Nickel loses market share in EV batteries as makers turn to lithium substitute

Nickel inventories in the Shanghai Metals Market are at March 2021 high at 10,847 tonnes.

Electric vehicle makers in China have started moving towards lithium ferrophosphate (LFP) batteries as nickel prices crash near an April 2021 low. LFP batteries, which do not use cobalt or nickel, are now commanding a nearly 60 percent market share.

Nickel is the worst performer across metals, crashing 7 percent in October and November. The metal has lost 45 percent in the London Metal Exchange (LME) and 36 percent in Shanghai, year-to-date.

Rising supplies and the Russia-Ukraine conflict have affected the metal with Indonesia heading towards a 70 percent global supply share in the next five years. Russia, which accounts for 10 percent of the global nickel production, has catalysed a rearrangement in the market supply chain amid ongoing conflict with neighbouring Ukraine.

Nickel inventories in the Shanghai Metals Market are at March 2021 high at 10,847 tonnes.