Not you, lithium: The ultimate guide to the other battery metals...

Not you, lithium: The ultimate guide to the other battery metals vital to Europe’s energy transition - *

• Nickel, copper, cobalt, zinc and graphite are battery metals in high demand in Europe
• Eurometaux says 10% more zinc, 35% more copper, 100% more nickel and 330% more cobalt are needed by 2050
• Europe’s EV uptake is the driving force for battery metals demand.

The commodities that are vital to electric vehicles (EVs) go beyond the posterchild that is lithium.

Battery metals also include nickel, copper, cobalt, zinc, and graphite – basically anything that can be used in any way for the production of electric vehicles (EVs).

And Europe is hungry for battery metals.

According to a report by KJ Leuven commissioned by the European Association of Metals (Eurometaux), the EU energy transition will require 10–15% more zinc annually than the region uses today, 35% more copper, 100% more nickel and 330% more cobalt.

Demand is outpacing supply

There’s a huge supply/demand imbalance in Europe right now, where pandemic-related bottlenecks have been compounded by the Russian invasion of Ukraine.

And as if this wasn’t enough, Europe is experiencing increasing energy costs in winter driven by sanctions on Russian oil and gas – which is impacting smelters across Europe that have had to lower utilisation rates at times of peak power costs in Q1 & Q2.

“Europe is braced for more smelter disruption as we head into the winter heating season from September as energy prices are expected to rise again,” CRU Group’s Helen O’Cleary told *

There are a few jurisdictional risks too – earlier this year Rio Tinto’s (ASX:RIO) licence to develop a huge lithium project was revoked by Serbia.

There is a broader concern though – the European Commission (EC) is assessing a proposal by the European Chemicals Agency (ECHA) to classify lithium carbonate, chloride, and hydroxide as dangerous for human health.

Rystad notes the classification “would not stop lithium usage”, but there’s a strong chance it would “have an impact on at least four stages in the EU lithium battery supply chain: lithium mining; processing; cathode production; and recycling”.

In a nutshell, if you’re mining lithium in the EU, there’s a chance you’ll simply be creating raw materials just to see them exported back out of Europe to create cathodes. And yeah, Albermarle’s talking about shutdowns already.

Whichever way you look at it, Eurometaux says Europe’s EV uptake is the driving force for battery metals demand.

And because raw materials are the largest cost component of an EV battery, the supply and price of the input battery metals will have the greatest impact on whether EVs will reach cost parity with, and replace traditional internal-combustion vehicles.

Zinc for EV batteries and renewables

Zinc is largely used in construction and to extend the lifetime of steel through galvanisation, but EV production and solar panels are the main drivers for its energy transition demand.

It’s worth noting that while zinc-ion batteries don’t catch fire the same way lithium batteries sometimes do, they don’t have anywhere near the market saturation or rechargeability at present.

With that in mind, Eurometaux says global demand for zinc is expected to grow to ~20Mt by 2030, and up to ~25-27Mt by 2050.

And for Europe to meet its energy transition goals it will require 250-270Mt of zinc, rising to 300-320Mt by 2040 and then stabilising (equivalent to 10% of Europe’s zinc consumption today).

cheers.