Global nickel shortage is hampering electric vehicle manufacturing

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Nickel used in lithium-ion batteries that power electric vehicles must be 99.8% pure

A global shortage of nickel poses a problem for automakers looking to upgrade their fleets of electric vehiclesthe mineral being an integral part of their lithium-ion batteries.

The shortage is not the result of a lack of nickel, but rather because there are not enough mining projects or facilities capable of processing the type of nickel needed for batteries used by electric vehicles.

At the same time, the amount of nickel needed for a VE Lithium ion battery increases, because the more nickel it contains, the more energy dense it is.

The type of nickel that goes into an EV battery must also be of higher quality than typical, requiring at least 99.8% purity and a “class one” classification.

We’re moving towards, you know, 90% of the cathode being nickel for certain specific cell types,” Mark Beveridge of Benchmark Mineral Intelligence told CNBC.

Part of the problem is Russia’s invasion of neighboring Ukraine, with the Kremlin possessing a large amount of high-grade nickel.

Nickel prices have soared following Russia’s unprovoked aggression over fears the conflict could cause disruption in the supply chain.

The London Metal Exchange, fearing such disruptions, even suspended nickel trading for a period of one week, CNBC reports.

In the United States, domestic nickel resources are in decline, with the country’s main nickel mine in Michigan due to close in 2025.

The majority of nickel is currently used by the stainless steel industry and, although Beveridge estimates that batteries only account for around 10% of ore demand, he expects this to increase over time. to come up.

If we move forward 10 to 15 years, we actually envision a future where the battery industry could supply over 50% of the demand for nickel units by then,” Beveridge told CNBC.

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