Rare Earth Minerals Finds in India Likely to Inform Future Lithium Demand, Says Supply Chain Specialist

By : Oliver Chapman, CEO Of Supply Chain Specialists OCI | Wednesday, April 12 2023 - 20:55 IWST

Oliver Chapman, CEO of OCI
Oliver Chapman, CEO of OCI

INDUSTRY.co.id - LONDON, April 12, 2023 - Oliver Chapman, CEO of supply chain specialists OCI, comments on recent developments with rare earth minerals finds in India and the falling price of lithium.

“Supply chains adjust, they always do, and many onlookers make the mistake of looking at current issues without factoring in how supply chains are likely to react,” asserts Chapman.

“Take rare earth minerals. These minerals are essential for key technologies, including electronics, clean energy, defence, and automotive industries. Their name, however, is a misnomer; these minerals are not especially rare but have simply been too cheap to warrant much investment in their development.

“Last year, a narrative became increasingly popular that there were insufficient rare earth minerals to meet rising global demand. Similarly, an assumption arose that China held a monopoly on those particular minerals, meaning that the supply chain was too reliant on one region.

“But recent news of rare earth mineral finds in India, in Jammu, Kashmir, and the Ananthapur district illustrates that the supply of rare earth minerals will grow with demand and that more regions will emerge as sources of supply.

“With lithium, it is a similar story. The price of lithium surged last year. The metal is vital in electric vehicles, and demand for it is expected to increase substantially. Many commentators predicted that the lithium price would carry on rising for the foreseeable future, pushing up the cost of lithium-ion batteries and, therefore, electric vehicles.

“But both supply and demand react to rising prices - they always do. Higher lithium costs encourage producers of lithium-ion batteries to strive for greater efficiency, whilst lithium miners look at ways to increase production. As a consequence of both demand and supply reactions, the price of lithium has fallen sharply and is currently less than half that seen just two months ago. The price is almost a third of the price experienced last November.

“Recent developments in Cornwall, England, where lithium mining is emerging as a potential source of income for the region, illustrates how lithium supply is likely to increase dramatically over time. And whilst some respond to that saying it can take several years, perhaps as long as a decade, from the discovery of lithium in a region to full mining activity, it is worth noting that lithium was first found in Cornwall in 2020, but lithium extraction from the region is projected to hit 10,000 tonnes a year by 2026.  Yes there are lengthy time lags between discovery and peak output, but as the Cornish example illustrates, new lithium mining is already under development.

“There is a wider point to be made regarding the relationship between the cost of lithium and lithium-ion batteries. Over the last three decades, the price of lithium-ion batteries measured in kilowatt hours has fallen by 97 per cent, with public and private research and development, plus economies of scale, the main driver of falling costs. So, even if lithium costs had not fallen in recent months and remained at the all-time seen last year, the cost of lithium-ion batteries per kilowatt hour was still likely to fall over time.

“The price of both rare earth minerals and lithium is likely to fluctuate over time, with upswings and downswings - as is the case with all commodities. But technology costs tend to fall over time (following a learning rate), meaning that the long-term trajectory of lithium and rare earth minerals applications is lower cost per unit of efficiency, whether that efficiency is measured in, say, kilowatt hours or computing power of electronic devices.” Oliver Chapman, CEO of OCI

News Comment

Today's Industry

Wellington College Independent School Jakarta (WCIJ)

Senin, 29 April 2024 - 05:02 WIB

One of the UK’s Most Established Schools Chooses Jakarta for Their Latest Opening

Wellington College Independent School Jakarta (WCIJ) is thrilled to announce its grand opening in September 2024! As the first private UK school to open in Indonesia, WCIJ, a pioneering co-educational…

Presiden Jokowi

Selasa, 23 April 2024 - 10:29 WIB

President Jokowi Reaffirms Commitment to Farmers’ Welfare

President Joko “Jokowi” Widodo on Monday (04/22) inspected corn harvest in Boalemo regency, Gorontalo province. “Our corn import has decreased significantly from 3.5 million tonnes to…

Photo: Aris Nurjani/VOI

Rabu, 28 Februari 2024 - 12:47 WIB

Carsurin and NBRI Strengthen Strategic Alliance to Propel Indonesia’s EV Industry

PT Carsurin Tbk ("Carsurin") and the National Battery Research Institute ("NBRI") are pleased to announce the signing of a pivotal Strategic Alliance Agreement (SAA), marking a significant advancement…

Beras (Foto/Rizki Meirino)

Rabu, 21 Februari 2024 - 08:43 WIB

Gov’t to Continue Disbursing Rice Assistance

President Joko “Jokowi” Widodo has ensured that the Government will continue rolling out the rice assistance program for low-income families. The President made the statement when handing…

Ilustrasi pabrik beras. (Foto: DetikFood)

Rabu, 21 Februari 2024 - 08:40 WIB

Bapanas Head Ensures Availability of Rice Stock Ahead of Ramadan

The National Food Agency (Bapanas) has ensured the availability of rice for the fasting month of Ramadan and Eid al-Fitr 1445 Hijri/2024 CE. “We believe that there is enough rice for the fasting…