UPDATE 2-Congo aims to launch state cobalt monopoly in two months, mines minister says

(Updates to add separate Lualaba province initiative)

June 26 (Reuters) - Democratic Republic of Congo will begin its state-controlled buying of artisanal cobalt in about two months time, having been delayed by the coronavirus pandemic, the mines minister said on Thursday.

In January, the government created the Entreprise Generale du Cobalt as a subsidiary of state mining company Gecamines to purchase and market all cobalt that is not mined industrially in an effort to exert greater influence over prices.

Congo dominates global production of cobalt, the metal used in batteries, and is expected to supply 70% of the world’s cobalt in 2020.

One fifth of the cobalt it produces is mined manually by subsistence, or “artisanal”, miners, making setting up a state monopoly a huge and complex task.

“We have to wait two months for the storage sites to be set up, for us to then mandate the launch of state buying of artisanal cobalt,” Mines Minister Willy Kitobo Samsoni told Reuters in a text message.

“We are in the phase of operationalisation, which has been slowed by COVID-19,” he said.

Samsoni said in February that the EGC could seek a private partner if the state does not have the funds to purchase all the artisanal cobalt produced.

Congo’s cobalt production has been sinking in step with a slide in the price of the metal.

The first quarter of 2020 saw a 15.2% drop in cobalt exports compared to the same period last year. Cobalt production in 2019 was down 19.86% year-on-year.

Separately, cobalt-rich Lualaba province announced all minerals produced through small-scale artisanal mining there must be tested and sold at a centralised trade hub from June 29, a move the provincial governor said was intended to fight mining fraud and maximise state revenues. (Reporting by Hereward Holland, Writing by Helen Reid, Editing by Grant McCool and Angus MacSwan)