Connect with us

Published

on

Inside Silver Peak, America's only active lithium mine

SILVER PEAK, NV — On the edge of Western Nevada, hours from a major city and miles down private dirt roads, lies the United States’ only lithium-producing plant.

The nearest town is Tonopah – population 2,179 – where a prospector discovered silver at the turn of the twentieth century. The town’s mining roots are still on display, but the action has shifted to the country’s largest lithium brine operation 45 minutes away.

Silver Peak has been producing lithium since the 1960s. Specialty chemicals company Albemarle acquired the site in 2015 from Foot Mineral Company, and has owned it ever since.

Silver Peak has gained newfound attention in recent years as the energy and transportation sectors race to wean themselves off climate-warming fossil fuels. Lithium’s unique properties make it the common denominator across battery technologies. Forecasts for just how much will be needed in the decades to come varies. Under the International Energy Agency’s most ambitious climate scenario, lithium supply will have to grow 40-fold by 2040 from today’s levels.

The U.S. used to be a leader in lithium production, but it’s since ceded that position to foreign nations, including China. Now the Biden Administration has said that bringing battery supply chains back to U.S. shores is a matter of national importance, and the recently passed Inflation Reduction Act – the largest climate package in U.S. history – underscores this new push towards domestic production of vital materials.

Part of the trouble with bringing new supply online, however, is the sheer amount of land required. The scale of Silver Peak is hard to grasp from picturs. It spans 13,000 acres, and seems to appear out of nowhere, tucked between mountain ranges in the Nevada desert.

Evaporation ponds at Albemarle’s lithium operation in Silver Peak, NV.

Pippa Stevens | CNBC

The sun bears down and it hardly rains – ideal conditions for this type of lithium extraction, which depends on solar evaporation. There’s also salt, a byproduct of production, everywhere.

The huge site is not bustling with activity, which makes it seem even larger than it is. The sun provides much of the labor, and less than 80 people total work at the facility. But it’s sites like these – vast, sweeping operations – that will power the future.

“The U.S. is at the start of really expanding and developing its supply chain domestically for this critical mineral lithium, as well as the broader supply chain for electric vehicles and electrification,” said Karen Narwold, executive vice president and chief administrative officer at Albemarle.

“From Albemarle’s perspective, we think the United States can bring the full supply chain here.”

From hundreds of feet underground…to your car

Lithium can be produced from brine, hard rock or clay, and each method requires its own set of conditions and extraction processes. Silver Peak produces lithium from brine tapped from the Clayton Valley basin.

Salty brine that contains lithium is pumped from between 300 and 2,000 feet underground to the surface. Then, over the course of 18 to 24 months, solar evaporation concentrates the lithium.

This is one of the first of 23 ponds that lithium-rich brine travels through over the course of 24 months at Albemarle’s Silver Peak site. Brine is pumped from as much as 2,000 feet underground to the surface.

Pippa Stevens | CNBC

Lithium prices skyrocket

Lithium has garnered significant attention in recent months due to a sharp price spike, surging more than 700% since January 2021, according to Benchmark Mineral Intelligence. In some places, including the Chinese spot market, prices are up even more.

In a boom-and-bust cycle of sorts that mirrors other commodity markets, prices rose over the course of 2017 and into 2018 before cratering halfway through the year and falling throughout 2019. At that point the market was oversupplied, which led to a lack of investment in new production. The effects of that slowdown are still being felt. Today, supply is racing to catch up with demand, and some are warning that it simply won’t.

According to forecasts from Benchmark, 600,000 tons of lithium carbonate equivalent will be mined this year — that’s 10,000 tons less than needed. By the end of the decade, the firm envisions annual supply reaching 2.15 million tons of LCE, which will lag demand by a whopping 150,000 tons.

One of the intermediate-stage ponds at Albemarle’s lithium facility. As the brine becomes more concentrated with lithium the pools take on more of a turquoise color.

Pippa Stevens | CNBC

The surge in lithium demand comes from countries and companies doubling down on climate goals in the past few years. That includes automakers, which are announcing ambitious all-electric fleets.

Lithium isn’t the only mineral in these batteries — they also require cobalt, graphite and nickel. Each has its own limitations, and scientists are experimenting with different battery chemistries.

But while it’s possible to swap out some materials, at this point there’s no viable alternative to lithium.

Although lithium is not a scarce resource, getting a new mine up and running can take about seven years. These projects are capital intensive and require many permits, all of which means the industry is slow moving.

Lithium Americas has been trying for more than a decade to get production going at its Thacker Pass clay mine in Nevada, against opposition from environmentalists and Native American tribes. Piedmont Lithium is in the process of developing a spodumene mine in North Carolina, which it hopes will begin producing by 2026.

Albemarle is working on its own North Carolina mine at Kings Mountain. It’s a brownfield mine – meaning it was previously producing – which the company hopes will help it speed past the hurdles that delay new projects. Albemarle also has processing facilities in the state.

Extractive industries are resource-intensive by their very nature and can be highly disruptive to local ecosystems. But it’s hard to see how the world can move away from fossil fuels without new lithium production. An electric vehicle requires more than six times as many mineral inputs relative to internal combustion vehicles, according to the IEA. Under the Paris-based agency’s most ambitious climate scenario, it forecasts 230 million electric cars, buses, vans and heavy trucks on the road by 2030.

This is the last of the 23 evaporation ponds at Albemarle’s Silver Peak lithium site. From here, the lithium is sent for on-site processing where it’s turned into lithium carbonate.

Pippa Stevens | CNBC

Still, some believe these forecasts are far too ambitious, and the world should instead focus on existing resources rather than developing new sites.

Recycling could also become an option – Albemarle is one of the companies working on this – but the market hasn’t yet reached critical mass. Technologies are also being developed to make operations more efficient so that mines yield as much as possible.

Albemarle sets its sights on expansion

Silver Peak is Albemarle’s largest U.S. lithium production site at present, but it constitutes only a small portion of the company’s overall lithium production. Silver Peak produces about 5,000 metric tons per year of lithium carbonate equivalent (LCE), while Albemarle’s Chile operation – in the Salar de Atacama region – has the capacity to produce 85,000 metric tons per year. The operation there uses the same brine production process that was first developed in Nevada.

The company also co-owns two mines in Australia, and operates a number of processing facilities, including in China.

Albemarle is also increasing its footprint at Silver Peak. In Jan. 2021 the company announced plans to double capacity to 10,000 metric tons a year, which the company said is enough to power around 160,000 electric vehicles.

Bags of lithium carbonate at Albemarle’s Silver Peak facility. Some of it is sent to the company’s processing plant in North Carolina, where it can be turned into lithium hydroxide, which is used for EV batteries.

Pippa Stevens | CNBC

Albemarle’s Narwold said the expansion, initially slated for completion in 2025, is ahead of schedule. The company spent the last year and a half constructing 22 new brine-pumping wells, completing the first stage of the expansion.

By the end of this year Albemarle will be pumping at 20,000 acre feet annually, which is equivalent to roughly 18.5 million gallons of water per day. That represents the full extent of Albemarle’s water rights, which is also the entirety of the rights available in the Clayton Valley.

Albemarle is not just a lithium company: it also has bromine and chemicals divisions. But the lithium segment has grown in importance following the price spike and Albemarle’s expansion plans. Lithium now accounts for about two thirds of the company’s revenue, according to Meredith Bandy, vice president of investor relations and sustainability at Albemarle. That’s up from a few years ago, when each division was about one third of overall revenue.

“We’ve been investing in the lithium market for the last couple of years, and that’s starting to pay off in terms of volumetric growth as well as price performance,” she said.

Traditionally Albemarle had long-term, fixed contracts with customers. But this year the company restructured some of those contracts in an effort to capture upside from rising prices. It seems to be paying off.

One of the bright blue ponds at Albemarle’s lithium plant in Silver Peak, Nevada.

Pippa Stevens | CNBC

During the second quarter, Albemarle said net sales from its lithium division jumped 178% year over year. The company raised its full-year guidance three times between May and August, when Albemarle posted second-quarter results. The company will report third-quarter earnings on November 2.

For the full year, Albemarle now expects adjusted EBITDA for its lithium division to grow between 500% and 550% on a year-over-year basis. That’s up from prior expectations of a 300% jump.

“There’s a tremendous amount of demand. The industry really is having to work hard – Albemarle is having to work hard – to keep up with that demand,” said Bandy.

Investors have rewarded the company’s performance. The stock climbed to an all-time high on September 14, during a rocky period in the broader market. Shares have since fallen 18%, but the stock is still up about 8% for the year, with a company valuation around $30 billion.

By comparison the S&P 500 and Nasdaq Composite are down 25% and 33%, respectively, for 2022.

Climate bill: a game changer?

While the vast majority of battery production takes place outside the U.S. — China is a key player, currently refining 56.5% of global lithium, according to Benchmark — the Biden Administration is trying to change that.

In February, the White House announced funding for domestic production of materials and minerals critical to the energy transition. Then, in March, Biden invoked the Defense Production Act for these materials.

Albemarle’s Silver Peak lithium plant spans 13,000 acres.

Pippa Stevens | CNBC

“To promote the national defense, the United States must secure a reliable and sustainable supply of such strategic and critical materials,” a March statement from the White House read, citing lithium as among the “critical materials.”

But the most meaningful initiative, by far, is the recently passed Inflation Reduction Act. The bill, which is the largest climate funding package in U.S. history, focuses on incentives and credits aimed at accelerating the U.S.’ shift towards renewable energy while also jumpstarting domestic manufacturing.

The bill includes measures that will help battery companies on both the supply and demand side. Over time, a greater portion of an electric vehicle’s battery materials must be sourced from the U.S. or one of its free-trade allies in order for consumers to qualify for the tax rebates. Producers can also take advantage of the manufacturing tax credits.

Narwold called the Inflation Reduction Act a “great step forward.”

“It really does give the impetus to start focusing domestically on building that supply chain. No reason why the United States can’t be a significant contributor to that supply chain with the right support, both from the government – state and federal – as well as from the industry,” she said.

Bags of lithium carbonate. This is the end product after the lithium-rich brine has spent about 24 months travelling through evaporation ponds at Albemarle’s Silver Peak plant.

Pippa Stevens | CNBC

– CNBC’s Katie Brigham contributed reporting.

Continue Reading

Environment

Tesla posted record China sales in 2024. But this year is going to be tough as competition heats up

Published

on

By

Tesla posted record China sales in 2024. But this year is going to be tough as competition heats up

Tesla models Y and 3 are displayed at a Tesla dealership in Corte Madera, California, on Dec. 20, 2024.

Justin Sullivan | Getty Images

Electric vehicle-maker Tesla’s sales in China climbed to a record high last year. Sustaining that performance in 2025 could prove tricky as competition with homegrown players intensifies, analysts said.

The U.S. electric vehicle maker saw annual sales in China jump 8.8% to a record high of more than 657,000 cars in 2024. In December alone, its sales rose 12.8% from the previous month to 83,000 units, according to Tesla China.

However, Tesla has been losing market share to Chinese new-energy-vehicle players, down from 7.8% in 2023 to 6% in the January to November period last year, according to Bill Russo, founder and CEO of Automobility, who believes Tesla is “struggling to keep pace [with domestic rivals] and has a limited and aging product portfolio.”

Brand resiliency and price cuts have supported Tesla’s sales so far, said Tu Le, founder and managing director of Sino Auto Insights, but he was less certain that Tesla could keep up its momentum in 2025, given the lack of new products and increased local competition, especially from Chinese companies.

Aggressive price war

Tesla slashed the price for its best-selling Model Y in China by 10,000 yuan ($1,364.5) in late December and extended a zero-interest five-year loan plan for car buyers until the end of January.

Its best-selling Model Y now starts at 239,900 yuan after the discount, while the Model 3 sedan starts at 231,900 yuan — Tesla had cut its prices by 14,000 yuan in April — according to its website.

Still that marked a significant premium over a swath of cheaper models offered by Chinese domestic carmakers. BYD, which dominated the market with around 34% market share, prices one of its best-selling models Seagull at 136,800 yuan, and the more affordable Yuan Plus model, starting at 96,800 yuan.

TOPSHOT – People look at a BYD Seagull car by Chinese electric vehicle (EV) manufacturer BYD Auto at the Bangkok International Motor Show in Nonthaburi on March 27, 2024. (Photo by Lillian SUWANRUMPHA / AFP) (Photo by LILLIAN SUWANRUMPHA/AFP via Getty Images)

Lillian Suwanrumpha | Afp | Getty Images

As the price war extends into the new year, Li Auto introduced cash subsidies of 15,000 yuan per purchase along with a three-year zero-interest financing scheme, according to a post last Thursday on its social media Weibo account. Nio also extended a similar three-year zero-interest loan plan for its EV buyers.

The purchasing incentives came on top of Chinese authorities’ push to extend the consumer goods trade-in program, which subsidizes consumers to trade in old cars or appliances and buy new ones at a discount.

The government-subsidized trade-in program could further lower prices for both Model 3 and Model Y by up to 50,000 yuan, Tesla China said.

“Tesla has to discount aggressively to keep pace with the ongoing price war in the market,” Russo noted.

Despite dwindling market share, Tesla is unlikely to lose its ground completely in China, according to Joe McCabe, CEO and president of AutoForecast Solutions, who compared Tesla as “the Apple of cars” — an “early adopter” in the EV space with “phenomenal” technology.

“I don’t think Tesla is at risk of not surviving,” McCabe added, “all [Elon Musk] has to do is drop the price by 5%, because he can, and that will help for little blips.”

Head-to-head race

In addition to lowering prices, Chinese electric carmakers have rolled out a slew of new models, many with fancy in-car features, such as projectors, embedded refrigerators and driver-assist systems.

Meanwhile Tesla has been slow in adopting any of these features, with its product portfolio focused solely on fully electric vehicles, while its homegrown rivals have steered into plug-in hybrid cars and extended-range EV categories.

These more traditional models appeal to buyers who are “still worried about the leap to fully electric [cars],” Sam Fiorani, vice president of AutoForecast Solutions said. “Tesla has no plans for anything other than fully electric vehicles.”

Tesla needs to 'up its game' to retain leadership in EV transition: Investment strategist

The automaker’s plans of launching its full self-driving supervised system still hinges on regulatory permission in China, while several local competitors have made the advanced driver-assistance systems a basic part of their offering, including BYD.

Musk had warned in January that Chinese automakers could “demolish most other car companies in the world” unless regulators intervene with trade barriers, as the Warren Buffet-backed BYD overtook Tesla as the world’s top-selling EV company in the last quarter of 2023.

The U.S. imposed a 100% duty on Chinese EVs last September to protect its homegrown industries from the pricing pressure posed by heavily-subsidized peers from China. The European Union has also moved to impose tariffs as high as 45.3% on Chinese EV cars imported late last year, while Tesla enjoyed a lower tariff rate of 7.8%.

The trade barriers would force Chinese automakers to find buyers at home and in the “smaller, friendlier” foreign markets, adding pressure on Tesla’s sales in China and elsewhere, Fiorani added.

Tesla’s sales of China-made EV cars including exports to foreign markets fell modestly by 0.4% from a year ago to 93,766 units in December, according to CNBC’s calculation of China Passenger Car Association data.

BYD, which is subject to 17% tariff duties for car exports to European Union, still led the rank with 509,440 cars sold in December, a near 50% year-on-year jump.

—CNBC’s Evelyn Cheng and Sonia Heng contributed to this report.

Continue Reading

Environment

Bosch teases big announcement on electric bike battery innovation

Published

on

By

Bosch teases big announcement on electric bike battery innovation

Bosch eBike Systems plans to announce something new at CES 2025, perhaps related to advances in its electric bicycle battery technology. A cryptic teaser video gives a taste of what’s to come.

In the video seen below, a Bosch PowerPack 800 e-bike battery can be seen along with the words “Protect what is valuable” on either side of the battery.

The clues could lead in several directions, potentially relating to the battery’s safety or to advances in theft prevention.

Is Bosch unveiling potted e-bike batteries?

One potential theory centers around the possibility of Bosch unveiling potted batteries, a design that encases the internal components and battery cells in resin or other solid protective materials. This construction method is highly valued for its resistance to water, shocks, and vibrations, making it ideal for mountain bikers and commuters who ride in challenging environments.

While the concept is not new, it is still uncommon in the electric bicycle battery industry. Last year, the electric bicycle brand Rad Power Bikes unveiled new potted batteries as part of their SafeShield line of batteries.

The practice does raise some concerns regarding the ability to recycle such batteries, but Rad Power Bikes has said that its SafeShield batteries are still recyclable. Accessing the cells is difficult when potted batteries are discontinued, but many battery recycling programs grind up the entire battery and use a series of separators such as magnets, screens, and centrifuges to isolate the important materials for further recycling.

The shift towards potted batteries marks a significant increase in battery safety, especially for riders on rough terrain or who ride in wet environments. Physical damage and water ingress (especially salt water from coastal regions or areas with significant road salt usage) are two leading causes of e-bike battery fires. While such fires are still quite rare considering the large number of e-bike batteries in circulation, addressing those two areas, which are commonly seen in Bosch’s two main markets of electric mountain bikes and commuter e-bikes, could go a long way towards improving safety.

Does Bosch have a new theft protection system?

Another possible interpretation of the teaser could relate to anti-theft technology. Battery theft has become a growing concern for e-bike riders, especially in urban areas where bikes are often left locked up outside. Bosch might be addressing this issue by introducing integrated theft-prevention features.

Potential innovations could include built-in GPS trackers for locating stolen batteries, more tamper-proof locking mechanisms, or even remote disabling capabilities that render a stolen battery unusable.

Other companies, such as the now-defunct Juiced Bikes, have built e-bike batteries with specially designed cavities for concealing Airtags or other location-tracking devices.

While details remain under wraps, Bosch’s teaser has created a buzz in the e-bike community due to the e-bike component maker’s large market share. The official announcement from Bosch is expected soon, and we’ll report back as soon as we know more.

Until then, let’s hear your thoughts in the comment section below. What could Bosch’s engineers be cooking up this time?

FTC: We use income earning auto affiliate links. More.

Continue Reading

Environment

Several commodities face headwinds in 2025 — but this metal’s record rally is set to continue

Published

on

By

Several commodities face headwinds in 2025 — but this metal's record rally is set to continue

Gold bullions are displayed at GoldSilver Central’s office in Singapore June 19, 2017.

Edgar Su | Reuters

Commodity prices are largely expected to fall in 2025 due to a sluggish global economic outlook and a resurgent dollar, but gold and gas prices are poised to rally this year, according to industry experts.

Commodities had a mixed 2024: While investors flocked to gold to hedge against inflation, commodities such as iron ore fell as the world’s largest consumer of metals, China, struggled with tepid growth. The story this year is likely to be the same.

“Commodities in general will be under pressure across the board in 2025,” said research firm BMI’s head of commodities analysis Sabrin Chowdhury, adding that the strength of the U.S. dollar will cap demand for commodities priced in the greenback. 

Market participants will be keeping an eye on further China stimulus in hopes that it may fuel a recovery in commodities demand in the world’s second-largest economy. 

Oil prices to slip

Crude oil prices last year were dragged down by weak Chinese demand and a supply glut, and market watchers expect prices to remain pressured in 2025.

The International Energy Agency in November painted a bearish oil market picture for 2025, forecasting global oil demand to grow under a million barrels per day. This compares to a two million barrel per day increase in 2023.

Commonwealth Bank of Australia sees Brent oil prices falling to $70 per barrel this year on expectations increased oil supply from non‑OPEC+ countries that’ll eclipse the rise in global oil consumption.

Stock Chart IconStock chart icon

hide content

Oil prices year-on-year

BMI said in its December note that the first half of 2025 was likely to see a supply glut as substantial new production from U.S., Canada, Guyana and Brazil comes online. Also, if OPEC+ plans to roll back voluntary cuts materialize, the oversupply will further pressure prices.

BMI noted that the demand picture in 2025 was not clear yet. “Global oil and gas demand remains uncertain, with stable economic growth and rising fuel demand offset by trade war impacts, inflation and contracting demand in developed markets.”

Global crude benchmark Brent was last trading at $76.34 per barrel, around the same levels as it was a year ago in early January.

Gas set to rise

Global natural gas prices have rallied since mid-December 2024, driven by cold weather and geopolitics, Citi analysts said.

Ukraine’s recent halt of Russian gas flow to several European nations on New Year’s Day has introduced greater uncertainty to the global gas markets. As long as the cutoff remains in place, gas prices are likely to remain elevated.

Colder weather for the rest of winter in the U.S. and Asia could also keep prices elevated, said Citi.

BMI forecasts gas prices to rise by about 40% in 2025 to $3.4 per million British thermal units (MMbtu) compared to an average of $2.4 per MMbtu in 2024, driven by growing demand from the LNG sector and higher net pipeline exports. 

U.S. Henry Hub natural gas prices, which was the gauge that BMI referred to, are currently trading at $2.95 per MMbtu.

“LNG will continue to drive new consumption, supported by rising export capacity and strong demand in Europe and Asia,” BMI analysts wrote. 

Gold may add sheen

Gold prices notched a slew of all-time highs last year, and the run of fresh records could extend in 2025.

“Investors are optimistic about gold and silver for 2025 because they are so pessimistic on geopolitics and government debt,” said Adrian Ash, director of research at BullionVault, a gold investment services firm, emphasizing on the yellow metal’s role as a hedge against risk. 

Stock Chart IconStock chart icon

hide content

Gold prices year-on-year

JPMorgan analysts also expect gold prices to rise, especially if U.S. policies become “more disruptive” in the form of increased tariffs, elevated trade tensions and higher risks to economic growth.  

Gold notched its best annual performance in over a decade last year. Bullion prices rose about 26% in 2024, data from FactSet showed, driven by central bank as well as retail investor purchases.

BullionVault and JPMorgan expect gold prices to go up to $3,000 per ounce in 2025.

Silver and platinum likely to advance

Gold’s poorer cousin, silver, could also see prices rise, especially as demand for solar power — silver is used in building solar panels — remains resilient and the metal’s supply stays limited.

“Both silver and platinum have strong underlying deficit fundamentals, and we think a catch up trade later in 2025, once base metals find firmer footing, could be quite potent,” JPMorgan analysts noted. 

Solar power panels near Crawford Notch, New Hampshire. Silver is primarily utilized in industrial applications and is frequently incorporated in the production of automobiles, solar panels, jewelry, and electronics

Adam Jeffery | CNBC

Silver is primarily utilized in industrial applications and is frequently incorporated in the production of automobiles, solar panels, jewelry and electronics. It is also needed in building artificial intelligence products and has military applications as well, said CIO of Swiss Asia Capital’s CIO Juerg Kiener.

That said, silver’s upside will be dependent on global industrial demand which will be impacted by Trump’s tariffs, precious metals trading services group MKS Pamp wrote in an outlook report.

Copper faces demand worries

Prices of copper, which is key to the manufacturing of electric vehicles and power grids, may see a dent after shooting to a record high this year on the back of a global energy transition.

“A potential deceleration in energy transition amid Trump’s policy shifts might dampen, to some extent, the ‘green sentiment’ that bolstered prices in 2024,” BMI wrote in a note.

Close up of electrical engineer inspecting copper windings in electrical engineering factory

Monty Rakusen | Digitalvision | Getty Images

While copper prices rose to a record high in May 2024 largely as a result of a squeezed market, they trended lower for the rest of the year, and will continue to do so, John Gross, president at the eponymous metals management consultancy John Gross and Company, told CNBC.

A cocktail mix of high inflation, elevated interest rates and a stronger dollar will weigh on all metals markets, the metals market veteran said.

Iron ore forecast to drop

Iron ore prices may also slide on the back of an oversupply resulting from Chinese policies and geopolitics. 

“The expected U.S. tariffs on China, changing nature of Chinese stimulus and new low-cost supply [will] push the market into further surplus,” Goldman Sachs said, forecasting prices to decline to $95 per ton in 2025.

This despite China likely to import record amount of iron ore this year, according to Reuters. Iron ore prices fell over 24%, according to data from FactSet.

Cocoa and coffee

Cocoa and coffee prices stand out amongst the soft commodities basket, having scaled record highs in 2024 fueled by adverse weather conditions and supply tightness in key producing regions. But demand may taper in 2025.

“Given that these commodities are trading at levels well above cost of production, we expect production to expand and demand to contract in the coming year,” Rabobank researchers said.

Continue Reading

Trending