China’s Electric Vehicle (EV) sales continue to have a significant effect on the global market, their slow start to the year culminates in a decrease in Q1 sales despite double digit growth in the European and US markets. Germany sales are still in decline following the ending of EV subsidies in January. April will also see subsidies for EVs end in certain provincial governments in China. This may see consumers delay EV purchases and force OEMs to cut prices further. Q1 cathode consumption recovered to the levels at the end of Q3 2022, with the LFP taking the majority market share. We see this trend continuing over the next ten years as a low-cost solution to the mass market. Weaker sales in China have stagnated the growth of precursor supply, we expect this to recover in H2 2023. Over the longer term we expect NCM to grow 11% annually with NCA remaining flat. South Korea, Japan and Europe remain the primary export destinations for Chinese NCM.

The EV industry is witnessing rapid growth, with China's commitment to EV adoption and US government support for the local supply chain. However, challenges like infrastructure development and battery technology evolution persist. The global precursor market is projected to grow rapidly, but supply may struggle to keep up with demand by 2050. Governments' policies encourage EV adoption and reduce greenhouse gas emissions, contributing to increased demand. The industry must focus on sustainable sourcing of raw materials, recycling, and vertical integration.

The refinery is located at Townsville, Queensland and has good road, rail and sea links. The plant was originally commissioned in 1959 using conventional technology and with a capacity of 40kt/a cathode. Several expansions were undertaken in the years up to 1975 when the capacity reached 155kt/a cathode. Following extensive research and pilot testing at Townsville the Isa process was developed and the refinery was converted to this process using permanent stainless steel cathodes in 1979. ...