Understanding lithium demand, page-34

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Electric vehicles to grow battery market tenfold by 2025, UBS says
The global market for electric vehicle batteries in 2025 could be 10 times bigger than in 2018, according to a report by Swiss investment bank UBS published last week.
This should help to increase lithium demand by as much as four times, to drive a 41% increase in nickel consumption, and to more than double the use of cobalt over the same period, the report added.

These three metals are the ones most commonly used in battery production. The expected growth in demand for this particular use has prompted some price estimates to rise significantly in the past few years, although the prices for all three metals have actually come down this year.

Fastmarkets’ weekly price assessment for China-origin lithium carbonate, battery grade, reached 79,353 yuan ($11,462) per tonne ex-works on November 22, down from 79,973 yuan per tonne on November 15.

The price has come down by 52.40% over the year to date, from 166,500 yuan per tonne on December 21 last year. This has been because of new mining projects coming into operation in China, Argentina, Chile and Brazil.

Fastmarkets’ assessment of the domestic price in China for cobalt tetroxide, minimum 72.6% Co, delivered, was 280,000-300,000 yuan ($40,443-43,332) per tonne on November 23.

This was unchanged from two days earlier, but was down by 24.30% from 370,000-380,000 yuan per tonne on December 29 last year. This price did peak in mid-April, however, at 510,000-520,000 yuan per tonne.

The domestic Chinese price assessment for nickel sulfate, 21-22.5%, delivered, was 24,500-25,000 yuan per tonne on November 20, a 2.00% decrease from 25,000-25,500 yuan per tonne ex-works on November 13. It was also down by 5.80% from 26,000-27,500 yuan per tonne on July 24 this year, when Fastmarkets began assessing this market.

Battery demand for electric vehicles was calculated by UBS to rise to 973GWh by 2025, compared with around 93GWh in 2018. The market for batteries in general is expected to be 1,145GWh in 2025, up from 166GWh in 2018, the report added.

Significant opportunities may arise for NMC 622 batteries, which have a cathode comprising 60% nickel, 20% manganese and 20% cobalt. This will be the main global market by 2025, and will be worth almost $40 billion per year, the Swiss bank said.

The demand for NMC 811 material, which has 80% nickel, could push this market to be worth $25 billion per year. It could rank second among the most-in-demand battery materials, the report added.

The growing use of electric vehicles could drive lithium demand to 1.15 million tonnes per year by 2025, from 265,000 tpy in 2018, UBS said.

Consumption of nickel for batteries would total 665,000 tonnes in 2025, compared with 60,000 tonnes currently, according to the bank. This would push total nickel use to 3.1 million tpy from 2.2 million tpy.

And the UBS report said that demand for cobalt has room to grow to 260,000 tpy in 2025, from 120,000 tpy in 2018.