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IMF predicts sixfold increase in demand for EV battery minerals amid rising prices

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Amid the Russian invasion of Ukraine, which has driven up global metal prices, additional price increases are expected for nickel, cobalt, lithium, copper, and other metals essential for electric vehicle batteries, the IMF said in a report published on Dec. 26.

“Minerals such as copper, nickel, cobalt, and lithium are critical inputs for the energy transition,” the report reads. 

“They are used in EVs, batteries and wiring, and renewable-energy technologies such as solar panels and wind turbines.”

A typical electric vehicle battery pack, for example, needs about 8 kilograms of lithium, 35 kilograms of nickel, and 14 kilograms of cobalt. Charging stations require substantial amounts of copper.

In this context, the experts refer to predictions by the International Energy Agency (IEA), which expects the demand for copper to increase by 1.5 times, nickel and cobalt to double, and lithium to increase sixfold by 2030.

“This will drive up prices and could make these minerals as important as crude oil for the world economy over the next two decades,” report stated.

The article also discusses the potential exacerbation of the resource shortage due to the extreme vulnerability of modern global production to the supply of these metals, whose deposits are concentrated in a few countries in specific regions.

Experts note that copper mining is largely carried out in Chile, Peru, and China. Nickel is supplied by Indonesia, the Philippines, and Russia; cobalt by the Democratic Republic of the Congo, the Philippines, and Australia. Significant lithium deposits are found in China, Chile, and Australia.

Hence, experts highlight the need for appropriate fragmentation of critical markets in the context of the global transition to zero-emission energy technologies and mitigation of climate change effects. To this end, maintaining and expanding international cooperation, data exchange, and implementing other smart approaches in this field are crucial, the IMF stats.

It was previously reported that the total value of Ukrainian mineral resources is $14.8 trillion, with over 70% of the total value concentrated in just three regions: Donetsk, Dnipropetrovsk, and Luhansk.

In the total value of these metals, 62% is accounted for by coal and 14% by iron ore. The remaining assets represent less than 5% of the total value. The total volume of minerals is 111 billion tons.

Russia has seized hundreds of Ukrainian deposits, over the years of war and the annexation of Crimea.  By conservative estimates, their value could range from $12.5 trillion to $15 trillion.

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Read the original article on The New Voice of Ukraine

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