Australia is poised to play a major role in the global renewable energy transition, particularly in the production of battery minerals. With the growing demand for electric vehicles (EVs) and the expansion of charging infrastructure, the need for metals such as copper and nickel has increased exponentially. As the world’s largest lithium exporter and with significant copper and nickel resources, Australia is well-positioned to meet this demand.
Australia’s mining industry, which accounts for around 14% of the country’s GDP, is a major contributor to the economy. It accounts for more than two-thirds of Australia’s exports and employs more than a quarter of a million people. China, Japan, South Korea, India, and Taiwan are the top five export markets for Australian mining products.
Demand for copper is expected to increase significantly due to the increasing adoption of electric vehicles and the need for charging infrastructure. Australian copper exports are expected to increase from 868,000 metric tons in 2022–23 to around 970,000 metric tons in 2027–28, with export earnings estimated at US$15 billion in real terms. In addition to electric vehicles, copper is also required for power generation and transmission.
The increase in demand for nickel is largely due to its role in battery production, although it is also used to make stainless steel. Nickel demand for batteries is expected to reach 25% by 2028. The preference for nickel battery chemistry, whether NCM or LFP, will influence future growth projections. LFP batteries are cheaper and pose fewer social licensing risks, while NCM batteries offer higher energy density and runtime benefits.
As electric vehicles become more widespread, demand for these metals will put pressure on global supply. Australia’s contribution to meeting this demand is expected to increase as several new mining projects are in the pipeline. However, refining Indonesian lateritic ores into battery-grade nickel presents challenges as it requires more energy and generates more waste compared to Australian nickel sulfide mines.
Efforts to increase the use of recycled copper and supportive government policies in major economies will be critical to meeting future demand in a sustainable manner. The transition to renewable energy presents both opportunities and challenges for Australia’s mining industry, and strategic planning and collaboration will be critical to ensuring a successful and sustainable transition for the country’s economy.
Fuentes:
1. Environmental Defense Fund report on battery manufacturing in the United States
2. Quarterly Resources and Energy Report of March 2023 from the Australian Government’s Department of Industry, Science and Resources, Office of the Chief Economist
Definitions:
Electric Vehicles (Electric Vehicles): Vehicles powered by electricity stored in rechargeable batteries instead of traditional internal combustion engines
Copper is a versatile metal used in various industries, including electric vehicles, power generation, and transmission.
Nickel is an important ingredient in the manufacture of batteries and is also used in the manufacture of stainless steel.
LFP (Lithium Iron phosphate) is a type of battery chemistry used in electric vehicles known for its cost-effectiveness and thermal stability.
NCM (Nickel-Cobalt-Manganese): Another type of battery chemistry used in electric vehicles that offers higher energy density but carries potential risks from social licensing.
