Battery metals recycling is expected to begin scaling up by 2025 but will not alleviate tightening raw material supply until the late 2020s.
Recycled lithium is expected to account for 3-4pc of global lithium supply by 2025 and to rise rapidly from there. Battery recycler Umicore expects growth by 2025 in battery recycling, and German battery materials maker BASF predicts that recycling will reach scale in the sector within a decade. VW Group expects "large quantities of battery returns" by the end of the 2020s.
Rapid growth in electric vehicle (EV) manufacturing by 2025 is expected to cause shortages in supply of cobalt in particular. A JP Morgan report last year forecast a tightening of cobalt supply as early as 2023, despite an expected shift towards battery chemistries with lower cobalt content and its below-consensus prediction for EV penetration growth. "Recycling can help alleviate some of the tightness, although we do not expect meaningful volumes in the near term," the report said.
At this stage, too few EVs are reaching the end of their life cyle to provide the scrap volume for large-scale recycling. Recycled portable electronics still provide most of the volume.
Umicore has a pilot plant in Hoboken, Belgium, which can recycle up to 7,000 t/yr of lithium batteries to extract lithium, cobalt, nickel, copper and rare earths. The company plans to scale up as EV recycling rises to higher volumes, but has not yet decided on a location.
Belgium-based metals producer and recycler Umicore has been working towards a complete European supply chain for EVs. Last October, the company signed agreements with BMW and Audi (part of VW) to supply recycled battery materials.
BMW will produce EVs using batteries made by Northvolt in Gdansk, Poland, starting later this year. From next year Swedish lithium battery developer Northvolt will use its own lithium cells, made at its planned Gigafactory in Skelleftea, Sweden. Umicore will complete the chain by supplying materials to Northvolt.
Umicore has agreed to work with Audi towards closed-loop recycling in EVs. Audi has demonstrated in lab tests that 95pc of battery metals are recoverable from its EV batteries.
Carmakers too will start to recycle EV batteries. VW plans to open a pilot recycling plant in 2020 in Salzgitter, Germany with capacity of 1,200 t/yr. The company aims to ultimately recycle 97pc of all battery raw materials, up from 53pc.
