Why Europe’s Cobalt Policy May Backfire

EU Cobalt Regulations Risk Undermining Europe’s Strategic Autonomy

The European Union’s plan to tighten workplace exposure limits for cobalt has triggered strong pushback from some of the region’s largest mining and refining companies. Glencore and Umicore have warned that the proposed rules could severely damage Europe’s nascent cobalt value chain, deepening the bloc’s reliance on foreign suppliers, particularly the US and China.

Cobalt is one of the most strategically essential minerals in the global economy, playing a critical role in electric vehicle batteries, aerospace alloys, defence technologies, and electronics. Its unique properties, including high energy density, thermal stability, and durability, make it essential for next-generation battery chemistries that power the energy transition. 

Industry Backlash Over New Exposure Limits

The European Commission is considering a new occupational safety threshold for airborne cobalt particles of 0.01 mg/m³, significantly stricter than the levels permitted in China (0.05 mg/m³) or the UK (0.1 mg/m³). Industry groups argue that the proposed limit is too restrictive and would make EU-based facilities uncompetitive relative to global peers.

In a letter addressed to Commission President Ursula von der Leyen, 12 senior executives and industry associations warned that the “damage was already being felt” and that companies are diverting investment away from the EU due to the uncertainty surrounding the rule.

According to their analysis, the proposal could lead to the closure of one in six cobalt-related sites in Europe, directly undermining the goals of the Critical Raw Materials Act, which aims to strengthen European resilience in strategic minerals.

A Strategic Contradiction

Cobalt is essential for multiple high-value sectors, including electric vehicles, aerospace, defence technologies, and advanced electronics.

The Commission itself expects EU cobalt demand to increase fivefold by 2030.

Yet the proposed exposure limits could have the opposite of their intended effect:

• Higher regulatory burden → lower domestic production capacity
• Lower capacity → greater reliance on imports
• Greater reliance → heightened exposure to geopolitical risk.

This sits at odds with Europe’s ambition to develop independent supply chains and reduce its dependence on China. This country already dominates midstream cobalt processing, with a high risk of it weaponising its rarer earth minerals.

Contrast With US and Chinese Policy Moves

While Europe debates tighter restrictions, the US and China are accelerating strategic mineral security:

United States:

• The US Department of War, MP Materials, and Saudi Arabia’s Maaden have formed a joint venture to build a rare earth refinery in Saudi Arabia.
• New bilateral minerals agreements with Japan and other partners
• Rapid policy mobilisation following China’s export controls on rare earths

China:

• Strengthening control over strategic metals via export restrictions
• Expanding refining and processing dominance across cobalt, rare earths, and lithium

Against this backdrop, Europe’s proposed limits risk placing the region at a competitive disadvantage precisely when global supply chains are fragmenting.

Bottom line

At Cordoba Capital, we believe the EU’s proposed cobalt exposure standards highlight a clash between environmental/health objectives and strategic resource security.

If implemented in their current form, these rules could:

• Accelerate the offshoring of cobalt refining to the US and China.
• Increase Europe’s dependence on external supply chains.
• Raise long-term costs for EV and defence manufacturers.

The debate underscores the need for balanced regulation that protects worker safety while safeguarding Europe’s strategic mineral capacity.

We will continue to monitor developments as EU member states and the European Parliament review the proposals in the months ahead.