BASF and Nornickel team up to expand European battery production

Germany's BASF and Russian mining company Nornickel have entered into a deal to supply nickel and cobalt to meet the growing demand for electric vehicles (EV).

Under BASF's new base plant in Finland, the agreement could provide new impetus for European plans to build battery production capacity for market-dominant Chinese and Korean manufacturers.

Chemical giant BASF will build a battery cathode material plant in Harjavalta, Finland, adjacent to Norilsk Nickel's nickel and cobalt facilities, the world's second largest nickel miner and major cobalt producer. The agreement is an important element of Nornickel's broader strategy to expand its presence in the global battery materials market and establish long-term partnerships with leading manufacturers of cathode active materials.

“With the investment in Harjavalta, BASF will be present in all major regions with local manufacturing and increased customer proximity, further supporting the rapidly growing electric vehicle market,” said Kenneth Lane, President of BASF Business Unit.

Industry analysts expect any increase in EV range will depend on advances in high-tech cathode chemicals, for which cobalt and nickel are the main ingredients.

BASF made its way into the cathode market with a string of acquisitions and investments from 2012 to 2015, currently competing with European Umicore and Johnson Matthey, as well as a number of Chinese suppliers including Beijing Easpring and Ningbo Shanshan.

Over the next two years, the industry has been working to boost nickel content from cobalt in an attempt to increase energy intensity and save on more expensive cobalt, much of which comes from artisanal Congo mines where human rights abuses are common.