ECONOMY

Turkish cobalt in two years?

LONDON (Reuters) – Turkey’s Cengiz Holding plans to invest $70 million to build a plant which will produce cobalt concentrate in Turkey. «We aim to start production in two years at the latest,» Mehmet Cengiz, chairman of Cengiz Group, told Reuters. He did not give any figures for the capacity of the plant as the project is at an early stage. The price of strategic metal cobalt, used mainly in construction of aircraft and in rechargeable batteries, traded around $30 a pound on Tuesday and analysts think it might breach April’s 11-year highs around $31.75 in the near future. Cobalt, seen as the next target for investors in the world’s overcrowded commodity markets, is not traded on an exchange so the market can be opaque, and accurate pricing data hard to find. «We have invested $87 million in the past two years on our alumina refinery in Seydisehir,» Cengiz said, adding that the company plans to invest another $70 million in the coming four years on modernization of the facility. He said the company will produce 65,000 tons of aluminium and 200,000 tons of alumina in 2007. «We want to increase capacity but the energy costs, electricity in particular, is very expensive in Turkey. That’s why boosting capacity is not very feasible right now,» he said. Unlisted Cengiz Group owns two copper mines and a copper smelter in Turkey and produces 36,000 tons of copper annually.