Demand for Battery Materials Skyrockets as Net-Zero Emission Goals Penetrate Australian Industries

The IEA recently released its global energy outlook model to reveal the expected market growth of minerals to meet the Sustainability Development Scenario (SDS) in 2040. The sectors most likely to be impacted by the anticipated shift to clean energy are Commercial, Residential, and Transportation.
Currently, Australia accounts for about 25% of lithium ore reserves globally. This is a promising opportunity for the country’s economy as the lithium market is expected to grow 42 times to meet the goals of the SDS.
A market research by Thomson Reuters named Australia as a major exporter of key minerals in battery materials production. In fact, the Western Australian government has invested a significant amount of money in the last five years in the field.
Stock exchange data reveals that the investment rate of the country is not even remotely close to slowing down, especially with government policies catalyzing the transition of the country towards a green future.
In June 2020, 55 public stock offerings were admitted at the Australian Stock Exchange (ASX), and roughly 74% of these were under the global Metals and Mining industry classification standard. 21 offerings were found to be linked to exploration and/or transition to clean energy and the goal of net-zero emissions.
An analysis by Renew Economy Australia showed that strategic trade alliances, especially with North America, are a vital element in securing the country’s position as an important major distributor of highly valued minerals during the critical energy transition.
For instance, the Australian mining company Koba Resources Ltd. – a major player in the cobalt industry – highlighted its goal to align with America’s Clean Energy Plan led by President Biden’s administration
BHP, a global supplier of copper, is currently the leading Australian firm in building strategic investments in North America, investing around US$ 2.46 billion for the expansion of Spence Growth Option with the objective to improve ore throughput without compromising the lifespan of the mine.
On the other hand, Allkem – one of the most diverse lithium suppliers – has also invested in other countries like Canada because of the hard-rock lithium pipeline which serves the upstream production of lithium not only in North America but also in Europe.
Apart from public stock offerings, the mergers and acquisitions (M&A) market also reflects signs that prioritize the transition to green energy of various industry sectors across Australia.
Collaborative partnerships among companies show the strong interest of maximizing all possible resources to protect the stability of the mining industry in light of the rapidly increasing demand for materials needed for the energy transition.
Significant developments in this movement include the merger between Kirkland Lake Gold Ltd. and Agnico Eagle Mines Ltd., a gold mining company with operations in Canada, Finland, and Mexico apart from Australia. This partnership was sparked by the goal of becoming the leading firm in terms of energy performance by reducing greenhouse gas emissions significantly during operations.
Another bold move in the M&A space is the collaboration of IGO Nickel Holdings Pty. Ltd. And Western Areas Ltd. with the hope of exploring more products that are useful for promoting clean energy in the mining industry and achieving net-zero emissions in the near future.
Meanwhile, the Department of Industry of Australia has taken note of these market drivers and paid attention to IEA’s forecast of higher demand in the production of value-added minerals for battery production. This has been brought about by a surge of developments in electric vehicles (EVs) that require sufficient battery storage.
Both the public and the private sector contributed to making Australia home to 9 of the 50 currently leading mineral projects worldwide.
As the mining industry adapts to the priority of decarbonization across various industry sectors, Australian mining companies are evidently put in an advantageous position to make use of the value-added supplies currently available.
This is certainly an avenue which will allow the country to meet investment opportunities when stakeholders realize the stability of the country as a trusted battery materials supplier.