BHP Cobalt Price Falls 33% to One-Year Low of $28

By Stuart Wallace and Mark Herlihy

Aug. 15 (Bloomberg) -- BHP Billiton Ltd., the world's largest mining company, said its cobalt price tumbled 33 percent to the lowest price in almost a year.

The Melbourne-based company sold less than 5 metric tons at $28 a pound for August delivery to a European destination, BHP said today on its cobalt sales Web site. That's the lowest price since Sept. 5. BHP's previous sale was at $42 on July 9. It's offering 10 tons at $28 a pound for August delivery.

Global production of cobalt, used to make iPod batteries and jet engine parts, are forecast to increase as mines in the Democratic Republic of Congo expand or begin operating in response to an earlier jump in prices. Vancouver-based miner First Quantum Minerals Ltd. said in March that supplies will increase 85 percent in the next 20 months.

Katanga Mining Ltd. is restarting an underground mine in Congo and targeting output of more than 30,000 metric tons in 2011. Global production was 53,723 tons in 2007, the Cobalt Development Institute reported in April.

Freeport-McMoRan Copper & Gold Inc., the world's second- largest copper producer, and First Quantum Minerals Ltd. are also planning projects that will add thousands of tons of extra capacity.

To contact the reporter on this story: Stuart Wallace at swallace6@bloomberg.netMark Herlihy in London at mherlihy1@bloomberg.net.