Originally posted by the Voice of America. Voice of America content is produced by the Voice of America, a United States federal government-sponsored entity, and is in the public domain. How China Dominates Global Battery Supply Chain John Xie After years of planning, China now dominates the world's production of new generation batteries that are key to transitioning away from fossil fuels. These new batteries areessential forelectric vehiclesandmost portable consumer electronics such ascell phonesand laptops. By 2040, energy analysts estimate over half of all passenger vehicles soldworldwide couldbe electric, according to 2019 report by Bloomberg New Energy Finance.They expectasimilar percentage of light commercial vehicles in the U.S., Europe and China sales will be electric within that time, BNEF predicts. If current trends continue, most of them will likely use [1]Chinese batteries,a key element for transitioning away from fossil fuels, and most of those batteries will be lithium ion, which are also popular forcellphonesand laptops because of their high energy per unit mass relative to other electrical energy storage systems, according to the [2]U.S. Department of Energy. "Looking at the global automotive industry chain, China, for the first time, has taken the lead in the world in the manufacturing of key parts,"state media Xinhuasaid in Augustin a report titled "China's dominant position in batteries needs to be further consolidated." Switching from oil As the United States and China face off over advanced communication technologies like 5G, the world's battery supply is not yet a major issue. But it will likely grow in importance if the U.S. continues to [3]transition away from fossil fuel energy sourcesfor items such as vehicles, power grids,mobile phones and laptop computers. And that could make the global battery supply an issue of national security. For nearly half a century, American politicians have sought to protect the country from disruptions caused by foreign oilproducers. "All of our national security decisions were set against the backdrop of what they might mean to our energy security, following the 1973 Yom Kippur war when Egypt and Syria invaded Israel and the Arab nations cut off supplies to the US and allies who helped Israel." Dan Kish, senior vice president for policy at the American Energy Alliance, a not-for-profit energy advocacy organization, told VOA. In2019, theU.S. achieved its long-held goal of energy independence" producing enough oil and gas for its domestic needs. The achievement points to the challenge of controlling the raw materials that will power the world's next energy revolution. According to the U.S. Geological Survey(USGS), last year the U.S. imported 78% of its [4]cobalt,andall ofits[5]graphite. For the foreseeable future, the country will likely need to depend on Chinese supply chains to produce the batteries that help power America's economy. Graphite,cobalt,lithium According to data released from Benchmark Mineral Intelligence, a London-based research firm for thelithium-ionbattery industry, in 2019, Chinese chemical companies accounted for 80% oftheworld's total output of raw materials for advanced batteries. "Of the 136lithium-ionbattery plants in the pipeline to 2029, 101 are based in China," [6]the firm saidin May. "China controls the processing of pretty much all the critical minerals, whether it's rare earth, lithium, cobaltor graphite,"Pini Althaus, the chief executive of [7]USA RareEarth, saidin a telephone interview with VOA. A little-known Chinese company that was founded in 2011 is now the world's biggest maker of electric vehicle batteries. For three consecutive years ending in 2019,South Korea's market tracker SNE Research has rankedChina's ContemporaryAmperexTechnology Co.Ltd.([8]CATL)asNo. 1in the electric vehicle battery production,with a 27.9% market share.CATLmakes electric-car batteries for Tesla. CATLhairmanZeng Yuquntold [9]Bloomberglast month that they have developed a power pack that lasts more than a million miles. Among their top customers are Daimler AG, BMW andToyota. Battery supply chain China has focused on building capacity at every stage of the battery supply chain. In addition to rare earths, the manufacturing of lithium-ion batteries depends on some key materials like graphite, the material used in pencil tips.In2019,China produced more than 60% of the world's graphite, according to [10]U.S. governmentresearch.That meansBeijingcanset world prices. "This is a completely untenable situation," said Althaus, whose company has a pilot projectin Coloradowith the goal ofproducingafull range of rare earths as well as lithium. He said that it could take the U.S. 20 to 30 years to catch upwithChina. "It does not matter whether it is China or any other country. It is very dangerous if the world only depends on one country to provide key raw materials. Africancobalt, Chinese factories Cobalt has emerged as one of the hottest commodities in the new energy revolution because it is widely used in electric vehicles as well as computer and consumer electronics.But unlikegraphite, which China has significant natural reserves, the country's cobalt reserves accounts for only about 1% of the world's total.The Democratic Republic of the Congo (DRC)producesmore than 60% oftheworld's mined cobalt. But Beijing controlsthe global supply of this [11]silvery-blue metal. According to a [12]working paper published last year by the Organisation for Economic Co-operation and Development (OECD),eight of the 14 largest cobalt mines in the DRC are Chinese-ownedandaccountfor almost half of the country's output. DRC mining ownershipwas not always controlled by China.For example,thelargest mine in DRC, the TenkeFungurumeMine where cobalt is a by-product of its copper mining, was owned by an American companyuntil2016.That year,for $2.65 billion, [13]Freeport-McMoRan Inc.,a leading international mining company with headquarters in Phoenix, Arizona,soldits[14]mine toChina Molybdenum. China's influence dominates cobalt processing withChinese companiescontrollingabout 80% of the cobalt refining industry, where it is turned into commercial-grade cobalt metal and power, according to [15]Benchmark Minerals. Worldlithiumreserves China is among the five top countries with the most lithium resources, according tothe [16]2020USGS, butit has been buyingstakes in mining operations in Australia and South America where most of the world's lithium reserves are found. China's [17]Tianqi Lithiumnow owns 51% of the world's largest lithium reserve, [18]Australia's Greenbusheslithium mine.In 2018, thesame company also paid about $4 billion to become the second-largest shareholder in [19]SociedadQuĂmicay Minera (SQM), the largest lithium producer in Chile. Another Chinese company,GanfengLithium, now has a long-term agreement to underwrite all lithium raw materials produced by [20]Australia's Mount Marion mine,the world's second-biggest,high-grade lithium reserve. References 1. https://www.mining.com/chart-chinas-stranglehold-on-electric-car-battery-supply-chain/ 2. https://afdc.energy.gov/vehicles/electric_batteries.html 3. https://www.benchmarkminerals.com/membership/china-controls-sway-of-electric-vehicle-power-through-battery-chemicals-cathode-and-anode-production/ 4. https://pubs.usgs.gov/periodicals/mcs2020/mcs2020-cobalt.pdf 5. https://pubs.usgs.gov/periodicals/mcs2020/mcs2020-graphite.pdf 6. https://www.benchmarkminerals.com/membership/china-controls-sway-of-electric-vehicle-power-through-battery-chemicals-cathode-and-anode-production/ 7. http://usarareearth.com/ 8. https://www.catlbattery.com/en/ 9. https://www.bloomberg.com/news/articles/2020-06-07/a-million-mile-battery-from-china-could-power-your-electric-car 10. https://pubs.usgs.gov/periodicals/mcs2020/mcs2020-graphite.pdf 11. https://www.bloomberg.com/graphics/2018-china-cobalt/ 12. https://mneguidelines.oecd.org/Interconnected-supply-chains-a-comprehensive-look-at-due-diligence-challenges-and-opportunities-sourcing-cobalt-and-copper-from-the-DRC.pdf 13. https://www.fcx.com/about 14. https://www.mining.com/freeport-sells-prized-african-copper-mine/ 15. https://www.benchmarkminerals.com/membership/china-controls-sway-of-electric-vehicle-power-through-battery-chemicals-cathode-and-anode-production/ 16. https://www.usgs.gov/media/images/mineral-commodity-summaries-2020-cover 17. http://en.tianqilithium.com/ 18. https://www.nsenergybusiness.com/features/greenbushes-lithium-mine-australia/ 19. https://www.fuelsandlubes.com/tianqi-lithiums-purchase-of-sqm-shares-would-make-chinese-firm-worlds-largest-producer-of-lithium/ 20. https://news.metal.com/newscontent/100913083/[smm-express]-the-sale-of-shares-in-the-australian-mine-involves-57000-tons-of-lithium-concentrate-ganfeng-lithium-industry-to-obtain-half-of-the-shares/ .