Lithium Demand Is Increasing, Value Not under Rare Earth

Lithium is widely used in smartphones, pure electric vehicles (EVs) and accumulators, and the value is not to lose rare earth. The growing demand for lithium-ion batteries is bringing new business opportunities to the raw materials sector. In addition to trading companies and resource companies, cross-border companies such as battery companies and IT companies have also set off intricate battles.

The Nihon Keizai Shinbun website reported on October 16 that preparations for the start of production in the second half of 2020 are underway in Hobki, a globally important lithium mine in Quebec, Canada. A company believes that Canadian Nemaska Lithium Inc. (Nemaska), which is involved in the mining and smelting business, is a potential investment. The company is the Japanese SoftBank Group Corp (SoftBank) which is a global technology player that aspires to drive the Information Revolution. Includes advanced telecommunications, internet services, AI, smart robotics, IoT and clean energy technology providers.

According to the report, Softbank invested about 8 billion yen (1 yen, about 0.06 yuan) in April 2018, and obtained a 9.9% stake in Nemaska. This is the first mine investment project for Softbank. The mine's estimated production is 33,000 tons, and the company will directly purchase up to 20% in the long run, for the demand of the battery of the photovoltaic power generation business that the group is involved in.

The Nemaska is a developing chemical company whose activities will be vertically integrated, from spodumene mining to the commercialization of high-purity lithium-hydroxide and lithium-carbonate. With its products and processes, Nemaska intends to facilitate access to green energy, for the benefit of humanity. “The investment in Nemaska is a very important step in the group strategy.” Masayoshi Son, chairman & CEO of SoftBank Group Corp. emphasized the significance of funding.

Softbank Group continues to invest in the mobile travel sector, and also sees the development potential of lithium-ion batteries that are indispensable for pure electric vehicles. Masayoshi Son said, "The integration of technology and energy will further promote the mobile revolution in the era of internet and pure electric vehicles."

The value of this mineral does not lose the rare earth. According to the report, mine investment has been undertaken by resource companies and trading companies. However, in the field of lithium-ion batteries, cross-border enterprises have begun to directly purchase raw materials. What drives them to take action is the problem of uneven distribution of raw materials. According to the US Geological Survey, global annual production of the mineral has increased in 2018. Australia ranks first in terms of production, followed by Chile and China. Chile is far ahead of the reserves, followed by Australia and Argentina.

Lithium and rare earth are regarded as important resources for the development of high-tech fields. According to a recent report by the French "Les Échos", lithium-ion batteries are indispensable for electric vehicles. Demand for lithium-ion batteries continues to grow, while the supply of major raw materials is limited. Therefore, it is no longer possible to rely solely on resource and trading companies, and new competitors have begun to start mining investments. With Yoshino Akira winning the Nobel Prize, lithium-ion batteries have once again awarded attention. Including waste batteries, the competition for raw materials may also heat up.

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