridors of Kinshasa, a directive landed that would eventually ripple through every major automotive assembly line in Europe, every battery gigafactory in South Korea, and every energy storage project under construction across the American Southwest. The Democratic Republic of Congo, which sits atop roughly 71 percent of the world's proven cobalt reserves and produces more than 70 percent of its annual supply, had decided it was no longer willing to be the world's indifferent mineral pantry. Cobalt prices were near nine-year lows. The government had watched international buyers absorb Congolese ore at bargain prices for years. That morning, Kinshasa imposed an outright export ban.
By October, the ban had been replaced with a quota system capping annual exports at 96,600 tonnes, less than half of the country's 2024 production volume of approximately 204,000 tonnes. By the time the IEA released its Global Critical Minerals Outlook in July 2026, cobalt prices had risen by around 130 percent, touching nearly $58,000 per metric ton in the first quarter of 2026, levels not seen since mid-2022. The IEA's Executive Director, Fatih Birol, offered a characteristically precise summary of what had happened: 'Vast amounts of economic value depend on relatively small volumes of critical minerals, whose supply chains remain highly concentrated and are therefore vulnerable.'
The DRC's intervention did not occur in a vacuum. It arrived as lithium prices more than doubled, copper hit record highs, and tungsten surged sixfold amid tightening availability. What the cobalt episode made unmistakably clear, in ways that years of academic supply chain analysis had failed to convey, is that resource nationalism is no longer a Chinese phenomenon. It is a planetary one, and it is accelerating.
The Anatomy of a Market Shock
To understand the scale of what Kinshasa engineered, it helps to begin with where cobalt prices were before the intervention. In early January 2025, cobalt hydroxide CIF China was assessed at $5.80 per pound. The market was oversupplied, plagued by a glut that had been building for the better part of two years as new mines came online faster than EV demand could absorb their output. Prices had spent much of 2024 declining, falling 13 percent through the course of that year alone. Battery manufacturers, particularly those in China with long procurement horizons, were comfortable. Supply was abundant, prices were low, and there was little pressure to lock in alternative sources.
The February 2025 export ban changed all of that within weeks. By October, benchmark prices had surged from approximately $21,500 per tonne to $48,570. Cobalt hydroxide, the primary feedstock, more than quadrupled in price over the same period. By December 19, 2025, European cobalt metal assessed at Rotterdam had risen 139 percent year-on-year, from $10.05 per pound to $24 per pound. Cobalt metal entered 2026 at $56,414 per metric ton. The market, which had been structurally oversupplied, was suddenly heading into deficit.
The IEA now projects the cobalt supply gap will widen from just over 15 percent to more than 25 percent, a deterioration it attributes directly to the quota regime. Fastmarkets analyst Olivier Masson put the stakes plainly: the Congolese export quotas could expand the projected shortfall from 16,000 to 80,000 metric tonnes. That is the difference between a manageable tightness and a structural crisis for battery manufacturers whose medium-term production plans were written in a world of cheap, abundant cobalt.
The quota architecture itself is more sophisticated than a blunt production ceiling. Of the 96,600 tonnes permitted annually for 2026 and 2027, 87,000 tonnes are distributed to producers on a pro rata basis. The remaining 9,600 tonnes sit under the discretionary control of ARECOMS, the DRC's mining regulator. ARECOMS also holds authority to deduct volumes from individual companies' allocations, purchase excess stockpiled material at production sites, and determine the timing and conditions under which those accumulated inventories re-enter global markets. As the IEA noted in its Outlook, downstream buyers must now factor in discretionary interventions by ARECOMS, a form of sovereign supply optionality that effectively transforms cobalt pricing into a partially managed process, not unlike what OPEC has done with oil for five decades.
Glencore, CMOC, and the Fracture Lines of Mineral Sovereignty
When the export ban landed in February, both Glencore and CMOC Group, the two largest cobalt producers operating in the DRC, declared force majeure on their supply contracts. For a brief period, the two companies occupied the same legal posture. Their responses to the October quota system, however, revealed a divergence that carries implications well beyond this single commodity cycle.
Glencore, the Swiss-headquartered mining and trading conglomerate, broadly accepted the new framework. The company's reasoning, while not publicly articulated in detail, aligns with a position increasingly common among Western miners operating in Africa: sovereign assertions over mineral wealth are, at this point, structurally inevitable, and a predictable quota system, however constraining, is preferable to an indefinite export ban. For Glencore, stability has a calculable value even when the stable price is high.
CMOC Group, the world's largest cobalt supplier by volume, took the opposite position. The company opposed the restrictions and argued, pointedly, that tight quotas would accelerate the shift toward cobalt-free battery chemistries. Some analysts read this as a thinly veiled threat, given China's dominant position in LFP battery technology and its ability to redirect its own manufacturing capacity toward chemistries that reduce cobalt exposure. CMOC's posture is particularly striking when set against its production data: in the first half of 2025 alone, the company mined 61,073 tonnes of cobalt, yet its 2026 export quota is set at just 31,200 tonnes, representing only 27 percent of its 2024 annual production.
Building on my earlier reporting on the mechanics of Kinshasa's quota system in 'The Forfeiture' (July 2026), the CMOC situation illustrates something the raw numbers do not immediately convey. CMOC plans to continue expanding its mining operations regardless of the export constraint, because cobalt is extracted alongside copper, and copper prices are at record highs. This means Congolese cobalt production could continue growing even as exportable volumes remain capped, with the difference absorbed into domestic inventory or the ARECOMS strategic reserve. The result is a system in which the DRC government accumulates cobalt holdings with significant optionality over their future release, while Chinese operators with sunk capital in the ground have little choice but to keep digging.
Patrick Mpoyi Luabeya, the chairman of ARECOMS, has been direct about the intent. 'The quota system will suffice to make the final adjustments needed,' he told Fastmarkets in October 2025. 'These adjustments are to rebalance the market over the coming months and in the years ahead.' President Tshisekedi has been even less circumspect, describing the price recovery as evidence that export controls serve as 'a real lever to influence this strategic market' after years of what he characterized as 'predatory strategies' by international buyers. These are not the words of a government managing a temporary price correction. They are the words of a government that has discovered its leverage and intends to keep using it.
A Continent in Motion, a Supply Chain Unprepared
The DRC's intervention does not stand alone. It is, as the IEA framed it in its July 2026 Outlook, part of a broader pattern in which export controls have become a primary instrument of economic statecraft for mineral-producing nations. Zimbabwe and Namibia have imposed restrictions on lithium exports. Malawi has banned the export of raw minerals. Indonesia, the world's largest nickel producer, reduced its 2026 nickel ore production quota to between 250 and 260 million metric tonnes, down from 379 million metric tonnes in 2025. China, meanwhile, has tripled the number of mineral tariff codes subject to its own export controls since 2023, and in May 2026 curbed sulphuric acid exports, sending ripple effects through processing chains for copper, lithium, cobalt and rare earths.
The cumulative effect of these actions is an entirely new price environment for the battery industry. Over 70 percent of the cost of a lithium-ion battery stems from materials, with lithium, cobalt and nickel the decisive variables. When cobalt rises 130 percent and lithium more than doubles in the same period, the business case for battery gigafactories built on two-year-old cost assumptions begins to deform. The manufacturers most insulated are those that shifted early to lithium iron phosphate, or LFP, chemistries, which contain no cobalt. Those still dependent on nickel-manganese-cobalt, or NMC, formulations face a structural repricing of their input costs that cannot be hedged away or absorbed indefinitely.
Roman Aubry, nickel and cobalt analyst at Benchmark Mineral Intelligence, described the lesson of 2025 with characteristic precision: 'Having a single country responsible for the majority of supply has proven to be a significant vulnerability. Looking ahead to 2026, the market has to anticipate continued uncertainty from the DRC.' Indonesia offers one partial offset. Fastmarkets analysts project that Indonesian cobalt-in-MHP production will reach approximately 67,500 tonnes in 2026, up 145 percent from around 46,300 tonnes in 2025. But Indonesia's own quota interventions in nickel, as well as the capital-intensive nature of scaling mixed hydroxide precipitate production, mean that Indonesian supply is neither free of sovereign risk nor immediately sufficient to replace what Kinshasa has removed from the global export market.
The IEA's data on refining concentration underscores the deeper structural problem. Excluding rare earths, the average share of the top refining country rose to 72 percent in 2025, up from 70 percent in 2023. The top three refining nations collectively account for 86 percent of refined mineral supply. China remains the dominant refiner for virtually every critical mineral the IEA tracks, regardless of where the ore was mined. In Europe, prices for gallium and heavy rare earths such as dysprosium and terbium are currently around five times higher than Chinese domestic prices. Germanium prices are nearly three times higher. The cobalt story, in other words, is not simply about what Kinshasa decided to do. It is about what happens when supply chain risk that was always present becomes supply chain risk that cannot be ignored.
The Western Response: Deals, Frameworks, and the Question of Speed
In the months since the DRC imposed its export ban, Western governments have responded with a combination of bilateral frameworks, multilateral commitments and long-term offtake agreements. The pace has been notable. The quality of the architecture, however, remains an open question.
At the U.S. Critical Minerals Ministerial in February 2026, the State Department signed new bilateral frameworks and memoranda of understanding with partner nations in a single day, and launched the Forum on Resource Geostrategic Engagement, known as FORGE. The accompanying statement was frank in its diagnosis: 'This market is highly concentrated, leaving it a tool of political coercion and supply chain disruption, putting our core interests at risk.' At the G7 Summit in Evian in June, as I reported in 'The 60 Percent Line' (July 2026), leaders committed approximately 64 billion euros across 195 projects to reduce dependence on any single non-G7 supplier for rare earths and permanent magnets to below 60 percent by 2030. First Phosphate Corp. formalized investment and offtake agreements under the Critical Minerals Resilience and Production Alliance at the summit itself. In March 2026, the Smackover Lithium project signed a decade-long offtake agreement with Trafigura, committing to deliver 8,000 tonnes of battery-grade lithium carbonate annually once production begins.
Yet the IEA's data complicates the optimism embedded in these announcements. Investment in critical mineral mining fell by 9 percent in 2025, the first substantial decline in recent years. Funding for cobalt and graphite operations, the IEA notes, requires substantial capital before production begins, and rare earth projects face higher technical barriers and longer development timelines than most other minerals. Public finance commitments for critical mineral projects reached $65 billion between 2023 and 2025, a fourfold increase, but the IEA is explicit that this is insufficient relative to the scale of the demand trajectory ahead.
Under the IEA's Stated Policies Scenario, demand for critical minerals nearly doubles by 2040. Lithium demand grows more than threefold. Nickel, graphite and rare earths grow between 50 and 90 percent. Copper adds approximately seven million tonnes of demand by 2040, driven by electricity networks and next-generation technologies. The supply gap for copper has narrowed from 30 percent to 25 percent in this year's Outlook, a modest improvement. The cobalt gap has widened from 15 to 25 percent. These are not projections about a distant future; they are projections about a commodity market that is already being reshaped by the decisions Kinshasa made in February 2025.
The IEA has been specific about what would actually help. Governments need grants, equity participation, concessional loans and loan guarantees to lower upfront financing barriers. Contracts for difference, price cap-and-floor mechanisms, offtake backstops and strategic reserves can reduce the price and volume risks that make private capital reluctant to finance processing and refining capacity outside dominant-supplier nations. These are not novel instruments. What remains novel is their application, at scale and speed, to a problem that has been visible for years but treated as a future concern until Kinshasa made it a present one.
Joachim Braun, the Global Division President of ABB's Process Industries, captured the shift in register that has occurred across the industry: 'The conversation around critical minerals has changed markedly over the past year. They are no longer viewed solely through the lens of the energy transition, but increasingly they have become a defining test of industrial competitiveness, economic security and supply chain resilience.' The sentence worth dwelling on is the last one. Supply chain resilience is not something that can be contracted into existence through a ministerial communique. It requires processing capacity, refining infrastructure and skilled labor that take years to build, in jurisdictions that have so far struggled to build them.
Conclusion: The Lever Stays in Kinshasa
There is a particular irony embedded in the cobalt story that the IEA's careful language tends to obscure. For years, the DRC was positioned in policy discussions as a supplier-nation that needed Western investment, governance support and market access. The implicit assumption was directional: capital and expertise flowing from rich countries toward a resource-abundant but institutionally fragile state, in exchange for reliable mineral supply. What February 2025 revealed is that this assumption was always more fragile than the supply chain it was supposed to secure.
Kinshasa found a lever and pulled it. Prices rose 130 percent. Force majeure declarations cascaded through supply contracts. Manufacturers began accelerating the redesign of battery chemistries to reduce cobalt exposure. Western governments scrambled to sign frameworks and offtake agreements that, had they been pursued three years earlier, might have provided some structural buffer. The DRC quota system is now being studied, according to legal analysts at Gibson Dunn, as a template across other producing jurisdictions. Indonesia has already followed a parallel path in nickel. Zimbabwe and Namibia have moved in lithium. The diffusion of this model is not speculative; it is already underway.
What the IEA's July 2026 Outlook ultimately documents is not a price surge. It documents the end of an era in which critical mineral producers were assumed to be price-takers in a system designed by and for the industrialized world. The cobalt quota, the lithium restrictions, the nickel production ceilings: these are assertions of a different kind of economic agency, exercised by governments that have watched their geological endowments extracted at prices they did not set, for decades.
The battery supply chain that powers the energy transition and the AI economy was built on an assumption of compliant supplier nations. That assumption now costs approximately $58,000 per metric ton. And in Kinshasa, President Tshisekedi has made clear he considers that a fair price for the lesson.