Outlook for the green metals sector in Africa
The dependency of clean technologies on green metals indicates that demand for these resources will increase significantly in the medium to long term. Copper is expected to be the main source of growth because of its uses in expanding electricity networks and clean energy technologies. Green metals also play a pivotal role in the burgeoning electric vehicles market, which saw a surge in global sales from 1.8 million vehicles in 2022 to 2.3 million vehicles in 2023. Notably, China commands the largest share of the market at around 60%, followed by the EU and the United States.
Several factors drive this demand for electric vehicles, including energy policies and elevated oil prices. Emerging markets such as India, Thailand and Indonesia are aligning their electric vehicle demand with global trends and as a result they are experiencing a notable year-on-year growth rate exceeding 3%. In response to this demand, regulatory bodies are implementing stringent standards. The EU has adopted new carbon standards for cars and vans in line with their 2030 green objectives.
Similarly, in the United States, the Inflation Reduction Act and the adoption of
California’s Advanced Clean Cars II rule by several states are intended to achieve a 50% market share for electric cars by 2030, in line with national targets. Proposed emissions standards by the US Environmental Protection Agency are expected to bolster this trend.
The surge in electric vehicle demand is directly fuelling the need for batteries and critical minerals. Automotive lithium-ion battery demand spiked by about 65% to 550 gigawatt-hours (GWh) in 2022, driven primarily by the growth in electric passenger car sales.
A significant portion of lithium, cobalt and nickel demand is now attributed to electric vehicle batteries, marking a substantial increase compared to previous years.
Efforts to minimise reliance on critical materials are crucial for enhancing supply chain sustainability, resilience and security, particularly in light of recent price fluctuations for battery materials. On the downside, demand for green metals is highly dependent on its major consumer, China, and is therefore susceptible to developments in the Chinese economy.
