Belgium’s Umicore has chosen the city of Nysa in Poland as the location where it will build its first production plant to manufacture cathode materials for the European automotive market.

Given the intention to start deliveries in 2020, the three principal factors behind the decision were said to Metal Bulletin to be proximity to European customers, access to a technically skilled workforce, and a low-carbon electricity supply from renewable energy.

"Proximity to our European customers is at the core of this decision," Marjolein Scheers, media and external affairs manager at Umicore, told Metal Bulletin.

"We needed a place able to provide a skilled workforce and educated people, but the availability of a low-carbon electricity supply was equally important. We aim to leave a small footprint, and will be using renewable energy such as wind power and solar panels in the new plant," Scheers added.

Umicore’s European cathode plant will be able to supply customers with a wide variety of cathodes for batteries, chief executive officer Marc Grynberg said in conversations with Metal Bulletin earlier this year.

Increases in the prices of critical cathode raw materials such as lithium and cobalt remain a main concern among the major cathode and battery makers. But Umicore told Metal Bulletin that it plans to keep ethically sourcing all the raw materials used in the production of its cathodes.

The spot price for battery-grade lithium carbonate in China more than tripled to a monthly average of $26.60 per kg in April 2016, from $7.70 per kg in June 2015.

This week, the spot price softened to 130,000-135,000 yuan ($20,291-21,072) per tonne or $19.68-20.44 per kg, according to the market assessment on May 31.

Meanwhile, the low-grade cobalt free market price increased to $42-43 per lb on June 1 this year, from $13.35-14.15 per lb on the same date in 2015, according to Metal Bulletin’s market assessments.

'Ahead of the curve’
The first phase of Umicore’s project in Poland will create as many as 400 new jobs. The investment is included in the €600 million ($701 million) program by the company to increase its total capacity for rechargeable battery materials to at least 175,000 tonnes per year by 2021 in China and Europe.

Umicore will also construct a Process Competence Center at its existing site in Olen, Belgium, where it has one of its largest R&D centers. Commissioning of this center is scheduled for late 2019 and it will employ about 20 researchers.

"Umicore plans to keep ahead of the curve and look into the cathode technologies of the future. The new Process Competence Center will allow us to remain in the vanguard of cathode materials manufacturing," Scheers said.

The center is expected to strengthen Umicore’s leadership in innovative energy-efficient production processes, which will be applied to its high-technology installations worldwide, she added.

"Both decisions are major milestones for Umicore," Grynberg said, "and will significantly contribute to the EU’s initiative to promulgate a leading rechargeable battery industry based on innovative technologies and a sustainable supply chain."