Graphite is expected to become the next major bottleneck in the production of battery packs for electric vehicles (EVs), as experts in the field fear that the supply of the raw material will be short of demand in the next couple of years. The situation is expected to worsen as the demand still has room to spike higher, and some industry players are already experiencing tightness.
Graphite is a carbon-based mineral used in pencils, lubricants, brake pads, and as an additive in steel alloys. Its high conductivity makes it especially valuable in electronic products like solar panels and EV batteries. In the latter, it plays the role of the anode, which is the electrode through which current exits in the form of a positive charge. On the other hand, lithium is used for the cathode, which is the generator of the ions.
As such, graphite is a crucial material for the EV industry boom, and any shortage of it threatens to derail its steady growth. Currently, the problem doesn’t lie in the scarcity of the material itself, but rather in a.) the projected astronomical demand rise and b.) the limited locations of the available resource.
Starting with the former, the market demand for EVs has reached approximately 11,000,000 cars for 2022, each of which needs, on average, 75 kg of natural graphite. The production currently stands at 785,000 tonnes, so in 2022, we already have 40,000 tonnes of graphite deficit. China produces about 80% of this and could potentially ramp up this production to 915,000 tonnes by 2025, but this won’t be enough to cover the demand, which in the meantime, is only going to grow.
Untouched graphite deposits are also available in Africa, North and South America, but there are currently no processing units in these locations, and it’s doubtful the amounts are enough to justify the investment. As such, the only possible solution is to use alternative materials for the anode, like, for example, silicon.
