Concerns raised about supply of battery raw materials

By IM Staff
Published: Thursday, 29 March 2018

Demand for battery materials will crash into limited supplies soon, at the same time as global carmakers attempt to switch to making electric vehicles.

Increasing demand for graphite, cobalt and manganese is coinciding with a lack of sufficient supply to meet future expectations, miners said at this year’s Prospectors & Developers Association of Canada (PDAC) investors forum on energy materials and technologies, writes Daniel Sekulich.

"Five or 10 years ago, there was no battery market for graphite. Today, that market accounts for 25% of global demand for the mineral," Brent Nykoliation, senior vice-president at Toronto-based NextSource Materials, told delegates at the event in Toronto, Canada, March 4-7.

This is causing a paradigm shift in the mainstream automotive industry, he said, with established manufacturers, such as General Motors, Fiat-Chrysler, Ford and others accelerating their production of electric vehicles (EVs).

EVs are causing rapid change in the mining world, Trent Hall, head of Toronto-based minerals company First Cobalt, said.

"In the next 18 months, every car company is going to have an EV," Hall said. "This will inevitably lead to global supply chain disruption."

There are currently 25 major lithium-ion battery factories planned or under construction around the world, each with a capacity of more than 1GW of production, according to Robin Goad, president and chief executive office of Ontario cobalt miner Fortune Minerals.

"Thirteen of those will be in China, including the world’s largest, the CATL [Contemporary Amperex Technology Co Ltd] facility, which will be a 100GW [factory]," Goad said.

But several presenters at the PDAC event believe that China has a major supply problem.

Gregory Bowes, CEO of Northern Graphite, said that "China may have reached peak graphite. We are going to reach saturation point where battery demand [drives] prices quite a bit higher than they are now."