THE world’s biggest miners, including BHP Group and Glencore Plc, are finally firm believers in the electric vehicle (EV) battery revolution — what they don’t agree on is which metals will deliver the best long-term exposure to the developing global market.

BHP has revived a declining nickel unit in Western Australia to target the sector, while Rio Tinto Group is accelerating work to enter the lithium market. Glencore is focusing on cobalt and copper and Anglo American Plc is examining prospects for platinum and palladium to be deployed in future battery technologies.

“We did a review of all the battery input materials — nickel, cobalt, lithium,” said Eduard Haegel, asset president at the BHP’s Nickel West unit. “We think that in the medium-to-longer term, there will be a margin that will be sticky for nickel — we think it’s an attractive commodity.”

BHP, the biggest miner, this year reversed long-term efforts to seek a buyer for the division, opting to retain Nickel West to benefit from forecast growth in lithium-ion batteries and a scarcity of high-quality nickel supply.

From the second quarter of 2020, the unit will begin production of bright-turquoise colored nickel sulphate — a premium raw material for the battery supply chain — from a nickel refinery south of Perth, with plans to potentially carry out the industry’s largest expansion.

The outlook for battery materials is firming as governments set targets on phasing out combustion engine vehicles, and as automakers commit to expanding line-ups of electric models, according to Angela Durrant, a Sydney-based principal analyst at Wood Mackenzie Ltd. “The demand profile is certainly becoming more clear,” she said.

Deployment of more than 140 million electric vehicles by 2030 will require 3 million tons more copper a year, 1.3 million tons of nickel and about 263,000 tons of cobalt, according to Glencore Plc’s forecasts. By 2040, almost 60 percent of new vehicle sales and about a third of cars on the road will be electric.

BHP sees an abundant global supply of lithium, and regards cobalt as at risk of substitution, reducing the attractiveness of both commodities, chief financial officer Peter Beaven said in a May speech. Rio also remains wary over cobalt, while Glencore CEO Ivan Glasenberg said in 2017 the company has “zero interest” in lithium, in part because of a lack of arbitrage opportunities.

Picking winners hasn’t been helped by price gyrations. Key battery metals have faltered in the past year after dramatic gains. That’s chiefly been on concern that incumbents and new producers have added too much volume too quickly, as well as on short-term worries over a slower pace of growth in China’s electric vehicle market, the world’s largest.(SD-Agencies)