The London Metal Exchange plans to ban cobalt brands said to be tainted by human rights abuses, Reuters reported Oct. 5.
The proposal aims to include responsible sourcing principles into metal brands deliverable against its contracts.
Brands that may have used tainted cobalt to earn a discount for the LME's cobalt contract against prices gathered by Metal Bulletin are targeted by the exchange. LME CEO Matt Chamberlain said the proposal is to identify brands trading at a discount of at least 2%.
Brands will be given 30 days to defend themselves from being delisted or suspended, Chamberlain said.
The exchange looks to complete the auditing process to ensure compliance with responsible sourcing principles for cobalt and tin by the end of 2020.
Meanwhile, auditing for copper, aluminium and zinc is targeted to be finished by the end of 2021. The metal industry and market participants were given until the end of November to give initial feedback, while a formal consultation will take place in early 2019.
Most of the world's cobalt supply originates in the Democratic Republic of the Congo, where human rights abuses on artisanal and small-scale miners are rampant.
LME's proposal prompted Trafigura Beheer BV to launch an investment plan that will train, equip and organize artisanal and small-scale cobalt miners in the DRC.
In December 2017, Nanjing Hanrui Cobalt Co. Ltd. said child labor may have been used in some of the cobalt it provided to LME-approved cobalt supplier Yantai Cash.