Increased focus on battery recycling as Glencore announces strategic partnership with Li-Cycle

Global commodity producer and trader Glencore has announced a strategic partnership with battery recycling firm Li-Cycle, which will secure Glencore an off-take for products produced by Li-Cycle in North America

As part of the agreement, Glencore will subscribe for $200 million convertible debt in Li-Cycle, and the company will become Glencore’s preferred partner for Glencore in the lithium-ion battery recycling sector.

Upon the closing of the subscription, the partnership will secure Glencore an offtake of black mass produced from Li-Cycle’s spoke facilities, as well as offtakes of battery usable end products produced by Li-Cycle, and other by-products produced.

In exchange, the company will procure feedstock and black mass for Li-Cycle’s facilities, alongside supplying Li-Cycle’s sulfuric acid requirements.

“We are excited to announce this new strategic partnership with Li-Cycle,” Kunal Sinha, Glencore’s head of recycling, said in the statement.

“We both believe that battery recycling will form a key part of the energy transition. Our bold aim is to help support the creation of a genuinely circular economy that supplies recycled materials and minerals back into the battery supply chain,” he added.

There has been increased focus on the battery recycling industry, as key battery raw material supply remains fundamentally tight globally.

This move is part of many that Glencore has made in the battery recycling industry, including agreements for cobalt recycling in Morocco, and a partnership with Britishvolt to develop a battery recycling ecosystem in the United Kingdom.

The company is also exploring the possibility of building a nickel sulfate plant, and battery precursor cathode active materials plant in Ontario, Canada, as part of a consortium with the government of Ontario, Electra and Talon Metals.

“Glencore has been working on establishing regional platforms across the world to localize battery raw material supply chains within key regions in a scalable and sustainable manner,” the company said.

“With the addition of this strategic partnership with Li-Cycle, Glencore will seek to combine primary and recycled battery raw materials to produce battery grade end products. This will enable auto manufacturers to meet their electric vehicle (EV) ambitions while also being able to meet key regulatory directives related to battery raw materials,” it added.

Key battery raw material prices remain high globally at present as a result of the tightness in supply.

Lithium hydroxide prices in Europe and the United States have more than doubled over the course of 2022. Fastmarkets assessed the lithium hydroxide monohydrate LiOH.H20 56.5% min, battery grade, spot price ddp Europe and the US, at $74-78.50 per kg on April 28, up from $35-36 per kg on January 6.

Similarly, cobalt prices have increased steadily over the course of the year amid increased demand and tight supply. Fastmarkets assessed the price of cobalt standard grade, in-whs Rotterdam, at $39.75-40.50 per lb on Wednesday May 4, up from $33.50-34.05 per lb on January 3.

Nickel briquette premiums in the US have also surged and are currently at record high levels following unprecedented volatility on the London Metal Exchange and supply concerns. Fastmarkets assessed the nickel briquette premium, delivered Midwest US, at $1.75-2.50 per lb, having increased over 170% since January 4.

To gain more insight into the importance of battery recycling and other risks to BRM supply, view the exclusive Fastmarkets BRM risk matrix and read the full report.

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