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Nthoftheriver
You need to be clear on the cost of the battery as distinct from the cost of the battery pack in an EV. The battery pack costs anywhere between 1/3 to 1/2 the cost of the car depending on the make and the model. A car costing $60,000 will have about 60kg of nickel in its battery pack. That's a battery pack costing $20,000 to $30,000 with 132lbs. of nickel at $9/lb = $1,188, That means the nickel in the battery pack is between 5.94% and 3.96% of the battery pack cost or 1.98% of the cost of the car.
It doesn't take much effort to work out the impact of a $1/lb. increase in the price of nickel on the overall percentage cost of the car/battery pack.
Cheaper cars have smaller batteries and therefore less nickel so the percentages are more or less the same.
The drive (no pun intended) to reduce costs is relentless so movements in the price of nickel will be an issue. The biggest saving in the cost of manufacturing EVs, however, will come from improvements in production. Moving from using nickel sulphate to a nickel powder in the production of the battery cathode is reported to save 7% in the cost of producing the batteries. Wright's Law will also positively impact unit costs the higher volumes go. The price of nickel is only one component in a large complex process.
I think Tesla's adoption of LFP batteries for cars is a short term move. LFP, like NCA and NMC chemistries, have their limits. LFP more or less reached its limit sometime ago. NCA and NMC still have some way to go before they top out.
Using LFP batteries takes the pressure off and givse the nickel mining sector time to catch up.
TDT
Hello North, I think we lost eighteen months progress to Covid, hopefully no more slippage now. I guess financing your first mine is the hardest.
Same here Luke2 (sure you used a different moniker in those days, not meant negatively).
Did attend the AGM after they bought it and all was very positive, but we are almost 4 years on and annoyingly still to see any real value add to the SP for our holding. Hopefully it will garner attention after the Finance package for A1 is sorted.
Good luck all holders.
Vermelho doesn't matter at all.
29,000t from A1 and A2 at $20k is $350m profit a year.
Many of us invested here when we ‘only’ had Araguia a stainless mine.
JM has always said we need a partner for Vermelho, we may get an inkling before long of who it is.
One of the problems with viewing HZM as a ‘climate protection stock’ or a ‘battery metals’ producer is that you’re pigeon holing your perception of the company.
Yet the reality is that nickel has multiple uses and steady both within and without the ‘green’ revolution.
In other words, HZM is much better viewed as a future nickel producer. Forget trying to hitch its fortunes to EV batteries or you’ll be perpetually in a state of varying euphoria and depression based on the uncertain future of this technology.
I believe that the case for HZM stands squarely as a nickel producer where the case for nickel still stands irrespective of EVs.
@Rover,when you lay it out like that it makes more sense-people will pay for what they want when the chips are down !!
Take the humble potato and the value add for that.
Would a price rise on that stop you buying your oven chips.
Not just batteries of the car
The whole cost of baking the car .. higher commodities is driving up
Prices for consumers
Welcome to inflationary pricing
True Soundbuy, but noting that batteries are a big component of the EV cost.
Not trying to put a downer on HZM as still hold all my shares, just trying to guage what is the best course for Vermelho in next few years. If you go the expensive route to supply theEV market, yes you can still supply SS as others have done to date. But it’s an expensive commitment and I really think it needs a large partner to push the project forward to maximise benefits.
Still a nice problem to have.
Batteries costing 4-5 times what they do now?
Depends surely on the % cost of the battery to the total vehicle cost..... (vehicle - not just car)
Hi Wasa,
Lol, that graph on Nickel is scary in a nice way. But if I was and EV manufacturer I’d be seriously worried. Batteries costing 4-5 times what they do now. Try selling that cost mark up to EV buyers.
Still hopefully I’ve sold down the majority of my HZM holding for a huge mark up 2025.
Jeez.....that's some nickel squeeze
Don't worry about nickel price or demand. Is whqt the IMF are saying. Check the price forecast for net zero!
https://mobile.twitter.com/hilldanr/status/1451273117356236801/photo/1
FTC
JM has already said that is not ruled out
If SS is buoyant and nickel prices are still above DFS then it is possible
Yes it can supply stainless and most new nickel mines need $20,000 a tonne to be viable, Vermelho does not it is in the lowest quartile for production costs.
Can Vermelho also supply stainless steel industry if EV battery demand cools?
Have we missed the EV market
Jeez....a tad premature, hasn't even begun let alone the so called 'Green Revolution' (and there's always optionality with V.).
Hi Theaeo,
Agree that energy storage is going to be big. But if you can store it via cheaper battery mixtures (assuming you don’t need to worry about energy density/land space).
Just worried about building a mine for a 30 yr mine life on expensive technology too late in the demand cycle.
First off I don’t think you’re wrong but I do think an assumption that ev battery demand will be temporary or cyclic could be a mistake. Everything I see in the news points to a permanent demand for energy storage. Nickel or not.
Morning all,
Just been revisiting thoughts on if as Nickel price rises the pressure on EV batteries increases to keep the price in check. So think it will push alternative battery technology development faster and or greater use of existing cheaper alternative battery chemistry. As such, I wonder if our focus on Araguaia P1 & P2 means we are pushing Vermelho further out on the demand cycle.
If we want to progress Vermelho as an EV focused supply source then I believe we should be post Araguaia P1 finance be putting some real focus on getting on with the Vermelho development plan. I suppose that really means getting a major partner on board sooner rather than later. Let them take on the work and allow HZM to be the junior partner. Get the benefits without shifting too much of management time form Araguaia.
Any views.