[ferro-alloys.com]Meeting the future metals needs of electronic vehicles remains a challenge for the mining industry and will require significant levels of investment, an official from one of the world's largest producers of nickel said Tuesday.

Paul Casbar, regional sales manager for the US for Vale, told delegates of the inaugural S&P Global Battery Metals Conference in Brooklyn, New York, the downstream industry had already committed to $150 billion of investments worldwide in the EV sector over the next five to seven years, including major automotive manufacturers and the battery and components industries. "So there's plenty of money being spent," he said.

But he said more than $70 billion of investment in nickel mining was needed to bring new production to the market and more than $40 billion was needed in copper mining to to meet future EV demand.

Casbar also said new investment was needed in cobalt, but it remained constrained because of the lack of new investment in nickel and copper. Cobalt is predominantly a byproduct of nickel and copper mining, with very few primary cobalt resources in the world.

However, he said that investment in bringing new nickel production to the market would also deliver new cobalt as byproduct, "which will reduce the reliance on the Democratic Republic of Congo [for new cobalt supply]."

Several forecasts in the past have said future EV demand for cobalt was dependent on the DRC producing as much as 300,000 mt/year of cobalt by 2030, but the country is widely seen as a controversial source of cobalt.

But Casbar said the required levels of investment in bringing new nickel production to the market would only come from higher nickel prices. Speaking on the sidelines of the conference, he said it would take "prices above $20,000/mt sustained to incentivize such investment."

On Tuesday, three-months nickel closed on the London Metal Exchange at $12,600/mt.

Casbar said there was about 250,000 mt of nickel sitting in LME warehouses and as much again in on-warrant stocks, meaning it was not visible, but expected that overhang to disappear. He said the market had a structural global deficit of 140,000 mt this year and was likely to maintain that deficit next year.

Asked why a company as large as Vale had not already begun such investments, given the projections for future deficits, Casbar said the whole of the nickel industry was still "shell-shocked after two awful years. Nickel prices remained well below $9,000/mt in 2016 and even dipped to below $8,000 at one point, according to LME data.

He also said the company had worked hard over the last few years to reduce its debt level down to a target level of around $10 billion, which it had recently achieved.

Casbar said there was enough nickel resources in the world to meet future demand. Most of the world's untapped nickel reserves were within the tropics, including Indonesia and the Philippines, with the majority of those deposits being laterite. "Most of those resources have already been identified," Casbar said.

• [Editor:王可]