The difficulty lies in creating new mines to utilise those reserves. For cobalt, over 7.6 million tons of reserves have been identified, with the DRC, Australia, and Indonesia as the top three locations. According to USGS data, Indonesia, Australia, and Brazil have the biggest reserves in nickel, with an estimated global reserve of more than 95 million tons being identified. There is no lack of reserves for most of these minerals. “The data shows a looming mismatch between the world’s strengthened climate ambitions and the availability of critical minerals that are essential to realising those ambitions,” said Fatih Birol, executive director of the IEA, in a press release. In May 2021, the International Energy Agency (IEA) released a report expressing their concerns about the future security of minerals essential for the energy transition, such as minerals for EVs. The challenge for the mining industry is keeping up with this demand. Before the Russian invasion of Ukraine and rising tensions between the two countries, prices of transition minerals were already rising due to an increase in demand. However, there are limitations to the supply in the short term. Indonesia and the Philippines are the other big producers of nickel, with more than 30% and 13% of production respectively. Data from the United States Geological Survey (USGS) for example, shows that other than Russia, the Democratic Republic of the Congo (DRC) and Australia were the other top producers of cobalt, with 69% and 4% of total global production respectively. It would be possible to get the supply of nickel and cobalt from countries other than Russia. Russia is the world’s second-largest cobalt producer, responsible for more than 6% of global cobalt production, as well as the third-largest nickel producer, with over 11% of global production. This makes the supply chain vulnerable to disruptions and price volatility. Minerals such as lithium, nickel, and cobalt are produced in just a handful of countries – more than half of the supply of each mineral comes from the top 3 producing countries. The growing demand for the minerals needed in the batteries poses a challenge for the mining sector. In 2019, that was still 24.9 GWh/year, an increase of 110%. According to the IEA, the demand for EV batteries in Europe was 52.4 GWh/year in 2020. With the demand for EVs rising, so does the demand for batteries and transition minerals. That number is expected to only rise as a result of many nations setting targets to phase out fossil fuel cars in the next decades. With total global electric car sales of 6.6 million, EVs sales made up almost 9% of the global car market. While sales stagnated in 2021, 2.3 million registrations were still added to the EV stock last year. In 20, sales went up 142% compared to the year before. Sales in Europe hit a record increase in 2020, overtaking China as the region with the highest registrations. In the last few years, EV sales have been booming.
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