Relief for critical mineral producers is years off, according to a study by Wood Mackenzie.
Today the energy research and consultancy released its report, Electric Vehicle & Battery Supply Chain: 5 Things To Look For In 2024.
In the past year nickel has plunged 44% to $16,006 tonne, while Benchmark’s EV lithium has tumbled 62% in the same period.
“What a difference a year makes. The battery raw material price rush of 2022 feels a distant memory as markets enter 2024 in the middle of a price slump. Indeed, we expect surpluses of lithium, cobalt, nickel and graphite bound for batteries to sustain for several years,” writes the reports authors.
There is a glut of batteries in the market that is going to keep down the cost of battery materials. Wood Mackenzie explains that 747 GWh of power batteries were produced in China over 2023. About 387 GWh were installed into products and another 153 GWh were exported resulting in a surplus of over 200 GWh of lithium-ion batteries in China alone last year.
“With storing batteries an expensive business, automakers may have a more cautious appetite for purchasing cells in 2024. Along with reducing battery raw materials prices, 2024 should be a year characterised by highly competitive battery prices, leading some to diversify their cell chemistries,” writes Wood Mackenzie.