Belgian multinational Umicore is seeing strong demand for raw materials for battery production, spurred on by a resurgent electric vehicle (EV) market in China, according to comments by the company's chief executive in its 2020 full-year earnings call on Thursday February 11.
Lithium prices have started to recover while cobalt prices have rallied hard since the start of 2021, both driven by improved EV demand in the East Asian nation, which is the world's largest producer of battery-powered vehicles.
"The trend is favorable [and] cobalt demand [is] picking up," Umicore chief executive officer Marc Grynberg said during the call.
Despite this recovery, however, cathode production has some way to go before capacity is fully utilized.
"That being said, in China, significant [cathode] capacity was built in 2018, [on] very optimistic projections for continuous growth in electric vehicle [sales of] 50%+ per year in both 2020 and 2021. Unfortunately, this growth has not materialized," Grynberg said.
Growth of China's EV market has been held back by the
removal of government subsidies, which affected consumer demand. The first six months of 2020 showed negative growth in sales figures on a year-on-year basis.