![]() ![]() That eye-watering growth rate would be stronger still were it not for a shift towards non-cobalt battery chemistries, led by China, the world's largest EV market. ![]() Sales of new energy vehicles rose by 56% year-on-year in the fourth quarter of 2022 and usage of cobalt in EV batteries jumped by over 60% over the full year, according to the Cobalt Institute's latest quarterly report. Lithium mining also faces opposition from environmental and social activists.Įxamples include Serbia's government halting Rio Tinto's (RIO.L), (RIO.AX) Jadar project, which was expected to be Europe's biggest lithium mine, producing 58,000 tonnes a year of battery-grade lithium carbonate.ĭeficits have pushed prices of lithium carbonate to record highs above $50,000 a tonne in China, according to BMI.CME cobalt price, total volume and market open interest CHANGE OF GEARĬobalt's fortunes are still tied to the EV sector but the relationship is changing. Shortages of nickel have fuelled a rally that took prices to $24,435 a tonne last month, the highest since August 2011. Indonesian nickel has a high carbon footprint and there are concerns the government will eventually give in to producers wanting to dump tailings in the sea.Ĭobalt is a byproduct of nickel production in Indonesia. Most new nickel units suitable for EV batteries will in future come from new high pressure acid leach (HPAL) plants in top producer Indonesia. WHAT ESG ISSUES RELATE TO NICKEL?Īnd nickel also has ESG (environmental, social and governance) risks. One reason to cut cobalt content in EV batteries is cost - cobalt metal on the London Metal Exchange is trading at four-year highs around $71,000 a tonne.Īlso, 50% of the world's cobalt reserves are in Democratic Republic of Congo where potential for political instability and disruption is high.Ĭongo currently produces more than 70% of the world's cobalt but some artisanal cobalt production poses reputational risk due to human rights abuses and the use of child labour. The driving range of LFP cars is lower, but they are popular in urban China, which dominates the EV battery supply chain.īMI estimates cathodes can contain between 0-15 kg of cobalt, 0-40 kg of nickel and 30-50 kg of lithium. "We see potential to use LFP for up to 30% of our battery electric vehicle portfolio." "LFP is robust over many charging cycles at lower cost," Volkswagen said. Volkswagen said it likes lithium phosphate (LFP) batteries because they contain no cobalt or nickel and "supply is secure." ![]() Volkswagen (VOWG_p.DE) declined to comment on the ratio it uses but sources say its batteries use 7-1-2 cathodes. LG Energy Solution (373220.KS) is supplying batteries with cathodes containing 90% nickel to Tesla. Many automakers are now looking at 8-1-1. Moves to include more nickel to boost energy density and extend driving range initially saw a shift to 5-3-2 and 6-2-2. Tesla (TSLA.O) batteries typically use nickel-cobalt-aluminium (NCA) but the dominant cathode chemistry in the auto sector is nickel-cobalt-manganese (NCM). EV batteries are charged and discharged by the flow of lithium ions between the graphite-containing anode and the cathode.Ĭathodes contain nickel which delivers high energy density, allowing the vehicle to travel further.Ĭobalt ensures cathodes do not easily overheat or catch fire and it helps extend the life of batteries which automakers usually guarantee for eight to 10 years. ![]()
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