From Kinshasa to Kansas: US Lays Out Its Plan to Reshape Cobalt Supply Chains
•February 11, 2026
0
Why It Matters
Project Vault and the Orion‑Glencore deal signal a strategic pivot to secure cobalt for U.S. EV supply chains, challenging China’s dominance and reshaping global mineral trade dynamics.
Key Takeaways
- •US launches $12 billion Project Vault critical mineral stockpile.
- •Orion CMC acquires 40% of Glencore’s DRC copper‑cobalt mines.
- •Deal aims to divert cobalt supply from China to US.
- •US refining capacity and DRC export limits may delay impact.
- •Europe worries about being sidelined in critical mineral race.
Pulse Analysis
The Biden administration’s Project Vault marks a decisive shift from the Inflation Reduction Act’s earlier funding model toward a dedicated, government‑controlled reserve of critical minerals. By earmarking $12 billion for a separate stockpile, the United States aims to guarantee a steady flow of cobalt, nickel and other battery inputs, insulating domestic manufacturers from geopolitical shocks. This move also introduces reference pricing and adjustable tariffs, tools intended to stabilize market volatility and encourage long‑term investment in mining and processing infrastructure.
The Orion CMC‑Glencore memorandum deepens the strategic partnership with the DRC, granting the U.S. a foothold in two of the world’s largest copper‑cobalt complexes. With a 40% equity position, Orion will channel a defined share of production to vetted American buyers, effectively creating a parallel supply channel to the China‑controlled refining network that currently handles roughly 80% of global cobalt. However, the initiative faces practical hurdles: the United States lacks sufficient downstream refining capacity, and DRC export quotas are slated to remain below 2024 levels through 2027, potentially limiting the volume of cobalt that can be redirected.
The broader market reaction underscores a realignment of critical‑mineral geopolitics. Europe, already grappling with climate‑target pressures, fears exclusion from emerging supply‑chain frameworks as the U.S. and DRC solidify their partnership. Meanwhile, new logistics corridors such as the Lobito railway promise alternative routes for African exports, further diminishing China’s traditional trade pathways. If Project Vault’s funding remains intact and the Orion‑Glencore deal proceeds, the United States could reshape cobalt flows, prompting a gradual but substantive shift away from Chinese dominance in the EV battery ecosystem.
From Kinshasa to Kansas: US lays out its plan to reshape cobalt supply chains
IRA, which was introduced in 2022, had provided much needed financial support for electric vehicle (EV) battery manufacturers to set up shop and begin the construction of a non-China-reliant supply chain.
An estimated $43 billion of cell manufacturing, cathode active material (CAM) and precursor cathode active material (pCAM) capacity has been cancelled, paused or formally delayed in Canada and the US since President Trump’s second inauguration on January 20, 2025 according to Fastmarkets estimates.
In ripping up the legislation and Trump’s vocal opposition to EVs, many stakeholders in the energy transition said they believed the US had stepped back and handed the EV keys to China.
But news this week that the US will take a leaf out of China’s playbook has once again promised to alter future supply chain pathways and trade routes, with Trump taking a different route for resource security. Many cobalt market participants described the news as a “fundamental change” to the future of cobalt.
First, the US announced Project Vault, a new $12 billion critical mineral stockpile entirely separate from its existing defense strategic stockpiles, to directly support US manufacturers.
Secondly, and hours after the US Export-Import Bank board voted to confirm the stockpile budget, US government-backed investment group Orion CMC announced a memorandum of understanding (MoU) with Switzerland-headquartered global mining giant Glencore.
Interested in staying ahead of cobalt market movements? Unlock Fastmarkets’ cobalt price data, market analysis and forecasting to help you make informed decisions for your business.
The MoU entails Orion CMC taking a 40% stake in Glencore’s two copper and cobalt mines in the Democratic Republic of Congo (DRC).
“The Orion deal is supply security for the US given every other major cobalt producer in the DRC is Chinese, except for ERG,” one trader said, referring to Eurasian Resources Group, a Kazakh-owned operation.
Critically, according to Glencore’s announcement, Orion will “direct the sale of the relevant share of production from the assets to nominated buyers, in accordance with the US-DRC Strategic Partnership Agreement, thereby securing critical minerals for the United States and its partners.”
Yet the announcements have raised questions in the cobalt market about timings and implementation. Market participants say the immediate impact on the spot market may be muted, due to limited US cobalt refining capacity and DRC export quotas restricting shipments to less than half of 2024 levels through to the end of 2027.
They said, however, fundamentals would no doubt shift if the deal is agreed later this year.
With China accounting for 80% of cobalt refining in 2024, according to Fastmarkets estimates, it seems likely that hydroxide will continue to flow to China from Orion CMC’s stake. But with the US currently imposing a 35% tariff on imports of Chinese cobalt metal, exemptions could be required to solve purchasing requirement headaches.
“It’s a clear statement of intent by the US and it is massive for the market. There are a lot of questions about how much of the $12 billion will be allocated to cobalt, what form of cobalt will they buy etc.,” said a second trader.
A third trader shared a similar view: “It’s a big announcement and it has fundamentally changed the landscape longer term now. If the MoU goes through, then it’s a big character change for the cobalt market, unusual though as Glencore’s mantra is to dominate a market.”
But some sources questioned the viability of the $12 billion stockpile, arguing it would be an easy budget target for cancellation should the US administration change in 2028.
“Similar to the IRA legislation, which was passed and people got to work only for it to be torn up two years later, what is to stop this budget getting cancelled if the administration changes sides again?” a market participant said.
Some of the planned EV supply chain construction that was affected by the IRA funding removal has been converted to facilities for other products. One example is the Kentucky facility Ford inherited from its dissolved joint venture (JV) with SK On, which is now going to be used for energy storage systems (ESS) cell and pack production.
The end-of-decade timeline coincides with the scheduled completion of the Lobito Corridor railway system, which links the DRC and Zambia’s copper belt with the Atlantic coast of Africa and is positioned to export volumes to the US. This would provide an alternative to current routes through Tanzania and South Africa, which primarily serve the Chinese market.
Under the announced structure, participating manufacturers will commit to purchasing materials at specified prices and pay upfront fees to submit “shopping lists” of required materials.
The project does aim to purchase “shelf-ready” materials that manufacturers can use immediately in product lines.
US Vice President JD Vance said at the Critical Minerals Ministerial on Wednesday that the US will establish “reference prices” for minerals at every stage of production, with these prices intended to reflect “fair market value” rather than prices artificially depressed by foreign overproduction.
Adjustable tariffs will be used to counteract any material flowing into the market below the established price floor, Vance said, with the primary goal of making prices predictable and less erratic, providing the long-term certainty required to invest in new mining and processing facilities.
In reaction to the news, market participants in Europe raised concerns about where the rush to secure critical resources leaves Europe, given the trade bloc’s aggressive decarbonization deadlines.
“The DRC government has courted the US, Indonesia and Saudi Arabia, but so far, no engagement with Europe at all. We could get left behind,” said one European consumer.
The US and the DRC signed a strategic partnership in December 2025, seeking to ensure the protection and resilience of its mineral supply chains in support of mutual economic and strategic interests with the US.
“These announcements leave the EU fighting over scraps really and shows how complacent they have been,” said a fourth trader.
The strategic announcements were met with surprise in Brussels. European officials contacted for this story declined to comment, saying they were still assessing the implications of the US moves, while market participants awaited a response from the European Commission and expressed hopes for a similar stockpiling incentive to support critical minerals prices.
The European Court of Auditors said on Monday that the EU’s 2030 climate goals are at risk of being missed due to supply bottlenecks of critical resources.
After this week, the US looks to be executing a multi-year plan to pivot cobalt supply chains for when DRC export restrictions ease, and processing capacity and new transportation infrastructure come online.
Market participants have said the question is not whether Project Vault will buy cobalt, it’s whether the US will be able to access the right infrastructure in time to fundamentally shift global cobalt flows away from China.
Want to learn more about what is happening at the cutting-edge of critical minerals and battery raw materials? Listen to our Fast Forward podcast series for insight, debate and news from the major players.
The post From Kinshasa to Kansas: US lays out its plan to reshape cobalt supply chains appeared first on Fastmarkets.
0
Comments
Want to join the conversation?
Loading comments...