ASX Cobalt Stocks: Investment Opportunities in 2023
Team Veye | 24-Aug-2023
Cobalt is a silvery metal primarily used to make heat-resistant alloys and permanent magnets. The cobalt mining industry has been anticipated to grow strongly in Australia, with strong reserves and a flagship project pipeline. Australia is already the third-biggest cobalt miner, and with the world's second-largest reserves, the country is well equipped to sustain growth as reported the Geoscience Australia. Cobalt is on the edge of a significant demand spike as batteries become an increasingly common part, driven by the rise of renewables.
Australia accounts for 16% of the global cobalt resources but, at present, only produces approximately 5%. All over the world, 98% of cobalt is a by-product of nickel. In the case of copper, it’s 60% of that market. And in Nickel’s case, it’s around 38%. Cobalt is essentially an accidental metal.
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Investing in ASX Cobalt Stocks?
Cobalt is a base material applied in manufacturing and is a by-product of refining copper and nickel. This metal is extensively applicable in the materials of electric vehicle batteries, industrial equipment parts, and paints.
Due to the rising demand for lithium ion batteries in electronics devices and electric cars, cobalt prices have been rising at steady rates during the coronavirus pandemic. The increased consumption of battery technology and renewable energy might boost the cobalt stock's upward trajectory. Investors might consider buying ASX cobalt stocks to benefit from the rising demand for electric vehicles.
Demand Driving ASX Cobalt Stocks?
Cobalt is evolving as an important aspect with rising demand, enhanced by the metal’s uptake in the growing lithium-ion battery industry, with a craze of ASX-listed cobalt stocks bringing up cobalt ground to take advantage of the upcoming market.
The demand for growing lithium-ion batteries has flourished in the sustainable energy and electric vehicle markets.
Research firms predict that the lithium-ion battery market is expected to be worth US$77.4 billion by 2024, which will be mainly supported by electric vehicle demand growth.
ASX Cobalt Stocks: Biggest Companies in 2023?
As the cobalt prices have demonstrated with heavy fluctuations over the past few years, up surged in 2021 and taken a sharp correction back to 2017 price level now. There are biggest ASX-listed cobalt stocks with exposure to the commodity are as follows:
Meteoric Resources NL (ASX: MEI), with a market cap of $388.03 million and a current market price of $0.20 (As of August 18, 2023), is an Australian exploration company that explores mineral tenements in Brazil and Western Australia.
Meteoric Resources NL had a pact in a cooperation agreement with the State Economic Department and the State Government of Minas Gerais.
Meteoric Resources NL refers to its announcement titled Cooperation Agreement Signed with the Government of Minas Gerais dated The Company provides the following additional information relating to the cooperation agreement and the MOU referred to in that announcement.
Anson Resources Limited (ASX: ASN) has a market capitalization of $181.07 million and a current market price of $0.143 (as of August 18, 2023). It is an Australian exploration and development company involved on the exploration, acquisition, and development of natural resources.
Anson Resources Limited reported the completion of a Numerical Groundwater Flow Model for the region, covering both the Paradox and Green River Lithium Projects in south-eastern Utah, USA.
The Company’s objective is to maintain shareholder long term relationship value through the exploration, acquisition of natural resources that meet the future demand for new energy and technology markets.
Aeon Metals Ltd. (ASX: AML) has a market cap of $17.54 million and a current market price of $0.016 (as of August 18, 2023). It is an Australian-based mineral exploration and development company listed on the Australian stock exchange. Aeon holds a fully owned interest in the Walford Creek Project, situated in north-west Queensland, around 340km to the north-west of Mount Isa.
Aeon Metals Limited has contracted the services of two drill rigs. One is a specialized RC drill rig to complete deep RC in some areas. The other is a multi-purpose drill rig capable of both RC and diamond drilling. They are both expected to commence work on a planned 20,000-metre programme in June 2023.
Australian Cobalt Market – Understand
The cobalt mining sector has been growing at 4% year over year in the Australian market. Post-pandemic, the Australian government had notified and emphasized that mining was a key business and that cobalt mining operations had to recommence again rigorously post-pandemic.
The rating agency Fitch foresees Australia having increasing cobalt production growth, indicating various basic drivers. Fitch predicts Australia’s cobalt sector will experience 5.3% average growth between 2021 and 2029, compared to the average growth rate of 2.4% between 2010 and 2020. Australia has been positioned as the third-largest country in the world on the rating agency’s (Fitch) mining risk reward index, notably higher than the DRC, which is positioned at 51.
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Frequently Asked Questions (FAQ)
What is cobalt?
Cobalt is a silvery metal primarily used to make heat-resistant alloys and permanent magnets.
Who produces cobalt on the ASX?
Jervois Global Limited (ASX: JRV) is involved in mineral exploration and evaluation and mine construction, including associated metallurgical test work and research and development activities. The company is considered to be strongly engage in cobalt production in Australia. The market cap of the company is $140.53 million as of 18 August 2023.
Is there cobalt mines in Australia?
According to world Data, Australia was the third-largest producer of cobalt in 2022 globally, with output up by 8% compared to 2021. During the first half of 2020, Australia's Glencore Murrin Murrin nickel cobalt mine located in Western Australia produced 14% year-on-year growth in cobalt production, to 1.6 kt.
Which companies produce cobalt in Australia?
Sunrise Energy Metals Limited (ASX: SRL) is developing the classic Sunrise battery materials complex. The Sunrise project is one of the largest and most cobalt-rich nickel laterite deposits in the world, with all key permits in place. The company also has one of the largest and highest-grade scandium deposits in the world.
Anson Resources Limited (ASX: ASN) has produced its first battery-grade lithium carbonate from brines from its Paradox Lithium Project in Utah.
What is the best stock for cobalt?
With a reasonably priced and active engagement in cobalt production, Aeon Metals Limited (ASX: AML) has a market cap of $17.54 million and a current market price of $0.016 (as of August 18, 2023). It is an Australian mineral exploration company listed on the Australian stock exchange and is the best cobalt stock.
Why is cobalt price dropping?
Post-2022, with interim measures of taming inflation, efforts from the central banks from all over the world have taken initiative, which has been impacting industrial growth sentiments and the rising interest rate, which has been the major problem behind the continuous fall in cobalt prices as a commodity.
Can I invest in cobalt?
Investors may invest in ASX companies focusing on cobalt resource exploration. ASX cobalt shares can be added to the portfolio for diversification benefits.
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