A method for producing extra fine cobalt metal powder (up to 1.7 FSSS) by the digestion of cobalt pentammine chloride in a dilute ammonium hydroxide solution to form a cobalt-containing precipitate, followed by reducing the precipitate in a hydrogen atmosphere to cobalt metal powder, is improved by: (a) adding NaOH to the mother liquor containing cobalt species in solution, to form a cobalt-containing precipitate; and (b) either heating the precipitate in hydrogen to reduce it to cobalt metal powder or recycling the precipitate as a cobalt source for the formation of cobalt pentammine chloride. The final cobalt metal powder is useful, for example, as a starting material in the manufacture of cemented carbides.