EV BATTERY MATERIALS TO BE IN SHORT SUPPLY FOR YEARS

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Lithium carbonate, used to make battery cathodes for electric vehicles (EVs), will be increasingly scarce (see related story in this issue), according to Benchmark Mineral Intelligence, and will not be able to meet market demand next year.

Prices already have risen, not only for lithium carbonate, which has doubled in price year on year; the price of cobalt hydroxide, which boosts energy density and battery life, is up 40 percent. 

Prices for EV battery materials have trended down over the past decade.

However, cobalt, lithium, and nickel, which account for 30 to 45 percent of EV batteries’ cost, are seeing their markets tighten as their prices head skyward under pressure from global economies recovering, manufacturing resuming, and demand for EVs rising steadily in years ahead.

The pinched market is likely to benefit China, which controls production of 65 percent of EV batteries’ anode materials and electrolytes and 42 percent of cathode materials, Goldman Sachs estimates.

“China has a better grip on supply chains than anyone else,” Adam Panayi, a director at research firm Rho Motion, commented to The Wall Street Journal.

That circumstance should prompt other countries to develop their own supplies, which also would rein in climbing prices, he said.

TRENDPOST: More than 40 percent of new car buyers are considering purchasing an electric vehicle, according to the most recent Mobility Lens Consumer Index from consulting firm EY Global.

Having made commitments to be all-electric within 15 years, Ford, General Motors, Volkswagen, and other automakers are now focusing on locking in deals with suppliers who can guarantee access to these needed materials.

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