\n\t![\"\"](\"http:\/\/www.fnarena.com\/ckfinder\/userfiles\/images\/investmentu-cobalt.jpg\")
<\/p>\n
\n\tBut cobalt is making a comeback..<\/p>\n
\n\tAerospace and green technologies have introduced a slew of new applications for cobalt. According to the Department of Energy, cobalt can't be as easily replaced this time around…<\/p>\n
\n\tCobalt: One of 14 Critical Metals to Clean Energy<\/strong><\/p>\n \n\tIn December of 2010, The U.S<\/span>. Department of Energy outlined its "Critical Materials Strategy<\/a>." Cobalt is one of 14 elements defined as a critical metal to clean energy over the next 5-15 years. Nine of these 14 are classified as rare-earth elements.<\/p>\n \n\tThe DOE sees cobalt as such a critical metal because of its use in lithium ion batteries. The DOE predicts that each electric-powered vehicle (PHEVs<\/span> and EVs<\/span>) will demand 9.4 kg of cobalt. That doesn't even include all of the cell phones, tablets and laptops that will continue to use lithium ion batteries. Cobalt is also a significant ingredient in Nickel Cadmium and NiMH<\/span> rechargeable batteries.<\/p>\n \n\tBesides the demand for cobalt from batteries, the other critical use for the metal is in superalloys<\/span>. Cobalt superalloys<\/span> are used extensively in military aerospace engineering. Because of the resistance to heat and corrosion the cobalt superalloy<\/span> is particularly useful for gas turbine engines<\/a>.<\/p>\n \n\tOther industrial uses of cobalt include:<\/p>\n \n\tAlthough cobalt doesn't get a ton of press, it's a pretty important metal in this day and age. Even if we don't realize it, the U.S<\/span>. government seems to.<\/p>\n \n\t‘A Debilitating Impact' on the U.S<\/span>.<\/strong><\/p>\n \n\tMIT's technology review<\/a> reported that U.S<\/span>. diplomatic cables released by WikiLeaks<\/span> last year mention an African cobalt mine. According to the report, The Department of Homeland Security claimed that the single mine is so important that it's "incapacitation or destruction… would have a debilitating impact" on the national economy and U.S<\/span>. Security.<\/p>\n \n\tConsidering the volatile state of Africa's political scene, it's not very reassuring. But since only 15 percent of U.S<\/span>. consumption of cobalt is via recycled metals, the United States relies on 85 percent of its cobalt from foreign sources.<\/p>\n \n\tSomething else that isn't reassuring for Americans – 40 percent of all cobalt production is from African mines, and 99 percent of that African cobalt is processed and sold by the Chinese. Much like the rare earth metals<\/a>, China has a virtual grapple hold on cobalt production.<\/p>\n \n\tThe U.S<\/span>. hasn't mined cobalt since 1971 and hasn't processed it since 1985. Much like rare earth materials, China used its cheap labor and lack of environmental regulation to undercut the competition.<\/p>\n \n\tBut that is starting to change this year.<\/p>\n \n\tCobalt Projects and Producers<\/strong><\/p>\n \n\tFormation Metals, a small penny stock on the Toronto Exchange, began the Idaho Cobalt Project this year. Formation expects the project to produce 1,500 tons of super-alloy grade cobalt annually over the next 10 years, roughly 3 percent of the global supply.<\/p>\n \n\tTwo other U.S<\/span>. projects are expected to get underway in the next few years that should yield cobalt:<\/p>\n \n\tWhile most cobalt producers and processors are foreign, there are a few other cobalt players in the American markets.<\/p>\n \n\tCobalt Supply ‘Should' Outpace Demand<\/strong><\/p>\n \n\tAdding to new U.S<\/span>. ventures, there are also cobalt mining projects coming online soon in Canada and Australia. With all this supply expected to enter the markets, it's likely that cobalt prices are likely to remain somewhat low for now.<\/p>\n \n\tThe USGS<\/span> believes that "global increases in supply from existing producers and new projects are forecast to outpace increases in consumption."<\/p>\n \n\tBut that doesn't mean cobalt shouldn't be on your radar as an investor. The Democratic Republic of Congo is a very volatile place that is still reeling from a recent civil war. Violence and protesting disrupted mining operations <\/a>in the region as recently as October 2009.<\/p>\n \n\tIt's not out of the question that something drastic may happen in that region of the world. As a result cobalt would be certain to experience a dramatic rise in price.<\/p>\n \n\tIt'd be wise for investors to keep an eye on this developing industry and world news that affects it over the next few years.<\/p>\n \n\tGood investing,\n
\n
\n
\n\tJustin Dove <\/p>\n