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Excerpt from July 30, 2020 BMO Metals Brief:

Cobalt hydroxide payables cif China increased to 74.5% this week, according to FastmarketsMB, up from 66.0% last month and now at a new high since the assessment began in January 2019. The increase is due to shipping delays from South Africa as well as low stocks across China. There is also speculation that the Chinese government may begin stockpiling material. The cobalt hydroxide price is tied to the European metal price, which has dropped over the same period, down ~3% m/m, given continued weakness across the western world’s super alloys sector. Meanwhile, Chinese prices for cobalt salts, including tetroxide and sulphate, have surged, up 12% m/m and 9% m/m respectively, and while this is likely due to supply shortages, we have also seen a mild recovery across the Chinese battery sector, both for NCM (auto) and LCO (consumer electronics). Back in May, we flagged that there was likely >3 months of hydroxide inventory in China after late-2019 restocking, and stocks will be much lower now. Chinese consumer demand has not fully recovered as of yet, seen in the 2Q20 China EV sales data, but we caution that EV sales are typically heavily skewed towards the end of the year.

 
Cobalt
 
Metal Bulletin - July 30, 2020
Prices for cobalt salts, including cobalt tetroxide and sulfate, surged in the first half of this week, with suppliers refraining from ...
large tonnages in the market. Fastmarkets’ price assessment for cobalt tetroxide 72.6% Co min, delivered China ...

Prices for cobalt salts, including cobalt tetroxide and sulfate, surged in the first half of this week, with suppliers refraining from offering large tonnages in the market. Fastmarkets' price assessment for cobalt tetroxide 72.6% Co min, delivered China was 190,000-195,000 yuan ($27,125-27,839) per tonne on Wednesday July 29, up by 10,000 yuan per tonne (5.5%) from 180,000-185,000 yuan per tonne on July 24. This marks the biggest increase between consecutive assessments since mid-January….Further downstream, demand remains healthy along the supply chain for lithium cobalt oxide (LCO) batteries used in consumer electronics, which has contributed to larger price gains in cobalt tetroxide compared with sulfate…"The LCO supply chain is experiencing a peak in consumption," a third consumer said…Meanwhile, demand for nickel-cobalt-manganese (NCM) lithium-ion batteries, which are used in electric vehicles, has also improved in July compared with the previous two months, according to market sources.

 
BNN Bloomberg - July 29, 2020
Chief Executive Officer Elon Musk urged miners to boost supply of the critical battery metal. Musk, who sells <...

Metals and mining are a critical part of the future of clean energy, and that’s triggering major shifts in a historically dirty industry. Mined materials such as nickel, cobalt, copper, lithium, gold and rare earths are an integral part of wind turbines as well as electric grids and vehicles. They even power some of the digital technologies allowing many people to work from home. But could these products of mining ever be as sustainable as the clean energy industries they help power?... Musk, who sells electric cars to some of the most sustainably-minded consumers out there, specifically asked for efficiently-mined nickel due to challenges in sustainable sourcing…“The electric vehicle chain, and broader market in general, is crying out for zero-carbon product,” Canada Nickel CEO Mark Selby told Bloomberg. That’s also the case for dozens of other critical metals and minerals, which raises questions about how companies selling clean products source sustainably mined products — or what sustainable mining even means. “I’ve never heard of a company saying here’s where we paid more for sustainable materials and why,” said James Lipinsky…“The consumer does care very much about sustainability when they are buying an iPhone or electric vehicle, but in all these cases the decisions are made deep in the supply chain and they are really relying on how responsible corporate America is.”Corporate procurement departments haven’t been as focused on sustainable mining as they have been on recyclable plastic, he said, adding that will need to change. “Historically, mining is a dirty word, but if we want to replace internal combustion engines with electric vehicles, sustainable mining is critical to our future,” Lipinsky said.

 
Business Wire - July 29, 2020
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growth of electric vehicle demand expected in the coming years. Cobalt, in particular, is a key component of rechargeable...

“We expect to build on this momentum through the end of the year and forecast producing between 32,000 and 33,000 tonnes of finished nickel and between 3,300 and 3,400 tonnes of finished cobalt on a 100% basis for 2020 in line with our original guidance for the year.”

 
 
EVs & Energy Storage
 
Reuters - July 30, 2020
TOKYO (Reuters) - Panasonic Corp (6752.T) plans to boost the energy density of “2170” battery cells it supplies to Tesla Inc (TSLA.O) by 20...
in top producer the Democratic Republic of Congo. Tesla CEO Elon Musk has long said he wants to move to zero-cobalt ...

Panasonic Corp plans to boost the energy density of “2170” battery cells it supplies to Tesla Inc by 20% in five years and commercialize a cobalt-free version “in two to three years”, the head of its U.S. EV battery business said…Panasonic introduced the “2170” lithium-ion cells, with the nickel-cobalt-aluminium (NCA) cathode chemistry, for Tesla’s Model 3 in 2017. Researchers say it already has the highest energy density at above 700 watt-hour per litre…Panasonic has already cut cobalt content to under 5% in the NCA cathode and plans to improve its batteries in stages, its U.S. EV battery chief Yasuaki Takamoto told Reuters…According to Takamoto, the average density of LFP battery cells is less than half the level of Panasonic’s latest NCA batteries. He did not name any companies…Panasonic has already developed technologies resulting in a more than 5% increase in the energy density of “2170” cells. From September, the firm will start converting lines at its factory in Nevada that it operates with Tesla as it prepares to further boost the energy density of the cells, Takamoto said…To control safety risks associated with higher density and less cobalt, Panasonic is adjusting the composition and design for better thermal stability, Takamoto said…He also noted there will be various battery requirements coming into play as EV usage diversifies…Tesla’s Musk has promised to reveal significant battery advances during a “Battery Day” presentation scheduled for Sept 22. Tesla plans to introduce an EV battery that will last one million miles later this year or early next, which it jointly developed with CATL.

 
Yahoo Finance UK - July 30, 2020
(Bloomberg) -- Power companies are loaning out Teslas in Washington, electrifying bus fleets in Virginia and lobbying for electric vehicle ...
to BloombergNEF projections, 10% of electric demand will come from electric vehicles by 2040. Electric

Power companies are loaning out Teslas in Washington, electrifying bus fleets in Virginia and lobbying for electric vehicle tax credits on Capitol Hill…San Diego Gas & Electric Co. even went so far as to help train salespeople on how to convince consumers to buy electric cars and then paid them as much as $500 per sale. It’s all part of a $1.5 billion effort by utilities such as Exelon Corp. and Dominion Energy Inc. to promote vehicles that run on electricity…The companies see it not just as a chance to sell more power, but to balance electricity demand and meet sustainability goals, said Max Baumhefner, a senior attorney with the Natural Resources Defense Council…“The grid is built for the one hour of the year when electricity demand peaks,” Baumhefner said. Pushing energy consumption to after hours, when many drivers charge their cars at home, helps smooth out the swings in usage and could even reduce power costs for everyone, he said…But some aspects of the industry’s campaign — such as lobbying for tax credits or against President Donald Trump’s rollback of efficiency standards — put the companies at odds with powerful oil interests. Half of U.S. oil demand is for gasoline…Electric and plug-in hybrid vehicles are a threat to that, even if they currently account for about 1.4 million, or 0.7%, of the vehicles on U.S. roads. Within five years, BloombergNEF predicts they will represent as many as 7% of U.S. car sales due to declining battery costs and a growing number of options…An Exelon startup called EZ-EV has helped motorists take test drives, calculate mileage needs and winnow down options — then score discounts at local dealerships. And motorists who sign up for a monthly car subscription with Exelon’s Steer can shift between electric models, from a Tesla Model X to a Porsche Cayenne…In Congress, oil and utility interests have squared off over efforts to expand a $7,500 tax credit for electric vehicles. The utility industry’s leading trade group, the Edison Electric Institute, has lobbied alongside automakers Tesla Inc. and General Motors Co. to expand the tax credit, while oil interests argue climbing sales and the surge in Tesla’s value show subsidies are no longer needed to jump-start a new industry…Refiners and their trade associations “have waged a state-by-state campaign” to block utility investments in electric vehicle infrastructure, the Edison Electric Institute said in a May court filing. They are using “all available tools in all available forums to attempt to slow or stop the general move toward electric and other clean energy transportation, which they view as an existential threat.”

 
 
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For further information about the NICO Project and its Mineral Reserves, please refer to the Technical Report on the Feasibility Study for NICO, entitled "Technical Report on the Feasibility Study for the NICO-Gold-Cobalt-Bismuth-Copper Project, Northwest Territories, Canada", dated April 2, 2014 and prepared by Micon, which has been filed on SEDAR and is available under the Company's profile at www.sedar.com.

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The materials appearing in this email contain forward-looking information. This forward-looking information includes, or may be based upon, estimates, forecasts, and statements as to management’s expectations with respect to, among other things, the size and quality of the Company’s mineral resources, progress in permitting and development of mineral properties, timing and cost for placing the Company’s mineral projects into production, costs of production, amount and quality of metal products recoverable from the Company’s mineral resources, anticipated revenues, earnings and cash flows from the Company's mineral projects, demand and market outlook for metals and coal and future metal and coal prices. Forward-looking information is based on the opinions and estimates of management at the date the information is given, and is subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. These factors include the inherent risks involved in the exploration and development of mineral properties, uncertainties with respect to the receipt or timing of required permits and regulatory approvals, the uncertainties involved in interpreting drilling results and other geological data, fluctuating metal and coal prices, the possibility of project cost overruns or unanticipated costs and expenses, the possibility that production from the Company's mineral projects may be less than anticipated, uncertainties relating to the availability and costs of financing needed in the future, uncertainties related to metal recoveries and other factors. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Inferred mineral resources are considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that mineral resources will be converted into mineral reserves. Readers are cautioned to not place undue reliance on forward-looking information because it is possible that predictions, forecasts, projections and other forms of forward-looking information will not be achieved by the Company. The forward-looking information contained herein is made as of the date hereof and the Company assumes no responsibility to update them or revise it to reflect new events or circumstances, except as required by law.