Bit slow of the mark, but we are getting there.
Lithium-rich Australia seeks to lure battery cell manufacturers
By Angela Macdonald-Smith11 Dec 2018 — 12:01 AM
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Australia risks missing a once-in-a-generation opportunity to develop a major manufacturing hub for the booming lithium-ion battery market to capture more than its current tiny share of the value chain, according to a report from the federal government, which is launching a strategy to turn that situation around.
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Despite having almost all the minerals and chemicals needed for battery production, the country earns just 0.53 per cent of the ultimate value of its exported ore in the lithium value chain, leaving more than $200 billion to be added through offshore processing and production, the Austrade report said, citing advisory firm Future Smart Strategies.
"At the moment Australia produces about half of the world's lithium, but once it's mined out of the ground, it's shipped offshore, with all of the value-creation activities such as processing and battery manufacturing occurring overseas," said federal Trade Minister Simon Birmingham, who is heading up the strategy with resources colleague Matthew Canavan.
Australia's lithium industry should be about more than just mining, ministers say.
"Now is the time to accelerate the development of a high-tech lithium manufacturing sector in our own backyard."
Senator Birmingham said that through Austrade's resources team, the government was ramping up efforts to attract overseas investment in the sector and highlight Australia's comparative advantages.
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That work is understood to be close to yielding results, with a significant investment by an overseas player in the sector expected to be announced before Christmas.
The report, to be released on Tuesday, found that local lithium producers are beginning to move into new areas of the supply chain, while feasibility studies are under way for local battery production, including a 15-gigawatt-hour "Gigafactory" in Townsville.
Battery giant Albemarle recently joined with Chris Ellison's Mineral Resources to build a lithium hydroxide plant in Western Australia so it is not solely reliant on processing facilities in China.
The government's strategy will aim to further that trend, leveraging off Australia's position as the holder of the world's third-largest reserves of lithium and the biggest producer of hard rock lithium spodumene, which is mostly exported to China for processing before being sent to Japan and Korea to be transformed into battery packs. The finished batteries are then imported into Australia.
Australia's participation in the lithium supply chain is limited to mining. Austrade
But the critical components of battery production, including precursor, anode, cathode and electrolyte, can be manufactured in Australia, which could host the entire production chain with investment from a battery cell manufacturer, the report found.
Senator Canavan said Australia had an "enormous" opportunity to leverage the rapidly growing lithium-ion industry, which has seen lithium prices triple since 2010 and is standing ahead of a five-fold increase in global battery consumption in the next 10 years.
He said the government's Resources 2030 Taskforce, which delivered its final report in September, would act as a road map to put Australia in the best position to make the most of investments in the lithium supply chain.
Future Smart Strategies estimates Australia earns $1.13 billion from mining and concentrating lithium ore, more than the $740 million earned in that part of the market by the rest of the world. But it earns zero in any of the $2 billion refining sector, the $22.1 billion electro-chemical sector, the $31.1 billion battery cell production and the $156 billion battery assembly sector.
China dominates the market in refining, electrochemical and cell production. Austrade
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