On 22 September, Tesla hosted its Battery Day Event with CEO Elon Musk and Senior Vice-President Andrew Baglino detailing a number of important updates and developments on the company’s ambitions. Of key focus from a manganese perspective were the announced plans for the company to start mass-scale manufacturing of a lithium-ion battery with a cobalt-free cathode chemistry for its mid-range vehicles. The battery would be comprised of two-thirds nickel and one-third manganese. In addition to the company’s ambitious growth projections and technical innovation in battery production, there was also a growing interest to localise Tesla’s regional cathode supply chain, leveraging raw material resources within North America.
The announcement from Tesla in moving towards upstream integration reinforces a key priority for EV and battery producers, which is the sustainability of their supply chains. This is contrary to Chinese precursor producers whose manganese products are based on imported ores. In terms of supply security for key raw materials, Tesla aims to fully guarantee the sustainable production necessary to reduce the costs of production and scale out its battery production in North America. The future impact of critical raw materials from a geopolitical standpoint is becoming increasingly important against the backdrop of national security to support local battery production in the USA.
In terms of battery-grade manganese raw material requirements, close to three-quarters of battery-grade manganese sulphate production takes place in China and the country accounts for most global electrolytic manganese metal (EMM) production. A source of feedstock supply in the same region may be of particular interest to those operating precursor/cathode plants outside of China or those developing precursor plants in Europe and North America. While at present there are few ex-China sources of manganese sulphate or EMM, the challenge remains as to where new plants outside of Asia will source their battery raw materials to comfortably supply future demand for use in lithium-ion batteries over the coming decade.
Roskill’s NEW Manganese: Outlook to 2030, 16th Edition report will be published in October 2020 and provides analysis on supply, demand, trade and prices. In addition, it provides industry cost curves and forecasts for the various forms of manganese consumption in lithium-ion batteries. For more information or to subscribe, click here.