Sumitomo Metal Mining looks to boost battery materials output, possibly in US

Panasonic Holdings

16/11/2023 11:38

By Yuka Obayashi
       TOKYO, Nov 16 (Reuters) - Japan's Sumitomo Metal Mining
 5713.T  is considering producing cathode battery materials in
the United States among other options as it looks to expand
output to meet demand from electric vehicles, an executive said
on Thursday.
    Sumitomo Metal, which supplies the nickel-cobalt-aluminium
(NCA) cathode materials for the Panasonic  6752.T  lithium-ion
batteries used in Tesla  TSLA.O  EVs, is building a plant in
Niihama, western Japan, to boost annual cathode production
capacity by 24,000 metric tons in 2025 from 60,000 tons now. 
    "Where and when to increase our production capacity next
time depends on each country's regulations and laws," Katsuya
Tanaka, managing executive officer, told an analyst meeting.
    "We are examining the impact from any changes to laws and
regulations, including the U.S. Inflation Reduction Act (IRA), 
will have on business, if we were to invest in the United
States, especially with the presidential election coming up next
year," he said.
    The IRA includes major provisions to cut carbon emission,
boost domestic production and manufacturing.
    Sumitomo Metal plans to bolster its annual output capacity
to 120,000 tons by March 2028 and 180,000 tons by March 2031.
    The company, which is also a miner and smelter, is also
accelerating exploration of a new nickel mine, another executive
said. It abandoned a long-running feasibility study on an
Indonesian nickel project in Pomalaa. 
    Australia's nickel sulphide explorer Ardea Resources 
 ARL.AX  said in July it has signed a non-binding agreement with
a Japanese consortium to conduct a feasibility assessment at its
Kalgoorlie Nickel Project Goongarrie Hub in Western Australia.
    The consortium consists of Sumitomo Metal, Mitsubishi
 8058.T  and Mitsui  8031.T .
    "Currently, we are evaluating Ardea's report on the
preliminary study while discussing about a more detailed study,"
said Masaru Takebayashi, managing executive officer.
    "We are still in the preliminary study stage and whether we
will join the project depends on the outcome of the studies," he
said, adding the company is also scrutinizing a few other
projects.
    Sumitomo Metal is targeting to boost annual nickel output
capacity to 150,000 tons in a long-term from 82,000 tons now.

 (Reporting by Yuka Obayashi; editing by David Evans)
 ((Yuka.Obayashi@thomsonreuters.com; +813-4520-1265;))