not 100% sure if this will stay visible snippet
Here’s why:
• There’s probably about 40-60kg of copper in each EV. For an EV with a 60kWh ternary battery of the high nickel variety there’s probably about the same amount of nickel, 40-60kg.
• So if we’re going to sell, say 8m units of EVs this year and assuming that 60% of those will be high nickel batteries and that 75% of all EVs sold will be BEVs, then we’re looking at nickel demand for EVs (including lower nickel batteries) of about 260Kt for the year, up from 210Kt last year.
• If we do the same calculations for copper, assuming copper is used in all EVs, then we’re looking at c.400Kt of copper, up from 330Kt last year.
So it’s a bigger absolute increase in copper, you would say – 70Kt vs 50Kt for nickel. And that’s true.
But there’s a problem. Refined copper demand in 2021E was c.25Mt. Nickel demand for the same period was c.2.8Mt of which c.50% was nickel pig iron, so Class 1 nickel demand was c.1.4Mt. You can see that the copper market is something like 18 times bigger than the Class 1 nickel market, so the 70Kt really gets lost – it’s only 0.3% of the market.
But for class 1 nickel, the increased nickel demand is 4% of the market.
That’s adding a reasonable chunk to nickel demand but it’s effectively irrelevant to copper demand and that’s why the acceleration in EV sales is more important to nickel than copper.