lithium market dynamics - investchile · lithium market demand in 2016 glass & ceramics (24%)...

Lithium Market Dynamics David Klanecky CORFO Roadshow

Proprietary Information of Albemarle Corporation

Macro Trends Driving Long-Term Lithium Growth Opportunity

Health •  Aging population •  Pharmaceutical synthesis •  Increased respiratory distress and illness

Salts Specialties

Mobility •  Battery performance, cost and safety •  Demand for mobile devices and tools •  Electrification of transportation

Salts Electrolyte Additives

Metal

•  Power grid efficiency and renewable use •  Weight reduction in aerospace and large

format transport (metals and plastics) •  Friction reduction (grease and eco-tires)

Salts Metal

Organometallics

Energy Efficiency

2

Lithium is a Key Enabler to Solving Global Issues


Battery Market Expectations

Consumer Products CAGR (2016-21): ~8% LCE Content: < 0.1 kgs

Battery Markets Continue to Accelerate

3

Source: Based on Internal Albemarle Demand Model and third-party data

Transportation CAGR (2016-21): 30 – 35 % LCE Content: 40 – 100 kgs

Grid Storage CAGR (2016-21): > 40% LCE Content: > 1,000 kgs


Li-Ion Batteries Enabled Consumer Product Innovation

4

1992 1st Mass Produced Li-Ion Battery Cell

2007 iPhone debuts

Smartphones | Tablets | Laptops | Wearables | Power tools

2003 Cell phones become mainstream

In 5 years, Li-Ion batteries went from a niche end-use to the #1 consuming market for Lithium with explosive growth from consumer electronics and expansion into additional consumer devices:

power tools, lawn and garden equipment, forklifts, golf carts, etc…

Future Growth Driven by Expanded Use of Batteries in Numerous Consumer Devices


Portable Solar Energy Storage

Portable Energy Storage

Stationary Energy Storage

Power Tools

Cordless Phones

Toys

Personal Care Smartphones

Tablets

Wearables

Payment

Buses

Golf Carts

Bikes Wheelchair

Forklift

Li-Ion Battery Applications Continue to Find New Applications

Transportation Energy Storage

Growing market Growing market

Expanding market

Consumer Electronics &

Devices

5


BEV, PHEV, HEV

Battery Electric Vehicles Value Chain Enabled by Lithium

6

Li Carbonate Li Hydroxide

Cathode, Anode, Electrolyte

Cylindrical, Pouch, Prismatic

xEV, PEV, ESS, CE

BMW VW

Nissan Tesla GM

ALB SQM Tianqi

Umicore Nichia SMM

Panasonic Samsung LG Chem

BYD Lishen

ATL

Prod

uct

Exam

ples

Su

pplie

r Ex

ampl

es

Performance Products

Battery Components

Battery Cells

Battery Packs OEM’s


Clutch

Conventional Internal Combustion Engine Power flow

Internal Combustion

Engine Transmission Drive

Shaft

(Plug-in) Hybrid Electric Parallel Power flow

(Toyota Prius)

Internal Combustion

Engine Transmission Drive

Shaft Lithium Battery

Clutch

Lithium Battery

Electric Motor Transmission

Electric Motor

Extend Range Electric Series Power flow

(Chevrolet Volt, BMW i8)

Lithium Battery

Electric Motor Transmission

Battery Electric Vehicle

(Tesla, GM Bolt)

Lithium Use Grows with Automotive Technology Evolution

Internal Combustion

Engine

Electric Generator

Clutch

7

ICE

PHEV

PHEV

BEV


New EV Model Launches Gain Momentum

8

•  Over 100,000 EV/PHEVs sold in 2016, 6 new models on the market

•  Converting all models to electric drive trains over the next decade

•  Launched Chevy Bolt – range of 238 miles at $30k price point

•  Full electric vehicle in 2019, and 1 million electrified cars by 2025

•  Tesla SX3 - 500,000 vehicles produced annually by 2018

•  Ford to invest $4.5B in EVs to introduce 13 new models by 2025

•  40% of VW’s fleet to be electrified by 2025, plus $2B on infrastructure


The Future of Grid Storage

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Mortenson (2016), Energy Storage Association Annual Conference and Expo

Grid Storage Likely to Drive Second Wave of Growth Beyond 2021


New Battery Materials Will Involve Lithium

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Battery Type Market Share in Transportation

No Disruptive Non-Lithium Energy Storage Technologies on the Horizon

Source: Lux Research 2016 Report

Considerations Driving Continued Innovation in Battery Design: •  Safety

•  Cost

•  Power

•  Durability

•  Energy Density

Proprietary Information of Albemarle Corporation 11

Demand Forecast Raised due to Faster BEV/PHEV Penetration

-

50

100

150

200

250

300

350

400

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Source: Based on Internal Albemarle Demand Model and third-party data Ceramic & Glass

Lubes & Greases

Other Applications

Portable Batteries

Automotive

Grid Storage

Year

BEV Pen. Rate

BEV MT

LCE

PHEV Pen. Rate

PHEV MT

LCE

2016 0.6% 21 0.4% 4

2021 2.3% 111 2.7% 30

Penetration Rate Assumptions and Corresponding LCE Demand (thousands MT)

Forecast Drivers •  BEV / PHEV penetration rate

forecast •  New EV model launches •  Battery size / energy density

requirements increasing

Thousands LCE in Metric tons

Demand Growth is increasing due to faster penetration rates in the transportation area.


Key Takeaways – Lithium Market •  Up to this point, energy storage growth has been driven

by portable electronic devices

•  Transportation & Grid Storage drive Li-Ion Battery Growth in the future

–  Even low EV adoption rate in the automotive world will represent a huge market for batteries

•  New Li-Ion applications: Power Tools, Telecom, Forklift, Medical, command a CAGR >15% in the next 15 years

•  Application value chains are complex and understanding the inherit partnerships is critical

•  Innovation pipeline for “next generation” lithium materials is essential

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Lithium Market Dynamics David Klanecky CORFO Roadshow


Lithium as an Enabler to achieve Energy benefits

•  Has the highest specific heat capacity among solids •  Has a high electrochemical potential •  Has low atomic mass •  Has low density

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Widely used in energy related applications: glass, aluminum alloying, lubricating greases, and energy storage / batteries


Lithium Market Demand in 2016

Glass & Ceramics (24%)

Other (23%)

Grease & Lubricants (11%)

2016 Global LCE Demand: 190,000 MT

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Source: Based on Internal Albemarle Demand Model and third-party data

Energy Storage (41%) Includes:

• Consumer Products • Transportation • Grid Storage

Growth of 15-20,000 MT LCE in 2016

Proprietary Information of Albemarle Corporation 16

Continued Declines in Lithium Ion Battery Costs Expected, Enabling Innovation

Source: Bloomberg New Energy Finance Summit (April 2016)

•  According to automaker Tesla, lithium ion battery costs declining to that of an internal combustion engine ($100/KWh) is “…achievable by 2025”

•  Today, lithium represents less than 3% of the cost of a lithium ion battery

lithium market dynamics - investchile · lithium market demand in 2016 glass & ceramics (24%)...

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