Apple looking to buy cobalt direct from miners

Apple is one of the world’s largest end users of cobalt for the batteries in its gadgets

Apple is one of the world’s largest end users of cobalt for the batteries in its gadgets

Apple is reportedly in talks about buying cobalt direct from miners in a long-term deal set to span five years or more.

And, according to the sources, that's exactly it.

Cobalt prices have skyrocketed of late due to an expected growth in demand for electric vehicles powered by lithium-ion batteries.

And its not like it's just a small amount of the material the iPhone flogger is looking to buy.

Apple is not the only company seeking long-term cobalt supply deals: BMW has been seeking its own 10-year deal for its electric vehicle program.

The move to get more supplies of cobalt means the technology giant will find itself in competition with electric carmakers and battery producers to lock up cobalt supplies.

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All our global businesses grew adjusted profits and we concluded the transformation programme that we started in 2015", he said. The company has set aside a further $164 million of regulatory provisions, but this is down from $344 million in 2016.

"There's absolutely no excuse for anyone under legal working age to be in our supply chain", Apple said in its recent Supplier Responsibility Progress Report. Apple is one of the largest users, and until now it has been buying metal through the companies that make batteries for its devices. Bloomberg reports the company has been discussing the issue with miners for over a year, and the company has not yet decided whether it will proceed with a deal. South Korea's top oil refiner, SK Innovation Co., agreed to a deal this week of $3.9 billion with Australian Mines Ltd. BMW is also close to securing a 10-year supply deal. One source told Bloomberg that the iPhone maker first started the discussion on the cobalt deals past year, but that there are chances that talks may not go anywhere right now.

Apple has not responded to an Observer request for comment.

Talking to reporters in London last December, Glasenberg said the company had held talks with Apple, Tesla (TSLA.O) and Volkswagen (VOWG_p.DE) as part of ongoing discussions with industrial clients. A metric ton now costs $80,000 which is more than triple of what it used to cost 18 months ago.

"As a result, the global proven reserves of cobalt are dependent on the economic viability of the relevant copper and nickel mines", cautioned analysts at Natixis. Although Glencore - a name which may be familiar to you - is the biggest supplier, two-thirds of all cobalt supplies actually come from the Democratic Republic of Congo.

Glencore Plc Chief Executive Officer Ivan Glasenberg late past year named Apple among several companies the miner was talking to about cobalt, without giving further details.

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