Lithium iron phosphate and related battery chemistries are expected to take a larger market share in Europe, but the market faces many challenges in developing the recycling and reuse supply chain, speakers and participants at the Leadvent Electric Vehicle Battery and Recycling Forum in Amsterdam said Feb. 26.
"In Europe, LFP and lithium manganese iron phosphate should take 40% of market share by the end of this decade," Remi Cornubert, president of consultancy Strat Anticipation, said. "If we want to offer affordable EVs to the consumer, we need to use LFP."
For LFP battery recycling to reach breakeven in Europe, lithium prices would need to return to $20,000/mt, Cornubert added.
Platts, part of S&P Global Commodity Insights, last assessed European imports of battery-grade lithium carbonate at $9,700/mt CIF Europe on Feb. 26, up $50/mt on the day.
"While China is quite happy to do it, there's no business case in Europe for recycling LFP," Tom Vöge, director of public policy at GRS Service GmbH, said. "So that certainly means that there's even more need for investment in Europe in building up capacities for LFP recycling and making sure it's competitive in some way here, too,"
Previously, market participants called for government subsidies to support the development of LFP recycling in the EU.
"European shredders and pre-processors [black mass producers] are charging large gate fees to accept LFP batteries -- in Europe, we have to pay a lot for the recycling, you could buy a nice brand new car for these gate fees, but in China, you get paid for LFP," a battery collection source told Platts on the conference sidelines.
Platts assessed Chinese LFP black mass at Yuan 2,900 per 1% lithium content on Feb. 26, stable on the day.
With the EU looking to tighten control on the exporting of end-of-life lithium-ion batteries to outside Europe, the more attractive Asian market is not available as an export market for some battery recyclers.
Another factor to consider for the LFP battery recycling supply chain in Europe is the potential of the second-life market, such as in energy storage systems.
"People in Europe are storing [LFP batteries] and waiting and hoping that it can be used for energy storage systems," the collection source said. "But [EU] demand is not that high, nor is demand high from the few European LFP black mass producers, so this is also causing storage capacity issues."
Direct recycling as a solution
Multiple market participants floated direct recycling, an alternative to hydro- or pyrometallurgy, as a potential technological solution to make LFP recycling more economically viable in the future.
Dr. Xiaohan Wu, lead expert at Porsche Consulting, said LFP batteries will outlive EVs by far, so if LFPs are directly recycled, "we would practically destroy a significant portion of the functional value and would not utilize the battery's lifetime assets given by the chemistry."
Direct recyling is more resource-efficient and has the potential to recover higher rates from the materials and cover them in their functional form, Dr. Jacqueline Edge, project leader at the Faraday Institute, said.
"So having extracted the elemental form of the mineral, you don't have to then reprocess it into, say, cathode active material," Edge said. "You're actually recovering it as a cathode active material in the chemical structure, which is of a much higher value."
However, Edge noted there are barriers to direct recycling, the largest of which is that disassembly must be done manually, which is "very slow and very expensive."
Edge added that automation was a potential solution to this problem, but the large variety of battery pack designs and lack of standardization are current challenges when it comes to training a robot for pack disassembly.
The potential revenue increase through direct recycling, compared to other recycling processes, is expected to be much bigger for LFP than for the nickel-manganese-cobalt chemistry, Dr. Andreas Bittner, CEO of CellCircle UG, said.
"We can increase the value of the recycled LFP product by a factor of three," Bittner said. "This is very important because the market for LFP batteries is rapidly growing -- from 2020 to 2030, we have forecast an approximate 60-fold increase of the LFP battery market, and this also has a strong influence on the LFP battery recycling market."
