Electric vehicles: Africa’s battery minerals and GVC opportunities (1)

African countries are not yet significant participants in the global value chain (GVC) of electric vehicles (EVs). A major component of an electric vehicle is the lithium-ion battery (LIB) that powers it. An electric vehicle’s battery pack makes up a third to half its total cost. And the constituent battery cells constitute about 60-80 percent of the cost of the battery pack, with the battery shells, other battery modules, battery management system, on-board charger, and DC/DC converter constituting the remainder. Cell costs are roughly divided into two halves between raw materials and manufacturing, however (TIPS, 2021).

Key LIB minerals are available in ample quantities in South Africa (manganese, nickel & platinum), Democratic Republic of Congo (cobalt), Zimbabwe (lithium), Mozambique (graphite) and Zambia (copper). Most Chinese firms currently mine these important battery minerals on the African continent. More value-adding and job-creating activities in the LIB GVC (smelting and refining, precursor production, cell production, cell assembly, and EV production) take place elsewhere, however. African countries could participate more. The Southern African Development Community (SADC), perhaps the only region at the moment, which could forward integrate farthest and quick enough along the LIB GVC, has put plans in motion towards this goal.

The article addresses the following questions: (1) How feasible is it for mineral-producing African countries to forward integrate along the LIB GVC? (2) How can partner countries and firms, especially Chinese and Singaporean ones, facilitate this greater beneficiation objective? (3) What should African governments do to encourage the mostly Chinese LIB minerals miners towards greater beneficiation on the continent?

Read Also: Nigeria missing from electric vehicles value chain despite mineral deposits

Electric vehicles

What is Africa’s current position in the LIB GVC?

According to the International Energy Agency (IEA), demand for minerals critical to the energy transition to renewables could increase by as much as six times by 2040. With the African Continental Free Trade Agreement (AfCFTA), a regional LIB GVC involving the DRC and SADC countries could be globally competitive. The value-add of the downstream stages of the LIB GVC is exponentially higher than the upstream mining and refining stages. African countries can aspire to not only the beneficiation stages, but also the precursor production and cell production stages, and ultimately cell assembly.

A significant amount of the global reserves of crucial minerals for the batteries of electric vehicles are in Africa; especially in the Democratic Republic of Congo, Zimbabwe, Mozambique, Zambia and South Africa. Naturally, the subject African countries want a greater portion of the pie. At the moment, the plan, in the case of the DRC, at least, seems to be about apportioning more mining royalties to itself. A more important priority for African countries should be to incentivize mining firms towards doing more of the beneficiation in situ, like they do elsewhere outside the continent. To move forward with such an agenda, however, existing concerns may need to be addressed first. In this regard, the use of child labour for mining cobalt in the DRC is probably top of the list.

A lithium-ion battery consists of four key components: cathode, anode, electrolyte and seperator. The cathode consists of chemical materials that react with each other to generate an electric current. The most commonly used LIB cathode chemistry is Lithium Nickel Manganese Cobalt Oxide (NMC). Other LIB cathode chemistries are Lithium Cobalt Oxide (LCO), Lithium Manganese Oxide (LMO), Lithium Iron Phosphate (LFP) and Lithium Nickel Cobalt Aluminium Oxide (NCA). On the other hand, the anode, which facilitates the flow of the electric current generated by the cathode through an electric circuit, consists mostly of graphite. Lithium salts, mixed with solvents, are the commonly used electrolytes or conduction medium.

African countries can aspire to not only the beneficiation stages, but also the precursor production and cell production stages, and ultimately cell assembly.

Thus, amongst others, the key minerals that constitute a lithium-ion battery are lithium, cobalt, manganese, and natural graphite. The typical mining value chain for extracting these minerals consists principally of (1) mine initiation activities, (2) mineral extraction and beneficiation, and (3) refining and recycling. In most cases, however, beneficiation and refining take place outside the continent. We argue this should not be the case.

An edited version of this article was first published by Nanyang Business School’s NTU-SBF Centre for African Studies, Singapore. References, figures and tables are in the original article. See link viz.

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