Global lithium demand 'to double' by 2024, driven by EVs
The annual production of electric vehicles (EVs) is set to grow from 3.4 million in 2020 to 12.7 million in 2024, while battery production is predicted to grow from 95.3GWh to 410.5GWh in the same period, a GlobalData report forecasts.
Correspondingly, demand for lithium is expected to rise from a forecasted 47.3kt in 2020 to 117.4kt in 2024, at a CAGR. Global demand for lithium will be driven by growth in manufacturing facilities, particularly in China – where lithium-ion battery manufacturing capacity is expected to increase from an estimated 388.2GWh in 2020 to 575.3GWh in 2024, the report states.
“Lithium metal production is expected to reach 134.7kt versus 58.8kt in 2020. This follows a significant 18.2% decline in 2019 to 78.2kt, resulting from sluggish global EV sales and a steep fall in prices, which, in turn, encouraged reduced production levels," says Vinneth Bajaj, Senior Mining Analyst at GlobalData.
“Lithium production over the next four years will be mainly supported by output from existing Australian mines such as Mount Cattlin and Pilgangoora. Other major mines include Mount Marion, Salar de Atacama and Salar del Hombre Muerto located in Australia, Chile and Argentina, respectively.”
Bajaj adds that nearly 12.7 million EVs are expected to be produced globally in 2024, driven by China, which is determined to boost EV sales.
China is targeting a 20 percent share of new car sales by 2025, versus just 5 percent in 2019. The country’s decision to cut subsidies in a phased manner until 2022, rather than eliminating it in 2020, is expected to provide an essential boost to the domestic market, as well as the overall global EV market, he says.
Telsa is working towards achieving 100GWh of cell production capacity by 2022 (Model Y pictured), and up to 3,000GWh by 2030. This is a far greater figure than any other manufacturer, including China’s BYD, which is expected to expand its capacity to 126GWh in 2024, versus just 40GWh in 2019.
Japan’s Panasonic, a key supplier to Telsa, expects to increase its capacity from 40GWh in 2019, to 63GWh by 2021, while LG Chem will expand from 65.2GWh in 2019 to 172.4GWh in 2024, the report adds.
“Tesla has also announced a revolutionary 4680 cell design, the production of which has already begun with 10GWh of annual capacity expected through 2021. It is expected to completely change the cost dynamics of EVs by reducing the overall cost of its long range and high-performance battery cells,” concludes Bajaj.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.