How to Invest in Cobalt
Cobalt is a difficult metal to categorize, as some consider it to be an industrial metal, while others place it under the rare earth/strategic metals umbrella. Given its wide use across much of the industrial world, we placed the metal in this respective category. Applications of this metal include aircraft engines, drill bits, magnets, batteries, pigmentation, orthopedic implants, and even gamma rays. The majority of cobalt is used for superalloys which are resistant to both corrosion and natural wear-and-tear.
From a production standpoint, Asia dominates, as the region accounts for nearly half of the world's output. Both Europe and the Americas each account for just under a quarter of production each, leaving little room for producers outside of these regions. As previously stated, superalloys and batteries are two of the most prominent uses of the metal, though it has a fairly large presence in the mining and drilling industry as well as in colors/pigments.
An investment in cobalt can be seen as a play on the industrial sector and its potential growth. Companies may trade cobalt for hedging purposes, but more traditional investors will find the metal as a useful play on macroeconomic factors and the behavior of the global economy.