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China's energy storage network: as electric cars become more popular, many related metals are becoming more familiar to investors.Cobalt is widely used in electric car manufacturing, but it is also being driven by the fiery price of electric cars, which have forced battery makers to look for cheaper alternatives, nickel.
Market is expected that by 2025, the electric car battery demand will turn 20 times, huge demand for metals demand, in the past year, cobalt prices jumped nearly 150%, making battery manufacturers have to find alternatives, to cut costs.
Nickel, manganese and cobalt are all used in the production of lithium batteries, according to SK Innovation, a south Korean manufacturer. In that case, nickel accounts for more than 60 per cent, while cobalt and manganese account for 20 per cent.The company is trying to shift the ratio from 6:2 to 8:1, which means increasing the nickel content and reducing the amount of cobalt and manganese.
A spokesman for the company said it was not about creating a new product but trying to respond to a changing market environment.
The average cobalt price in July was $5,8549 a tonne, six times the price of nickel.The market has been overwhelmed by demand from batteries, coupled with a conflict in the democratic republic of Congo that has affected supply.The democratic republic of Congo is the world's largest cobalt producer, and nearly 60 percent of the world's cobalt supply comes from the country.
In addition, ubs said in a recent report, the electric car demand will boost demand of nickel, nickel by 2025 global demand growth will be 10% to 40%, as to how much growth, will see how many of the nickel replace cobalt.
Asian market dominant in the global electric car batteries, in the first five months of Japan panasonic's production, 30% of the global total, South Korea's samsung and LG Chem total output accounted for 20%, China's byd (002594, shares) is 8%.
In the long term, samsung SDI said, the proportion of cobalt in the battery will drop to about half its current level.
However, it will take years for technology to reach that goal.Global battery makers are now facing a rise in cobalt prices, with only a price hike or a long-term contract to guarantee a steady supply.
Panasonic, which offers nickel-cobalt-aluminum technology to customers including tesla, is trying to reduce its use of cobalt.The company's spokesman said the cobalt, which is a rare metal, had initially been trying to reduce cobalt applications.
The company said tesla's current application ratio is 8:1, and is working with panasonic to increase the use of nickel to 85 percent.
LG Chem is also developing products to try to reduce the use of cobalt and to cut its impact on battery prices by seeking to hedge.
Byd is more focused on using cheaper lithium-iron-phosphate batteries and does not need to use nickel and cobalt.However, analysts believe the market is turning to nickel - manganese - cobalt and nickel-cobalt-aluminum, and the technology to increase nickel usage is gaining traction.
But the good news is, the extraction of cobalt and copper and nickel mining often related, in copper prices, nickel increased demand, pushing up prices of cobalt as a by-product, the production should be increased