US-China trade war has highlighted the challenge of securing rare earth supplies. Nothing seems more fascinating to the minerals sector currently than electric vehicles and battery metals. It is a melting pot of ideas, speculation and, most recently, global economic warfare. The push towards EVs seems unstoppable. The Netherlands has pledged to ban the sale of petrol and diesel cars by 2025 and the UK and France by 2040. China is targeting zero-emission cars as 12 per cent of new car sales by next year. EVs need batteries and batteries need metal. While the winning battery technology is not yet declared by common consent, lithium and cobalt will be key. Only eight countries currently produce lithium. On the latest available figures, four of them account for 93.5 per cent of global production. There is, however, no shortage of lithium. It is just that most of it is in the ground. The imbalances in the lithium battery chain are breathtaking. A recent study by BMI Research estimated that China produced more than 60 per cent of global lithium in April 2019. The figure for the US was 1 per cent. The US neither mines nor produces any appreciable amount of graphite, nickel or cobalt. China’s share of some of these commodities is in excess of 50 per cent.
FT 23rd June 2019 read more »