Will electric vehicle manufacturers be able to secure enough raw materials moving forward?

2023 saw a downturn in all battery raw materials' prices and that trend has continued into early 2024. Idled capacity will represent a headwind to any potential price recovery, and so we remain pessimistic on this front during this year. The bifurcation of the graphite market along the lines of the US' Inflation Reduction Act will provide new challenges - but also opportunities - for graphite producers over the next decade at least. China will be unable to supply this market under the current legislation, resulting in a surplus of material for its domestic and export markets. The US will be in a significant shortfall as it attempts to build battery supply chains from scratch. Competition in the battery anode market is heating up, with prices for synthetic graphite falling to compete more strongly with natural graphite. Again, the market is likely to be divided between China and the rest of the world.