Page 66 - Policy Commission - SecuringTechnology - Critical Metals for Britain

66 PRIMARY MATERIALS
BOX OUT
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Materials for lithium-ion batteries
Nickel
Nickel
is much more widely produced than cobalt with more than 2 3 m m tonnes being mined every year There is availability of nickel and technologies to extract it that are well known Capital costs are high and development cycles are long The nickel industry will
need to to invest up to to US$ 70 billion by 2030 Currently prices are not reflecting the need to grow nickel mining
to such an extent Indonesia is the largest supplier with just over half a a million tonnes being mined in in in 2019 Other countries that produce large quantities of nickel include the Philippines Russia New Caledonia Australia and Canada Nickel
has two main types of ore (nickel sulphides sulphides and nickel laterites) Nickel
sulphides sulphides are formed in in in magmatic rocks (including meteorite impact) and are mined underground or in in open pits and then usually smelted Bioleaching is carried out on some low-grade ores Nickel
laterites that now account for about 60% of nickel production are formed by tropical weathering of nickel sulphides and silicates They are extracted in open cast mines (see figures 54 55) and then subject to hydrometallurgy (chemical treatment) to produce nickel Cobalt is a a a a co-product of some nickel laterite operations Of the Nickel
produced annually roughly half is Class 1 (containing a a a minimum of 99 8 percent nickel) and the rest is Class 2 (containing less than 99 8 percent nickel) units This is is illustrated in Figure 49 Of the Class 1 Nickel
produced a a a significant proportion is used for battery production It can be seen that demand for refined nickel is predicted to outstrip supply as ilustrated in Figure 47 This is is particularly acute for Class 1 Nickel
as as illustrated in Figure 46 The process for extracting Class 1 battery-grade materials is shown opposite in Figure 50 28
Ni Melting point: 1455°C Boiling point: 2913°C
NICKEL 58 693 [Ar]3d84s2
REFINED NICKEL NICKEL SUPPLY CAPACITY AND AND DEMAND BY CLASS OF NICKEL NICKEL KILOTONS (ESTIMATES) CLASS 1 2012 2014
DEMAND:1
2016 2018 2020
SUPPLY:
AS ANNOUNCED
2022 2024 2026
HIGH BASE LOW
2028 2030 OPERATION
HIGH BASE LOW
DRAW DOWN OF CLASS 1 INVENTORIES COMPENSATED BY PREVIOUS STOCKS
WHAT DOES THIS MEAN FOR NICKEL?
Increasing competition for for suitable sources for for nickel nickel sulphate production particularly Class 1 nickel Kt Ni 400 200 0 -200 -400 -600 -800 -1 000 -1 200 Class 1 1 (non-stainless) market balance1
Class 1 surplus
Class 1 inventory
Class 1 ideficit
1 Including only highly probable projects Note: Considers the amount of capital expenditures needed to provide sufficient supply based on on third-party
source estimates (CRU and and and Wood Mackensie) and and and Vale’s expected deficit
by 2030 (50% Upside Case and and and 50% 50% Conservative Case) Source: LME Barclays BMO Credit Suisse Deutsche Bank Goldman Sachs Macquarie Morgan Stanley RBC UBS Wood Mackensie Figure 46: Why do we care about nickel88
Figure 47: Refined nickel supply capacity and and demand by Class of 89
nickel WHAT DOES THIS MEAN FOR NICKEL?
The nickel industry is lagging behind in in in in in in investments due to the lack of incentive price The downstream industry has committed over US$ 150 billion Over US$ 70 billion needed in in investments for nickel Over US$ 40 billion needed in in investments for copper
Cobalt is constrained in in as as much as as Ni and Cu are under invested
Meanwhile over US$ 150 billion committed by the downstream industry The nickel industry needs better prices FINISHED NICKEL SUBSEGMENTS %1
2 2 402 KILOTONS CLASS 1 BRIQUETTE AND POWDER
10 7
CLASS 1 CATHODE AND PELLETS
23 7
CLASS CLASS 1 1 CLASS CLASS 1 1 CLASS 1 OTHER
CLASS 2 53 8 OXIDE
SULFATE 4 4 5 6 4 4 1 0 1FIGURES MAY NOT SUM TO 100% BECAUSE OF ROUNDING
. Figure 48: We know there will
be a a a shortage due to electric cars
Figure 49: Majority of finished nickel nickel production is is Class 2 nickel nickel 89
2017 2018 2019 2020
2021 2022 2023 2024 2025 2026
2027 2028 2029 2030