Panasonic Drops Supplier for Obtaining Cobalt from Cuba

Panasonic Corp. has a suspended a Canadian supplier of cobalt used to make batteries for Tesla electric cars because the metal was mined in Cuba and may be subject to U.S. sanctions.

Sources tell Reuters the affected vendor is Toronto-based Sherritt International Corp. The company mines cobalt in Cuba through a 50:50 venture with the country’s General Nickel Co. Neither Sherritt nor Panasonic have confirmed their relationship.

Reuters says that most of the cobalt Panasonic requires as sole battery supplier to Tesla comes from the Philippines through Japan’s Sumitomo Metal Mining Co. Ltd. Panasonic says it has been using cobalt from its Canadian vendor in Tesla batteries since February.

Refining and processing cobalt involves multiple suppliers and co-mingled materials. Panasonic says it cannot determine exactly how much Cuban cobalt ended up in Tesla batteries. It suspended its Canadian source as a precaution.

Panasonic tells Reuters it has asked the U.S. Dept. of Treasury’s Office of Foreign Assets Controls for clarification about possible exposure to sanctions.