Cobalt is a common element which is found worldwide. The element is used in electric vehicles, paints, and equipment parts. Due to a rise in the demand for lithium-ion batteries, cobalt prices have increased tremendously. Therefore, investing in cobalt stocks is worth considering for investors urged to invest in renewable energy and battery technology.

But, it is harder for investors to choose the best one to invest in and take advantage of potential growth. If you are also one of them, we have covered you. Here, you can find the top cobalt stocks you can consider investing in.

5 Best Cobalt Stocks to Buy

Investing in cobalt stocks can be challenging as the prices fluctuate and the supply-demand changes monthly. Also, the stocks of the companies that produce these commodities fluctuate greatly. Therefore, you must invest in established businesses that ensure healthy profit margins. If you want to ensure the stable returns, invest in the below-mentioned cobalt stocks:

Glencore Cobalt Stock

Glencore is the Switzerland-based largest producer of cobalt in the world. Besides cobalt, Glencore also produces zinc, copper, and nickel. These elements play a key role in the global energy transition. Therefore, Glencore is a great option for those seeking commodity exposure. The cobalt comes from different sources, including the mines in Australia, Canada, and the Democratic Republic of the Congo. Glencore works as a publically traded company and holds a listing on the New York Stock Exchange and London Stock Exchange. The company has been operating in more than 50 countries. 2021 Glencore will produce more than 18,000 tons (17% more than last year's production).

BHP Group

It is an Australian natural resources firm interested in copper, nickel, petroleum, coal, and iron. Cobalt is produced as a by-product during the mining of nickel and copper. BHP Group is one of the largest mining companies working worldwide. BHP signed a partnership agreement with KoBold Metals, which uses the algorithms to decide on exploration and land purchasing. As a result of this agreement, the company can obtain metals like nickel and cobalt to manufacture electric vehicle batteries and other renewable energy projects. The good part is that BHP is constantly profitable and is expected to generate the profit in double digit percentages.

Vale S.A.

The company was founded in 1942 and produces the base materials and metals. Vale S.A. is present in Brazil and is one of the largest companies in Latin America. It is one of the largest producers of nickel and iron. Also, Vale S.A. is a top producer of several materials used in battery manufacturing, including copper and manganese. In 2002, the company changed its name from Companhia Vale do Rio Doce to Vale S.A.

It is traded on the New York Stock Exchange and São Paulo Stock Exchange. The cobalt production of Vale S.A. comes from its Moatize mine in Mozambique. It is the world’s largest nickel mine, producing more than 150000 tons annually. Not only that, the company is also ranked among the largest cobalt producers, as it contributed about 5% to the global cobalt market.

Freeport-McMoRan

Freeport-McMoRan is another one of the best cobalt stocks to buy. It is an Arizona-based company that has been working at a global level. The company is one of the top producers of copper, molybdenum, and gold. Cobalt is part of the company's portfolio of assets. Tenke Fungurume mine, which is present in the Democratic Republic of the Congo, is the major contributor to its overall production of cobalt.

The company produces more than 7000 tons of cobalt annually and thus becomes the second largest producer of cobalt globally. It accounts for more than 15% of the global cobalt market. Freeport Sulphur Company established the Freeport-McMoRan in 1912, and the company underwent a significant transformation in 1981 when it was merged with McMoRan Exploration Company. It operates as a publicly traded entity listed on the New York Stock Exchange.

Wheaton Precious Metals Crop

It is a Canadian-based company. Wheaton Precious Metals Corp was founded in 2007, and its headquarters are in Vancouver. It is not a mining company but signs an agreement with the mining company (Glencore, Freeport-McMoRan, and Vale S.A.) to pre-purchase the whole or a part of the production at an agreed discounted price. The company purchases almost 100000 tons of cobalt annually. Along with the precious metal, the company also gets the amounts of cobalt. Though the company is not directly involved in cobalt production, it owns a specific place in the global mining space. It is also profitable and offers a significant dividend to investors who need investment income. Wheaton Precious Metals is listed on the New York Stock Exchange and Toronto Stock Exchange.

Why Invest In Cobalt?

There are so many reasons one should invest in cobalt, but the major reason is the increasing demand and price of metal. Also, it is expected that the demand for cobalt will increase shortly. Therefore, it offers you great investment opportunities. Besides that, all the investors have to deal with the risk of inflation, and commodity investments offer great protection against inflation.

Remember that precious commodities rise when the inflation rates rise. Therefore, investing in commodities is a good idea to hedge against inflammation. In addition, you can diversify your earning portfolio by investing in cobalt. As you know, cobalt is crucial to Li-ion batteries used in electric vehicles. As the electric vehicle market will grow in the coming years, cobalt demand will also increase. Therefore, investing in the cobalt at present will be a great idea!

Conclusion:

The lithium-ion batteries are used in laptops, mobile phones, and electric vehicles. Due to the rise in the demand for Li-ion batteries, the demand for the materials required to produce Lithium-ion batteries, such as Cobalt, has also increased. Therefore, investing in Cobalt stocks will be a profitable decision. This year, the best cobalt stocks to invest in are Glencore, BHP Group, Freeport-McMoRan, Vale S.A., and Wheaton Precious Metals.