(Bloomberg) – Elon Musk has a plea for mining companies: “Please mine more nickel.”
“Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally friendly way,” Musk, chief executive of the electric car maker, said during a second-quarter earnings call.
Musk’s plea comes as one of Japan’s general trading giants is about to receive a payback of roughly $ 500 million on a nickel project in Madagascar due to low prices and the coronavirus pandemic.
Supplies of battery-grade nickel, a key component in an electric vehicle’s battery cathode, could run out as early as 2023. BloombergNEF expects a tight balance in the next two to three years as demand for batteries increases lithium ion.
Ambatovy, one of the world’s largest nickel projects, with total operating capacity representing 5% of global class 1 nickel production capacity, has not resumed operations after being suspended in March 2020. A Prolonged suspension will exacerbate potential stress on the nickel market.
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