The supply chain for electric vehicles is becoming more central to the United States’ automotive sector, making it crucial for the country to access to key raw materials – which includes lithium – and the ability to process them, U.S. Transportation Secretary Pete Buttigieg told Bloomberg in an interview Monday.
Buttigieg said it is important that the U.S. have its own capacity to process those raw materials but that it would suffice to maintain good trading relationships with countries that produce them, rather than producing the raw materials themselves.
His comments, published by Bloomberg in a video of an interview on the sidelines of the G7 Transport Ministers meeting in Ise-Shima, Japan, suggest the U.S. may prioritize the creation of lithium processing plants over development of lithium mines.
“This is not a matter of believing that every single element of a battery, for example, can come from one country,” he said. “That’s a matter of physics or geology. And it’s not always possible.”
He added that it “does mean making sure that we have the relationships, not just for the raw materials, but things like refining capacity [for] many of the key raw materials needed for EV battery components that are very concentrated in China. That is something that’s addressable.”
A 2020 United Nations Trade and Development report on strategic battery raw materials cited cobalt, lithium, manganese and graphite as the main ones. Of those, cobalt is considered by many to be the rarest and most difficult to obtain, but lithium – referred to these days as white gold – is not far behind. Lithium demand has increased several-fold in recent years as EV sales rocketed. Lithium prices rose as a result, driving many grease manufacturers to consider alternative thickener chemistries.
Grease is also one of the main applications for lithium, and 63% of the world’s grease is made with conventional lithium or complex lithium soap thickeners, according to Lubes’n’Greases Fact Book.
With EV sales forecasted to continue growing fast, lithium demand is expected to continue rising, and numerous countries are scrambling to ensure supply. The U.S. is the world’s ninth-largest lithium producer, according to Investing News, but accounts for just 1% of global output. It has a single commercially operating mine, Albemarle is the only existing commercial producer, at its Silver Peak mine in Nevada, but new sources are under development, such as American Lithium Corp.’s TLC mine, also in Nevada.
China ranks third in lithium production – behind Australia and Chile and accounting for 15% of the worldwide total.
According to the 2020 U.N. study, most lithium mines produce lithium carbonate, which is generally sold on three- to five-year contracts to refiners that produce and market downstream chemicals and lithium metal.
The U.S. currently has little lithium processing capacity, but multiple companies are developing facilities, including a plant that Tesla is building in Corpus Christi, Texas, and another that Albemarle plans in Chester County, South Carolina.