COBALT.

Abstract

In order to empirically assess the potential effects of seabed mining on the cobalt market an econometric model of the world cobalt industry was estimated and presented. The estimated model was then simulated under different scenarios. First, it was assumed that no seabed mining or stockpiling by the US government will take place until 1990. In the second simulaton exercise, the impact of the annual purchase of 5 million pounds of cobalt from 1985 to 1988 was investigated. Finally, the model was simulated under the assumption that seabed mining starts in 1988. Two scenarios were considered. Under the first one it was assumed that an unrestricted access to seabed mining would yield 50 million pounds of cobalt annually. The second scenario assumed that seabed mining will be restricted so that only 30 million pounds of cobalt will be produced each year.