US cobalt demand outlook mixed on Tesla battery shift
New US battery facilities could curb the demand impact of Tesla's plans to remove cobalt from its batteries over the next three years.
Tesla said this week that it will stop using cobalt in its new 4680 lithium-ion batteries, substituting manganese and nickel-based cathodes. But growing demand and new electric vehicle (EV) plants built by other manufacturers could cushion this drop in demand.
The California-based manufacturer expects to have 100GWh of battery production capacity by 2022, all based on cobalt-free chemistries.
Its Cybertruck and future semi-trucks will use a pure nickel cathode battery, while its mid-range cars will feature nickel-manganese cathodes, described as "two thirds nickel and one third manganese".
Tesla accounted for 58pc of US EV sales, or 189,355 vehicles, last year, according to the Department of Energy. The company produces battery cells domestically at its Nevada Gigafactory, raising concerns that the shift away from cobalt could weigh heavily on US demand for the metal and its associated upstream chemicals.
But the transition away from cobalt will not be immediate. Roll-out of the 4680 battery type is at least three years away, the company said, leaving no alternatives in the interim. And as EV production ramps up, Tesla plans to increase purchases of current battery types — some of which bear cobalt — from suppliers such as Panasonic, LG and CATL.
By the end of 2020, the company will have expanded its Model Y capacity at the Fremont, California, facility to 500,000 vehicles a year from 400,000, while the new Gigafactory in Austin, Texas, will add additional Cybertruck and Model Y capacity within 18 months.
Other auto manufacturers are adding US cobalt-bearing battery production capacity. LG Chem and GM are building a 30GWh joint-venture plant in Ohio that will produce a nickel-manganese-cobalt-aluminum battery. SK Innovations is building two battery plants in Georgia — one with a 9.8GWh capacity that will start production in 2022, and a 11.7GWh facility due to launch in 2023. The two plants will be able to supply batteries for 300,000 EVs a year.
Tesla is expected to face growing competition in the EV sphere, broadening the options for vehicles with cobalt-bearing batteries. GM plans to launch 22 models by 2023, and Ford has earmarked a portion of $700mn of investment in its Dearborn, Michigan, plant to support hybrid and EV production of the popular F-150 truck.
Volkswagen, meanwhile, plans to begin building its new all-electric SUV at its Chattanooga, Tennessee, plant in 2022.
Tesla itself is expected to boost its own battery production capacity. The Gigafactory in Nevada has at least 20GWh of capacity, with the company starting test production of the 4680 battery at a 10GWh California plant. Company-wide capacity will exceed 3TWh by 2030, Tesla said.
Argus assessed US cobalt prices at $15.40-16.00/lb on 22 September, up from a 2020 low of $13.28-14.10/lb on 14 July. US cobalt demand is still heavily dependent on demand for superalloys, the prices of which have come under pressure following this year's sharp drop in air travel.
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Taiwan's scrap imports fall in March as demand slows
Taiwan's scrap imports fall in March as demand slows
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Japan's ferrous scrap exports slip in March
Japan's ferrous scrap exports slip in March
Shanghai, 29 April (Argus) — Japan's ferrous scrap exports declined sharply in March as import demand from Vietnam diminished, while the South Korean market remained bearish. Total exports in March retreated by 17pc on the month and by 10pc from the previous year, reaching 516,000t, according to Japan's customs data. Total exports dropped by 4.6pc on the year to 1.6mn t in the first quarter. Japanese scrap exporters encountered challenges because of declining overseas demand since March, as buyers became more cautious in the face of weaker-than-expected downstream demand recovery. Scrap exports will likely remain subdued in the coming months, according to trade sources. Vietnamese buyers were active in the seaborne market at the beginning of the year, but rising inventory levels and uncertainties in the steel sector outlook led them to step back after February. Exports to Vietnam in March dropped by 21pc on the month. The South Korean market is not expected to rise significantly in the near term as domestic scrap prices continued to fall, dropping by $50-60/t over the past three months. "South Korean buyers only fulfilled long-term contracts and stayed away from the spot market," a Japanese trader said. Exports to South Korea plummeted by 38pc to 470,000t in the first quarter. Exports to Taiwan dropped significantly by 41pc from the previous month as buyers were more focused on purchases of containerised scrap. Exports to Malaysia remained steady above 30,000t in March, while exports to the Philippines decreased from 34,000t in February to 13,000t. But a depreciation of the Japanese yen allowed exporters to offer relatively more competitive prices compared to other suppliers, with buyers price sensitive given a sluggish steel market. The yen started to weaken in March, reaching above ¥155:$1 at the end of April from $146.8:$1 in mid-March. Japan ferrous scrap exports (t) Country March % ± vs Feb % ± vs Mar '23 Jan-Mar % ± on year Vietnam 210,014 -20.7 20.7 683,821 48.0 South Korea 156,851 -9.8 -32.2 469,644 -38.1 Bangladesh 43,755 13.8 N/A 91,205 79.0 Taiwan 35,329 -40.8 -62.8 140,755 -28.8 Others 70,023 -20.6 -7.2 213,587 3.0 Total 515,971 -17.4 -10.4 1,599,011 -4.6 Source: Japan customs Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
STB chair Oberman to leave rail agency on 10 May
STB chair Oberman to leave rail agency on 10 May
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Japan’s JBIC to finance Chilean copper mine development
Japan’s JBIC to finance Chilean copper mine development
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