Russian nickel sanctions could slow EV adoption – GlobalData
Sanctioning Russian nickel will slow the adoption of electric vehicles (EVs) and hinder the decarbonisation effort of Western economies, says data and analytics company GlobalData.
The company notes that such actions will also mean that Western countries will be reliant on Russian oil and gas for longer.
According to GlobalData’s Mining Commodity Analyser, Russia was the world’s third-largest producer of nickel last year, producing more than 200 000 t.
As nickel is used in the production of EV batteries, any sanctions placed on Russian nickel could cause EV manufacturing prices to increase further, threatening adoption and decarbonisation efforts.
“Geopolitical issues such as the Russia-Ukraine situation disturb the fine balance of battery metal supply chains,” says GlobalData thematic research team battery analyst Daniel Clarke.
“A skyrocketing nickel price would have major repercussions on the climate ambitions of countries around the world, and will ultimately hamper the adoption of EVs.”
“The extra costs will be felt somewhere, either hitting the profits of automakers, or being passed on to customers,” notes Clarke.
“Now is a critical time for EV adoption, as advanced economies aim to accelerate the decarbonisation process.”
However, the sanctions would not be a disadvantage to everyone.
“Russia has reportedly been looking to reduce the impact of sanctions by turning to Asia for trade,” says Clarke.
“EV and battery companies in China may well step in and buy the commodity at lower prices.
“China already has a strong position in the battery metal supply chain, and buying Russian nickel on the cheap as a result of sanctions would further strengthen its globally competitive position.”
“It is possible that another nickel-producing nation such as Indonesia or the Philippines could step up and supply western automakers with nickel, but this would lead to two negative consequences for companies downstream,” adds GlobalData thematic analyst Dr Lil Read.
“Firstly, Western automakers would see an increase in emissions across their supply chains, as these two producing countries are geographically further afield and frequently engage in environmentally unfriendly practices.
“Secondly, this would lead to an increasing reliance on China for companies downstream, as Chinese companies play a key role in the main nickel mines in these countries.”
Considering other battery types that may have the potential to increase in popularity as a result of the situation, Read believes that even though battery innovation has been “mind-blowing” over the past few decades, no innovations are going to happen overnight.
“We expect that lithium-ion phosphate batteries, which do not contain nickel or cobalt, will see an increase in popularity and adoption over the medium term if the conflict continues. However, lithium has its own limitations.”
Comments
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation