NOVEMBER 10, 2021

By Lukas Boer, Andrea Pescatori , Martin Stuermer and Nico Valckx

Clean energy needs may cause years of high prices for copper, nickel, cobalt, and lithium under a net-zero emissions scenario.

The world’s historic pivot toward curbing carbon emissions is likely to spur unprecedented demand for some of the most crucial metals used to generate and store renewable energy in a net-zero emissions by 2050 scenario.

Prices could reach historical peaks for an unprecedented length of time—and even delay the energy transition itself.

A resulting surge in prices for materials such as cobalt and nickel would bring boom times to some economies that are the biggest exporters—but soaring costs could last through the end of this decade and could derail or delay the energy transition itself.

Prices for industrial metals, an important foundation for the global economy, have already seen a major post-pandemic rally as economies re-opened, as we recently wrote. Our latest research, included in the October World Economic Outlook and a new IMF staff paper, details the likely effects of the energy transition for metals markets and the economic impact for producers and importers.

For example, lithium, used in batteries for electric vehicles, could rise from its 2020 level around $6,000 a metric ton to about $15,000 late this decade—and stay elevated through most of the 2030s. Cobalt and nickel prices would also see similar surges in coming years.

Read more at: https://blogs.imf.org/2021/11/10/soaring-metal-prices-may-delay-energy-transition/

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The race is on to find a steady source of lithium, a key component in rechargeable electric car batteries. But while the EU focuses on emissions, the lithium gold rush threatens environmental damage on an industrial scale

by Oliver Balch

Tue 8th Dec 2020

Even before the new mine became the main topic of village conversation, João Cassote, a 44-year-old livestock farmer, was thinking about making a change. Living off the land in his mountainous part of northern Portugal was a grind. Of his close childhood friends, he was the only one who hadn’t gone overseas in search of work. So, in 2017, when he heard of a British company prospecting for lithium in the region of Trás-os-Montes, Cassote called his bank and asked for a €200,000 loan. He bought a John Deere tractor, an earthmover and a portable water-storage tank.

The exploration team of the UK-based mining company Savannah Resources had spent months poring over geological maps and surveys of the hills that ripple out from Cassote’s farm. Initial calculations indicated that they could contain more than 280,000 tonnes of lithium, a silver-white alkali metal – enough for 10 years’ production. Cassote got in touch with Savannah’s local office, and the mining firm duly contracted him to supply water to their test drilling site. The return on his investment was swift. After less than 12 months on the company’s books, Cassote had made what he would usually earn in five or six years on the farm.

Savannah is just one of several mining companies with an eye on the rich lithium deposits of central and northern Portugal. The sudden excitement surrounding petróleo branco (“white oil”) derives from an invention rarely seen in these parts: the electric car. Lithium is a key active material in the rechargeable batteries that run electric cars. It is found in rock and clay deposits as a solid mineral, as well as dissolved in brine. It is popular with battery manufacturers because, as the least dense metal, it stores a lot of energy for its weight.

Read more at: https://www.theguardian.com/news/2020/dec/08/the-curse-of-white-oil-electric-vehicles-dirty-secret-lithium

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