Apple is rumoured to be working on a deal that will allow it to buy cobalt, an essential battery material, directly from miners. It’s prompted by fears that electric vehicles will create shortages.
Apple is believed to be in talks to buy long-term supplies of cobalt directly from miners. The company is said to be making the move in order to guarantee that it will have enough of the key battery component. There are fears that battery-material supplies will become scarce as the number of electric vehicles increases.
According to Darton Commodities, cobalt use in electric vehicles and other lithium-ion battery applications was at 48,900 tonnes in 2016, and raised to 55,400 tonnes in 2017. The figure is expected to skyrocket to 159,900 tonnes in 2025 and to 324,300 tonnes in 2030. By securing a deal directly with miners, Apple can ensure that it can continue the steady production of iPhone, iPad, and iPod devices.
A confidential source, speaking to Bloomberg, claimed that Apple is seeking to establish contracts to secure several thousand metric tonnes of cobalt per year for the next five years or more. The talks began over a year ago but it’s not certain that Apple will take a deal in the end. On it’s part, Apple declined to comment on the issue.
Apple is competing with the likes of BMW AG, Volkswagen AG, and Samsung SDI Co. to sign multi-year contracts with cobalt miners. South Korea’s top oil refiner, SK Innovation Co., agreed to a deal this week of $3.9 billion with Australian Mines Ltd. BMW is also close to securing a 10-year supply deal.
In 2016,Apple and Samsung came under fire from Amnesty International after it alleged that the two phone makers were buying cobalt from mines that use child labour. As a response, Apple said that it would not use cobalt from small-scale mines in Congo until it could verify that “appropriate protections” were in place.
Source: Bloomberg
