Fortune Minerals Limited

10/26/2020 | Press release | Distributed by Public on 10/26/2020 09:45

COBALT NEWS

South China Morning Post - October 23, 2020

China has 72 gigawatt hours of domestic battery demand, controls 80 per cent of the world's capacity for raw material refining, with the ...

building an integrated cobalt mining, processing and refining supply chain in the Democratic Republic of Congo, Zhejiang Huayou Cobalt -

China, whose passenger car market only took off two decades ago, has not only taken the global lead on the adoption and manufacturing of electric vehicles (EV), but also its most valuable component - the battery - which makes up 30 to 50 per cent of their value…Chinese battery makers will maintain their dominance in an industry where the operating and planned production capacity may more than quadruple in a decade, even as their European and American competitors expand to catch up, said analysts…The next decade will be 'particularly interesting', as Europe and the US try to create their own battery champions to challenge Asian incumbents, which are already building capacity in both places, said James Frith, head of energy storage at clean energy research provider Bloomberg NEF. China has the world's most competitive lithium-ion supply chain, supplanting the decade-long lead in the industry enjoyed by Japan and South Korea, according to the research provider of clean energy last month…Contributors to the competitiveness include China's 72 gigawatt-hours of domestic battery demand, control of 80 per cent of the world's capacity for raw material refining, 77 per cent of battery cell production capacity and 60 per cent for components…Another competitive advantage China has built up over many years is a significant control over global resources and the capacity to mine lithium, cobalt, nickel, manganese and other key material needed to make battery packs…After more than a decade building an integrated cobalt mining, processing and refining supply chain in the Democratic Republic of Congo, Zhejiang Huayou Cobalt - China's biggest refiner of the metal - has the capacity to produce 39,000 tonnes of cobalt compounds annually, enough for nearly 30 per cent of China's demand, a Dongxing Securities report said…Cobalt, the most expensive material in an EV battery, plays a key role in an EV battery's usable life and safety, especially in preventing overheating of nickel-intensive batteries…'Given the ambitious EV sales target for the next five to 10 years, and the ambitious vehicle electrification targets that cities and nations have, there will be major challenges for suppliers to keep up,' he said. 'That will ultimately translate into higher material prices, which will present economic challenges for carmakers trying to reduce costs of electric vehicles to compete with petrol and diesel ones.'…'The biggest contributor to falling battery costs throughout the coming decade will be reductions in manufacturing costs through larger factory sizes and improving economies of scale,' said IHS Markit's associate director Sam Wilkinson…The world needs to produce 10,000 gigawatt hours (GWh) of batteries every year for 15 years to convert the entire global fleet of vehicles into electric…Tesla aims to have 100 GWh of its own battery manufacturing capacity by 2022, rising to 3,000 GWh, while continuing to source from suppliers, he added…