Despite weaker consumer sentiment as a result of the recent recession, the electric car market is expected to see a healthy rebound in growth, said Neal Brewster, manager of strategy consulting at Roskill.
“Electric vehicle (EV) sales are actually doing pretty well, and I think those will come back much more quickly. I guess we might see governments actually encourage EV sales, so for those particular markets, I’m actually quite bullish, [and see] good drivers longer-term,” Brewster said.
The rise of electric vehicles in the automotive market will bring up demand for battery-intensive metals, Brewster noted, as battery manufacturers shift away from cobalt into nickel.
“In terms of battery technology, we’re seeing a shift towards high nickel-intensity batteries, so our view on nickels is particularly bullish,” he said. “Cobalt will lose share of the market, but it’s a fast-growing market, so [we’ll still see] positive growth year on year.”
Lithium demand is also expected to grow rapidly, Brewster said.
“In terms of lithium, lithium demand could be growing at double digits, so 15% year-on-year, over a number of years. I guess lithium has had a bit of a correction in the last couple of years so if you go back to 2017…we probably saw supply overtaking demand, and that caused quite a floor on prices. That’s now kind of bottomed out,” he said.
As demand picks up, lithium prices should perform strongly over the medium-term, Brewster added.
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