Tesla, Glencore join Fair Cobalt Alliance. But what is it and why does it matter?

Tesla, one of the world’s biggest vehicle and energy companies, was in the headlines this week because it joined the Fair Cobalt Alliance (FCA). Mining giant Glencore, just a few days ago, announced its membership of the FCA. A few other companies namely Zhejiang Huayou Cobalt, Sono Motors and the Responsible Cobalt Initiative (RCI) are all part of the alliance. But the question is: what is the Fair Cobalt Alliance, why is it needed and why is this story important?

What is artisanal mining?

OECD’s mineral guidebook has a formal definition of artisanal mining:

Formal or informal mining operations with predominantly simplified forms of exploration, extraction, processing, and transportation. ASM is normally low capital intensive and uses high labour-intensive technology. ASM can include men and women working on an individual basis as well as those working in family groups, in partnership, or as members of cooperatives or other types of legal associations and enterprises involving hundreds or even thousands of miners. For example, it is common for work groups of 4-10 individuals, sometimes in family units, to share tasks at one single point of mineral extraction (e.g. excavating one tunnel). At the organisational level, groups of 30-300 miners are common, extracting jointly one mineral deposit (e.g. working in different tunnels), and sometimes sharing processing facilities.

The images in this slideshow are from a photo gallery found here. (Courtesy: Fair Cobalt Alliance)

How many people are involved in artisanal and what do they mine?

According to Delve, the total number of people across the world engaged in artisanal mining is a staggering 42,654,993. According to the Fair Cobalt Alliance, it is the second biggest employer after agriculture. Majority of the workers are men (70 per cent) and the rest are women. Children are also believed to be working in artisanal mines. What are they mining? Diamonds, gold, tin, tantalum, cobalt and many other minerals. Look at the charts by Delve, to see the number of people working in the sector.

Courtesy: Delve. Visit the website here.

What is cobalt and why do we need it?

Cobalt has a very interesting history. The Cobalt institute tells the story of how Cobalt got its name: in the Schneeberg Mountains it was often found with silver and nickel and it was the silver that was of principal interest at that time. When problems in separation and smelting arose, they were blamed on the “Kobolds” – later it was found to be the cobalt in the ore that complicated the refining process – hence the name transference. The Cobalt institute explains why Cobalt is often referred to as a technology enabling element. It is used in the manufacture of rechargeable batteries, electronics, catalysts, alloys and healthcare has resulted in the metal being referred to as a technology enabling element.

Why FCA?

The Impact Facility has a three-pronged strategy: improving access to: finance and markets, capacity development and ethical markets. The Fair Cobalt Alliance states on its website that, their goal is to have measurable impact on the mining communities they engage with. “To that end, we continuously and meticulously measure the success of our programmes to ensure that we maximise our reach – and the social return of our investment and grant capital,” they say on their website.

Other metals and other players

Gold supplies also depend quite significantly on artisanal mining. This excellent article by the World Gold Council details what ASM means for the supply chains of gold globally and what can be done about it. Pact is an organisation that also works in this area.  You can watch an interview we did with Pact to talk to them about their mines to market programme.

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