Battery metals such as lithium, cobalt, nickel, manganese, graphite, and vanadium are essential for the production of batteries, particularly as demand for electric vehicles (EVs) and renewable energy storage continues to rise. This demand has made investment in these metals attractive, with investors considering various avenues such as stocks, exchange-traded funds (ETFs), and funds dedicated to battery metal mining companies.
These metals have applications beyond just energy storage and EVs, extending into industries like aerospace and defence. However, electric vehicles are driving the largest demand for these resources. EV batteries are similar to those used in phones or laptops but on a larger scale, and they rely heavily on metals like lithium, nickel, manganese, and cobalt. Commonly used battery types, such as NMC 8-1-1, consist primarily of nickel, with smaller amounts of manganese and cobalt.
Lithium, the lightest of the battery metals, is the most recognised. It plays a central role in batteries for consumer electronics and EVs. As a result, EV manufacturers are working to secure long-term lithium supplies to meet the rising demand. However, balancing supply and demand is a challenge, as the development of new lithium mining projects can take up to 20 years, which may not be fast enough to keep pace with the projected needs by 2030. Additionally, China is a major producer, complicating the global supply chain for this metal.
Graphite, another critical component, makes up about 20-30% of a lithium-ion battery’s weight. The high losses during production mean that it takes about 30 times more graphite than lithium to produce batteries. China also dominates graphite production, providing 70-80% of the world’s supply, leading to concerns about supply security, particularly in the US and EU.
Vanadium, primarily used to strengthen steel, is increasingly important for energy storage. It is used in large industrial batteries, which are notable for maintaining energy storage capabilities for over two decades without degradation. This makes vanadium a vital material in the effort to create durable and efficient energy storage solutions.
The global push for green mobility, combined with recent global disruptions like the pandemic and geopolitical conflicts, has further highlighted the importance of securing a reliable supply of these metals. As the transition to a low-carbon future accelerates, metals such as vanadium are set to play a crucial role, especially for companies like Ferro-Alloy Resources that are positioned to capitalise on this growing need.
The increasing demand for EVs and renewable energy storage is driving interest in battery metals, with lithium, graphite, and vanadium being at the forefront. With global supply challenges and a lengthy timeline for mining development, the role of companies like Ferro-Alloy Resources becomes increasingly critical in the quest for a sustainable energy future.
Ferro-Alloy Resources Ltd (LON:FAR) is developing the giant Balasausqandiq vanadium deposit in Kyzylordinskaya oblast of southern Kazakhstan. The ore at this deposit is unlike that of nearly all other primary vanadium deposits and is capable of being treated by a much lower cost process.
