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Battery Technology Innovation/Electric Vehicles

Lithium and cobalt: A tale of two commodities – by Marcelo Azevedo, Nicolò Campagnol, Toralf Hagenbruch, Ken Hoffman, Ajay Lala, and Oliver Ramsbottom (McKinsey.com – June 2018)

https://www.mckinsey.com/

What does the rise of electric vehicles mean for two critical raw materials that go into their batteries—and for the players in this ecosystem?

The electric-vehicle (EV) revolution is ushering in a golden age for battery raw materials, best reflected by a dramatic increase in price for two key battery commodities, lithium and cobalt, over the past 24 months. In addition, the growing need for energy storage, e-bikes, electrification of tools, and other battery-intense applications is increasing the interest in these commodities (Exhibit 1).

However, recent concerns regarding the future of the raw-material supply availability for batteries and the impact of rising commodity prices on battery production costs have highlighted risks that might create divergent futures for these two commodities.

The strategic response needed will likely differ across industry players such as automotive OEMs, battery manufacturers, mining and refining companies, and financial investors. For all players, there is a growing imperative to understand the complexities and dynamics of this rapidly changing market and to ensure that their strategies are robust in the face of uncertainty.

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Indian State-owned firms mandated to acquire overseas lithium and cobalt assets – by Ajoy J Das (MiningWeekly.com – June 22, 2018)

http://www.miningweekly.com/

KOLKATA (miningweekly.com) – The Indian government has mandated all State-owned mineral-based companies to pool their resources to acquire lithium and cobalt assets overseas.

A rough deadline of March 2019 has been set for these companies to complete all formalities, such as leveraging their balance sheets jointly, form joint ventures (JVs), consortiums or any such suitable corporate structures so that process of scouting and acquiring lithium and cobalt assets could get under way next financial year.

“The mandate for these companies is to acquire and source strategic minerals, lithium and cobalt from abroad,” joint secretary of the Mines Ministry, Anil Kumar Nayak, said.

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US risked Chinese battery monopoly had Gertler dispute escalated – by David McKay (MiningMx.com – June 19, 2018)

https://www.miningmx.com/

GLENCORE’S workaround the US sanctions placed on Dan Gertler, the Congo’s mining tycoon, was a remarkable piece of pragmatism on behalf of the Swiss miner and minerals trader, but it may have also been informed by a broader concern.

The concern is that in failing to settle the matter, the assets from which Gertler was demanding the resumption of royalties – the Mutanda and Kamoto Copper mines – would have been expropriated by the Congolese government with whom Gertler is close.

It’s quite likely then, given China’s obvious comfort in operating in the Congo, that its companies may have bought the mines and taken control of a large slug of world cobalt (and copper) supply that is crucial to battery manufacture. Controlling the cobalt market would give the Chinese unprecedented control over the world automotive sector.

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Chile antitrust regulator to probe Tianqi purchase of SQM stake – by Dave Sherwood and Aislinn Laing (Reuters U.K. – June 15, 2018)

https://uk.reuters.com/

SANTIAGO (Reuters) – Chile’s antitrust regulator FNE said on Friday it would open an investigation into the effects on the market of Chinese miner Tianqi Lithium Corp’s (002466.SZ) purchase last month of a 24 percent stake in SQM SQMa.SN (SQM.N), one of the world’s top lithium producers.

The FNE’s decision comes three months after Chile´s government under former President Michelle Bachelet requested regulators investigate a potential fusion between the two lithium miners, alleging it would distort the global market for the key ingredient in the batteries that power electric vehicles.

China’s Tianqi said in May it would buy nearly a quarter of SQM from Canada-based fertiliser company Nutrien Ltd (NTR.TO) for $4.1 billion (£3 billion).

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Super Batteries: Which Metal Will Fuel the Future? – by Georgia Williams (Nickel Investing News – June 13th, 2018)

Nickel Investing News

There has been a lot of discussion around which battery metal will reign supreme in the push to bring electric and hybrid vehicles to market. Currently lithium, nickel and cobalt are the heavyweight contenders, but what is next?

At the 6th International Nickel Conference, the Investing News Network caught up with Jon Hykawy, president of Stormcrow Capital, a research firm specializing in guiding and educating its clients on taking advantage of volatility in the critical materials and technology markets.

He shared his insight about the future of the battery metals sector and which energy metal will play a vital role in the next stage of battery evolution. Hykawy also explained why there is slow and cautious momentum towards packing batteries with more energy.

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After cobalt-free pledge, Panasonic to triple consumption for auto batteries: sources – by Pratima Desai (Reuters U.S. – June 14, 2018)

https://www.reuters.com/

LONDON (Reuters) – Panasonic Corp expects to more than triple its cobalt consumption in five years’ time, industry sources said, even as the company aims to develop cobalt-free automotive batteries in the near future.

Panasonic is the exclusive battery cell supplier for all new Tesla vehicles, including the mass-market Model 3 electric car. Sources say cobalt-free batteries are many years away.

The scramble to secure supplies of cobalt, which stabilizes and extends the life of lithium-ion rechargeable batteries used to power electric vehicles, has seen prices rise to around $40 a lb from below $10 a lb in December 2015.

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Commodities of the future – by Molly Lempriere (Mining Technology – June 13, 2018)

https://www.mining-technology.com/

The latest Deloitte mining trends report identifies ‘commodities of the future’ as one of the key turning points for the industry. MINE presents the commodities likely to make a splash on the market in the future, and those that may be better left in the past.

Deloitte’s report, Tracking the trends 2018: The top 10 issues shaping mining in the year ahead, ended with a section on the commodities of the future. Choosing which commodities to invest in and which to divest is an important challenge for mining decision-makers, especially as industrial needs change and environmental concerns come to the fore. Deloitte, therefore, presented its predictions, taking into account technological developments.

“Given how inextricably socioeconomic trends link to commodity demand, mining executives have long had to double as futurists,” says the Deloitte report. “To assess which commodities to invest in, and which to divest, miners need to keep their fingers on the pulse of fluctuating consumer demands, global demographic and economic shifts, and the effects of environmental change.”

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Australia takes over Chile as world’s No.1 lithium producer – by Cecilia Jamasmie (Mining.com – June 12, 2018)

http://www.mining.com/

Australia has taken over Chile as the world’s largest lithium producing nation boosted mainly by record output at two major mines, data from United States Geological Survey (USGS) shows.

Down Under produced 18,700 tonnes of lithium in 2017, according to the USGS, thanks mainly to Western Australia-based mines — Galaxy Resources’ Mt Cattlin and Mt Marion, owned by Neometals and China’s Jiangxi Ganfeng Lithium.

Chile, which holds the largest known lithium reserves in the world (about 52%), only produced 14,100 tonnes of the white metal last year, which meant its market share dropped to 32.8% from 37.6% in 2016. Australia, instead, went from having 36.8% of the global market to 43.5% in the same period.

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Cobalt Hunt Takes Aussie Explorer to Forest on BMW’s Doorstep – by Elisabeth Behrmann (Bloomberg News – June 13, 2018)

https://www.bloomberg.com/

The search for cobalt, a key component of the battery-powered auto fleets of the future, has arrived on BMW AG’s doorstep with a discovery of an ore deposit not far from the plant where the German manufacturer makes its i3 electric city car.

The cobalt find in a forested section of Saxony’s Eichigt municipality, Germany’s first detection of the metal in modern times, could revive mining in an area that last saw activity during the Renaissance, and help diversify raw-materials supply, exploration company Lithium Australia NL said.

Some 60 percent of the world’s cobalt is concentrated in the Democratic Republic of Congo, where concerns over working practices and political strife have sparked a global hunt for alternatives sources.

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Wheaton Precious Metals CEO says company ‘taking a gamble and investing in cobalt’ – by Gabriel Friedman (Financial Post – June 13, 2018)

http://business.financialpost.com/

A deal with Vale over cobalt marks the first time that Wheaton Precious Metals has moved outside the gold and silver space

Cobalt has given the Voisey’s Bay mine — one of the world’s largest nickel deposits — in Newfoundland and Labrador a new lease on life this week in yet another sign of the growing influence that the electric vehicle industry already exerts on global supply chains.

Brazilian giant Vale SA on Monday announced it will sell most of the mine’s future cobalt production for US$690 million to finance a long-delayed $1.7-billion expansion, which will add an underground component to the mine and extend its life by 15 years.

Cobalt, long considered an industrial metal used as an alloy in jet engines and natural gas turbines, is increasingly in demand for use in lithium-ion batteries. Forecasts that the electric vehicle industry is set for major growth over the next decade have increased cobalt prices by more than fourfold during the past two years to US$80,000 per ton.

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U.S. electric car sector, wary of China, seeks more domestic lithium – by Nicole Mordant (Reuters U.S. – June 12, 2018)

https://www.reuters.com/

(Reuters) – Miners are pushing to sharply boost lithium output in the United States, as automakers in the world’s third biggest electric vehicle market are eager to cut their dependence on China for the critical battery ingredient and find more local sources.

In North Carolina, Nevada and half a dozen other states, miners are working to revive the U.S. lithium industry, once the world’s largest until it fell off in the 1990s.

Global demand for the lightweight material is expected to quadruple by 2025. Miners are betting U.S. expansion will pay off with orders from battery and vehicle manufacturers who are wary of relying too much on China, which is home to the majority of the world’s lithium processing facilities and sucks up most output of top producer Australia.

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Sudbury’s nickel in demand again – by Harold Carmichael (Sudbury Star – June 13, 2018)

http://www.thesudburystar.com/

It’s the type of metal needed for electric cars

In the first half of 2017, nickel was selling for an average price of US$4.43 a pound and there was an increasing glut of nickel in London Metal Exchange warehouses. On Aug. 31, that glut reached a whopping 389,154 tonnes. Fast-forward to today and it’s a totally different picture.

Last week, LME nickel stockpiles had shrunk to 278,800 tonnes. The metal also broke through the US$7-a-pound mark last week — a gain of about $1.50 pound since last December. Nickel started the day Friday at $7.10 pound, but had dropped to $6.96/pound U.S. by the end of the day, and has dropped a bit more since then.

Terry Ortslan, mining analyst with TSO & Associates in Montreal, said a combination of the weakening of the U.S. dollar and hoarding by traders in anticipation of nickel needed for electric vehicles is causing rising prices and inventory drops.

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Vale in deal with two Canadian companies to sell cobalt – by Nicole Mordant (Reuters U.S. – June 11, 2018)

https://www.reuters.com/

(Reuters) – Brazil’s Vale on Monday unveiled a $690 million financing to expand a Canadian nickel mine, agreeing to sell unmined cobalt from Voisey’s Bay as a booming electric vehicle market propels demand for the critical battery ingredient.

Vale said it would sell cobalt mined after 2021 as a by-product from the mine in Canada’s northern Labrador region to Wheaton Precious Metals Corp and Cobalt 27 Capital Corp in a so-called stream financing deal.

The transaction is the world’s biggest cobalt stream to date, a form of alternative financing that allows an investor to make an upfront payment in exchange for future production at a discounted price.

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FORECAST: EV nickel demand to surge tenfold by 2025, Vale says – by Millicent Dent (Metal Bulletin.com – May 15, 2018)

http://www.metalbulletin.com/

Mass production of electric vehicles (EVs) will transform the nickel market, which must evolve from pricing and supply perspectives in order to meet the anticipated surge in demand.

“We’re already preparing [to enter the EV space] but we’re going to preserve optionality until it’s time and we can extract value,” Robert Morris, Vale’s executive vice president of sales and marketing for base metals, told Metal Bulletin.

Nickel prices are not nearly high enough to incentivize more production to come online. “If we want to supply this battery revolution with the appropriate nickel units, prices will have to be substantially higher,” he said, adding that it would likely take a couple of years for that to occur.

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Rio Tinto moves into cleaner resources to chase electric vehicles – by Kaori Takahashi (June 9, 2018)

https://asia.nikkei.com/

Global miner shifts focus to lithium after exit from coal

TOKYO — Anglo-Australian miner Rio Tinto is realigning its business structure in the wake of the global resources boom, after completing its exit from the coal industry earlier this year, with an eye on electric vehicle-related battery materials.

Rio Tinto CEO Jean-Sebastian Jacques, in a wide-ranging interview with Nikkei in Tokyo this week, laid out the company’s focus on new minerals, particularly lithium, technology partnerships in Asia, and divestment in coal.

Rio Tinto is shifting tack to respond to China’s demands, but its own operational needs and relationships with Asian customers are changing. On Thursday, Rio Tinto finalized a joint venture with China Minmetals to explore for minerals in the country.

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