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NOT ALL NICKEL IS CREATED EQUALLY

Only Class 1 Nickel can drive an EV-charged future

SULPHIDE DEPOSITS SUCH AS THOSE IN SUDBURY
ARE THE PRIMARY SOURCE OF CLASS 1 NICKEL

CLASS 1

NICKEL MARKET

Nickel products that fall into Class 1, mined from sulfide deposits, comprise of electrolytic nickel, powders and briquettes, as well as carbonyl nickel. These products are LME deliverable and have a nickel purity of a minimum of 99.8%.

Historically, most nickel was produced from sulfide ores, including the giant (>10 million tonnes) Sudbury deposits in Ontario, Norilsk in Russia and the Bushveld Complex in South Africa, known for its platinum group elements (PGEs). However, existing sulfide mines are becoming depleted, and are not being replaced, which has changed the geographical weighting of nickel production.

Nickel deposits come in two forms: sulfide or laterite. About 60% of the world’s known nickel resources are laterites. The remaining 40% are sulfide deposits.

Generally sulfide deposits are found in more politically stable jurisdictions (eg. Canada, Australia, Greenland) than the often equatorial areas hosting laterite deposits, such as Indonesia, the Philippines, Papua New Guinea, New Caledonia and parts of Africa.

CLASS 2

Nickel Class 2, mined from laterite deposits, is a group that comprises of less ‘pure’ nickel products. Examples of these are nickel pig iron (NPI), a version of nickel created using low-grade laterite ores and blast/electric furnaces, ferronickel, nickel oxide, utility nickel, Toniment, mixed hydroxide and other <99.8% products. Both have a reduced nickel content and are often used in stainless steel and alloy steel production, where a high content of iron becomes beneficial. Class 2 products contribute the remaining 45% of total nickel mining output. These products are not LME deliverable and must be sold to an end customer.

ONLY CLASS 1 NICKEL (PURITY >99.8%) 
ARE SUITABLE FOR EV BATTERIES

  • EV sales forecasted to reach 44 million vehicles per year by 2030 under the EV30@30 Initiative (EVI)
  • To increase energy density, future battery chemistries will contain more nickel.
  • Nickel will make up to 80% of the mass in cathodes 
  • 2030 projected nickel demand of 1.3 Million Metric Tonnes Per Annum (59% of current annual supply) as nickel content in EVs increases to 40kg per car battery. 

WORLD NICKEL MARKET - 2.3 MILLION TONNES PER ANNUM

  • Less than 40% of world nickel production comes from sulfides 
  • Sulphide deposits such as those in Sudbury are the primary source of Class 1 nickel 
  • Only Class 1 nickel (purity > 99.98%) suitable for EV batteries
  • Class 2 nickel (ferronickel and nickel pig iron) not suitable for EV batteries due to iron content and impurities, common use in stainless steel 
  • Nickel demand for batteries has doubled from 3% of the world Nickel Market in 2017 to 6% in 2018. This rapidly increasing demand is already over 12% of Class 1 nickel production.  

GLOBAL NICKEL SUPPLY DEFICIT FORECAST

Estimated that 1.83Mt of new Ni supply (Class 1 & Class 2) is needed by 2040 – broadly the same as the current market!

NICKEL'S EV PROBLEM

Most Chinese battery manufacturers use lower-cost lithium-iron-phosphate batteries ie. no nickel but Chinese battery manufacturers are looking to mi-grate to nickel-containing batteries with several including Shanshan, Nichia, L&F Materials, and Reshine producing them.  

According to Adamas Intelligence, which tracks battery metals, EV manufac-turers deployed 57% more nickel in EV batteries in 2020. Volkswagen has reportedly committed to using NMC 811s in its EVs from 2021 onwards. 

Korea’s top two battery-makers, SDI and LG Chem, are looking to build more nickel into their EV battery composites. 

It makes sense to use more nickel in EV batteries, because doing so increases the battery’s energy density, thereby extending the vehicle’s range.

Quote: 
‘Although the capacity to produce nickel sulfate is expanding rapidly, we cannot yet identify enough nickel sulfate capacity to feed projected battery forecasts” Wood Mackenzie

Nickel is used in two of the dominant battery chemistries for EVs, the nickel-manganese-cobalt (NMC) battery used in the Chevy Bolt (also the Nissan Leaf and BMW i3) and the nickel-cobalt-aluminum (NCA) battery manufac-tured by Panasonic/Tesla. 

Battery manufacturers have been developing nickel-rich NCM 811 batteries (80 percent nickel, 10 percent cobalt and 10 percent manganese) because they have longer lifespans and allows electric vehicles to go further on a single charge.