Sweden is turning its gaze towards Peru and other South American countries for lithium tie-ups amid a global race to lock in supply of the “white gold” metal that is key for the batteries that power electric vehicles.
A senior trade official from the Scandinavian nation told Reuters by phone that firms in Sweden - which is making a push in such batteries is home to global car brand Volvo - were looking for alliances with regional lithium and copper producers.
Governments and automakers around the world, with an eye on huge expected demand for electric cars, are looking to seal tie-ups for the light metal, including in the so-called “lithium triangle” centered on Chile, Bolivia and Argentina.
Peru - a major copper producer - is also looking to edge in on the action. Canada’s Plateau Energy Metals last year announced the discovery of 2.5 million tons of high-grade lithium resources in the south of the country, with the potential to be the largest lithium mine in the world.
“What you see in Sweden, Germany, in many countries now is how we are going out to obtain the materials and minerals needed for the future of electrification,” Niklas Johansson, State Secretary to the Minister for Foreign Trade told Reuters.
“This is not only lithium, but also copper, which is very important in Peru.”
Johansson added that a major push by China in lithium was putting a spotlight on global supply. The Asian giant is making a major strategic drive to bolster its home-grown electric carmakers and battery manufacturers.
“If someone controls a lot, this is not good for (lithium) prices, it’s not good for the competition and it also becomes a safety issue and a safety supply problem,” he said, adding it was important for countries like Sweden to have a “range of supplies in different parts of the world”.
China produces nearly two-thirds of the world’s lithium-ion batteries, and controls the majority of lithium processing facilities globally, according to data from Benchmark Minerals Intelligence, which tracks lithium prices.
In the region, China’s Tianqi Lithium Corp has taken a major stake in Chilean miner SQM. Germany has also made a major push with a deal in Bolivia to help exploit the country’s huge largely untapped reserves.
Sweden’s home-grown auto industry includes Volvo cars, now controlled by Chinese auto giant Geely, and truck makers AB Volvo and Scania. Swedish firm Northvolt will start construction in August of a huge lithium-ion battery plant.
In copper, also needed for the electric revolution, Peru is the second largest producer in the world.
Johansson added Swedish firms were both interested in potential lithium supplies in the region, but also in helping develop the deposits.
“There are many companies that are interested in lithium and buying lithium, and there are also other Swedish companies that are suppliers of mines that are very interested in helping to make the mines more sustainable,” he said.