Supply crisis propagation in the global cobalt trade network

Abstract

Cobalt is widely recognized as a strategic mineral especially for current energy and low carbon revolution. Nonetheless, the geographically concentrated supply makes reliable access to cobalt more of a strategic concern. Understanding the systemic impacts of epicenter economies, and how crises propagate if these economies were hit by negative shocks, are thus important for policy makers. To explore this issue, we construct a global cobalt trade network using the data of 2019, upon which a cascading failure model is established. Accordingly, we simulate the avalanche process, and an avalanche network is derived to analyze the structural features of crisis propagation dynamics. Results show that (1) When the ratio r ≥ 8, avalanche sizes of major epicenter economies increase rapidly from 22 to 36; (2) Democratic Republic of Congo, Mainland of China, Germany, and United Kingdom have systemic impacts in the global cobalt trade network; (3) Out-degree, in-strength, out-strength, and betweenness show influences on the dynamics of supply crisis propagation, while in-degree and eigencentrality do not show clear influences on the propagation dynamics; (4) Indirect cascades account for a significant fraction of the avalanche sizes. These findings contribute to more efficient supply management of the strategic raw material for policy makers.