EV battery production hit by surge in Nickel prices

The war between Russia and Ukraine has induced a serious hit on the EV industry. Ever since Russia launched the invasion of Ukraine, the metal, which is precious of battery production, has soared to over USD 100,000 (SGD 135k) per tonne. Several sanctions that have been imposed on Russia, which supplies the world with about 10% of its nickel needs, have only made the matters worse.

“As of this writing, nickel is up 67.2% just today, representing around a US$1,000  increase in the input cost of an average EV in the US,” said Morgan Stanley auto analyst Adam Jonas. He warned investors and automakers not to expect high revenues from EV sales in the coming times.

Meanwhile, United States President Joe Biden urged for a rapid shift to EVs to stop “tyrants like Putin” from using fossil fuels as a weapon. "Loosening environmental regulations won’t lower prices. But transforming our economy to run on electric vehicles, powered by clean energy, will mean that no one will have to worry about gas prices. It will mean tyrants like Putin won’t be able to use fossil fuels as a weapon," Biden said.

Over in China, nickel titan Tsingshan Holding Group lost billions of dollars in trading as the war affected the price of Nickel. An official said the paper loss stood at $8 billion on Monday. It was followed by the London Metal Exchange suspended trading in the metal on Tuesday due to violent moves in nickel prices. The exchange said late Tuesday that it does not expect trading to resume until Friday. According to Chinese media outlets, Tsingshan lost $8 billion on Tuesday. "There have been some foreign moves," said Tsingshan's founder, Xiang Guangda, adding that the company is in active negotiations with relevant parties, though he didn't specify with whom and what was being discussed.

Nickel inventories in LME-registered warehouses have fallen to 75,012 tonnes, the lowest level since 2019, in recent days.

Also read: Ukraine crisis forced Porsche to pause production; vehicle deliveries to Russia also suspended