6 ms·

> Perhaps we will, given the ramping production, but if they don't move more or less in step, prices could be somewhat stubborn There's somewhere in the range

> Perhaps we will, given the ramping production, but if they don't move more or less in step, prices could be somewhat stubborn There's somewhere in the range of 35-50 gigawatt-hours (GWh) of annual lithium ion battery production capacity at existing manufacturing facilities worldwide right now. By 2020, under three years from now, that will triple or quadruple to 150-200 GWh, based on new factories that have broken ground or money already committed to expansion from BYD (20 GWh), Boston Power (10 GWh), LG Chem (7 GWh), CATL (50 GWh), Panasonic/Tesla (35-50 GWh), Foxconn (15 GWh), Samsung SDI, SK Innovation, and others. Given how long it takes auto manufacturers to take new cars to market and grow their sales (years) and how few are actually far along enough to hit the market in the next year or two, I don't think the supply side of the battery market will have any trouble keeping up with demand. It may even be too much, lowering prices.

monkmartinez 9y ago
Wait until the "OPEC" of lithium emerges from the coming price wars... If you don't think that will happen, I have some land in Yuma, Beach front.
- pg_bot 9y ago
  Cartels are unstable by their nature, OPEC is the exception not the rule. Cartels can only thrive when there is a lack of competition and strong enforcement between member nations. There is a reason why we don't hear of coal or natural gas cartels which are substitute goods for oil.
  - cirgue 9y ago
    Even OPEC is not much of an exception: they've only occassionally been effective at coordinating outputs, and supply dynamics typically overwhelm OPECs ability to respond.
    - Kadin 9y ago
      OPEC is definitely an exception in that it stayed together even though there are multiple times when it wasn't clearly in any of the members' economic best interests to participate or maintain the cartel's supply control. This is pretty obviously because it's a political rather than economic organization: the member states have political reasons for wanting to remain in control of the supply which probably exceed the rational reasons for pursuing revenue maximization. It seems unlikely that the countries with significant lithium reserves have enough in common politically, to maintain a similar cartel. Not that some might not try. But they will also have to deal with the fact that OPEC did it first, and major powers may be unlikely to allow that to be repeated.
      - foota 9y ago
        OPEC may exist as an organization but its members generally don't abide by quotas.
- hwillis 9y ago
  Highly unlikely. Lithium is one of the cheapest and easily-supplied materials required. By some measures a larger percentage of world cobalt production is used for batteries than lithium. Lithium and cobalt are both in high supply in almost all countries, unlike oil.
  - oasisbob 9y ago
    If lithium is abundant in so many countries, why is it mined in so few? Compare: https://en.wikipedia.org/wiki/List_of_countries_by_lithium_production https://en.wikipedia.org/wiki/List_of_countries_by_lithium_p... https://en.wikipedia.org/wiki/List_of_countries_by_oil_production https://en.wikipedia.org/wiki/List_of_countries_by_oil_produ...
    - hwillis 9y ago
      Wikipedia isnt exhaustive but the real reason is that hard rock deposits, primarily spodumene, are only economical at high volumes. Spodumene is present basically everywhere hard rocks are. Lithium brine, which makes up almost all of all current battery lithium, exists almost totally in three countries.
      - stale2002 9y ago
        Well, ok, but that contradicts your statement that Lithium is available in almost all countries. It is only "available" in all countries if those countries want to pay an extremely high price, right?
        Tuna-Fish 9y ago
        "Extremely high" requires the qualification that it's only high in comparison to the current market price, but not high in the sense that it makes use in batteries uneconomical. Currently, a very small proportion of the cost of the battery is lithium. As battery production increases, the market price of lithium will go up, potentially by several times. This will make spodumene deposits economical to extract, but it will not have a meaningful effect on the cost of the batteries. The preliminary work to open these deposits for extraction has started in many countries, for example the Keliber project in Finland is currently undergoing the environmental effect study. http://keliber.fi/ http://keliber.fi/
- tuna-piano 9y ago
  How many industries industries are currently controlled by cartels? Maybe OPEC in oil and DeBeers in diamonds. But even in those cases, the cartels still have limited overall effects. OPEC has trouble policing its members, and DeBeers has competition. Why do you think that lithium producers will be able to form a cartel, when almost no one else can?
- megablast 9y ago
  > If you don't think that will happen, I have some land in Yuma, Beach front. Talk is cheap, and staying stuff like this makes you just look foolish.
kbaker 9y ago
The Lithium-ion battery market has already hit PCB manufacturers, by taking up copper foil used in printed circuit boards. http://globalsmtseasia.com/industry_news/copper-crisis-looms-for-the-pcb-industry/ http://globalsmtseasia.com/industry_news/copper-crisis-looms...
- Retric 9y ago
  "The problem is not that there is not enough copper in the world, but its conversion to copper foil that is the problem." That's only ever going to be a very short term problem.
codecamper 9y ago
What's a good company to invest in here? Panasonic? Trouble is that lithium batteries are a drop & their bucket. BYD? (I thought BYD was just LiFePo4. better for storage not so much for cars. Though they make busses.)
- sunflowerfly 9y ago
  Some believe Tesla is properly described as a battery company instead of a car company. Their valuation is high for current sales though, obviously investors are buying on growth potential. Regretting selling my shares.
- yardie 9y ago
  Our experience with LiFePo4 is they are slightly cheaper at the cost of performance. If batteries make up the bulk of the cost of a BEV they would probably be the best choice for general fleet vehicles.
- greglindahl 9y ago
  BYD also makes cars. You can buy this one in the US https://en.wikipedia.org/wiki/BYD_e6 https://en.wikipedia.org/wiki/BYD_e6 and it was apparently the best-selling EV model in China in 2016. Stanford owns some of their buses.

monkmartinez 9y ago

Wait until the "OPEC" of lithium emerges from the coming price wars... If you don't think that will happen, I have some land in Yuma, Beach front.

pg_bot 9y ago
Cartels are unstable by their nature, OPEC is the exception not the rule. Cartels can only thrive when there is a lack of competition and strong enforcement between member nations. There is a reason why we don't hear of coal or natural gas cartels which are substitute goods for oil.
- cirgue 9y ago
  Even OPEC is not much of an exception: they've only occassionally been effective at coordinating outputs, and supply dynamics typically overwhelm OPECs ability to respond.
  - Kadin 9y ago
    OPEC is definitely an exception in that it stayed together even though there are multiple times when it wasn't clearly in any of the members' economic best interests to participate or maintain the cartel's supply control. This is pretty obviously because it's a political rather than economic organization: the member states have political reasons for wanting to remain in control of the supply which probably exceed the rational reasons for pursuing revenue maximization. It seems unlikely that the countries with significant lithium reserves have enough in common politically, to maintain a similar cartel. Not that some might not try. But they will also have to deal with the fact that OPEC did it first, and major powers may be unlikely to allow that to be repeated.
    - foota 9y ago
      OPEC may exist as an organization but its members generally don't abide by quotas.
hwillis 9y ago
Highly unlikely. Lithium is one of the cheapest and easily-supplied materials required. By some measures a larger percentage of world cobalt production is used for batteries than lithium. Lithium and cobalt are both in high supply in almost all countries, unlike oil.
- oasisbob 9y ago
  If lithium is abundant in so many countries, why is it mined in so few? Compare: https://en.wikipedia.org/wiki/List_of_countries_by_lithium_production https://en.wikipedia.org/wiki/List_of_countries_by_lithium_p... https://en.wikipedia.org/wiki/List_of_countries_by_oil_production https://en.wikipedia.org/wiki/List_of_countries_by_oil_produ...
  - hwillis 9y ago
    Wikipedia isnt exhaustive but the real reason is that hard rock deposits, primarily spodumene, are only economical at high volumes. Spodumene is present basically everywhere hard rocks are. Lithium brine, which makes up almost all of all current battery lithium, exists almost totally in three countries.
    - stale2002 9y ago
      Well, ok, but that contradicts your statement that Lithium is available in almost all countries. It is only "available" in all countries if those countries want to pay an extremely high price, right?
      - Tuna-Fish 9y ago
        "Extremely high" requires the qualification that it's only high in comparison to the current market price, but not high in the sense that it makes use in batteries uneconomical. Currently, a very small proportion of the cost of the battery is lithium. As battery production increases, the market price of lithium will go up, potentially by several times. This will make spodumene deposits economical to extract, but it will not have a meaningful effect on the cost of the batteries. The preliminary work to open these deposits for extraction has started in many countries, for example the Keliber project in Finland is currently undergoing the environmental effect study. http://keliber.fi/ http://keliber.fi/
tuna-piano 9y ago
How many industries industries are currently controlled by cartels? Maybe OPEC in oil and DeBeers in diamonds. But even in those cases, the cartels still have limited overall effects. OPEC has trouble policing its members, and DeBeers has competition. Why do you think that lithium producers will be able to form a cartel, when almost no one else can?
megablast 9y ago
> If you don't think that will happen, I have some land in Yuma, Beach front. Talk is cheap, and staying stuff like this makes you just look foolish.

kbaker 9y ago

The Lithium-ion battery market has already hit PCB manufacturers, by taking up copper foil used in printed circuit boards. http://globalsmtseasia.com/industry_news/copper-crisis-looms-for-the-pcb-industry/ http://globalsmtseasia.com/industry_news/copper-crisis-looms...

Retric 9y ago
"The problem is not that there is not enough copper in the world, but its conversion to copper foil that is the problem." That's only ever going to be a very short term problem.

codecamper 9y ago

What's a good company to invest in here? Panasonic? Trouble is that lithium batteries are a drop & their bucket. BYD? (I thought BYD was just LiFePo4. better for storage not so much for cars. Though they make busses.)

sunflowerfly 9y ago
Some believe Tesla is properly described as a battery company instead of a car company. Their valuation is high for current sales though, obviously investors are buying on growth potential. Regretting selling my shares.
yardie 9y ago
Our experience with LiFePo4 is they are slightly cheaper at the cost of performance. If batteries make up the bulk of the cost of a BEV they would probably be the best choice for general fleet vehicles.
greglindahl 9y ago
BYD also makes cars. You can buy this one in the US https://en.wikipedia.org/wiki/BYD_e6 https://en.wikipedia.org/wiki/BYD_e6 and it was apparently the best-selling EV model in China in 2016. Stanford owns some of their buses.