LME Week: Challenges for commodities in a low-carbon economy

London, Oct 8 (SMM) – As the world transits to a low-carbon economy, the transition across commodities will be determinant on supply chain changes, said Jeremy Weir, CEO of commodity trading house Trafigura.

Speaking to delegates at LME week in London on Monday October 8, he said that stricter environmental regulation had grown difficulty in building a new, qualified aluminium or copper smelter in China. This is likely to lower growth of global aluminium output to 4% in the next few years. 

Nickel and cobalt are likely to become major raw materials in the near future, going by the increasing investment in new energy globally. The number of electric vehicles (EVs) is expected to increase to 30 million by 2030. Production of each EV will require 5-10 kg of lithium metal. 

This development in new energy is likely to slow down supply chain transformations for other minor metals. Labour issues, such as the use of child labour in cobalt mining in Congo, will also hinder the process, he added.

He believed that it will be a big step in standardisation across the metals industry if more responsible mining approaches are adopted.