By CRM staff
Toronto, Ontario — January 9, 2019 — Booming demand for electric vehicles has sparked a race to acquire metals used in the production of batteries.
While only a modest 668,000 battery-powered vehicles were sold in 2017 (out of 82 million passenger vehicles sold worldwide), sales are growing by 78 percent year-on-year, according to business intelligence firm JATO Dynamics. Investment bank Goldman Sachs has forecast battery sales for vehicles will reach $60 billion by 2030, compared to $10 billion today.
To get a piece of this market – and to secure their ability to produce electric vehicle batteries in the future – multinational corporations and national governments are rushing to secure a supply of metals. The three essential elements sought are nickel, cobalt and lithium.
But difficulties abound for producers of batteries for electric cars – more than half of the world’s cobalt, for example, is produced in the Democratic Republic of Congo, a country beset by instability. The automotive industry, meanwhile, is not alone in seeking out cobalt. Apple relies on the metal to produce its iPhones and MacBooks, meaning there is competition between the industries for the precious resource.
So far, China is winning the race to produce batteries for electric vehicles, with Bloomberg New Energy Finance predicting that the country will have a 70 percent share of global production by 2021. China also leads the world in consumption of electric vehicles.
But Japan and South Korea are rushing to increase their output of electric vehicle batteries. Hoping to feed this growing demand for cobalt and other metals are a wide range of international mining firms. Because of the East Asian dominance in production, however, one firm is in a unique position to become a major player in cobalt supply.
Pacific Rim Cobalt, which is headquartered in West Vancouver, controls a potential new mine in Indonesia. Its proximity to the major electric vehicle battery producers means it could beat off competition from the two main cobalt-mining countries – the DRC and Australia. The firm’s CEO, Ranjeet Sundher, said he expects the potential mine in Indonesia to “lend itself well to low-cost, logistically straightforward drilling”.
“It’s going to be a busy year ahead, and we look forward to getting the drills turning and building value,” he added.
Brazilian firm Vale SA, meanwhile, is seeking to expand production at its nickel mine in Voisey Bay, Labrador as the race for metals intensifies.