Glencore will supply the US carmaker with cobalt from its Murrin Murrin mine in Australia.
The Anglo-Swiss company will provide GM with cobalt from its Murrin Murrin mine in Australia, according to a joint statement released on Tuesday (April 12). The raw material is key for electric vehicle (EV) batteries.
GM and top cobalt producer Glencore did not provide details on volume or pricing for the supply deal.
Glencore, which produces cobalt in the Democratic Republic of Congo and also as a by-product in Australia and Canada, has already signed supply agreements with Tesla (NASDAQ:TSLA) and BMW (OTC Pink:BYMOF,ETR:BMW).
The major miner put out a total of 31,300 metric tonnes (MT) of cobalt from its own sources in 2021, and is forecasting that its output of the metal will reach around 48,000 MT in 2022.
US-based GM will use the cobalt in its Ultium battery cathodes. These batteries are used to power EVs such as the Chevrolet Silverado EV, GMC Hummer EV and Cadillac Lyriq.
The move from GM comes as automakers race to secure supply of key raw materials, hoping to avoid shortages in the coming years. GM's plan by the end of 2025 is to have the capacity to build 1 million EVs in North America.
GM and Glencore's agreement is not the only raw materials deal to happen this week. On Monday (April 11), Ford (NYSE:F) revealed a lithium supply arrangement with Lake Resources (ASX:LKE,OTCQB:LLKKF); it could see the Australian junior supply the Michigan-based carmaker with lithium from its Kachi project in Argentina.
Last week, Tesla CEO Elon Musk said on Twitter that the company may need to get into lithium mining and refining directly at scale if prices don't improve. In 2015, raw materials accounted for 40 percent of the cost of a lithium-ion battery; according to Benchmark Mineral Intelligence, they represent 80 percent of the cost today.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: Lake Resources is a client of the Investing News Network. This article is not paid-for content.
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