Madagascar’s largest nickel and cobalt mine, Ambatovy, has halted production after Cyclone Gezani swept through the island nation this week, traders said Friday, warning that extended disruptions could tighten global battery material supply.
Ambatovy, a joint venture primarily owned by Japanese trading house Sumitomo Corporation and the state-owned Korea Mine Rehabilitation and Mineral Resources Corporation (KOMIR), produces nickel and cobalt briquettes for international markets, including electric vehicle batteries. In 2024, the operation generated approximately 28,000 metric tons of nickel and 2,500 tons of cobalt.
The cyclone struck Madagascar’s eastern coast, heavily damaging Toamasina, the island’s main port and Ambatovy’s export hub. Traders indicated that shipments of processed nickel and cobalt are likely to be delayed, with recovery dependent on both port operations and mine rehabilitation. Ambatovy and Sumitomo did not respond to requests for comment.
“The cyclone has created a significant operational bottleneck,” a European trader familiar with the company said. “If outages persist, it could put upward pressure on cobalt prices, especially given the already tight market.”
Cobalt is a key ingredient in lithium-ion batteries, which power electric vehicles, consumer electronics, and energy storage systems. Prices currently hover around 26 dollars per pound on the London Metals Exchange, up 160 percent since the Democratic Republic of Congo imposed an export ban in February 2025. Congo accounts for roughly 70 percent of global cobalt supply, highlighting Madagascar’s important role as a secondary producer.
Ambatovy’s nickel and cobalt production is processed into briquettes, which are crushed and dissolved in sulphuric acid to produce sulphates, a critical input for battery manufacturing. Disruptions at the mine could affect downstream supply chains in Europe, North America, and Asia.
Madagascar’s mining sector is highly exposed to extreme weather events. Cyclones, which frequently hit the island during the Southern Hemisphere’s cyclone season from November to April, can disrupt both production and logistics. Past events have led to weeks-long shutdowns at mines and delays at ports, impacting export revenues and international markets.
Analysts say the Ambatovy outage comes at a critical moment for global cobalt demand. The market has been volatile since Congo lifted its export ban last October, replacing it with annual quotas. Global mine production is expected to reach roughly 285,000 tons in 2026, with Madagascar contributing a small but strategic share.
“The Ambatovy mine, while smaller than Congo’s operations, is vital for diversifying supply,” said Dr. Julian Taylor, a metals analyst at Global Commodity Insights. “Even temporary disruptions can create ripple effects in the EV battery sector, especially given the ongoing green energy transition.”
Madagascar relies on nickel and cobalt exports for foreign exchange, with mining accounting for a significant portion of industrial output. Ambatovy has also invested in local communities through employment and infrastructure projects, making production stoppages economically sensitive beyond the global market.
Recovery efforts will depend on the extent of cyclone damage to both the mine and port infrastructure. Traders anticipate that once Toamasina reopens and the mine resumes normal operations, production could return within weeks, though any delays may influence cobalt and nickel pricing in the short term.
As global demand for battery metals rises alongside the electric vehicle boom, Madagascar’s vulnerability to climate-related disruptions underscores the strategic importance of stable operations at Ambatovy and other regional producers.
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