The European Battery Raw Materials conference in Barcelona addressed a number of key challenges for building out an effective European battery supply chain. Constrained supply outlooks for battery-grade lithium and graphite were key points of discussion, with plans to classify lithium as toxic in Europe a notable potential own goal.

Fastmarket’s European Battery Raw Materials 2022 event in Barcelona drew record attendance, with a range of presentations and panel discussions looking to find potential solutions to the challenges of establishing a domestic battery supply chain in Europe. An obvious starting point was the forecast supply shortfall in lithium to meet the needs of the growing lithium-ion battery industry – not uniquely a European problem. The uptake of LFP chemistries within that mix will have some impact on the level and type of lithium required with no consensus on whether the lower energy density approach is suited to the European mass market segment. However, there was consensus that the plans by the European Chemicals Agency’s Risk Assessment Committee to classify three lithium salts as toxicants will not help. The potential move could have a significant ESG impact on European lithium projects as they look to secure financing for new and existing mining and refining projects in the region.

Another theme was the potential shortfall in other battery materials – which don’t generate as much attention but are essential to securing a regional supply of lithium-ion batteries. Europe has very few lithium and graphite operations, is home to just one of the world’s 15 battery-grade manganese sulphate producers, and has just 9% of the global supply of cobalt chemicals. Amongst the five key battery materials, graphite makes up the most material by weight in a lithium-ion battery. To date, the supply growth of battery-grade graphite has been driven by increased synthetic production out of China. However, the energy-intensive process raises ESG concerns and is impacted by high energy costs – the latter a particular issue in Europe just now. The future growth in domestic, non-China supply for graphite was seen to be mine-driven, with an index price for standardised grades of milled output a potential way to encourage future investment.