Australia set to move on lithium battery opportunity
The Australian Government looks ready to play a part in helping the country capitalise on its potential as a manufacturer of lithium-ion batteries.
Western Australia now has seven producing lithium mines after Altura Mining opened its Pilgangoora operation in the Pilbara during September.
The state accounts for around half of global lithium supply, guided by the Greenbushes mine in the South West region, the world’s largest operation.
Despite dominating this part of the supply chain, plans to use local lithium for battery manufacturing purposes have been limited.
The Australian Government has, however, indicated it will now help to maximise this potential as a lithium-ion battery manufacturer.
Trade, Tourism and Investment Minister Simon Birmingham, who this week launched Austrade’s Lithium-ion Battery Value Chain strategy, said Australia was well positioned to become a world leader in this developing market.
“Lithium-ion battery technology has enabled the mobile device revolution and is driving innovation and a global shift in energy storage solutions,” Birmingham said.
“At the moment Australia produces about half of the world’s lithium, but once it’s mined out of the ground, it’s shipped offshore, with all of the value-creation activities such as processing and battery manufacturing occurring overseas.”
Birmingham said the government’s ambition was to drive enhanced investment across the value chain of commodities like lithium.
He believes now is the time to accelerate the development of a high-tech lithium manufacturing sector in “our own backyard.”
“Through Austrade’s resources team we are ramping up our activities overseas to attract investment and highlight our significant comparative advantage such as our strong economic conditions, skilled workforce and well-established resources infrastructure network,” Birmingham said.
Australia’s resources industry has urged the government to take action on this opportunity as the development of the local lithium sector has progressed.
Association of Mining and Exploration Companies chief executive Warren Pearce warned in October that there was a “window of roughly two years” before the global lithium supply chain would begin to settle.
“Australia has all of the minerals that are needed to manufacture lithium rechargeable batteries and a series of competitive advantages that we can capitalise on to step our way down the value chain,” Pearce told Australian Mining at the time.
The report questions the potential of lithium-ion battery manufacturing becoming a missed opportunity for Australia, noting that the country has “unparalleled access to the essential mineral element inputs” to support the supply chain.
Australia also has “some expected cost advantages” over other lithium-ion battery producers, according to the report.
For example, the report cites McKinsey and Roskill figures that suggest it is at least 10 per cent cheaper to convert spodumene (which is mined in Western Australia) to lithium hydroxide than the brine mined in South America.
The report also backs the expertise of the Australian mining sector, local infrastructure, the highly developed workforce and skills, support for innovation, and strong safety and environmental practices as key drivers for a lithium-ion manufacturing sector.
Resources Minister Matt Canavan said it was time Australia took advantage of the booming lithium industry.
“Lithium prices have tripled since 2010 and global battery consumption is predicted to increase five-fold in the next 10 years, driven by a global shift to electric vehicles in some markets and off-grid storage to support renewable energy development,” Canavan said.
“As the world’s largest producer of lithium and with mineral reserves covering 90 per cent of the elements required in lithium-ion battery production, we have an enormous opportunity to leverage of this rapidly-growing industry.”