Goldman Sachs has stepped up its trading in battery metal cobalt, latching on to one of the hottest corners of the commodities market as carmakers transition to electric vehicles.
The bank has been active in cobalt markets since last year, and has more recently dipped into physical purchases of the metal for the first time, according to people familiar with the matter.
The involvement of banks such as Goldman could help bring liquidity to the trading of cobalt, an opaque market where prices are determined privately between buyers and sellers.
Carmakers need metals such as lithium and cobalt for batteries, and some source it directly from miners. But they are open to potentially painful price fluctuations.
Already, the price of lithium carbonate has risen 65 per cent this year while cobalt sulphate prices are up 24 per cent, according to Benchmark Mineral Intelligence.
Prices are likely to continue rising quickly. To meet the goals of…