The EU depends on China for materials critical to the green transition, but wants to strengthen its own supply chain. One minerals producer is set to start processing lithium in Germany in 2024. What obstacles does it face in ramping up production?
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00:00Europe's path to a green future has a problem.
00:03Its industry needs resources.
00:06This new lithium processing plant in Germany could be key to diversifying supplies.
00:11To get ahead in battery production, resources like lithium are crucial.
00:15But chemical processing into battery-grade materials is tricky.
00:19This refinery here in Germany will be the first of its kind in Europe.
00:22But the continent still remains largely dependent on China to source materials.
00:28China dominates refining of the alkali metal, and with it, the know-how for processing the material.
00:39But to break free of this dependence, Europe needs to build its own material supply chains.
00:44Here at AMG Lithium's Frankfurt laboratory, chemists constantly monitor and test the refining
00:49steps they design for processing lithium hydroxide.
00:52The scientists here have come up with ways to filter out contamination from the lithium
00:56that the company will later refine on a larger scale.
00:59The processes here in the lab will later work one-to-one in the industrial process.
01:07You press the material in here.
01:09Then the cylinder spins really fast.
01:12And as it rotates, the solution is forced out of the filter bag, and only the dirt or
01:17the impurities remain.
01:19And my clean, crystallized material stays in here.
01:21That's basically the process.
01:27The Frankfurt-based chemical company has been building its experience in these refining
01:30steps for five years now.
01:33Understanding precisely how each step works will make it possible for the scientists here
01:38to build out capacity away from the lab.
01:45Spodumene rock from a mine in Brazil sits at the beginning of AMG Lithium's processing chain.
01:50In Brazil, it's ground up and processed.
01:56And in the first phase, we ship this spodumene concentrate, is the name for it, to China.
02:03And the reason for this is simply because there is no other conversion plant who is
02:09able to use this material at this moment.
02:12And then we get back from China, a technical intermediate, into Bitterfeld, where we do
02:20the refining to the final battery grade.
02:23Bitterfeld-Wolfen, a chemical industry town in Germany's east, a location AMG picked to
02:28set up its industrial production, with space to expand the initial capacity five times.
02:36They're still setting up shop here in what may become Europe's largest lithium refinery,
02:40where they're expecting to refine 20,000 tons of lithium hydroxide per year in the
02:44first phase.
02:46But as prices for the product crashed recently, investments are tough.
02:51People are very, very cautious putting money into lithium projects at this point.
03:01Because with the current price level, it's very hard to make an investment case, actually.
03:08The plant here received some public subsidies, and European governments pledged more money
03:12for building up the critical minerals sector.
03:15Recently, the European Union's Critical Raw Materials Act came into force, aiming to eliminate
03:21dependence in material supply chains.
03:24It sets targets for 2030 that 10 percent of materials should be mined in the EU, 40 percent
03:30refined within the bloc, and 15 percent recycled here.
03:37In total, no more than 65 percent of a single material should be sourced from one country
03:41alone.
03:46But despite the build-up of refining capacities, the amount of money pledged doesn't yet match
03:51the need.
03:52If we put these funds in perspective, for lithium alone, you're looking at a mid-single-digit
04:00billion euros of investment needed just to meet the EU's 2030 target.
04:10AMG's lithium refining plant in Germany is expected to make a dent in reaching those
04:14goals.
04:16They are starting to turn the tables on global materials supply chains.
04:20But they won't be able to walk it alone.