Belgium-based materials technology giant Umicore will spend $181 million on expanding its nickel manganese cobalt (NMC) production facilities in China and South Korea.
The expansion, which will mean total capacity will triple within three years, is in answer to the surge in demand for materials used in hybrid and electric vehicles, the company says.
Umicore also targets the stationary storage system market with its range of materials for cathodes.
Brownfield sites on adjacent land to existing factories at Jiangmen, in China’s Guangdong Province, will be developed for the expansion, and there is also expected to be some development of green belt land.
According to the Chinese government statistics, China’s annual cobalt consumption is 4.45 million tons, which has increased by 29% since 2011.
Domestic supply of the material, an article on the battery web portal Ofweek says, could soon see shortages as it fails to keep up with demand.
“Insiders are worried about the future if there is not a timely supply surge in response to the demand, and it is likely the market will see a tightening over the next few years,” the article said.
The article mentioned that the opening of Umicore’s new facilities would coincide with the opening of Tesla’s ‘Gigafactory’ in 2017, where it is said both NMC and NCA (nickel cobalt aluminium) lithium batteries will be made, the former for its EVs and the latter for its grid storage products.
Cobalt itself is far from abundant, with resources largely mined in the Democratic People’s Republic of Congo, where a recent Amnesty International report claimed was using child labour in its mines.
