Glencore, China’s GEM extend strategic cobalt partnership
Mining News Pro - Diversified mining and marketing company Glencore has extended its partnership with GEM of China for the supply of cobalt hydroxide by another five years.

Both companies have also formally embedded responsible sourcing and sustainability into the contractual relationship.

Under the terms of the agreement, Glencore, headed by CEO Ivan Glasenberg, will provide around 150 000 t of cobalt contained in hydroxide for GEM between 2020 and 2029.

Glencore and GEM are committing each other to annual audits under OECD-aligned standards, specifically, the Cobalt Refiner Supply Chain Due Diligence Standard developed by the Responsible Minerals Initiative, Responsible Cobalt Initiative and Chinese Chamber of Commerce of Metals, Minerals & Chemicals Importers & Exporters. This shared commitment will help to demonstrate strong responsible sourcing practices and transparency across multiple points along the supply chain, the companies stated in a media release to Mining Weekly.

The Cobalt Institute, of which Glencore is a member, has developed the Cobalt Industry Responsible Assessment Framework (CIRAF), an industry-wide risk management tool that helps cobalt supply chain players identify production and sourcing related risks. This long-term strategic cobalt partnership includes a commitment to use CIRAF when communicating publicly on environmental and social issues specific to the cobalt supply chain.

GEM chairperson Xu Kai Hua stated that despite Covid-19, the adoption of new energy vehicles was accelerating: “There is no doubt that they are revolutionising the world`s automobile industry.”

As a result, cobalt, as a key raw materials for electric vehicle batteries, would, he said, become a global strategic resource of extreme importance for the rapidly growing new energy vehicles market in China and the rest of the world.

“This ten-year cobalt supply agreement reflects a deepening of the strategic cooperation between cobalt resources and the market in the face of the changing competitive landscape and the booming trend of new energy in the world and will fundamentally stabilise the development of GEM cobalt products. There is a huge demand for cobalt resources in the global market,” Kai Hua said.

“There is no doubt that this agreement provides a long-term guarantee for the supply of responsibly mined cobalt to help stabilise the global share of GEM cobalt products. This agreement will also help address the demand for cobalt in China’s new energy market. After the signing of this agreement GEM will no longer worry about the supply of responsible cobalt. GEM can focus on the manufacturing of cobalt products to meet the global demand for quality and technological innovation.

“The partnership between Glencore and GEM sets an excellent example of focusing on responsible sourcing and sustainability across the supply chain,” he added.

Glencore head of copper and cobalt marketing Nico Paraskevas expressed pleasure at the extension of the partnership and spoke of cobalt providing thermal stability and longevity of performance in batteries and thus playing a key role in enabling the transition to a low-carbon economy.

“Long-term security of cobalt supply and cobalt demand visibility are critical to prevent supply shortages that could impede the energy transition and, ultimately, the world’s ability to meet climate change targets. As the cobalt supply chain matures with greater emphasis on long-term partnerships, this contract is just one example of Glencore and its customers working together towards the adoption of industry leading standards on responsible sourcing and environmental and social corporate governance,” Paraskevas added.

As one of the world’s largest global diversified natural resource companies and a major producer and marketer of more than 60 commodities, Glencore’s operations have around 150 mining and metallurgical sites and oil production assets and its industrial activities are supported by its global marketing network. Customers are industrial consumers, such as those in the automotive, steel, power generation, battery manufacturing and oil sectors.

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