Niche metal cobalt is leaving bigger names like copper and lithium in its dust, triggering a hunt for new deposits from Idaho to Chile.

As one of the key components in the new breed of rechargeable batteries and with supply dominated by the Democratic Republic of Congo, prices have surged at four times the pace of major metals in the past year. That has caught the attention of governments, explorers and money managers, with annual demand set to increase 34 percent until 2026 as electric cars gain popularity, according to CRU Group.

Authorities in Chile, the top copper-producing nation, are embarking on a fact-finding mission with a view to restart cobalt production after a more than seven-decade hiatus. First Cobalt Corp. is merging with two other firms to create what it calls the world's largest explorer of the mineral. A bet on the cobalt industry has helped make a Commodity Capital fund the best performer in the commodities market, while legendary Australian prospector Mark Creasy has cobalt on his latest list of targets.

"Cobalt is the next big thing," Commodity Capital co-founder Dana Kallasch said last week. The firm's Global Mining Fund has returned about 70 percent this year, beating 213 peers, according to data compiled by Bloomberg.

The mineral once used to dye pottery dark blue is now in demand from car and phone makers from Tesla to Apple.

Congo produced 66,000 tons last year, compared with 7,700 in China, the second biggest producer. In Congo, cobalt is mined mostly informally in precarious conditions that sometimes involve child labor.

"We are seeing companies being more careful about where cobalt comes from and asking for providers to have the right paperwork," Rebecca Gordon, head of technology metals at CRU Group, said.

Rising prices are encouraging operators in Asia and elsewhere to produce cobalt as a byproduct of other metals such as nickel and copper. Chile also wants to get in on the act. Development agency Corfo met with companies including Samsung SDI and Umicore SA in Europe during a recent roadshow on lithium, another key component of electric-car batteries.

"We are talking to elderly people in the Coquimbo region to see where the old mines were, investigating who owns the land and taking the first samples," said Corfo's Eduardo Bitran.

Lombrana and Barton write for Bloomberg News.