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Cobalt prices are highest in many years...
For the week: an astounding -19.15%... a new multi year low.
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In the past four months .30 has acted as support and resistance and held up for numerous tests, so I’m looking at this as a key zone being fought over. There’s a head and shoulders pattern currently setting up with .30 being the neckline as well, so I think there’s a good chance of a big move if the price can breakout past it (w/ confirming volume). RSI looks nice and bullish and there’s not a ton of resistance until .50, so the variables look favorable for a nice run.
http://onlycharts.com/2011/11/14/gvcm-30-is-a-key-resistance-zone-head-shoulders-pattern-trigger/
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Geovic Mining Corp (GMC) is committed to sustainable development and social responsibility. By this we mean that our long-term welfare is directly related to the welfare of the people and communities in the areas where we operate. In the end, these are the people who should be the main beneficiaries of our cobalt mining activities.
We expect to leave behind the capacity for a better future for our hosts. This commitment encompasses the following values:
GMC is also committed to excellence with regard to the environment. We recognize and embrace the concept that sound environmental management is essential for our business.
Understanding, minimizing and mitigating all environmental impacts, as well as using all resources prudently and efficiently, is critically important to GMC. We pledge to conduct our activities in a manner that safeguards all the resources under our stewardship, whether they are minerals, forests, water, land or air.
The best way to reduce the effects of our operations on the environment is to disturb as little of it as possible. We will implement sustainable development initiatives that meet present needs without compromising those of future generations.
In Cameroon, GMC is developing an understanding of how the interplay of social, ideological, environmental and economic factors affects the fragile balance of the country's ecosystem. GMC is developing its GeoAid (“Earth Aid”) program to ensure that sustainable and high quality environmental and socio-humanitarian standards are an integral and essential component of the Company's mining operation. This program is more fully outlined in the document "Geovic, GeoAid and the Environment."
| Wade Nesmith Chairman | John E. (Jack) Sherborne Chief Executive Officer, Director |
| David C. Beling Executive Vice President, Chief Operating Officer | Barbara A. Filas Executive Vice President, Corporate Development & Chief Administrative Officer |
| William A. Buckovic Executive Vice President, Exploration, Director, Founder | |
| Greg Hill Senior Vice President, Chief Financial Officer | Gary R. Morris Senior Vice President, President Geovic Mineral Sands |
| Conrad Houser Senior Vice President, President, Geovic Energy | Alan W. Peryam Senior Vice President, General Counsel |
| Andrew C. Hoffman, CFA Vice President, Investor Relations | |
| Diane Hartnett Corporate Controller | Shelia I. Short Corporate Secretary |
| Michael Goldberg Director | John T. Perry Director |
| Robert J. (Don) MacDonald Director | Gregg Sedun Director |
| Michael T. Mason Director |
| Greg Hill Chairman | Richard Howe General Manager, Director |
| Moger Jean Claude Ayem Director | David C. Beling Director |
| Ambroise Ondoa Onana Director | |
| Anita Efoua Mbozo'o Deputy General Manager |
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| Pierre-Marie Noah Procurement, Logistics | |
| Patrick Holmes Finance, IT |
Corporate Information for | Geovic Mining | |
| Corporate Head Office Geovic Mining Corp Telephone: 303.476.6455 Operations Office Geovic Mining Corp Exchange: TSX Exchange | Registered Office 2711 Centerville Road, Suite 400 Auditor Transfer Agent Email: service@computershare.com |
Know the Management | Know the News | |
| http://www.geovic.net/biographies.php | http://www.geovic.net/news.php |
Cobalt is an element that has many diverse and critical uses. In most applications, substitution for cobalt yields lower product performance. Below are cobalt’s most common usages.
| 2007 Global Cobalt Use(1) | % of Market |
| Batteries - Cell phones, computers, hybrid vehicles, portable tools, etc. | 25 |
| Super Alloys - Turbine blades, mainly jet engines | 22 |
| Chemicals - Includes pigments and dyes | 26 |
| Wear Resistant Alloys - Hard facing and cobalt carbide | 12 |
| Catalysts - Includes Gas-to-Liquid conversions | 9 |
| Magnets - High performance applications | 6 |
Cobalt in rechargeable batteries is the fastest growing use, and notably in 2007 the percentage of cobalt use for rechargeable batteries rose to 25% of total cobalt demand from 22% in 2006. Nickel metal hydride and lithium-ion batteries both contain cobalt and are used in hybrid electric vehicles (HEVs), computers, cell phones, portable tools, audio/visual units, and numerous electronic devices. The fastest growing segment of battery applications is for HEVs, which reduce air pollution and fuel consumption by at least 50% compared to conventional vehicles. The HEV “plug-in” option is even more environmentally friendly, and includes an extra cobalt-bearing battery that can be charged from electrical outlets and achieve fuel economies that exceed 100 miles per US gallon. In the US, roughly one-third of all CO2 emissions come from transportation sources.
The Toyota Prius HEV was named 2004 Motor Trend Car of the Year and 2005 European Car of the Year. The one millionth unit was sold in April 2008, and Toyota estimates sales of one million hybrid vehicles annually "as early as possible in the 2010s". In the next few years, the Company plans to offer all Toyota and Lexus models as hybrids. General Motors, Ford, Daimler-Chrysler, Mercedes, and others are attempting to catch up with Toyota’s hybrid success. Nearly all current HEVs use nickel-metal hydride batteries that contain about 22 pounds of nickel and 3 to 5 pounds of cobalt. Lithium-ion batteries containing 5 to 7 pounds of cobalt and little or no nickel are expected to dominate future HEV markets because they charge in minutes rather than hours and offer many other economic and technical advantages. Global production of HEV’s in 2007 was about 400,000-500,000 units, and is estimated to increase to 8 million units by 2015(2), thereby increasing annual cobalt demand by nearly 22,000 tonnes/year. In 2006, the world produced 69 million conventional cars and light trucks, and is expected to produce over 80 million units by 2015.
Cobalt Supply and Demand
The cobalt market is dynamic but small in comparison with other base metals. Consumers purchase cobalt through negotiated agreements, bids, and open markets from producers, traders and to a lesser degree, government stockpiles and private inventories. Approximately 48% of the world’s 2007 cobalt mined was a byproduct of nickel from sulfide and laterite deposits. An additional 37% was produced as a byproduct of copper operations, mainly in the Democratic Republic of the Congo (DRC) and Zambia. The remaining 15% of cobalt mining came from primary producers.
Several new projects are deemed to be sufficiently advanced and financed to produce significant quantities of cobalt in 2009-10 (mainly as a byproduct), including those listed below. However, until that time cobalt demand is expected to significantly exceed production due to limited new production and the absence of stockpiles. Additional projects may also come on stream in the intermediate term, however political and logistical issues in the DRC may endanger the viability of some of the larger projects.
| Major New Projects | Start Up Year |
| Annual Prod. |
| Tenke Fungurume | 2009 | DRC | 4,000 |
| Talvivaara | 2009 | Sweeden | 2,500 |
| Goro | 2009 | New Caledonia | 1,500 |
| Kamoto | 2010 | DRC | 1,000 |
| Katanga | 2011 | DRC | 1,000 |
| Camec | 2011 | DRC | 1,000 |
| Nama | 2011 | Zambia | 1,000 |
| Idaho | 2011 | U.S. | 1,000 |
| Total | n/a |
| 13,000 |
Cobalt consumption in 1995 was only 24,000 tonnes, but grew to 60,800 tonnes in 2008, for a compound annual growth rate (CAGR) of 7.4% for the 13-year period.
Geovic's preliminary estimate for 2009 world demand is 52,600 tonnes, or a 13% decrease from 2008 demand, principally due to the impact of the global economic crisis in the first half of the year. On the supply side, Geovic estimates that 2009 cobalt production will fall by approximately 5% compared to 2008, to around 53,000 tonnes.
In the chart below, actual world supply and demand data from external sources are used through 2008, whereas the projections from 2009 through 2015 are based on an 11% CAGR (principally due to the "catch-up effect" following the aforementioned significant demand decline in 2009). The combination of production from existing mines and new production is expected to yield 10% CAGR between 2008 and 2015, however the aforementioned demand growth is expected to yield a relatively tight supply/demand balance during that period.
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| Source: Actual supply and demand by USGS, The CDI and other independent research groups. Projections after 2008 were developed by Geovic. |
Roskill Consulting, an international group that researches mineral industry information, estimates growth in demand by 2011 in a most likely case to be 72,500 tonnes(3). However, this forecast could be considerably understated given the exponential growth in batteries for hybrid vehicles and new demand from emerging markets such as China and India.
Global cobalt consumption by country and the increase for the four-year period ending 2006 is shown below(4).
Tonnes Cobalt
Country | 2002 | 2006e | % Change |
| Europe | 11,100 | 13,730 | 24 |
| Japan | 7,250 | 12,300 | 70 |
| China | 4,300 | 11,000 | 156 |
| USA | 9,250 | 11,450 | 24 |
| Other | 5,200 | 7,520 | 45 |
| Total | 37,100 | 56,000 | 51 |
The table below shows approximate production of refined cobalt and reserves and resources by country.
Refined Cobalt Production in 2007 & Reserves(4).
| Country | Mine Production | Tonnes x 1000 | Tonnes x 1000 |
| Australia | 3,700 | 1,500 | 1,800 |
| Brazil | 1,150 | 29 | 40 |
| Belgium | 2,900 | ||
| Canada | 5,650 | 120 | 350 |
| China | 13,250 | 72 | 470 |
| DRC | 600 | 3,400 | 4,700 |
| Cuba | 3,900 | 1,000 | 1,800 |
| Finland | 9,100 |
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| France | 300 | ||
| India | 1,000 | ||
| Japan | 1,100 | ||
| Morocco | 1,600 | 20 | n/a |
| New Caledonia | 0 | 230 | 860 |
| Norway | 4,000 | ||
| Russia | 3,600 | 250 | 350 |
| South Africa | 250 | ||
| United States | 0 | 33 | 860 |
| Uganda | 700 | ||
| Zambia | 4,600 | 270 | 680 |
| Other |
| 180 | 1,100 |
| Total | 53,500 | 7,100 | 13,000 |
| *includes reserves plus measured and indicated resources | |||
There are no published statistics on world use of cobalt scrap, but the USGS estimates 2006 U.S. scrap consumption was about 25% of reported US consumption.
Prices
Cobalt prices fluctuate significantly in response to world events and changes in the overall supply/demand balance. Historically, cobalt prices have had limited transparancy, although quotes can be found from sources such as Platt's Metals Bulletin and www.minormetals.com. In late 2009, or early 2010 the latest, the London Metals Exchange (LME) plans to launch the first-ever cobalt futures contract, which should materially improve such transparancy.
As of April 2009, the 3-year and 20-year average prices of 99.8% cathode cobalt are approximately $18/lb. and $28/lb, respectively.
Footnotes
Much of the project and cobalt market data in this report were obtained from the four sources below:
(1)The Cobalt Development Institute, www.thecdi.com.
(2) Credit Suisse Metals & Mining report, 04-02
(3) The Economics of Cobalt, 11th Ed., 2007 by Roskill Information Services Ltd., www.roskill.co.uk
(4) USGS website, http://minerals.usgs.gov/minerals/pubs/ commodity/cobalt/.www.sfp-metals.co.uk
References
Cobalt market data, publications and related services may also be obtained from other
sources, including:
Disclaimer
This document contains certain forward-looking statements and projections estimated by Geovic personnel regarding future production, metals markets, competition, capital spending, earnings, cash-flow, commodity prices, resources and other considerations. The statements are based upon Geovic’s current expectations and beliefs, and are subject to a number of known and unknown risks and uncertainties that could cause actual results to differ materially from those presented herein. Any use of this document is at the sole risk of any party that so relies.
Geovic Energy, a wholly owned subsidiary of Geovic Mining Corp. (TSX.GMC, OTCBB.GVCM), aims to become a major energy and metals mining company, targeting project opportunities in the U.S. and international markets.
The Company is developing uranium mining projects in the United States, having leased uranium properties in the Cheyenne-Denver Basin of northeastern Colorado and the Wyoming Red Desert Region, as well as gold/uranium properties in the Whetstone Mountains near Tucscon, Arizona, and three oil and gas projects in Wyoming.
Moreover, other mining interests are being pursued in various metals, mining, and energy markets worldwide.
