In addition to the influence of geopolitical factors, such as a pandemic or the Russian war against Ukraine, which have already pushed prices up on global markets, additional increases in prices are expected separately for nickel, cobalt, lithium, copper and other minerals.
This is stated in the publication of IMF experts dedicated to trends related to the transition to clean energy and reducing the impact of climate change, Ukrinform reports.
“Minerals such as copper, nickel, cobalt and lithium are critical sources for the energy transition. They are used in electric vehicles, batteries, and in renewable energy technologies such as solar panels and wind turbines,” note the Foundation’s experts.
For example, a typical electric vehicle battery requires about 8 kilograms of lithium, 35 kilograms of nickel and 14 kilograms of cobalt. Charging stations require significant amounts of copper.
In this context, experts turn to the forecasts of the International Energy Agency (IEA), which expects that by 2030, demand for copper should increase by 1.5 times, for nickel and cobalt – twice, and for lithium – six times.
“This will drive up prices and could make these minerals as important as crude oil is to the global economy over the next two decades,” experts say.
The problem may be exacerbated by the extreme vulnerability of the current global supply of these minerals, which are concentrated in certain regions in a small number of countries. In this regard, a chart is provided showing that, for example, copper mining mainly occurs in Chile, Peru and China. Nickel is supplied mainly by Indonesia, the Philippines and Russia, cobalt by the DRC, the Philippines and Australia. While China, Chile and Australia have significant lithium deposits.
Thus, experts draw attention to the need for appropriate fragmentation of critical markets as humanity transitions to zero-emission energy technologies and mitigates the effects of climate change. To this end, it is important to maintain and expand international cooperation, expand data exchange and introduce other smart approaches in this area.
As reported, on December 13, at the COP28 climate summit in Dubai (UAE), representatives of the world's governments agreed for the first time in history to a “transition period” from fossil fuels to prevent the worst effects of climate change.