![]() The fast pace of change needed to meet climate goals, such as the International Energy Agency's (IEA) Net Zero by 2050 Roadmap, implies soaring metals demand in the next decade. They are copper and nickel, major established metals that have traded on exchanges for decades, and minor-but-rising lithium and cobalt, which have traded on exchanges only recently but are gaining popularity because they are important for the energy transition. Our focus is on four important metals among the variety being used for the transition. We look specifically at the goal of limiting global temperature increases to 1.5 degrees Celsius, which requires a transformation of the energy system that could substantially raise metals demand as low-emission technologies-including renewable energy, electric vehicles, hydrogen, and carbon capture-require more metals than fossil-fuel counterparts. ![]() ![]() Cobalt and nickel prices would also see similar surges in coming years. Our latest research, included in the October World Economic Outlook and a new IMF staff paper, details the likely effects of the energy transition for metals markets and the economic impact for producers and importers.įor example, lithium, used in batteries for electric vehicles, could rise from its 2020 level around $6,000 a metric ton to about $15,000 late this decade-and stay elevated through most of the 2030s. Prices for industrial metals, an important foundation for the global economy, have already seen a major post-pandemic rally as economies re-opened, as we recently wrote. Prices could reach historical peaks for an unprecedented length of time-and even delay the energy transition itself.Ī resulting surge in prices for materials such as cobalt and nickel would bring boom times to some economies that are the biggest exporters-but soaring costs could last through the end of this decade and could derail or delay the energy transition itself.
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