Goldman Sachs has stepped up its trading in battery metal cobalt, latching on to one of the hottest corners of the commodities market as carmakers transition to electric vehicles…The bank has been active in cobalt markets since last year, and has more recently dipped into physical purchases of the metal for the first time, according to people familiar with the matter…Carmakers need metals such as lithium and cobalt for batteries, and some source it directly from miners. But they are open to potentially painful price fluctuations…Prices are likely to continue rising quickly. To meet the goals of the Paris climate agreement, demand for cobalt is set to increase more than twentyfold by 2040, according to the International Energy Agency…At the moment, carmakers cannot easily hedge their exposure to battery metals such as cobalt since there is too little trading on exchanges such as the London Metal Exchange…Goldman, meanwhile, was providing hedging products to carmakers and in turn hedging its own exposure by holding physical cobalt, people familiar with its operations said. The bank declined to comment…The bank has become a key investor in the transition to electric cars. It invested about $1bn this week in Swedish battery company Northvolt, as part of a $2.75bn funding round.

Discussions in Cornwall this weekend are expected to centre around restricting internal combustion engine (ICE) vehicle sales, with Germany and the UK having already committed to banning new sales by 2030. Japan is currently targeting 2035, while France, Canada and the US plan to ban sales by 2040. Italy is the only member of the G7 that has yet to make a commitment on this front. The UK is expected to push for a multilateral agreement for 2030, ahead of its chairmanship of the COP 26 later this year…Individual members also have been ramping up their electric vehicle (EV) commitments ahead of the G7, with US and European administrations outlining plans that extend beyond just banning ICE vehicles…The New Atlantic Charter, released yesterday by the US and UK, affirmed both countries' commitment to climate goals, saying they will "prioritise" climate in "all of our international actions"…In May, US president Joe Biden announced a $174bn EV plan as part of a wider infrastructure package. He emphasised the building of a new EV industry in the US rather than exporting manufacturing abroad…The EV ambitions of the US administration are not in doubt, but what is less obvious is where the batteries and raw materials will come from. It is a problem common to all the G7 nations, but Europeans lately have invested heavily in regional battery technologies and raw materials supply, helping the continent catch up with China in terms of cell manufacturing…The US administration is waking up to the fact that the US is exposed to several potential risks, prompting Biden to order a review into supply chains for new technology that wrapped up this week. The resulting report underscores the challenges faced by the US in building its EV sector. "Currently, the US has limited raw material production capacity and virtually no processing capacity […] This current approach to the US supply chain exposes the downstream value chain to additional supply chain risk from the reliance on foreign inputs from the upstream value chain, especially the lack of domestic processing," it says…The report also highlights the geopolitical risks of not building an independent battery supply chain, warning of the danger of relying on potential political adversaries for industrial materials…"There are several geopolitical disruptions that could interrupt the high-capacity battery supply chain. The first is the possibility of China restricting exports of cobalt, nickel, lithium, graphite or finished anode or cathode materials, for each of which China has dominant processing capacity […] It is reasonable to expect that China could restrict exports of any or all of the battery supply chain materials it produces, due to trade tensions with the US or a simple prioritisation of domestic customers for its battery materials […] The US must secure a reliable supply base through both targeted international investments and a strong domestic supply base," it says…The report also warns that China could just as easily dump battery materials into the global market to reduce international competition because of its current advantages. 

Automaker are being forced into operational roles in the mining sector, said Rho Motion's Adam Panayi on Friday…The managing director of Rho Motion recorded a Kitco Roundtable podcast with correspondent Paul Harris, Mining Audiences Manager Michael McCrae and editor Neils Christensen…To make electric vehicles, automakers are going to need a lot more cobalt, lithium, nickel and copper than is currently being mined…Panayi said large automakers getting into the mining business is "inevitable" since the magnitude of some of the special materials needed is nearly akin to building an "entire sector from scratch."…"You are going to need continuing investment in that market for [nearly] the next two decades in order to keep pace with the growth of EVs and other battery technologies," said Panayi…CLICK ON BLUE TITLE TO ACCESS PODCAST

Indonesia aims to sell only electric cars and motorcycles by 2050 to replace vehicles powered by combustion engines, the country's energy minister said on Monday, as the Southeast Asian country seeks to reduce its carbon emissions…All motorcycles sold from 2040 will be electric-powered, while all new cars sold from 2050 will be electric vehicles (EVs), Arifin Tasrif said…In the past decade, the world's fourth-most populous country sold on average 6.5 million motorcycles per year and about 1 million cars…The country had more than 15 million cars and 112 million motorcycles on its roads as of 2019, data from Indonesia's automotive industries association showed…Indonesia has grappled with choking air pollution in urban areas, with the traffic-clogged capital Jakarta consistently ranking among the region's most polluted cities…A move towards EVs also supports Indonesia's ambitious plans of becoming a global hub for production, as the country ramps up processing of its rich supplies of nickel laterite ore used in lithium batteries.

Samsung SDI Co. will soon begin mass production of new rechargeable battery Gen 5 that will enable an electric vehicle to run over 600 kilometers (372.8 miles) per single charge, making a head start in the race over next-gen battery business…The EV battery making unit under South Korea’s Samsung Group recently succeeded in developing a Gen 5 rechargeable battery cell with production of a sample batch, completing the final pre-work stage for mass production, according to industry sources on Sunday…The Gen 5 batteries are nickel-cobalt- aluminum (NCA) batteries with 88-percent nickel content, which allows EVs to travel over 600 kilometers (372.8 miles) on a single charge…Samsung SDI will mass produce Gen 5 battery cells at its Hungary plant…German automaker BMW already began testing Samsung’s Gen 5 batteries for its new EV models iX and i4 to be released this fall…LG Energy Solution, the largest EV battery maker in Korea, is due to release new batteries with nickel content of between 89 and 90 percent in the second half of this year. SK Innovation, also a Korean EV battery maker, will begin supplying batteries with 90-percent nickel content for American auto giant Ford’s electric pickup F-150 early next year. Their new high-nickel batteries reportedly are capable of running up to 700 kilometers (435 miles) on a single charge.

After years of come-and-gone predictions that battery-powered sedans, pickups and SUVs would replace gas-guzzling, emissions-spewing models, the shift to electric vehicles is revving up. Beyond EV pioneer and market leader Tesla, virtually every major auto manufacturer is lining up to flip the e-switch and it is not just a big deal for consumers, but the thousands of auto dealerships across the country that will need to embrace the electric future…General Motors has said it's aiming to produce only EVs by 2035, with 30 new plug-in models arriving by 2025, marking a $27-billion investment. Ford, which previously committed $22 billion to EV development, just announced that 40% of its vehicles will be electrified by 2030. Toyota, Volkswagen, Daimler, Hyundai, Fiat Chrysler, Honda and other automakers are making similar pledges…In preparation for this onslaught of new models, franchise car dealers in the U.S. — many of them longtime small businesses located in suburban and rural communities — are gearing up. Salespeople are getting ready to put you in an EV today. And because EVs have fewer moving parts, service technicians are being trained to maintain them…Colonial is one of 2,300 Ford dealers, among a total of roughly 3,000, that have volunteered to become EV-certified, an investment that entails training sales and service personnel, upgrading battery-charging stations and purchasing special equipment, parts and tools. The remaining third have thus far opted out of spending nearly $50,000 for the certification. Other manufacturers are asking for upwards of $300,000 for the designation…EVs comprise less than 3% of overall new-car sales in the U.S. Tesla has dominated the market, making up about about 55% of it, according to Credit Suisse — though that's down from 72% a few months ago, reflecting the growth in competition…A Bloomberg New Energy Finance report estimated that by 2040, EVs will account for 58% of worldwide passenger vehicle sales, with China, Europe and the U.S., respectively, leading the pack…One genuine concern for dealers, however, is the fact that EVs don't require oil changes, transmission repairs and other service owners of ICE vehicles routinely bear — and that account for 50% of dealers' gross profits. A 2019 report from AlixPartners estimates that dealers could see $1,300 less revenue in service and parts over the life of each EV they sell…"EVs need tires, brakes, batteries, lights and some steering and drivetrain maintenance," she stated. Rick Case Auto is already selling and servicing a limited number of EVs and hybrids, but "within the last six months we've ramped up EV training for our salespeople and technicians and purchased new charging equipment" in anticipation of increased consumer demand for new electric models, Case said…Another issue on dealers' minds is direct-to-consumer (D2C) sales, the business model that's fueled Tesla's marketing of more than 385,000 EVs on U.S. roads to date. Tesla does operate about 130 company-owned showrooms, yet sales are transacted online. At last count, 33 states allowed D2C auto sales, with others' legislatures debating bills that would bypass the so-called franchise system that has legally connected dealers and manufacturers for more than a century…Generating foot traffic — the proverbial "kicking the tires" routine — is the lifeblood of dealers' business models, so to survive they will have to adjust to consumers' appetite for buying directly online, a routine that only expanded during the pandemic. That means letting manufacturers take reservations and deposits online, as Ford and other manufacturers are doing, and finding ways to attract and foster long-term relationships with a new generation of EV drivers, such as special test-drive events, on-site charging and mobile service techs who make house calls. "The dealer network has been around for a long time because they are able to pivot to where the market is and what customers expect and require," Sutton said…The auto industry is at an inflection point in the transition to EVs, and dealers large and small will have to pivot once again. "If you're going to play in the EV sector, you've got embrace it now — the charging infrastructure, the parts, the equipment, the labor," Paladino said.

A major Chinese-funded and built hydropower dam taking shape in the southeast of the Democratic Republic of Congo may find itself affected by the Congolese president’s desire to renegotiate deals signed with foreign mining companies…Work on the US$660 million Busanga Hydropower Station began in 2017 and once completed the project will provide power to a major mining project, Sicomines, in the mineral-rich region…The hydropower project is part of a minerals-for-infrastructure deal signed in 2007 by former president Joseph Kabila, under which Chinese firms agreed to construct US$3 billion in infrastructure in return for a 68 per cent stake in the mine…The DRC agreed to pay back the funding with copper and cobalt produced by the mine under a device known as resource-backed loans…However, such deals have been criticised by non-governmental organisations, including Global Witness, for their lack of transparency and allegations that Congolese politicians benefit from them more than the public…The DRC is Africa’s largest copper and cobalt miner and has attracted growing interest from Chinese companies that have invested heavily in the country…But it has found itself caught up in China’s geopolitical rivalry with the West, which is also eying its cobalt supplies – a key element in electric car batteries…Last month Tshisekedi threatened to renegotiate deals with foreign mining companies signed by his predecessor – a move that could have an impact on China’s ambitions to become the world’s leading manufacturer of electric cars…Tshisekedi believes his predecessors in Kinshasa signed lopsided contracts that denied the Congolese people – many of whom live in poverty – their fair share of benefits from the sale of their nation’s minerals…Wu Peng, director general of the Chinese foreign ministry’s department of African affairs, recently said the dam was the largest infrastructure project under construction in the DRC and would generate 1.3 billion kilowatt hours of electricity annually, around 10 per cent of the DRC’s total electricity generation…ChinaPower, one of the contractors, confirmed in May that it was installing turbines and equipment that will help to power Sicomines –a copper and cobalt mining joint venture between two Chinese companies, Sinohydro and the China Railway Engineering Corporation, and Congolese state miner Gécamines, which has one of Africa’s largest reserves of copper and cobalt at around 6.8 million tonnes…About 170MW from the dam’s 240MW electricity production capacity will power the Sicomines project, with the remainder fed into the national grid. When complete the dam will be the third-largest in the country, behind two dams on the Inga Falls along the Congo River…The dam was partly financed by a US$165 million loan from Exim Bank of China and built by a joint venture known as Sicohydro, 75 per cent of which is owned by Sinohydro and the China Railway Engineering Corporation and the rest by the Congolese Société Nationale d’Électricité and Gécamines…Since 2012, Chinese companies have pumped more than US$10 billion into the DRC. Besides the Busanga dam, Chinese companies have also bid to build a third Inga dam…REDD Intelligence said in a recent note that the Democratic Republic of Congo was likely to see increasing eco¬nomic engagement from China with lending to road and hydropower projects supporting the now largely Chinese-owned mining sector…Six Chinese companies led by the China Three Gorges Corp have formed a consortium with a Spanish company AEE Power Holdings to build Inga III. The US$14bn project would involve the construction of two dams and transmission lines within the DRC and its borders.