Battery Metals

Electra Battery Materials has launched a demonstration plant designed to recover and recycle high-value elements found in lithium-ion batteries including nickel, cobalt, lithium, copper and graphite at its refinery complex north of Toronto.

Electra claims it will process up to 75 tonnes of black mass material in batches mode using its proprietary hydrometallurgical process in the demonstration plant. Electra plans to complete the demonstration plant in early 2023, while providing regular updates.

Pending the successful completion of the demonstration plant, Electra says it will assess whether to continue processing black mass throughout 2023 with material supplied by its business partners or from third parties.

“The launch of our black mass recycling demonstration plant caps a year filled with a number of significant achievements for Electra,” said Trent Mell, Electra’s CEO.

“With the outlook for electric vehicle adoption in North America becoming increasingly bullish as a result of the recent passage of the US Inflation Reduction Act and the considerable investments made by automotive companies to electrify their fleet, the need for a domestic supply of battery-grade materials supply whether through primary refining or recycling processes becomes critical,” added Mell.

Finland’s Terrafame will start recovering natural uranium as a byproduct of zinc and nickel production at its Sotkamo mine, in the home country, by mid 2024.

The miner, in which the Finnish state has a 67.1% stake and commodities trader Trafigura holds a 31.1% interest, is aiming to produce 200 tonnes per year by 2026, it said on Wednesday.

Terrafame, formerly known as Talvivaara, intends to refine the uranium into yellowcake, used as fuel for nuclear power plants. The commodity has so far been waste from processing the metals extracted at Sotkamo. These include nickel and cobalt sulphates for electric vehicle (EV) batteries as well as other minerals.

“As the recovery begins, Terrafame will become a Finnish uranium producer, and thus will also play a role in building Europe’s energy self-sufficiency,” chief executive officer Joni Lukkaroinen said in the statement.

“The utilization of Terrafame’s natural uranium in energy production helps in achieving climate goals since nuclear power does not result in carbon dioxide emissions in the production process. As an energy source, it is stable,” Lukkaroinen said.

Europe’s only uranium recovery operation

The company has a ready-built uranium recovery plant on site, which it says it will be Europe’s only uranium recovery operation. It will increase its net sales by about 25 million euros ($27m) per year, from 378 million euros ($401m) in 2021, it said.

Terrafame, one of Europe’s largest nickel miners, churned out last year about 28,600 tonnes of nickel and 54,400 tonnes of zinc. It also began producing battery chemicals from its own minerals at its northeastern Finland mine.

The Finnish government authorized uranium production in 2020, but environmental organizations took the decision to the courts as they feared the effects it would have in the environment.

Before uranium recovery at Sotkamo can be commissioned, the country’s Radiation and Nuclear Safety Authority will have to verify that the company’s operations are in line with the Nuclear Energy Act’s principles.

In its quarterly report released on Monday, the Australian government said it expects spodumene prices to rise from an average of $2,730 a tonne in 2022 (from just $598 in 2021) to average $4,010 a tonne in 2023 as record spot prices feed into contracts. However, 2024 will see a softening in the market to $3,130 in 2024.

Lithium hydroxide prices are set to follow a similar pattern and are expected to lift from $17,370 a tonne in 2021 to $39,900 in 2022 and $61,200 in 2023, moderating to an annual average of $48,500 in 2024.

Rapid price movements and the relative immaturity of the market will likely lead to ongoing uncertainty, according to the Department of Industry, Science and Resources, adding that should supply concerns ease prices could fall more quickly:

“While expansions to production are already underway in Australia and overseas, there are long lead times for lithium mine and brine operations. Moreover, the potential for delays in bringing such large volumes of lithium into production, mean risks remain of persistent supply shortages over the next few years.

“However, one of the drivers of recent high spot prices appears to be a push by refiners and battery makers to build up inventories, due to concerns about global supply chains. The lack of data on global lithium stocks makes it difficult to judge how well battery producers have built up stockpiles.

“If these concerns ease, prices could moderate more rapidly over the outlook period. Prices may also ease if global economic growth slows more sharply than the IMF has forecast.”

Production surge

The Department expects global output to rise from 551,000 tonnes lithium carbon equivalent (LCE) in 2021, to an estimated 691,000 tonnes in 2022. Next year 915,000 tonnes are forecast, a 32% jump from 2022.

In 2024 production would climb above the 1m tonnes mark for the first time with Australia’s share coming to nearly half the global total at 470,000 tonnes, thanks to a pipeline of projects.

This includes the almost complete expansion of Mineral Resources and Ganfeng Lihtium’s Mt Marion mine, Liontown’s Kathleen Valley project which received a final investment in June and all major approvals in Q3 this year, and Core Lithium’s Finniss project near the city of Darwin where first concentrate production is expected in the first half of 2023.

The sharp production rise will also be boosted  by expansions to SQM and Albemarle brine operations in Chile while state-owned copper miner Codelco is undertaking exploration in the Salar de Maricunga, with drilling due for completion early next year.

In Argentina, new and expanded brine operations by Allkem, Livent and Minera Exar will add to output Elsewhere. Piedmont Lithium has completed a pre-feasibility study for its  Ewoyaa project in Ghana with first production expected late next year while European Lithium is progressing arrangements to secure additional capital to progress its Wolfsberg hard rock project located 270km south-west of Vienna, Austria.

Spot prices turn down

Last week spot Chinese lithium prices fell for the first time since May as uncertainty grows about demand in the world’s second-largest economy following the easing of covid-19 restrictions and the looming end to electric vehicle subsidies.

Lithium prices have defied predictions of a sharp pullback, however, and ex-works Chinese battery grade lithium hydroxide is still up 170% year-to-date averaging $81,000 a tonne during the first two weeks of December, according to Benchmark Mineral Intelligence. Lithium carbonate prices have followed a similar trajectory according to the London-headquartered battery supply chain and pricing specialists.

Benchmark data show spodumene prices up 257% this year averaging some $5,900 a tonne for 6% concentrate FOB Australia in November.  Benchmark commented that spodumene contract pricing mechanisms tied to the lithium chemicals spot market had been successfully renegotiated, allowing for a shorter lag time for pricing movements in the chemicals market to be reflected in spodumene pricing.

The past year was sobering for investors who poured money into Tesla Inc and rival electric vehicle startups that hoped to emulate Tesla CEO Elon Musk’s success.

As interest rates rose and financial markets gyrated, shares in many EV startups deflated. Rivian Automotive Inc, which had a higher market value than Ford Motor Co shortly after it went public in 2021, lost more than 70% of its value over the past year.

Other EV startups fared worse. Electric van maker Arrival warned it could run out of cash in less than a year. Lucid Group Inc, backed by Saudi Arabia’s sovereign wealth fund, struggled to build its sleek Air luxury EVs. Chinese Tesla challenger Xpeng Inc’s shares lost more than 80% of their value.

Now comes the hard part: Persuading more mainstream consumers to come along for the ride.

Why it matters

The automobile industry is pouring more than $1 trillion into a revolutionary shift from combustion engines to electric vehicles guided by software. From Detroit to Shanghai, automakers and government policymakers have embraced the promise of electric vehicles to provide cleaner, safer transportation. European countries and California have set 2035 as the deadline for ending sales of new combustion passenger vehicles.

Tesla Inc’s surge to become the world’s most valuable automaker – achieving a $1 trillion valuation last year – humbled established automakers such as Toyota Motor Corp and Volkswagen AG that once were reluctant to go electric.

Starting next year, a wave of new electric vehicles from pickup trucks to middle market SUVs and sedans will hit the world’s major markets.

Industry executives and forecasters do not agree on how rapidly electric vehicles could take over half the global vehicle market, let alone all of it.

In China, the world’s largest single automotive market, battery electric vehicles have captured about 21% of the market. In Europe, EVs account for about 12% of total passenger vehicle sales. But in the United States, EV market share is only about 6%.

Among the barriers to EV adoption, industry executives and analysts said, were a dearth of public fast-charging infrastructure, and the rising cost of EV batteries, driven by shortages of key materials and uncertainty over government subsidies that have buoyed EV purchases in major markets including the United States, China and Europe.

By 2029, electric vehicles could account for a third of the North American market, and about 26% of vehicles produced worldwide, according to AutoForecast Solutions, a consultancy.

Electric vehicle sales likely will not increase in a smooth, ever-ascending curve, said AFS President Joe McCabe. If there is a recession next year, as many economists forecast, that will slow EV adoption.

Wards Intelligence forecasts that combustion vehicles will make up just under 80% of North American sales in 2027. Based on automakers’ product plans, Wards analyst Haig Stoddard said at a recent conference that manufacturers “expect strong ICE (internal combustion engine) volume heading into the next decade.”

What does it mean for 2023?

Throughout 2022, established automakers such as Mercedes, Ford and General Motors Co unveiled dozens of new electric vehicles to challenge Tesla and the upstarts.

Mass production of most of these vehicles kicks into gear starting in 2023 and 2024.

By 2025, there could be 74 different electric vehicle models offered in North America, McCabe said. But he predicts fewer than 20% of those models are likely to sell at volumes above 50,000 vehicles a year. Automakers could be stuck with too many niche models and too much capacity.

Slowing economies threaten overall vehicle demand in Europe and China, too.

During the early years of the 20th Century, new auto companies sprang up, backed by investors eager to catch the wave of mass mobility that Henry Ford and other automotive pioneers started. By the 1950s, the global auto industry had consolidated and once-heralded brands such as Duesenberg had disappeared.

The next few years will determine whether the 21st Century’s crop of electric vehicle brands will follow a similar path.

Australia revised upwards its resources and energy export earnings for the current financial year to hit a record A$459 billion ($308 billion) on Monday, as the war in Ukraine boosts prices of energy commodities.

The country is set to see strong growth in revenue from exports of thermal coal used in power plants as well as liquefied natural gas (LNG) for the year ending June 2023, the Department of Industry, Science and Resources said in a quarterly report.

“Many Western nations are having to pay substantially more for energy, on the high chance that sanctions on Russia will see some Russian production — particularly gas and coal — become stranded from world markets,” it said.

The department had predicted an annual value of resources exports at A$450 billion, in its most recent September report. A weaker than expected Australian dollar exchange rate as well as high prices for thermal coal were the main factors behind the revision, it said.

Iron ore, which is still Australia’s most valuable commodity export, is seen at A$113 billion this financial year, lower than the year ended in June when it stood at A$133 billion.

Ongoing strength in thermal coal prices are expected to see the biggest annual revenue growth at 65%, taking export value of the fossil fuel to A$76 billion from A$46 billion.

The value of liquefied natural gas exports is expected to hit $A90 billion from A$71 billion last financial year.

However, amid slower growth in steel manufacturing, the value of metallurgical coal exports is expected to decline to $A57 billion from A$68 billion last year.

Revenue for lithium exports is expected to jump to A$16 billion from A$5 billion a year earlier, as demand for the mineral used in batteries heats up.

Toyota Motors unveiled its first battery electric vehicle (BEV) pickup truck this week in Thailand. The EV prototype is generating interest among buyers and looks street-ready, but buyers are asking, will Toyota sell its electric pickup in the US?

Will Toyota’s electric pickup truck make its way to the US?

At its 60th Anniversary of operations in Thailand, Toyota revealed the Hilux Revo BEV prototype, its first fully electric pickup truck.

Since the EV truck is built for consumers in Thailand, it’s designed to serve a different purpose. Thai drivers often prefer a versatile pickup that can do it all with a mix of passenger and cargo space.

Looking at images of the Hilux Revo BEV, you can tell it’s designed for the Thai market. Toyota’s EV pickup looks to be in the mid-size range, with a single cab and extended bed. In addition, you can see details indicating it’s built for work with tie-down hooks on the outside of the bed rails.

The electric pickup closely resembles its Hilux truck line, but of course, without the diesel engine. The Thai market is dominated by pickup trucks, where Toyota’s gas-powered Hilux Revo trucks are a top contender.

Thailand is Toyota’s fourth-highest production center globally, behind Japan, China, and the US.

Although Toyota didn’t offer specifications, the EV pickup features a charging port on the front left fender. Toyota’s CEO, Mr. Akio Toyoda, said at the event that the electric pickup is “designed to support carbon neutrality and a better environment for all.”

As for US customers, I wouldn’t get my hopes up for the electric vehicle to make its way here. The company’s CEO reiterated its hybrid approach going forward, claiming:

At Toyota we believe in creating a full portfolio of carbon reducing choices for our customers from hybrid electric vehicles, plug-in electric vehicles, battery electric cars, and fuel cell vehicles. Also, we are pursuing hydrogen fuel options like these GR-Yaris and GR-Corolla hydrogen powered concept cars. As we work to achieve a sustainable future, I also believe we need to take a holistic approach to carbon neutrality.

He added:

 I am often criticized in the press because I won’t declare that the automotive industry should commit 100% to BEV. I believe we need to be realistic about when society will be able to fully adopt Battery Electric Vehicles and when our infrastructure can support them at scale.

Toyota has a long history of lobbying against going fully electric. Despite this, the world’s largest automaker has made several initiatives to better compete in the EV market in the past several months.