Several factors can cause this to happen: new technology, changing consumer preferences, supply constraints, or skyrocketing demand can all bring an unknown metal to the forefront of discussion. Cobalt could be the latest metal that fits this description. It’s a crucial metal to the boom in lithium-ion battery demand, but it also has an increasingly precarious supply chain that could be very volatile moving forward.

Why Investors Should Look at Cobalt

Today’s infographic comes from eCobalt Solutions, a company focused on providing ethically produced and environmentally sound battery grade cobalt salts. It presents the investment case for the relatively unknown metal.

With the green movement in full swing, there is compelling evidence that cobalt could be the next relatively unknown metal to rise to prominence. Here are the top 10 reasons that investors should look at cobalt:

  1. Cobalt is one of the few metals used for superalloys. Nearly 20% of all cobalt is used for superalloys – a class of high-tech metals that originally emerged to suit the high operating temperatures of jet engines. There are three main superalloy types:

Nickel-based: the bulk of alloys produced Cobalt-based: higher melting point gives ability to absorb stress, and corrosion resistance Iron-based: the original superalloy, invented prior to the 1940s

Their use has extended into many other fields – and today, superalloys are used in all types of turbines, space vehicles, rocket engines, nuclear reactors, power plants, and chemical equipment. 2. The green economy runs on cobalt. There are many types of lithium-ion batteries, but the vast majority of li-ions sold today use cobalt in some capacity. In fact, by 2020 it is expected that 75% of lithium-ion batteries will contain cobalt. Why? It’s because cobalt is the most important metal for increasing the energy density of lithium-ion cathodes. 3. …And green uses such as EVs are driving the upwards trajectory of cobalt demand. By 2020, almost 1/5 of cobalt demand will stem from electric vehicles. Total refined cobalt demand: “Cobalt’s demand growth profile remains one of the best among industrial metals peers. Its exposure to rechargeable batteries continues to play a crucial role.” – Macquarie 4. Getting cobalt is the hard part. 98% of cobalt is produced as a by-product of copper and nickel mines. The problem? If copper and nickel production isn’t growing, then more cobalt isn’t mined to meet demand. 5. Why not find more cobalt? It’s easier said than done. The vast majority of the world’s cobalt lies in risky regions like the DRC.

  1. And so supply can tighten… Chemical cobalt – the kind used in batteries, is expected to fall into a growing deficit over the next few years. By 2020, CRU expects that deficit to be at least 12,000 tonnes.
  2. Meanwhile, the U.S. government definitely doesn’t have any strategic stockpiles. According to the U.S Defense Logistics Agency, the government sold off cobalt all the way up until 2008. Now there is only 301 tonnes left in strategic stockpiles.
  3. Cobalt was one of the best-performing metals in 2016.
  4. Cobalt prices have been rising, but they are nowhere near all-time highs yet. All-time highs for cobalt prices happened in 2008, after the DRC government placed restrictions on export of ores and concentrates. For a brief stint, cobalt prices even exceeded $50/lb. The current price? Roughly $16/lb.
  5. Many experts predict the cobalt market to be interesting to watch in 2017: “Just how much cobalt is in stockpiles in China is the Million Dollar Question. Clarity here can materially affect the cobalt price.” Chris Berry, House Mountain Partners, LLC “The refined cobalt market will fall into a 3,000 tonne deficit this year following seven years of overcapacity and oversupply. CRU anticipates prices to increase onward into 2017…” – Edward Spencer, CRU Group “With this growth will come further disruption to the traditional market structures that have developed in cobalt over the last 30 years. In short, a new, more secure supply chain for the modern era will need to be created, a task that includes new mines, new refineries, and a more transparent supply chain.” – Andrew Miller, Benchmark Minerals on

#1: High Reliability

Nuclear power plants run 24/7 and are the most reliable source of sustainable energy.  Nuclear electricity generation remains steady around the clock throughout the day, week, and year. Meanwhile, daily solar generation peaks in the afternoon when electricity demand is usually lower, and wind generation depends on wind speeds.As the use of variable solar and wind power increases globally, nuclear offers a stable and reliable backbone for a clean electricity grid.

#2: Clean Electricity

Nuclear reactors use fission to generate electricity without any greenhouse gas (GHG) emissions.Consequently, nuclear power is the cleanest energy source on a lifecycle basis, measured in CO2-equivalent emissions per gigawatt-hour (GWh) of electricity produced by a power plant over its lifetime. The lifecycle emissions from a typical nuclear power plant are 273 times lower than coal and 163 times lower than natural gas. Furthermore, nuclear is relatively less resource-intensive, allowing for lower supply chain emissions than wind and solar plants.

#3: Stable Affordability

Although nuclear plants can be expensive to build, they are cost-competitive in the long run. Most nuclear plants have an initial lifetime of around 40 years, after which they can continue operating with approved lifetime extensions. Nuclear plants with lifetime extensions are the cheapest sources of electricity in the United States, and 88 of the country’s 92 reactors have received approvals for 20-year extensions. Additionally, according to the World Nuclear Association, nuclear plants are relatively less susceptible to fuel price volatility than natural gas plants, allowing for stable costs of electricity generation.

#4: Energy Efficiency

Nuclear’s high energy return on investment (EROI) exemplifies its exceptional efficiency. EROI measures how many units of energy are returned for every unit invested in building and running a power plant, over its lifetime. According to a 2018 study by Weissbach et al., nuclear’s EROI is 75 units, making it the most efficient energy source by some distance, with hydropower ranking second at 35 units.

#5: Sustainable Innovation

New, advanced reactor designs are bypassing many of the difficulties faced by traditional nuclear plants, making nuclear power more accessible. 

Small Modular Reactors (SMRs) are much smaller than conventional reactors and are modular—meaning that their components can be transported and assembled in different locations. Microreactors are smaller than SMRs and are designed to provide electricity in remote and small market areas. They can also serve as backup power sources during emergencies. 

These reactor designs offer several advantages, including lower initial capital costs, portability, and increased scalability. 

A Nuclear-Powered Future

Nuclear power is making a remarkable comeback as countries work to achieve climate goals and ultimately, a state of energy utopia. Besides the 423 reactors in operation worldwide, another 56 reactors are under construction, and at least 69 more are planned for construction. Some nations, like Japan, have also reversed their attitudes toward nuclear power, embracing it as a clean and reliable energy source for the future.  CanAlaska is a leading exploration company in the Athabasca Basin, the Earth’s richest uranium depository. Click here to learn more now. In part 3 of the Road to Energy Utopia series, we explore the unique properties of uranium, the fuel that powers nuclear reactors.

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