In 2026, the Democratic Republic of Congo imposed a cobalt quota, and the price reached elevated levels. The maneuver was audacious on paper. Cobalt accumulated as export restrictions took effect; insufficient local refining capacity constituted a distinct structural industrial brake. A large share of transformation value is captured in China.
The essentials
- The DRC imposed a quota of 96,600 tonnes of cobalt in 2026, 58% less than 2024 production, which significantly increased cobalt prices (IEA Critical Minerals Outlook 2026).
- Supply restriction generates a price increase whose impacts on local industrial value creation also depend on transformation capacity: Congolese raw cobalt is predominantly transformed in China.
- The Indonesian tin case is a restriction project intended to favor downstream development, but only if accompanied by simultaneous investment in local transformation capacity.
- China is moving up the battery supply chain while Africa remains an extractor: the refining asymmetry has increased in recent years.
- Contrasting trajectories could take shape: the quota without smelters, where transformation remains concentrated in China, or the competing smelter model, where development of local capacity increases locally added value.
A quota that creates rent without industrializing
The decision came quickly. Facing depressed cobalt prices since the post-pandemic overheating of 2022, Kinshasa settled the matter: reduce supply to lift prices. The price of cobalt increased significantly in 2026.
The problem is that this rent does not automatically convert into industrial wealth. The DRC produces a major share of global cobalt but exports the bulk in raw or partially processed form. Cobalt hydroxide production capacity exists in the DRC, but local chemical precursor capacity remains restricted. Cobalt accumulated due to export restrictions; insufficient local chemical refining capacity constitutes a distinct structural industrial brake.
China concentrates a major share of critical mineral refining, according to the IEA. It has built, over the past two decades, a chemical transformation capacity unmatched elsewhere. A large share of Congolese exports feeds transformation chains dominated by China, where refining, chemical precursors, and cells are concentrated, while refining margins remain concentrated in East Asia.
China ahead, Africa catching up
François Godement, specialist in Chinese strategies at the Institut Montaigne, has documented the central mechanism: China moves up the value chain while its trading partners remain extractors. In the African case, this asymmetry was built methodically. Chinese investments in Congolese mines secured access to raw ore, while China developed substantial refining and transformation capacity on its territory. The result: high-value segments, from refining to precursors and cells, are heavily concentrated in China, which also depends on foreign mineral supplies, notably Congolese cobalt.
Export restriction shifts the balance of power upstream. It can affect downstream, where transformation capacity remains concentrated in China. This is the structural limit of quotas alone: they can redistribute raw mineral rent, but do not create new transformation rent without local investments.
This analysis is consistent with the 2026 Bloomsbury Intelligence report on the realignment of African supply chains. The report identifies Congolese quotas and local content policies as possible levers for local value creation. The DRC chose supply restriction alone. Without local transformation conditions, the quota’s effect on captured value depends on multiple variables that Kinshasa only partially controls.
Dani Rodrik, Harvard economist whose work on industrialization in developing countries carries authority, raises an adjacent point: effective industrial policy requires institutions capable of coordinating public and private investment over time. The DRC has the mineral resources, but must strengthen institutional capacity to transform a quota into a local transformation industrial strategy.
The link between resource control and moving up the value chain is not automatic. It requires an institutional architecture capable of coordinating public and private investment over time, a strengthening that African producer countries pursue unevenly.
Indonesia as an imperfect mirror
The Indonesian model comes up in every debate on African mining strategy. Jakarta banned raw nickel exports in 2020, then extended the restriction to other minerals. According to UNCTAD, the Indonesian restriction led to the construction of smelters and attracted investors for local transformation, with an increase in locally added value.
But the Indonesian case is more nuanced than it appears. The industrial investment that followed the restriction came largely from China: smelters built in Indonesia are often owned by Chinese groups that relocated part of the transformation, while technological and industrial capacity remains heavily concentrated in China according to UNCTAD. Locally added value increases, but technological control remains in East Asia.
Available analyses emphasize that the Indonesian model created local value without transferring technological control. For the DRC, reproducing this scheme would mean attracting refineries to Africa, which improves local fiscal revenues and employment, but technological capacity would remain controlled by foreign investors. This is progress on refining, but not the technological mastery some African analysts hope for.
The question is therefore whether the DRC can do better than Indonesia. The challenge supposes a conjunction of elements: institutions capable of negotiating with investors, Western buyers willing to value locally transformed cobalt, and strategic long-term support. These elements emerge fragmentarily in current negotiations.
The battery chain as new arena of contention
The transition to electric vehicles has transformed critical minerals geography into a top-tier geopolitical issue. Cobalt is important for certain lithium-ion batteries, particularly NMC (nickel-manganese-cobalt), but is not essential for LFP batteries, which represent a high share of the market. The DRC controls most of the global resource. But the value chain from ore deposit to integrated vehicle battery comprises at least seven technical steps, of which chemical refining and a large share of active material and cell manufacturing are concentrated in East Asia, especially China.
The IEA highlights risks created by the concentration of critical mineral refining in China and implications for the global energy transition. This dependency is not symmetric. Europe and the United States need cobalt for their batteries; China needs Congolese cobalt to feed its cell factories and exports. This concentration of transformation in China creates an asymmetry in the global critical mineral value chain.
The European Union began a response with its critical raw materials regulation, adopted in 2024, which sets supply diversification targets. Discussions are underway for partnership agreements with several African producer countries. But concrete commitments in terms of investment in local transformation capacity remain modest relative to the scale of the challenge. The question of who controls emerging industrial value chains exceeds the mining sector alone: it structures the economic geopolitics of the decade.
Local smelters or captive rent: the stakes of the next ten years
The Congolese restrictions of 2025 demonstrated capacity to influence cobalt availability and prices. The central question is whether this supply restriction can become the foundation of an industrial value-chain advancement strategy, or whether it will remain a mineral rent policy.
Contrasting scenarios could emerge after 2030. One would maintain supply restriction without structural investments in local refining capacity; transformation would remain concentrated in China, and mining revenues would be amplified by the supply constraint. The other supposes the DRC uses a share of quota revenues for investments in local refining, attracting investors and buyers for transformed cobalt. This path requires institutional strengthening and stable partnerships.
The most useful indicator for distinguishing the two trajectories is the share of cobalt exported in refined or battery-precursor form. A significant increase in this share would mark the first steps of an industrial strategy materialization. If it stagnates, the restriction will have increased mining revenues without transforming industrial structure.
Experience from Botswana with diamonds and Chile with copper shows that mining value-chain advancement depends on a set of conditions: contractual stability between producer and investors, acceptance by end buyers of valuing local transformation, and institutions capable of maintaining these commitments across multiple cycles. State institutional capacity is a prerequisite for any sustainable economic lever, whether minerals or otherwise.
The DRC today possesses a major market advantage: ore the world needs and a restriction that proves its capacity to act on prices. Technological substitutions like LFP batteries and recycling create uncertainty about future demand. This current advantage is limited in time. The question posed to African minerals is the same as that posed to other strategic resources in other regions: does resource control translate into industrial development, or does it remain rent?
The answer will depend on the capacity of Congolese actors to strengthen their institutions, and on the willingness of European actors and automakers to commit to industrial transformation partnerships for Congolese cobalt.
Sources
- BISI, Critical Minerals Supply Chain Realignment: Africa’s Leverage vs Great Power Extraction Risks in 2026
- IEA, Global Critical Minerals Outlook 2026 (iea.org, main report)
- Bloomsbury Intelligence, Critical Minerals Supply Chain Realignment Africa 2026 (report cited via BISI)
- SMM, Real Barriers to Upgrading Africa Battery Metals (Shanghai Metals Market, 2026)
- Energy Transition Africa, IEA 2026: Africa’s Minerals Rising, Its Refining Capacity Not (bisi.org.uk)
- RioTimes, Africa’s Critical Minerals 2026
- François Godement, work 2025-2026 on China-Africa value chains, Institut Montaigne
- UNCTAD, analysis of the Indonesian tin sector and export restrictions (unctad.org)
