The electric vehicle market is booming, and components to make EVs are dwindling. While we know this, it’s not exactly stopping manufacturers from developing more models. The demand for EV metals (cobalt, graphite, nickel, copper, and cobalt) is increasing and causing them to be endangered resources.
EV Boom Around the World:
- Electric bus sales are on the rise in China. The country recently laynched the world’s first electric cargo chip.
- Norway has built the first zero-emission electric ferry, and the world’s first zero emission zone at sea has also been established in the country.
- The UK has seen a surge in electric buses as a means of public transportation. Not only does this align with its emission reduction goals, it’s also become a mainstream means of travel. Additionally, electric planes are in development as we speak.
Sales Continue to Rise:
Bloomberg forecasts that electric car sales are expected to reach 11 million by 2025, and 30 million by 2030. They are expected to reach 60 million by 2040. In addition, they forecast that electric bus sales will reach 84% of the market share by 2030.
In 2017, global electric car sales reached 1.2 million, and 1.4% of the market share. A few years ago, the sales didn’t comprise of anything. This increase has quadrupled the price of cobalt, and caused what’s referred to as a “cobalt crunch.”
Cobalt production has more than tripled over the past two years. Major investments in mines are required to eliminate price spikes. In fact, there are efforts to develop new mines, as well as other efforts to reduce the amount of cobalt used in rechargeable batteries.
Regardless of the figures, cobalt is a small market because only 50% of it goes into batteries. According to Cobalt Blue Holdings Ltd., a standard electric car battery contains 15 kilograms of cobalt. A laptop requires around 33 grams, and a smartphone requires six grams. Its availability is limited to the Democratic Republic of Congo (DRC), with 65% extracted from the country. Congo’s tumultuous socio-political climate puts its continued availability in question.
Cobalt Outside of Congo:
Companies like Clean TeQ Holding Ltd., are developing a $680 million cobalt, nickel and scandium project in Sydney, Australia. There are more than 370 undeveloped discoveries, and a dozen of potentially viable projects outside of Congo that are expected to pick up by 2023.
Other than competition, the Congo also faces ethical restrictions. The country is under pressure to restrict artisanal mining which includes the cobalt sector. A 2016 Amnesty International report states that cobalt mining has prevalent child labour. In 2014, Tesla Motors Inc – one of the largest cobalt consumers – only sourced metal from North American miners due to supply-chain concerns.
Even though Congo will likely remain the main supplier of cobalt, it’s market share will fall as a result of outside developments.
Related:
Cobalt Demand Prices Continue to Skyrocket
Swedish Mines are Potentially the Answer to Battery Shortage
