Glencore Plc announces an offtake deal with Missouri Cobalt

Glencore Plc agreed to an offtake deal with Missouri Cobalt LLC, giving the world’s biggest commodity trader more exposure to the crucial battery metals.

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The agreement follows a steep rise in the price of battery metals over the past year amid surging sales of electric vehicles. The hike has threatened carmakers’ margins while rising demand has sparked fears of a scarcity of mined raw materials such as lithium, cobalt, and nickel.

Glencore will buy all of Missouri Cobalt’s production of those three battery metals, the trading house said in a statement. It gave no details of the offtake terms, saying only there’s “significant embedded pre-payment.” It also said the two companies will explore other joint opportunities, including recycling.

Glencore, already the leading cobalt producer from its mines in the Democratic Republic of Congo, has struck a series of deals in recent weeks to secure more metals by recycling old batteries. 

Missouri Cobalt, which operates the Madison mine in the U.S. state, said in a separate statement that it was changing its name to the United States Strategic Metals LLC. The company hired Goldman Sachs Group Inc. last year to assess the possibility of a public listing, Reuters reported in June.

Earlier this month Glencore announced the UK’s first battery recycling facility in a joint venture with Britishvolt, which processes 10,000 tons of lithium-ion batteries annually. In January Glencore signed an agreement with US firm Managem to produce cobalt as well as specialized nickel and lithium products from battery scrap materials or ‘black mass’.

Both the joint ventures give a push by Glencore into the business and will help to ease the supply of critical battery metals to the electric vehicle industry. They will also further Glencore’s target of becoming a net-zero total carbon emitter by 2050.

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