Apple Inc. is seeking contracts to directly buy long-term supplies of cobalt from miners for the first time, Bloomberg News reported, citing sources familiar with the matter.
Apple is said to be in talks to secure several thousand tonnes of cobalt per year from miners for five years or longer, in a bid to ensure sufficient supplies for manufacturing lithium-ion batteries used in its iPhone and iPad devices.
Under the current scheme, the companies making the batteries for Apple are negotiating for cobalt supplies, according to Bloomberg News.
Apple's plans will reportedly pit it against Volkswagen AG, BMW AG and Samsung Group unit Samsung SDI Co. Ltd., which are all eyeing multiyear cobalt supply deals to support their electric vehicle production targets. Volkswagen wants to secure long-term cobalt supplies for up to 10 years from 2019, requiring more than 150 gigawatt-hours of battery capacity per year by 2025.
Analysts have said a shortage in supplies of cobalt and other metals, combined with a global demand for electric vehicles and energy storage as well as price increases and geopolitics, are stepping up pressure on the supply chain for lithium-ion battery makers.