Sumitomo Metal Explores : Sumitomo Metal Mining (5713.T) is considering manufacturing cathode battery materials in the US to fulfill rising electric vehicle demand, according to an executive statement on Thursday.
Sumitomo Metal, a key supplier of nickel-cobalt-aluminium (NCA) cathode materials for Panasonic (6752.T) lithium-ion batteries used in Tesla (TSLA.O) electric vehicles, is currently constructing a plant in Niihama, western Japan, with the aim of increasing annual cathode production capacity to 84,000 metric tons by 2025, up from the current 60,000 tons.
The company’s Managing Executive Officer, Katsuya Tanaka, highlighted that the choice of location and timing for the next capacity expansion is contingent on each country’s regulations and laws. He emphasized that they are carefully assessing the potential impact of regulatory changes, including the U.S. Inflation Reduction Act (IRA), especially with the upcoming presidential election. Sumitomo Metal has ambitious plans to further boost its annual output capacity, targeting 120,000 tons by March 2028 and 180,000 tons by March 2031.
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In addition to its role in the battery materials sector, Sumitomo Metal, as a miner and smelter, is intensifying its exploration efforts for a new nickel mine. An executive disclosed the company’s decision to abandon a lengthy feasibility study on an Indonesian nickel project in Pomalaa. In collaboration with Mitsubishi (8058.T) and Mitsui (8031.T), Sumitomo Metal is engaged in preliminary studies with Australian nickel sulphide explorer Ardea Resources ARL.AX for a feasibility assessment at its Kalgoorlie Nickel Project Goongarrie Hub in Western Australia.
Sumitomo Metal is evaluating Ardea’s preliminary study report while discussing the possibility of a more detailed study. The company remains in the early stages of exploration, and its participation in the project will depend on the outcome of these studies. The company is also actively reviewing several other projects as part of its broader strategy.
Sumitomo Metal’s long-term objective is to increase its annual nickel output capacity to 150,000 tons, a significant rise from the current 82,000 tons. This strategic move aligns with the global shift toward electric vehicles and the increased demand for the materials essential to their production.