High lithium costs start to feed into prices of China EV batteries

  • Electric vehicle batteries typically use lithium carbonate or lithium hydroxide.
Now costs of raw materials, particularly lithium, are rising and feeding into battery costs. (Reuters)
Now costs of raw materials, particularly lithium, are rising and feeding into battery costs.

Soaring costs of materials such as lithium and nickel used to make electric vehicle batteries are starting to feed through into prices of these batteries in China, Benchmark Mineral Intelligence said this week.

Also Read : Is Ather launching OATS for champions? The EV startup's cryptic message decoded

This is contrary to expectations that prices of the lithium-ion rechargeable batteries used to power electric vehicles, vital for the energy transition, would keep falling over time as economies of scale kicked in.

Also check these Vehicles

Find more Cars
Mg 4 Ev (HT Auto photo)
UPCOMING
BatteryCapacity Icon64kWh Range Icon350 km
₹ 30 - 32 Lakhs
View Details
Tata Sierra Ev (HT Auto photo)
UPCOMING
BatteryCapacity Icon69 kWh Range Icon420 Km
₹ 25 - 30 Lakhs
View Details
Tata Harrier Ev (HT Auto photo)
UPCOMING
BatteryCapacity Icon50 kWh Range Icon400 Km
₹ 22 - 25 Lakhs
View Details
Honda Elevate Ev (HT Auto photo)
UPCOMING
₹ 18 Lakhs
View Details
Tata Punch Ev (HT Auto photo)
BatteryCapacity Icon35 Kwh Range Icon421 km
₹ 10.99 - 15.49 Lakhs
Compare
View Offers
Mg Comet Ev (HT Auto photo)
BatteryCapacity Icon17.3 kWh Range Icon230 km
₹ 7.98 - 9.98 Lakhs
Compare
View Offers

However, the initial cost gains from large scale battery production have been achieved with the construction of gigafactories, said Benchmark Mineral Intelligence (BMI) Chief Executive Simon Moores.

Now costs of raw materials, particularly lithium, are rising and feeding into battery costs, he added.

Electric vehicle batteries typically use lithium carbonate or lithium hydroxide. BMI's assessment of the lithium carbonate price in China shows a jump of more than 300% over the last year to $28,675 a tonne in mid-October due to supplies falling short of stronger-than-expected demand.

Its assessment of nickel sulphate prices in China suggests a rise of more than 30% to $5,658 a tonne in the 12 months to the end of September.

Widespread power shortages in China leading to reduced supplies and robust demand have created shortages of nickel sulphate and pushed up prices of the battery chemical.

Cobalt hydroxide prices are generally up more than 80% at $47,800 a tonne in the year to the end of September.

BMI said prices of batteries with cathodes made from nickel, cobalt and manganese could rise to around $115 a kilowatt hour (kWh) next year compared with $105 kWh this year if South Korean and Japanese producers follow China.

"The market may have to reposition itself for a period of rising battery cell prices, a new phenomena for an industry conditioned to expect year-on-year falls," Moore said.

First Published Date: 31 Oct 2021, 16:23 PM IST
NEXT ARTICLE BEGINS

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city

Want to get the best price for your existing car?

Powered by: Spinny Logo
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.