Citing anonymous sources, Bloomberg reports that the company is trying to secure contracts for several thousand tonnes of cobalt for five years or longer. Lots of industries require Cobalt, which is used in making Lithium Ion batteries and its shortage could mean that the competition would have to pay more to get this crucial element. While smartphones use around eight grammes of refined cobalt, the battery for an electric auto requires more than 1,000 times more. "We are in a supply-demand imbalance and it will take miners a few years to catch up".
So far, no major deals have been announced, although BMW's head of procurement told German daily newspaper Frankfurter Allgemeine Zeitung in early February that it was close to securing a 10-year supply deal.
Apple declined to comment on the report.
The price per ton of cobalt rose to $82,000 on the London Metal Exchange in mid-February, its highest level since it began tracking the commodity in 2010, and has nearly tripled in value since the beginning of 2016.
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The DRC is the richest source of cobalt but smaller deposits are also found in countries ranging from Finland to Canada. Apple has plenty of reason to be concerned as smartphones and electric cars depend on the cobalt, the price of which has doubled in the past 12 months, according to market track InvestmentMine. The country's cobalt imports from the Congo reached US$1.2 billion in the first nine months of previous year.
Cobalt is a byproduct of copper and nickel mining, used until recently to harden steel and before its ability to efficiently conduct electricity was discovered. It was the largest private investment to date in Congo.
In 2014, Apple first started mapping the cobalt supply chain, according to a 2016 Supplier Responsibility report.
Such companies are also facing growing public pressure to use cobalt that has not been procured using supply chains that involve human rights violations, something Apple has received scrutiny for in the past.
Rights group Amnesty International said a year ago about a fifth of Congo's cobalt production is mined by hand by informal miners including children, often in unsafe conditions.
Currently, 55,400 tons of cobalt - or a quarter of global cobalt production - are used for smartphones, electric cars and other lithium-ion battery productions, according to Darton Commodities, a company that specializes in procurement, financing and distribution of cobalt.
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