Rebecca Gordon on CRU Technology Metals, Consulting
My name's Rebecca Gordon. I work in the Consulting division of CRU. My responsibility is for the Technology Metals and Energy desk. We are the group of people who look after inquiries that come from single customers, specifically covering technology metals, and energy.
Why is technology metals an important area?
It's an area where we see a lot of change in the market, because of the societal acceptance of new electric vehicles and the new types of power generation. The reason that's interesting to us at CRU is that it's incredibly commodity-intensive to build a car or to build a power plant. We are looking at what these changes that are driven by policy throughout the world mean for the commodity markets that our customers work in.
We're getting questions both on the financing side, such as what markets and what commodities should be invested in, and from consumers who are concerned about accessing new materials from different parts of the periodic table that they haven't necessarily heard of before.
What trends are you seeing in technology metals?
From the consuming side, there’s a lot in the press on electric vehicles and all the policies around the uptake of electric vehicles, with governments stating that we need to adopt electric vehicles at a certain rate, to a certain percentage of the fleet by 2030 or 2040. For us that's really critical, because we need to look at whether the commodities exist in the market to build those cars.
The hot topic at the moment is cobalt. Is there enough cobalt in the world to build the batteries to drive the cars with electricity? That's really quite a difficult question to answer so we are doing a lot of research on the subject.
The commodities we look at, particularly cobalt, come from new regions of the world, which aren't traditional mining areas. Traditionally, iron ore comes from Australia, from Brazil. But the minor metals, like cobalt, come from the middle of Africa, which in itself brings new issues to the surface. There you don't just have supply issues, you have political issues, artisanal mining, and other concerns that consumers have with those commodities.
The hot topic at the moment is cobalt. Is there enough cobalt in the world to build the batteries to drive the cars with electricity? That's really quite a difficult question to answer so we are doing a lot of research on the subject.
Rebecca Gordon Head of Technology Metals and Energy, Consulting
The questions around the sourcing of cobalt are not just whether or not you can buy the material, but what it's going to cost and where you're going to get it from to guarantee that it arrives for your vehicle.
Another hot topic is commodities like nickel, where the market has grown very strongly, but prices are held down by a new type of nickel which contains iron – nickel pig iron. This is not suitable for batteries for cars. Therefore, as demand for the batteries in cars grows, you need to find the sources of nickel that don't have iron in them. That will cause differences in prices going forward.
Why are we seeing transport and power generation policy change?
We think the time has come for these changes to be possible. Societal pressure and the realisation that individuals have a right to clean air have really risen up political agendas. This is facilitated by cheaper technology and a better understanding of the possible solutions.
As that comes together, it's possible to set policy that's implementable at reasonable cost, which means you can make these changes in the market today. Maybe five years ago it was inconceivable to have an entire fleet of electric vehicles, but today you can see that this is possible.
It's really a seismic shift, in the same way that we moved from horse and cart to combustion engines. We're really seeing the possibility of moving from combustion engines to new energy vehicles happening now.
