Apple Could Source Key Battery Components Directly From Miners

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

Usually the firm would leave such a task in the hands of the firms that make the batteries for its iPhones, iPad and iMacs, but it seems that Apple has deemed sourcing this material is too big a job to not do itself. About a quarter of total cobalt production is used by the smartphone companies to manufacture the batteries, according to Bloomberg.

Citing anonymous sources, Bloomberg reports that the company is trying to secure contracts for several thousand tonnes of cobalt for five years or longer.

Bloomberg says that talks first began more than a year ago, and Apple is seeking a long-term deal - though nothing is yet certain.

What's more, not only Apple is racing to secure its cobalt supplies. It's apparently due to concerns over shortages caused by the recent boom in electric vehicles, and it's hardly surprising considering the iPhone maker is one of the world's largest end users of cobalt as it uses it in all of its device batteries. "We're not sure of the volumes, but if they are looking for anything more than a couple of years, they might be disappointed". The tech giant currently leaves cobalt buying to battery manufacturers, but now the company wants to ensure it can lock down enough of the metal to maintain a sufficient supply. BMW is also close to securing a 10-year supply deal with an unnamed supplier in February.

On it's part, Apple declined to comment on the issue. 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.

In 2014, Apple first started mapping the cobalt supply chain, according to a 2016 Supplier Responsibility report.

"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. Two-thirds of the world's cobalt production comes from the Democratic Republic of Congo, a region not exactly known for its stability.

Industry sources said Apple had spoken to miners such as Glencore (GLEN.L), a top producer, which said late last year it would produce around 39,000 tonnes of cobalt this year.

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