Before Arizona's cobalt refinery opens, every tonne of US cobalt still travels through China

In Madrid on 13 May 2026, three companies signed a memorandum of understanding (MOU) that drew wide coverage across the critical minerals sector. Entreprise Générale du Cobalt (EGC), EVelution Energy and Trafigura announced a framework to route Congolese artisanal cobalt through Angola’s Lobito Atlantic Railway to a processing facility in Yuma County, Arizona. The arrangement targets supplying up to an estimated 40% of projected US cobalt demand and was presented as a significant advance on the December 2025 US–Democratic Republic of the Congo (DRC) Strategic Critical Minerals Agreement. The business press called it a supply chain breakthrough.

The facility does not yet exist. Construction is scheduled to begin in early 2027, with completion targeted by the end of 2029. Every tonne of cobalt consumed in the US between now and then continues to move through a supply chain that China has spent two decades building. China currently refines most of the world’s cobalt.

Obligations agreed, supply pending

The MOU establishes a framework for the long-term supply of Congolese cobalt hydroxide to the US. The parties have agreed to advance discussions toward definitive long-term commercial agreements over the coming months. EGC is expected to originate cobalt hydroxide under its state mandate in the DRC. Trafigura is expected to provide logistics and marketing services. EVelution Energy is expected to process the material into battery-grade cobalt sulfate and alloy-grade cobalt metal at its Arizona facility.

That’s a lot of expectation. The supply does not flow until 2029 at the earliest, subject to definitive agreements, construction timelines and EGC’s operational readiness. The US International Development Finance Corporation (DFC) and the Development Bank of Southern Africa secured USD753 million for the Lobito Atlantic Railway. The railway is operational. The refinery is still on paper.

China refined 79% of global cobalt in 2024, a figure that has grown year-on-year. Chinese companies control stakes in nearly 80% of the largest DRC industrial cobalt operations. In 2022, exports from the DRC to China accounted for 91% of global trade volume in cobalt ores and concentrates.

This concentration grew over two decades of Chinese foreign direct investment in the DRC’s Copperbelt. Mine acquisitions, processing infrastructure and off-take agreements created deep dependencies across the supply chain. The Lobito Atlantic Railway can move cobalt from Kolwezi to the port of Lobito in approximately seven days. But the refinery is in the United States. Until EVelution’s Arizona facility begins processing, the refining gap is unchanged.

EGC’s output realities

EGC’s mandate covers artisanal and small-scale mining (ASM) production in the DRC. ASM cobalt fell to less than 2% of DRC output in 2024, a historic low driven by the scale-up of Chinese-controlled industrial operators. CMOC Group, the Chinese mining company, produced 114,000 tonnes from its two DRC sites in 2024, 31% above stated capacity. Industrial mining now dominates DRC cobalt production by a wide margin.

As of November 2025, EGC had produced 1,000 metric tonnes of traceable artisanal cobalt since its establishment by decree in 2019. US annual cobalt consumption runs at approximately 8,000 metric tonnes today. At a projected 3.9% annual growth rate, that figure rises to approximately 9,700 metric tonnes by 2029.

The MOU targets EVelution supplying up to 40% of projected US demand from this feedstock pool: approximately 3,880 tonnes annually by the time the facility opens. EGC has produced 1,000 tonnes in total across roughly six years of operation, an average of around 167 tonnes per year. Reaching the 2029 supply target requires annual output approximately 23 times current output.

EGC’s mandate has not been without legal challenge. In 2022, DRC’s minister of mining declared the monopoly a violation of the laws of the republic. The monopoly has since been reaffirmed, but the episode illustrated the governance fragility underpinning the supply corridor this MOU depends on. Scaling EGC is a precondition of the whole deal. The MOU assumes it will.

Quotas and cobalt economics

The DRC’s cobalt export ban, introduced in February 2025, extended in June 2025 and replaced by a quota system in October 2025, demonstrated in practice the exposure that US manufacturers carry in the interim. China’s cobalt intermediate imports fell 72% year-on-year by July 2025. Cobalt prices expectedly rose in the weeks following the ban announcement. The measure was intended to support domestic value-creation in the DRC; according to market research by Sweden-based Africa Security Analysis , the quota system also damaged the investment case for large-scale commitments in DRC supply chains.

US manufacturers in aerospace and defense, which consume approximately 51% of US cobalt as superalloys for aircraft gas turbine engines, continued sourcing through Chinese-dominated intermediary chains throughout that period. Most had no alternative. Two formal frameworks exist to map cobalt exposure through the intermediary layer between buyer and mine: the Responsible Minerals Initiative’s Better Cobalt program and the Organisation for Economic Co-operation and Development (OECD) Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas. Managing cobalt exposure during the three to four years before the Arizona corridor is operational amidst rising regulatory scrutiny will be a challenge.

The Madrid MOU is a significant step. It is a visionary supply chain that has taken a concrete step forward to connect a US refiner to a DRC state entity, through a commodity trader with infrastructure in Angola. The US development finance and a bilateral minerals agreement underpins the deal. All of that is real. The balancing act to make this MOU a reality is also real, laced with geopolitical and economic challenges, production requirements that far outpace today’s reality, and, above all, assumes that this deal, and others like it, will replace China’s 20 year head start. While compliance and transparency teams wait for the Yuma refinery to come online, they’ll be steady at work to ensure that their cobalt is clean because most of it is still sourced in the DRC behind a Chinese wall of corporate holdings.