SRG · Outbound Deep Dive 04
DR Congo caps cobalt, Zimbabwe curbs lithium — what export quotas can and cannot control
96,600 t export cap · Prices down 31% in a quarter · Only 1 of 7 lithium producers has built a plant · Deadline: 1 January 2027
Research summary
Quotas are the main tool in this round of resource-country policy, meant to take back pricing power and keep processing in the country at the same time. DR Congo’s cobalt quota shows that pricing power can be partly regained: prices recovered from a nine-year low in February 2025 to about US$26/lb in mid-2026, but fell back 31% in Q3. The ceiling is not in the resource-holding country’s hands. Zimbabwe has made clear that its full ban on lithium concentrate exports will not be extended, yet only one lithium producer in the country has built a lithium sulphate plant. For Chinese companies, integrated mining-and-processing projects are assets; projects with a mine but no in-country smelting are exposures.
96,600 t
DR Congo’s cobalt export cap for each of 2026 and 2027, made up of an 87,000 t base quota and a 9,600 t strategic quota. For comparison, exports for the whole of 2025 were only 44,333 t
−31%
Q3 fall in cobalt hydroxide on a CIF Asia basis, to about US$38,030/t at the end of September (Benchmark). A different measure, Platts CIF China, shows a 39.6% fall from the year’s high; the two should not be mixed
84.6%
Share of lithium iron phosphate (LFP, which contains no cobalt) in China’s battery output in July 2026, up from 81.8% at the start of the year; China’s EV cobalt demand is forecast to be 9.6% lower in 2030 than in 2026
7 · 1
Number of major lithium producers in Zimbabwe, and how many of them have built a lithium sulphate plant (association count, June 2026). The full ban will not be extended; the association’s request to delay it to June 2027 was refused
27%
CMOC’s 2026 quota of 31,200 t as a share of its 2025 output of 117,549 t. Glencore’s quota is 22,800 t for 2026 and 18,800 t for 2027 (−17.5%)
A quota can control a resource-holding country’s own ports, but it cannot stop buyers changing their recipe, and it cannot control how fast companies build plants. Using quotas to win pricing power and local processing capacity is a sound idea in itself, but there is a limit to what a quota can buy.
Two countries, one toolkit, two curves heading in opposite directions. DR Congo has its ports under control, yet cobalt prices fell by 30% in Q3 2026; Zimbabwe’s deadline has not even arrived, and only one of seven major lithium producers has built the processing plant to go with it.
On 9 October 2026, Zimbabwe’s information minister, Nick Mangwana, said that the ban on lithium concentrate exports, which takes effect on 1 January 2027, would not be postponed again.
01 | Tools: two quota designs, two ways to fail
The two quotas differ not in how strict they are but in their trigger: one locks total export volume, the other locks whether local processing capacity actually gets built.
DR Congo uses a volume quota: an 87,000-tonne base quota is allocated according to each company’s historical output, and a 9,600-tonne strategic quota is controlled by ARECOMS, the national regulator of strategic minerals markets. Zimbabwe uses a conditional quota: since suspending exports in February 2026, it requires companies to apply for a quota and attach a local processing commitment before exports can resume.
- DR Congo
- Volume quota: annual cap of 96,600 t (base 87,000 + strategic 9,600), set for each of 2026 and 2027. Fails when: the quota is measured by the year but the export window is bunched into half a year, so in the short run it produces a concentrated rush to clear stock
- Zimbabwe
- Conditional quota: no volume cap; approvals case by case according to each company’s plant-building progress, with a tax differential as a further nudge — concentrate 10%, lithium sulphate 0%. Fails when: plants take longer to build than the policy transition period, and the industry as a whole cannot comply in time
- Consequences so far
- DR Congo: exports accelerated under the cap, and prices fell 31% in Q3 regardless. Zimbabwe: only one of seven major lithium producers has built a lithium sulphate plant
02 | Cobalt: the quota’s ceiling is not in the resource-holding country’s hands
DR Congo has shown that a resource-holding country can influence the direction of prices; it has not shown that it can set their magnitude.
The quota system came into force in October 2025, and at first it worked. Cobalt prices recovered from a nine-year low of about US$10/lb in February 2025 to about US$26/lb in mid-2026, and national output was squeezed from about 220,000 tonnes in 2024 to 100,000 tonnes in 2025. For the first time in a decade, a resource-holding country had taken back part of the pricing power.
Yet in Q3 2026, with the quota system working as designed, cobalt hydroxide prices fell 31% in a single quarter (Benchmark, CIF Asia). There are three reasons:
- The total was capped, the pace was not. H1 exports were 41,140 tonnes, close to the 44,333 tonnes exported in the whole of 2025. Add 18,125 tonnes of carried-over quota to the annual cap of 96,600 tonnes and full-year exports could exceed 114,000 tonnes. Quotas constrain the total, not the flow.
- Buyers changed the recipe. The share of lithium iron phosphate (LFP, a chemistry that contains no cobalt) in China’s battery output rose from 81.8% at the start of 2026 to 84.6% in July, while China’s cobalt hydroxide imports fell 92% year on year. On a forecast cited by S&P Global, cobalt demand from China’s electric vehicles will be 9.6% lower in 2030 than in 2026.
- Inventories and recycling got there first. Stock that Chinese downstream companies bought around the time the quota was introduced has not yet been worked through, and recycled battery material is substituting for primary cobalt.
Left: the 2026 exportable cap is the annual quota of 96,600 t (an 87,000 t base quota plus the 9,600 t strategic quota held by ARECOMS) plus 18,125 t carried over from 2025 (usable until 30 April 2026), for a total of 114,725 t. Actual exports in H1 were already 41,140 t, 93% of full-year 2025 exports. Right: the timing, with Q2 up 41% on Q1. The cap is set on an annual basis while exports happen month by month; that mismatch in time scales is the direct cause of the short-term divergence between price and quota.
View data
| Composition of the export cap | Actual exports | Base quota | Strategic quota | 2025 carry-over |
|---|---|---|---|---|
| 2025 actual exports | 44,333 | — | — | — |
| 2026 exportable cap | — | 87,000 | 9,600 | 18,125 |
| H1 2026 exports | Value |
|---|---|
| Q1 | 17,053 |
| Q2 | 24,086 |
Left: the change in lithium iron phosphate (LFP) share of China's battery output in 2026; LFP chemistry contains no cobalt. Right: the expected change in cobalt demand from China's electric vehicles (−9.6%). Read together, the two panels show that what the quota constrains is precisely the raw material downstream users are using less of. The 2026 base in the right panel is back-calculated by SRG from the 2030 figure of 35,564 t and the 9.6% decline.
View data
| LFP share of China's battery output | % |
|---|---|
| Early 2026 | 81.8% |
| Q2 | 82.1% |
| July | 84.6% |
| China EV cobalt demand (t) | Value |
|---|---|
| 2026 | 39,341 |
| 2030 | 35,564 |
The 31% fall in cobalt hydroxide CIF Asia (Benchmark) is quarter on quarter; the 39.6% fall in cobalt hydroxide CIF China (Platts) is from the year’s high; the 30.47% fall in cobalt metal (Trading Economics) is over a single month. The base periods and products differ, so cite each with its basis attached.
Where the ceiling sits is ultimately decided by downstream recipe sheets, not by the exporting country’s quota tables. Yet DR Congo has not abandoned the tool: on 26 September 2026 ARECOMS confirmed that the quotas for both years would remain unchanged, adding that they could be cut further if the supply–demand imbalance persists or worsens.
03 | Countdown: Zimbabwe’s 1 January 2027
Zimbabwe uses a switch: at midnight on 1 January 2027 the export channel for concentrate closes, and officials have said explicitly that there will be no further extension.
The tax differential is the clearest part of the policy: from January 2026, exports of lithium ore and lithium concentrate are taxed at 10%, while further-processed products such as lithium sulphate pay 0%. The ten-point differential is the price the government has put on “please process here”.
The problem is time. A June 2026 count by the Lithium Producers Association of Zimbabwe found that only one of the seven major lithium producers had completed a lithium sulphate plant. The association asked for the ban to be pushed back to June 2027 and was refused.
| Date | Policy milestone | Project start-up |
|---|---|---|
| 2022 | Exports of raw lithium ore restricted; concentrate exports still allowed | — |
| 25 February 2026 | All exports of raw ore and lithium concentrate suspended, including cargoes in transit | — |
| 2 April 2026 | Ministry of Mines letter: switch to conditional quotas, with a local processing commitment required | — |
| April 2026 | — | Huayou Arcadia: 50,000 t/yr lithium sulphate; in production, first commercial export completed |
| 1 January 2027 | Full ban takes effect | — |
| Mid-2027 | — | Sinomine Bikita: planned 100,000 t/yr |
| July 2027 | — | Yahua Kamativi: planned 75,000 t/yr |
Huayou’s Arcadia lands before the ban; Sinomine’s Bikita and Yahua’s Kamativi both land after it.
Since 2021, Chinese companies have put about US$2 billion into lithium mining and processing projects in Zimbabwe. The association’s industry revenue estimates (not audited figures) show that, over the three-year transition of 2023–2025, the industry built its revenue on concentrate exports while investment in processing failed to keep pace.
Zimbabwe tightening exports subtracts from China’s supply; it does not cut it off. In 2025 it exported 1.128 million tonnes of spodumene concentrate (gross tonnes), the vast majority of it to China, yet by volume that is equivalent to only about 15% of China’s lithium concentrate imports.
04 | Companies: quotas sort by asset structure, not nationality
Under the same quota regime, Glencore and CMOC made opposite business choices, and the reason lies not in who they are but in their balance sheets.
In H1 2026 Glencore’s cobalt output fell 46% year on year, while its copper output rose 15%. This is not a decline in ore grade: the company has deliberately deferred the final processing stage for cobalt, keeping intermediate material in excess of its quota in the country to sell once quota becomes available. There is no less cobalt in the mine.
CMOC’s arithmetic is blunter: its 2026 quota of 31,200 tonnes equals just 27% of its 2025 cobalt output of 117,549 tonnes. Glencore publicly supports quota management; CMOC opposes it. Both have at some point declared force majeure because exports were blocked.
For a company that owns both copper and cobalt, the quota demotes cobalt to a by-product, and copper cash flow is enough to keep operations running; for a cobalt-focused miner, the quota directly sets a ceiling on revenue.
- Integrated mining and processing
- Relatively well placed: processed products are not restricted (scope to be verified), so these companies face a capital expenditure question, not a ban question
- Mines without processing
- Most exposed: quota falls short in DR Congo, and Zimbabwe has a hard deadline; options to assess include joint construction, toll processing or bringing in a local processing partner
- Trading and offtake
- The exposure lies in contracts: how force majeure applies, who bears title to cargo in transit and how downstream long-term contracts are performed all have to be gone through again
- Buy side
- The variable is the recipe, not the quota: the LFP route does not need cobalt; lithium demand is still there, but its sources are shifting; supply security should move from “locking in origin” to “staying switchable”
05 | Action: implementation friction and three checklists
A quota you cannot use is no quota at all: part of quota risk is operational-capability risk, not policy risk.
In mid-2026 DR Congo’s cobalt export declaration platform broke down, and 60% to 75% of exporters failed to complete the formalities before the 5 July deadline, leaving about 20,000 tonnes of cobalt, worth about US$1.1 billion at the prices of the time, facing the loss of its quota. Those hit hardest were the companies with the weakest filing capability.
Rule parameters need modelling too. On 29 June 2026 a DR Congo interministerial decree banned exports of copper and cobalt concentrates (processed products excepted; in strategic cases an exemption of up to one year is possible). A 55% valuation coefficient applies to concentrate exports (the tax base is first calculated at a statutory ratio, not purely from the actual transaction price), with a three-month transition period. Parameters like these affect cash flow no less than the tax rate does, yet none of them appears in a standard tax model.
- Calculate quota coverage (quota ÷ previous year’s output); for projects below 50%, disclose the exposure separately in annual reporting.
- Make “is processing in the country?” a dimension of asset classification, alongside reserves and grade.
- Add the timing of quota allocation and the valuation coefficient to the financial model.
- Build a key-dates calendar: Zimbabwe’s 1 January 2027, and DR Congo’s quota allocation milestones and carry-over expiry dates.
- Track by tool form: for volume quotas watch the pace, for conditional quotas watch plant progress, for tax differentials watch the rate gap.
- Track the scope of exemptions for processed products; where their boundaries fall often determines project structure.
- Establish who runs local declaration and reconciliation, and what the fallback is if the system fails.
- Review force majeure and delivery-milestone clauses; set out liability and title to cargo in transit if a quota lapses.
- For new projects, put the processing start-up date and the policy deadline on the same Gantt chart, with a buffer of at least one plant-build cycle.
Conclusion | A quota is a sieve, not a wall
Reading this round as “resource-holding countries are shutting the door” leads to two wrong responses: treating processing projects already in production as premature investments, or treating the quota as a problem to be solved through connections.
A description closer to reality: the quota is a sieve. What it sorts is not where a company comes from but its asset structure: whether it has kept processing in the country, whether it can turn quota entitlements into actual exports, and whether it has built rule changes into its financial model.
Resource-holding countries will keep using quotas to win pricing power and local processing capacity; that direction will not reverse in the next few years. The same approach of “restricting exports of unprocessed minerals and keeping processing in the country” is spreading in different forms: DR Congo has extended controls from cobalt to copper, Zimbabwe from lithium to antimony and tungsten, and Guinea requires foreign miners to build alumina refineries alongside their mines.
Policies usually go from proposal to effect in months; plants take years. That gap can only be absorbed at the very front end of project decisions. In the past, companies in resource-holding countries assumed “stable policy, volatile prices”; this round, the assumption needs to become “volatile prices + continuously adjusting policy”. Understanding the limits of a quota is more useful than predicting whether the next country will follow.
1. DR Congo cobalt quotas and decree: caps of 96,600 t for each of 2026 and 2027 (87,000 t base quota + 9,600 t strategic quota, the latter held by ARECOMS); on 2026-09-26 ARECOMS said both years would stay unchanged and could be cut if the imbalance persists or worsens. The interministerial decree of 2026-06-29 bans exports of copper and cobalt concentrates; processed products are not banned; a 55% valuation coefficient applies to concentrate exports, with a three-month transition period. A filing-platform failure in mid-2026 caused 60–75% of companies to miss the 5 July deadline, involving about 20,000 t of cobalt worth about US$1.1 billion. Sources: Fastmarkets (2026-09-26), Bankable (2026-10-03), Maofatong (贸法通) (2026-09).
2. Cobalt exports, output and prices: 2025 exports 44,333 t, output 100,015 t; H1 2026 exports 41,140 t (Q1 17,053 t, Q2 24,086 t); 18,125 t of unused 2025 quota carried over to 2026-04-30. The three price measures (Benchmark cobalt hydroxide CIF Asia, down 31% on the quarter; Platts cobalt hydroxide CIF China, down 39.6% from the year’s high; Trading Economics cobalt metal, down 30.47% in a single month) differ in product, market and base period, and cannot be used to corroborate one another (sources: Ecofin 2026-10-01, Bankable 2026-10-03).
3. Demand-side and company data: LFP share of China’s battery output 81.8% at the start of 2026 and 84.6% in July; China’s EV cobalt demand forecast to fall 9.6% from 2026 to 2030, to 35,564 t; China’s cobalt hydroxide imports down 92% year on year in H1 2026 (S&P Global 2026-09-21 and the China Automotive Battery Innovation Alliance (CABIA) data it cites). Glencore cobalt 5,800 t in Q1 2026 (−39%) and 10,200 t in H1 (−46%); copper 397,000 t in H1 (+15%); quota 22,800 t for 2026 and 18,800 t for 2027 (−17.5%). CMOC 2026 quota 31,200 t; 2025 output 117,549 t (Energy News Network 2026-09, Glencore half-year report, Jiemian (界面新闻) 2026-01).
4. Zimbabwe policy and companies: immediate suspension on 2026-02-25 of all exports of raw ore and lithium concentrate (including cargoes in transit); Ministry of Mines letter of 2 April requiring a quota application with a local processing commitment before exports can resume; from January 2026, a 10% tax on lithium ore and concentrate exports and 0% on lithium sulphate; full ban from 2027-01-01, with the information minister confirming on 2026-10-09 that there will be no extension; directive of 21 July instructing MMCZ to suspend antimony and tungsten exports. Companies: Huayou Arcadia 50,000 t/yr (in production 2026); Sinomine Bikita planned 100,000 t/yr (mid-2027); Yahua Kamativi planned 75,000 t (July 2027); the association’s June 2026 count found only one of seven major lithium producers with a completed lithium sulphate plant, and its request for an extension was refused; industry revenue figures are association estimates (about US$1 billion projected for 2026), not audited figures; 2025 exports of 1.128 million t of spodumene concentrate (gross tonnes), equivalent to about 15% of China’s lithium concentrate imports. Sources: Reuters, Zhongjin (中金), China Energy Net (中国能源网), bne.eu.
5. Diffusion and external mechanisms: Guinea requires alumina refining alongside mining; three Chinese companies each plan about US$1 billion of investment and 1.2 million t/yr of capacity; Chinalco’s Boffa project broke ground on 2026-06-13 (Mining.com, ZANIS, bne.eu).
5b. Investment basis: the Section 03 figure of “about US$2 billion invested by Chinese companies in Zimbabwean lithium mining and processing” is cumulative investment in a single mineral, on a different basis from all-sector direct investment stock.
6. The classification of quota forms and the action checklists are SRG analysis; regulatory and policy status is as of 2026-10-13.
· DR Congo cobalt export quota system (in force from October 2025; caps of 96,600 t for each of 2026 and 2027, comprising an 87,000 t base quota and a 9,600 t strategic quota; the strategic quota is held by ARECOMS)
· DR Congo interministerial decree (29 June 2026; bans exports of copper and cobalt concentrates and repeals the 2023 ban; strategic exemptions of up to one year; processed products not covered; 55% valuation coefficient on concentrate exports, with a three-month transition period)
· Decision of ARECOMS, DR Congo’s strategic minerals market regulator (26 September 2026; quotas for 2026 and 2027 unchanged, with further cuts possible if the supply–demand imbalance persists or worsens)
· Zimbabwe Ministry of Mines directive (25 February 2026; immediate suspension of all exports of raw ore and lithium concentrate, including cargoes in transit)
· Zimbabwe Ministry of Mines letter (2 April 2026; resuming lithium concentrate exports requires a quota application with a local processing commitment, plus environmental, safety and financial-disclosure conditions)
· Zimbabwe 2026 fiscal measures (from January 2026, a 10% export tax on lithium ore and lithium concentrate and 0% on further-processed products such as lithium sulphate; tax on raw ore and concentrate assessed by reference to the value of finished lithium sulphate)
· Zimbabwe Ministry of Mines directive (21 July 2026; instructs MMCZ to suspend immediately exports of antimony and tungsten ores, concentrates and other forms until further notice; antimony and tungsten were designated critical minerals in May 2026)
SRG’s Global Investment Compliance Navigator tracks raw-ore export controls, quota allocation rules and local processing requirements in DR Congo, Zimbabwe and 60+ jurisdictions in real time. It helps companies investing abroad, through a cycle of continuous policy adjustment in resource-holding countries, to turn quota and processing prerequisites early into designs for project structure, start-up schedules and compliance evidence.
See RiskSI →Disclaimer: This article is for information only and does not constitute investment advice. The analysis of DR Congo’s cobalt export quotas, Zimbabwe’s lithium concentrate export ban and other countries’ local processing requirements is based on public information as of October 2026; actual application depends on quota allocation decisions, the pace at which implementing decrees and sector-specific rules are issued, and individual companies’ licensing arrangements. Readers should consult professional legal and compliance advisers before making cross-border investment decisions.