• COP26 targets require 7Mt of lithium, 5Mt nickel sulphate each year by 2040: Benchmark
  • Cheaper lithium iron phosphate batteries are taking the EV world by storm

Our High Voltage column wraps all the news driving ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths, and vanadium.

 

A declaration at the Glasgow climate conference that seeks to phase out sales of petrol and diesel vehicles by 2040 would mean a +3000% increase in annual electric vehicle battery demand and a substantial increase in raw material requirements, according to Benchmark Mineral Intelligence analysis.

That’s going to be extremely difficult, the pricing agency says.

Benchmark estimates that if all cars and vans sold in 2040 were electric it would represent almost 8,400 GWh of lithium-ion battery demand.

In reality, this target will be difficult to meet, with Benchmark already forecasting 6,200 GWh of battery demand from the entire electric vehicle market in 2040.

This target would require over 7 million tonnes of lithium (LCE) annually, which is 17 times more than lithium chemical production in 2021.

It would also require over 5 million tonnes of nickel sulphate, which Benchmark’s Nickel Forecast shows is 19 times more than nickel sulphate production in 2021.

At the moment there is insufficient investment into raw material supply to meet battery demand in 2030 let alone 2040, Simon Moores, CEO of Benchmark Mineral Intelligence says. While building a battery cell production facility can take two years, it takes a minimum of five years to bring on a new lithium mine.

“Right now, lithium demand is growing at three times the speed of lithium supply,” Moores says.

“That’s a big problem that needs to be solved.”

 

Cheaper lithium iron phosphate batteries are taking the EV world by storm

In July, the sale of lithium iron (LFP) phosphate batteries for electric vehicles in China surpassed the incumbent NCM/NCA chemistries for the first time since the start of 2019.

Lithium Australia (ASX:LIT) – one company looking to take advantage of the fast-growing LFP market – says Chinese battery installations into LFP electric vehicles were up 309% year on year to 30 September 2021.

That momentum has carried through October, with production of 15.9GWh LFP batteries exceeding 9.2GWh for ternary (NCM/NCA) batteries, according to data from the China Automotive Manufacturers Association (CAAM).

 

WHAT IS LFP?

In batteries with LFP chemistry, phosphate serves as the cathode material.

NCM (lithium nickel cobalt manganese) batteries use a combination of nickel, manganese, and cobalt for the cathode, while NCMA (nickel, cobalt, manganese, aluminium) chemistry features a 90% nickel cathode.

Because iron and phosphate are more common than cobalt and nickel, LFP batteries are ~$US18 cheaper than NCM/NCA per kWh to manufacture, according to SNE Research.

The downside is that they have lower energy densities which makes them unsuitable for longer driving ranges. That is not really an issue for the stock standard work commute though, which explains their popularity.

“The LFP battery market has seen growing sales since the second half of last year, given the battery’s lower manufacturing costs, while NCM/NCA batteries typically have higher energy densities and a longer driving range,” Argus says.

“The advantages of LFP batteries have emerged following a fall in government subsidies for the NEV industry and rises in cobalt and nickel prices this year.”

Cobalt sulphate and nickel sulphate — key ingredients used in NCM/NCA lithium-ion battery production — were last assessed by Argus at Yn90,000-93,000/t and Yn33,500-36,500/t ex-works respectively, having risen by 62% and 18% since the start of this year.

 

A GLOBAL SHIFT TOWARD CHEAPER BATTERIES?

Outside China, Tesla recently flagged a move to LFP for its high volume, standard range Model 3 and Model Y electric cars, marking what could be a wider shift away from the more expensive nickel cobalt aluminium (NCA) chemistry.

It’s not the only company making that move. Ford has also flagged that it will use LFPs in some commercial vehicles while German giant Volkswagen also plans to use LFPs.

However, even if LFP does eat into the incumbent market, the EV world will still need a lot of nickel and cobalt.

Korean battery players are actually increasing the ratio of nickel in some batteries to make them more powerful.

LG Energy Solution has developed NCMA (nickel cobalt manganese aluminium) batteries that contain 90 per cent nickel, while Samsung SDI has come up with NCA (nickel cobalt aluminium) batteries that contain 91 per cent nickel.

 

Here’s how a basket of ASX stocks with exposure to lithium, cobalt, graphite, nickel, rare earths and vanadium are performing>>>

CODE COMPANY 1 WEEK RETURN % 1 MONTH RETURN % 6 MONTH RETURN % 1 YEAR RETURN % PRICE MARKET CAP
DEV Devex Resources 77 93 96 145 0.54 $ 141,603,624.82
CHN Chalice Mining 48 60 35 208 10.01 $ 3,451,735,400.40
S2R S2 Resources 39 158 31 -16 0.23 $ 71,274,971.00
AVL Aust Vanadium 34 28 40 168 0.0295 $ 88,582,287.99
QEM QEM Limited 32 58 26 147 0.245 $ 24,953,133.26
PRL Province Resources 27 27 3 1436 0.19 $ 192,042,167.87
MLS Metals Australia 25 25 25 25 0.0025 $ 10,477,114.72
VML Vital Metals Limited 23 17 19 129 0.0665 $ 262,425,434.29
NTU Northern Min 23 48 76 97 0.065 $ 305,393,001.86
RMX Red Mount Min 20 33 33 -14 0.012 $ 19,037,957.93
HNR Hannans 20 88 681 681 0.054 $ 122,494,759.37
LPD Lepidico 20 113 206 513 0.049 $ 319,926,870.43
AR3 Austrare 19 2 0.895 $ 38,961,494.49
AZS Azure Minerals 17 28 44 -37 0.41 $ 120,796,931.19
PSC Prospect Res 15 40 241 419 0.545 $ 235,687,944.25
IPT Impact Minerals 14 7 -6 -22 0.016 $ 32,380,718.70
HXG Hexagon Energy 14 58 26 103 0.12 $ 53,521,659.24
MNS Magnis Energy Tech 15 126 137 289 0.7 $ 687,480,250.64
ASN Anson Resources 14 104 224 432 0.165 $ 153,111,893.25
RLC Reedy Lagoon Corp. 13 132 143 364 0.051 $ 24,301,177.47
PGM Platina Resources 13 3 4 56 0.07 $ 27,800,469.89
JRV Jervois Global 11 7 54 131 0.59 $ 871,342,653.60
ARU Arafura Resource 11 25 43 150 0.25 $ 372,100,159.68
FGR First Graphene 11 14 -13 31 0.21 $ 112,774,802.13
POS Poseidon Nick 10 -5 42 32 0.095 $ 275,756,357.34
PUR Pursuit Minerals 10 4 -31 168 0.0375 $ 32,795,487.06
IXR Ionic Rare Earths 10 26 54 207 0.043 $ 132,303,581.05
FFX Firefinch 10 19 88 334 0.705 $ 656,825,715.70
NIC Nickel Mines Limited 10 20 3 25 1.1175 $ 2,678,505,939.32
IGO IGO Limited 10 13 34 119 10.035 $ 7,466,660,636.18
LYC Lynas Rare Earths 10 22 38 145 8 $ 7,264,413,009.70
QPM Queensland Pacific 9 -4 140 700 0.24 $ 318,569,085.79
LOT Lotus Resources 8 38 96 279 0.3525 $ 344,488,129.08
CTM Centaurus Metals 8 6 58 109 1.095 $ 379,820,602.46
SYA Sayona Mining 8 12 365 1995 0.1625 $ 1,162,162,123.16
PAN Panoramic Resources 8 8 52 69 0.2275 $ 461,455,650.90
GW1 Greenwing Resources 8 88 62 250 0.525 $ 56,900,631.15
RXL Rox Resources 8 8 -25 -51 0.395 $ 63,043,045.60
MIN Mineral Resources. 8 -8 -13 50 40.98 $ 7,523,792,406.24
TLG Talga Group 8 54 40 19 2.06 $ 639,879,489.90
CWX Carawine Resources 8 14 -29 -31 0.21 $ 21,777,980.40
BSX Blackstone 8 27 92 69 0.635 $ 226,437,362.03
NVA Nova Minerals 7 -15 4 -19 0.145 $ 252,285,257.98
PEK Peak Resources 7 -5 -14 78 0.073 $ 139,150,722.27
ARR American Rare Earths 7 4 137 59 0.1825 $ 62,903,898.72
OZL OZ Minerals 7 11 -3 72 25.49 $ 8,528,221,109.88
ARL Ardea Resources 6 19 10 9 0.495 $ 63,495,740.74
PNN PepinNini Minerals 6 74 144 272 0.67 $ 32,279,274.33
HYM Hyperion Metals 6 -4 3 327 1.025 $ 143,285,865.73
ESR Estrella Res 6 6 -30 -67 0.035 $ 40,019,487.16
AVZ AVZ Minerals 6 90 273 587 0.56 $ 1,689,540,657.00
VMC Venus Metals Cor 6 0 12 -24 0.19 $ 27,194,162.94
EGR Ecograf Limited 6 10 35 319 0.67 $ 267,948,408.11
TMT Technology Metals 5 10 8 -3 0.39 $ 69,017,976.27
REE Rarex Limited 5 3 10 -13 0.1 $ 45,159,320.40
NMT Neometals 5 36 130 420 1.135 $ 622,407,209.46
NMT Neometals 5 36 130 420 1.135 $ 622,407,209.46
ARN Aldoro Resources 5 35 60 300 0.52 $ 46,469,634.23
ARN Aldoro Resources 5 35 60 300 0.52 $ 46,469,634.23
TON Triton Min 5 24 2 -7 0.042 $ 47,647,658.81
GL1 Globallith 5 68 114 0.63 $ 67,966,966.25
RFR Rafaella Resources 5 12 -15 -6 0.085 $ 15,831,620.69
MMC Mitremining 5 -2 0.22 $ 5,687,871.00
GED Golden Deeps 4 14 14 -11 0.0125 $ 10,086,068.72
MLX Metals X Limited 4 4 54 364 0.385 $ 340,224,775.13
PLS Pilbara Min 4 25 105 417 2.455 $ 7,245,525,529.44
GSR Greenstone Resources 4 4 8 -28 0.026 $ 20,101,967.23
ILU Iluka Resources 4 0 6 80 9.15 $ 3,868,069,405.88
CLA Celsius Resource 4 8 -46 -18 0.027 $ 28,275,158.19
BRB Breaker Res NL 4 54 124 124 0.415 $ 133,594,780.89
MOH Moho Resources 3 -3 -20 -45 0.06 $ 7,546,524.12
BHP BHP Group Limited 3 -2 -27 2 37.32 $ 111,224,477,553.80
PAM Pan Asia Metals 3 20 329 232 0.515 $ 34,987,855.90
SYR Syrah Resources 3 23 23 143 1.29 $ 658,329,834.36
BOA Boadicea Resources 3 0 -35 -13 0.19 $ 14,762,980.05
WKT Walkabout Resources 3 0 -11 43 0.2 $ 83,559,901.82
COB Cobalt Blue 2 41 30 343 0.43 $ 122,383,707.27
ESS Essential Metals 2 75 178 153 0.245 $ 55,840,693.89
MAN Mandrake Res 2 -6 -61 -18 0.058 $ 27,387,107.49
VR8 Vanadium Resources 1 4 56 189 0.078 $ 36,475,390.15
EMH European Metals Hldg 1 4 18 118 1.44 $ 192,536,108.20
RBX Resource B 0 0 459 459 0.19 $ 7,590,041.15
AJM Altura Mining 0 0 0 0 0.07 $ 238,056,602.28
LML Lincoln Minerals 0 0 0 0 0.008 $ 4,599,869.49
ALY Alchemy Resource 0 2 -23 -39 0.012 $ 10,923,956.10
LIT Lithium Australia NL 0 23 13 150 0.135 $ 136,476,319.37
BUX Buxton Resources 0 45 14 35 0.096 $ 12,925,266.04
BEM Blackearth Minerals 0 -4 0 150 0.12 $ 25,000,455.71
ADV Ardiden 0 30 18 -52 0.013 $ 30,146,694.98
BKT Black Rock Mining 0 31 47 256 0.235 $ 192,440,239.43
CZN Corazon 0 12 23 -38 0.037 $ 9,391,249.98
MRD Mount Ridley Mines 0 8 17 133 0.007 $ 42,311,506.41
INF Infinity Lithium 0 105 18 114 0.225 $ 97,029,725.52
VIA Viagold Rare Earth 0 0 2339 10426 2 $ 166,624,808.00
LPI Lithium Pwr Int -1 63 91 103 0.4975 $ 177,872,622.48
SGQ St George Min -2 -7 -23 -62 0.064 $ 37,708,219.97
AGY Argosy Minerals -2 78 276 515 0.32 $ 412,778,403.51
SRL Sunrise -2 22 -19 -29 1.895 $ 168,408,233.73
SRI Sipa Resources -2 -2 -14 -21 0.054 $ 11,025,576.74
RNU Renascor Res -2 6 82 1175 0.1275 $ 245,521,400.80
AML Aeon Metals . -2 -9 -28 -64 0.05 $ 41,376,865.97
SLZ Sultan Resources -3 -5 -40 -24 0.175 $ 12,168,518.08
ORE Orocobre Limited -3 13 39 215 9.52 $ 6,171,247,672.48
AOU Auroch Minerals -3 -12 -38 -23 0.15 $ 52,818,086.40
GBR Greatbould Resources -3 -17 43 234 0.15 $ 53,585,371.35
JRL Jindalee Resources -3 21 3 220 2.56 $ 135,259,915.00
QXR Qx Resources Limited -3 87 65 56 0.028 $ 18,315,782.67
AAJ Aruma Resources -3 4 28 -15 0.083 $ 10,832,689.26
VRC Volt Resources -4 -4 4 200 0.027 $ 74,137,760.34
ADD Adavale Resource -4 -10 -17 56 0.053 $ 18,253,647.16
G88 Golden Mile Res -4 6 -38 -15 0.05 $ 8,550,916.40
HAS Hastings Tech Met -4 -2 36 88 0.245 $ 434,613,982.00
PLL Piedmont Lithium Inc -4 11 10 163 0.855 $ 471,907,503.00
MCR Mincor Resources NL -4 -3 25 35 1.28 $ 619,964,620.80
NWC New World Resources -5 10 -22 56 0.078 $ 122,194,664.59
GLN Galan Lithium -5 52 123 1168 1.585 $ 462,645,550.40
PVW PVW Res -6 130 166 183 0.425 $ 29,094,187.50
AZL Arizona Lithium -6 192 250 1014 0.1225 $ 233,214,759.24
AUZ Australian Mines -6 7 24 60 0.0235 $ 103,285,418.74
ATM Aneka Tambang -6 -4 3 3 1.03 $ 1,342,758.47
LEL Lithenergy -7 68 1 $ 45,000,000.00
GAL Galileo Mining -7 -14 -18 -11 0.21 $ 35,365,933.05
AXE Archer Materials -7 6 107 190 1.52 $ 382,336,834.82
NKL Nickelx -8 -31 -20 0.12 $ 6,731,250.00
LEG Legend Mining -8 -21 -56 -52 0.055 $ 151,532,464.66
FRS Forrestaniaresources -9 19 0.43 $ 11,360,250.00
A8G Australasian Gold -9 44 228 0.655 $ 23,698,148.87
INR Ioneer -9 24 104 218 0.715 $ 1,517,044,135.82
GME GME Resources -10 -9 24 35 0.062 $ 37,421,418.01
MRC Mineral Commodities -11 -17 -41 -63 0.125 $ 66,873,829.25
LKE Lake Resources -11 82 333 1525 0.975 $ 1,182,087,569.88
CXO Core Lithium -12 35 157 1077 0.565 $ 973,754,303.54
AQD Ausquest Limited -12 -6 -21 -17 0.015 $ 13,171,037.30
TKL Traka Resources -13 -7 -19 -43 0.013 $ 8,087,402.62
LTR Liontown Resources -14 14 336 622 1.665 $ 3,000,550,059.74
EUR European Lithium -14 86 186 281 0.16 $ 175,762,833.18
CHR Charger Metals -14 -7 0.455 $ 14,894,431.28
VUL Vulcan Energy -15 -8 51 526 10.58 $ 1,307,693,513.28
CNJ Conico -16 -24 0 -18 0.032 $ 33,007,090.84
SBR Sabre Resources -17 0 0 -50 0.005 $ 8,446,568.25
BMM Balkanminingandmin -18 -18 0.555 $ 19,158,750.00
TNG TNG Limited -24 16 -1 -17 0.0915 $ 121,201,212.88
STK Strickland Metals -25 -10 183 -24 0.065 $ 75,516,322.67
CAE Cannindah Resources -40 65 417 989 0.305 $ 157,116,207.30