July 28, 2022: The UK has joined a growing list of nations to issue a critical minerals alert, warning on July 22 that its plans to become a ‘giga batteries’ producer supplying electric vehicles and energy storage systems could stall because of expected shortages of raw materials.
Business, energy and industry minister Kwasi Kwarteng (pictured) said in a new policy paper launching the UK’s first ‘critical minerals strategy: “Global demand growth for certain minerals, driven in many cases by decarbonization targets, could outstrip supply chain capacity, which will struggle to expand quickly enough owing to long lead times for mine development and mineral processing.”
Kwarteng cited data from Benchmark Mineral Intelligence indicating that “rising demand has caused lithium prices to increase nearly 400% year-on-year as of May 2022”.
Cobalt, lithium and vanadium are already on a list of UK-designated critical minerals published by the government in late 2021 and now nickel has been put on a “watchlist”, Kwarteng said.
According to the UK’s policy paper, nickel “is traded in large global markets and has a diverse range of applications, giving supply chains a degree of resilience”.
However, Russia is a major supplier, and the invasion of Ukraine has caused significant disruption to nickel markets, the paper said. “Class 1 (high purity) nickel is an important metal for electric vehicle batteries, and as Russia continues its aggression in Ukraine, the criticality of nickel may rise over the coming year, hence its inclusion in the watchlist.”
The UK has pockets of mineral wealth, but largely relies on market forces to deliver a secure supply of minerals to UK industry, the paper said.
The UK will look to bilateral agreements with countries “to promote joint working towards solutions to global issues in critical mineral value chains”.
Meanwhile, a new UK Critical Minerals Intelligence Centre, led by the British Geological Survey, will update the UK’s strategy annually.
On June 30, UK gigafactory developer Britishvolt announced it had signed a memorandum of understanding with South Korea’s Posco Chemical for battery material supplies.
Under the terms of the agreement, Posco would supply cathode and anode active battery materials that could lead to a longer-term joint development agreement.