Sumitomo Metal Mining Co Ltd said on Tuesday that it will spend 47 billion yen ($ 424 million) on increasing production capacity for cathode battery materials used in electric vehicles (EVs) to meet growing demand.
Japan's largest nickel refinery will build a new cathode material production facility in Besshi, Ehime Prefecture in western Japan by 2025, and expand precursor production capacity at its Harima refinery in Hyogo Prefecture in western Japan.
Of the 47 billion yen spent on construction, 40 billion yen will go to the new plant, and the rest will be used in Harima.
Nickel is a key component of lithium-ion batteries used to power electric vehicles, which sales are expected to grow in the coming years as the world moves towards a low-carbon future.
Sumitomo Metal, which supplies nickel-based cathode materials for Panasonic Corp's lithium-ion batteries used in Tesla Inc electric vehicles, aims to increase production of cathode materials to about 7,000 tonnes per month in 2025 from about 5,000 tonnes now. , said a company representative.
The company said it plans to increase its cathode material production capacity to 10,000 tonnes per month by 2027.
“We are seeing signs of a significant increase in demand for our nickel metal products,” the company said in a statement.