German Aluminium Output Rises Slightly, but Industry Urges Policy Support

German Aluminium Industry

Weak Demand and High Energy Prices Threaten Recovery

German aluminium output rises slightly in Q1 2025, marking the first production uptick after nearly three years of decline. According to industry association Aluminium Deutschland, recycled aluminium production increased 3% year-on-year to 703,000 tonnes, while semi-finished products edged up 1% to 576,000 tonnes. However, this growth appears fragile, with no underlying increase in demand and restocking cited as the main driver.

Rolled aluminium product output rose 2% to 456,000 tonnes, while extruded products fell 2% to 121,000 tonnes. This divergence indicates ongoing weakness in value-added segments. In 2024, Germany's aluminium sector had posted a 2% drop in recycled aluminium and a 3% decline in semi-finished products, underscoring the prolonged pressure on producers. Therefore, although German aluminium output rises slightly, the sector remains far from full recovery.

Aluminium Deutschland president Rob van Gils warned that the rebound is not demand-driven and emphasized the need for lower energy prices and clear investment frameworks. The call comes as Germany transitions to a new coalition government following political instability earlier this year. Without structural policy support, Germany risks entering 2025 as a stagnant industrial economy. The aluminium sector is demanding urgent reforms to avoid becoming Europe’s next manufacturing casualty.

The Metalnomist Commentary

Germany’s modest aluminium output growth reflects restocking activity, not industrial recovery. Without energy price reform and investor confidence, the nation’s aluminium sector could slide further—despite its technological strength and recycling capacity.

Revising Germany's Offshore Wind Targets: Navigating Challenges and Strategic Alliances

Germany's BWO

Germany faces the need to revise its ambitious offshore wind energy target of 70GW by 2045, according to the Bundesverband der Windparkbetreiber Offshore (BWO). The association highlights emerging challenges in the sector, particularly the "wake" effects that reduce turbine efficiency, prompting a rethink of the operational and strategic aspects of Germany's renewable energy goals.

Impact of Wake Effects on Turbine Efficiency

Stefan Thimm, managing director of BWO, raised concerns about the "wake" effects, where turbines slow down the wind and create swirling air behind the rotors, leading to a significant reduction in the operating hours of offshore turbines. This phenomenon was evident in the last German offshore wind tender, which saw minimal activity and lower-than-expected prices, indicating a potential oversaturation and diminishing returns from currently designated zones.

Exploring New Horizons: Collaboration with Denmark

Given the limited availability of suitable areas in German waters, Thimm suggests that Germany might expand its offshore wind capacity by building wind farms in Danish waters. He proposed a cooperation agreement with Denmark, whose power demand is just 5% of Germany's, to use Denmark's exclusive economic zone for future German wind projects. This strategic move could help Germany achieve its scaled-up renewable energy targets while mitigating spatial constraints.

Shifts in Tendering and Policy Approaches

The discussion also extends to how Germany's renewable energy tendering process could evolve. Ministers from Germany's North Sea states have proposed shifting the focus from capacity-based tenders to those based on actual electricity generation. This approach would address system stability and integrate excess photovoltaic power more effectively, according to Lower Saxony's economy minister Olaf Lies.

Furthermore, upcoming federal elections in February 2025 could lead to significant policy shifts. The CDU/CSU, potentially the next ruling party, has expressed skepticism about the current government's rigid climate targets and its interventionist renewable policies, suggesting that Germany's renewable strategy may see substantial revisions in the near future.

German Manufacturing Output Rises in August, But Sector Faces Persistent Headwinds

German Manufacturing

Germany's manufacturing sector saw a notable uptick in production output in August, marking a turnaround from July’s four-year low. Data released by Germany’s Federal Statistical Office (Destatis) highlights a 3.4% increase in monthly manufacturing output for August, though it still lags 2.9% behind last year's levels. This recent rise in output reflects an industry still struggling to regain its pre-pandemic momentum amid ongoing challenges.

Overall industrial production also rose in August, registering a 2.9% improvement over June. However, when viewed across a broader three-month span, production from June to August was 1.3% lower than that in March to May, indicating a still-wavering recovery.

Automotive Rebound Fuels Sector Growth

The primary drivers of this rebound were capital goods and energy production, which increased by 6.9% and 2.3%, respectively, on the month. The energy sector, in particular, has been on a steady recovery path since experiencing sharp declines between early 2022 and late 2023. The automotive sector provided the most significant boost to August's output, leaping 19.3% after a steep drop of 8.2% between June and July. This surge underscores the automotive industry’s pivotal role in Germany's manufacturing base, especially as it weathers global supply chain pressures and demand fluctuations.

While industrial production has been gradually recuperating, incoming orders indicate a more cautious outlook. August manufacturing orders were 5.8% lower than July’s figures and down 3.9% on the year, highlighting an ongoing decline in demand that dates back to early 2022. Overall, new orders were nearly 20% lower in August compared to January 2022, reflecting challenges in securing demand.

Rock Tech Targets €100 Million for German Lithium Refinery

Rock Tech Lithium

Canada-based Rock Tech Lithium has secured €100 million in funding for its proposed lithium conversion facility in Germany, where it aims to produce lithium hydroxide monohydrate (LHM) for electric vehicle (EV) lithium-ion batteries. On Thursday, the company announced it had received a binding letter of intent from the state of Brandenburg, Germany, for up to €90 million ($96.5 million) in subsidies for the Guben project. This funding is contingent upon Rock Tech securing the full €800 million required for the refinery.

In addition, Rock Tech anticipates receiving €10 million from the German Railway Authority to support the transition of its transportation operations at Guben from road to rail.

With these potential subsidies, Rock Tech seeks to obtain €500 million through federal funding for the refinery. The company, having received the final permits necessary to commence construction in mid-May, remains "very confident" in its ability to secure the remaining capital in the coming months.

Initially, Rock Tech planned to commence LHM production, a precursor cathode active material (pCAM), this year. However, the timeline has been revised to early 2026. The groundbreaking for the refinery took place in March 2023.

The Guben project is designed with a production capacity of 24,000 metric tonnes per year, which Rock Tech asserts can power 500,000 EVs annually. This facility is the first of five conversion plants the company intends to establish in North America and Europe, with another identified location in Red Rock township, Ontario, expected to begin LHM production by 2028.

Rock Tech plans to source raw materials from its Georgia Lake spodumene project in Ontario, in addition to procuring hard rock from third parties, including the Chinese trading house C&D Logistics. The company has also expressed interest in recycling end-of-life EV batteries as an additional feedstock source "in the years to come."

AMG Advances Lithium Hydroxide Refinery in Germany with Integrated Supply from Brazil’s Mibra Mine

AMG Critical Materials

Bitterfeld Plant Set for Ramp-Up as AMG Expands Low-Cost Lithium Feedstock Operations and Secures Offtake with EcoPro

AMG Critical Materials On Track to Launch First German Lithium Hydroxide Refinery

AMG Critical Materials, a Dutch specialty chemicals producer, is making steady progress toward the ramp-up of its lithium hydroxide refinery in Bitterfeld, Germany. The first module, with a capacity of 20,000 metric tonnes per year, is designed to supply high-purity lithium hydroxide to Europe’s fast-growing battery manufacturing sector.

The German plant will process technical-grade lithium salts sourced from AMG's integrated Mibra Mine in Brazil, which produces lithium concentrate and co-produces tantalum, providing a critical cost advantage in spodumene processing.

Brazil's Mibra Expansion Strengthens AMG’s Vertically Integrated Lithium Strategy

In 2024, AMG completed the expansion of its Brazilian lithium operations, increasing production capacity from 90,000 tonnes to 130,000 tonnes per year. Despite selling 88,966 dry metric tonnes of concentrate—6% less than in 2023—the company achieved an average sales price of $854/dmt cif China.

Crucially, the Mibra Mine maintains a low production cost of $458/dmt, supported by tantalum byproduct credits. This low-cost feedstock enhances AMG’s competitive position as the Bitterfeld plant begins to scale production.

Offtake Agreement Secured with EcoPro as European Battery Market Grows

To ensure downstream placement, AMG signed a binding multiyear supply agreement in 2022 with South Korea’s EcoPro, one of the world's largest cathode material producers. Under this deal, AMG will supply battery-grade lithium hydroxide from its Bitterfeld refinery, reinforcing its role in the European EV battery supply chain.

The project aligns with EU ambitions to localize and secure critical raw material supplies amid growing demand for sustainable energy technologies. AMG’s fully integrated mine-to-refinery model positions it as a key player in Europe’s lithium ecosystem.

Cyclic and Solvay Sign Supply Agreement for Recycled Rare Earth Oxide

Canadian recycler Cyclic Materials has reached an agreement to supply Belgium's Solvay with recycled mixed rare earth oxide (rMREO) starting from late 2024. This development follows an initial agreement made in February 2023, after confirming the compatibility of Cyclic's product with Solvay's separation process.

The recycled oxide will be transported from Cyclic's new Hub100 facility in Ontario, Canada, to Solvay's plant located in La Rochelle, France.

"This agreement is in line with our sustainable sourcing strategy to deliver magnet grades of NdPr (neodymium-praseodymium) and Nd (neodymium) oxides to our customers by early 2025," stated An Nuyttens, president of Solvay Special Chem. She further noted, "Through this partnership, we are establishing a circular loop to reintegrate recycled MREO back into the magnet supply chain."

Since late 2022, Solvay has been working towards creating a rare earths hub for the permanent magnet value chain in La Rochelle. This initiative aims to enhance Europe's self-sufficiency and provide services to customers in the electric vehicle, wind power, and electronics sectors by 2025.

Founded in 2021, Cyclic Materials is focused on developing technologies to convert end-of-life products into raw materials, with plans to establish facilities in North America, Europe, and Asia to meet regional MREO demand. The company has attracted investments from notable entities, including BMW i Ventures, the capital venture arm of the German automaker. Earlier this year, Cyclic also signed an agreement with German magnet materials manufacturer Vacuumschmelze to recycle rare earth magnets in North America.

EGA to Acquire Majority Stake in US-based Spectro Alloys, Expanding Into Secondary Aluminum Market

Emirates Global Aluminium (EGA), the UAE's primary aluminum producer, is set to acquire an 80% stake in Spectro Alloys, a Minnesota-based secondary aluminum smelter. This move marks a strategic expansion into the U.S. market, bolstering EGA’s presence in a region that accounted for over a quarter of its global aluminum sales in 2023, equating to 550,000 metric tonnes.

The acquisition of Spectro Alloys will significantly enhance EGA's capabilities in the secondary aluminum sector, which involves the production of aluminum primarily from recycled scrap. This market is poised for substantial growth, with estimates suggesting that recycled aluminum will drive 60% of global aluminum supply growth by 2030, increasing to 70% between 2030 and 2040.

This latest acquisition aligns with EGA’s broader strategy to capitalize on the growing demand for sustainable aluminum. In May, EGA acquired German specialty foundry Leichtmetall, which has an annual production capacity of 30,000 tonnes. Additionally, EGA is constructing a recycling plant in the UAE, set to produce 170,000 tonnes of aluminum billets annually from both pre- and post-consumer scrap.

Spectro Alloys, with its current production capacity of 110,000 tonnes of aluminum ingots per year, is also expanding. The company began construction in March on an expansion project that will add 55,000 tonnes of billet production capacity in its first phase.

The transaction, pending regulatory approval, is expected to be finalized this quarter. Financial details of the deal have not been disclosed.

Germany Launches Green Aluminum Alliance to Drive Decarbonization

Germany Al

Germany has unveiled the German Aluminium Alliance, a coalition formed to spearhead the transition toward a competitive, climate-neutral aluminum industry. Spearheaded by the Aluminium Deutschland association, the alliance unites key players, including major trades unions IG Metall and IG BCE, and economic authorities from the federal states of North Rhine-Westphalia, Rhineland-Palatinate, Saxony-Anhalt, Saarland, and Hamburg.

Building a Sustainable, Competitive Aluminum Sector

The alliance’s primary objectives include developing low-emission technologies for aluminum production, creating a climate-neutral value chain, and boosting sustainability through a circular economy. With Germany’s aluminum industry playing a critical role in decarbonization, the alliance plans to advance research funding, secure stable energy supplies, and advocate for fair global competition to prevent carbon leakage. These goals align with enhancing Germany’s industrial competitiveness while contributing to EU-wide climate targets.

Aluminium Deutschland president Rob van Gils emphasized the need for aluminum in meeting climate goals, noting that cooperation with political and social partners is essential to ensure sustainability and industry resilience.

Wacker Targets €1 Billion Polysilicon Sales in 2025 Amid Semiconductor Boom

Wacker

Semiconductor Demand Drives Recovery as Solar Oversupply Weighs on Market

German chemical giant Wacker Chemie aims to regain €1–1.3 billion in polysilicon sales in 2025 after a sharp decline in 2024. The company’s 2024 polysilicon revenue fell 41% year-on-year to €949 million, down from €1.6 billion in 2023. However, Wacker expects growing semiconductor demand to lift sales volumes, even as challenges persist in the solar-grade market.

Semiconductor Growth Fuels Polysilicon Expansion

Wacker is ramping up production of semiconductor-grade polysilicon at its Burghausen facility in Germany, with a new plant slated to launch in 2025. This expansion aligns with rising chip demand from the automotive and data center industries. The company anticipates increased volumes of higher-purity polysilicon, which commands better margins.

Meanwhile, the solar-grade polysilicon market remains oversupplied. Chinese producers have expanded output capacity beyond current solar panel installation needs, putting downward pressure on prices and margins.

Silicone Business to Grow by 10% in 2025

Wacker also forecasts 10% revenue growth in its silicones division in 2025. The company refines silicon metal in-house to produce silicones, which are used in diverse industrial applications. In 2024, silicone sales rose 2% to €2.81 billion, driven by increased sales of specialty products and higher plant utilization rates.

To meet future demand, Wacker has expanded production in Zhangjiagang, China, and is building a new specialty silicone facility in Karlovy Vary, Czech Republic. The new site is expected to begin operations by the end of 2025, potentially boosting sales in 2026.

Eramet and BASF Cancel $2.6 Billion Nickel Smelter Investment in Indonesia

French mining company Eramet and German chemical giant BASF have decided to cancel their planned joint investment in a nickel-cobalt refining complex in Weda Bay, Indonesia. This decision, announced on June 24, 2024, was made after a thorough evaluation of the project's feasibility and the current market conditions​.

The primary reason for the cancellation is the anticipated short-term oversupply of nickel, driven by a temporary stagnation in electric vehicle (EV) market demand, a phenomenon often referred to as the "chasm." BASF explained that with the global supply of nickel for EV batteries improving, the necessity for their investment in the Indonesian facility has diminished​​.

Eramet, while canceling this specific project, mentioned that it will continue to explore potential investments in the nickel EV battery value chain in Indonesia and will update the market when appropriate. The initial plan, announced in January 2023, aimed to invest $2.6 billion to build a high-pressure acid leach (HPAL) facility designed to produce 67,000 tons of nickel and 7,500 tons of cobalt annually​​.

Indonesian officials noted that the decision might also have been influenced by the existing and planned HPAL facilities in the country, which would make it easier to obtain mixed hydroxide precipitate (MHP) without needing substantial new capital expenditure​​.

This development reflects broader trends in the global nickel market, where Indonesia's share of nickel mine supply has surged from 26% in 2018 to 55% in 2023, with the production of nickel intermediates more than doubling over the same period. Despite the anticipated 8.7% increase in global nickel production this year, demand growth is expected to lag at around 4%​​.

BMW to Establish Five New High-Voltage Battery Plants

German automaker BMW is set to expand its production of next-generation high-voltage batteries with the construction of plants in five countries.

The new battery production facilities will be located in Lower Bavaria (Germany), Debrecen (Hungary), Woodruff (United States), Shenyang (China), and San Luis Potosi (Mexico).

BMW is adhering to a "local for local" supply chain strategy to enhance resilience and reduce the carbon footprint of its production processes.

In addition to this expansion, BMW has announced the introduction of the Neue Klasse vehicle, its latest fully electric model. The cars are scheduled to debut in 2025 in Debrecen, followed by production in China in 2026 and Mexico in 2027.

Prototype battery cells are currently being developed at the Cell Manufacturing Competence Centre (CMCC) in Parsdorf and the Battery Cell Competence Centre (BCCC) in Munich.

Summary

BMW is building five new high-voltage battery plants in Germany, Hungary, the US, China, and Mexico as part of a strategy to localize its supply chain and reduce its carbon footprint. The new fully electric Neue Klasse vehicle will debut in 2025, with production expanding to China and Mexico in subsequent years. Prototype battery cells are being developed in Germany.

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#BMW #ElectricVehicles #BatteryPlants #SustainableEnergy #LocalForLocal #NeueKlasse #EVProduction #CarbonFootprint #GreenManufacturing #GlobalExpansion

Vulcan Energy Resources Starts Lithium Hydroxide Production at German Demonstration Plant

Vulcan Energy Resources

Lithium and geothermal group Vulcan Energy Resources has begun production of lithium hydroxide at its demonstration plant in Frankfurt, aiming for commercial production by 2027. This represents a two-year delay from its original timeline but positions Vulcan as a leader in carbon-neutral lithium extraction and processing.

From Pilot Production to Commercial Goals

Vulcan first started producing lithium chloride at its pilot extraction plant on April 8, 2024, and on December 21, initiated lithium hydroxide production using lithium chloride as feedstock. The demonstration plant has a capacity of 55 tonnes per year (t/yr), sufficient for regulatory compliance across at least three of the four required stages before commercial-scale operations commence.

The company plans to supply lithium hydroxide to key partners, including LG Energy Solutions, Umicore, Stellantis, Renault, and Volkswagen. As part of Phase 1 production, Vulcan aims to deliver 24,000 t/yr of lithium carbonate equivalent (LCE), enough for around 480,000 electric vehicles (EVs) annually, assuming an average EV battery capacity of 50kWh.

Low-Carbon Lithium Production with Geothermal Power

Vulcan employs direct lithium extraction (DLE) technology at its plant in the Upper Rhine Valley, achieving up to 95% efficiency — far higher than the 40-60% typical of traditional methods. By using geothermal brine to power extraction, the company eliminates fossil fuels from its processes, claiming the lowest carbon footprint in the global lithium production industry.

According to Cris Moreno, Vulcan’s CEO, the integrated upstream and downstream operations will produce lithium hydroxide without reliance on fossil fuels. "This allows us to provide affordable baseload heat and power, offering a sustainable and economically viable alternative," Moreno stated.

Challenges and Opportunities

Although Vulcan has twice delayed its commercial production schedule, its innovative approach to lithium extraction aligns with growing demand for sustainable materials in the EV market. Vulcan plans to create at least 1,300 direct and 1,500 indirect jobs upon reaching Phase 1 capacity.

However, the company has yet to complete a definitive feasibility study for Phase 2, which will further expand production and meet growing demand from global automakers and battery manufacturers.

European Aluminium Calls for EU Scrap Export Limits

European Aluminium Scrap

Aluminium industry group urges EU action to protect regional scrap supply amid rising export demand and U.S. tariff pressure

Rising Exports and U.S. Tariffs Put Pressure on EU Scrap Supply

European Aluminium has urged the EU to implement export limits on aluminium scrap. This follows increased competition from Asian markets and new U.S. trade measures. In 2024, the EU exported 1.5mn tonnes of aluminium scrap, with over 500,000t going to India alone. Meanwhile, U.S. buyers are now expected to shift toward scrap after Washington imposed a 25% tariff on primary aluminium.

Industry Pushes for Regulation Through the WSR and Circular Economy Act

The association proposed using export fees and tightening the Waste Shipment Regulation (WSR). This 2023 revision now includes scrap metal, offering a legal pathway for restrictions. European Aluminium also called for a new Circular Economy Act to ensure long-term scrap availability and quality. Furthermore, it recommends a dedicated emissions benchmark for recyclers.

Scrap Now Central to Primary Production and Green Goals

Sustainability targets have pushed primary aluminium producers to use more scrap. Improved technologies also enable the use of lower-grade material. As a result, competition for European scrap has intensified. German trade body Aluminium Deutschland previously appealed to its government for similar EU-wide restrictions.

The Metalnomist Commentary

Aluminium scrap is no longer a marginal byproduct—it’s become a strategic resource. With decarbonization and tariffs converging, Europe faces a policy choice: export profits or internal supply security. The latest moves by industry groups show momentum for regulatory intervention.

EU States Approve Tariffs on Chinese Electric Vehicles Amidst Ongoing Negotiations

The European Union has taken a significant step towards imposing tariffs on Chinese battery electric vehicle (BEV) imports, a decision that will have far-reaching implications for the global auto industry. On October 30, EU member states approved tariffs on Chinese BEV imports for the next five years. This move follows the European Commission's slight adjustments to the duty rates after receiving input from various stakeholders.

Tariffs Take Effect October 31

If no agreements are reached between the European Commission and individual companies, these definitive duties will be implemented starting on October 31. The proposed tariffs, which have been met with mixed reactions, required support from a qualified majority of 15 EU countries representing 65% of the population to pass. Despite opposition from Germany, which has raised concerns about the potential impact on the auto industry, the proposal was ultimately approved.

German MEP Michael Bloss criticized his country’s stance, stating, "This capitulation to China is not only weak; it harms Europe." Bloss, a spokesperson for the Greens on climate and industry policy, argues that stronger measures are necessary to protect European industry from unfair competition.

The European Commission continues to emphasize that any agreement reached with China must comply with World Trade Organization (WTO) rules and be effective in addressing harmful subsidies. Negotiations between the EU and Chinese officials are ongoing, with China's commerce ministry confirming that discussions will resume on October 7.

The new countervailing duties, which add to the existing 10% import duty on BEVs, include a 17% tariff on BYD, a slight decrease from the earlier proposed rate. Geely’s rate was lowered to 18.8%, while Tesla, exporting from China, will face a 7.8% duty. Other companies that cooperated with the EU inquiry face a 20.7% tariff, and non-cooperating firms will be subject to a 35.3% duty.

UAE’s Emirates Global Aluminium Maintains Stable Production in First Half of 2024

Emirates Global Aluminium Maintains Stability While Expanding in 2024

Emirates Global Aluminium (EGA), the UAE-based aluminum giant, reported stable production and earnings for the first half of 2024. Despite the challenging market environment, the company demonstrated steady performance, with slight growth in hot metal output and a focus on value-added products.

Steady Growth and Focus on Sustainability

In the first half of 2024, EGA produced 1.34 million tons of hot metal, a modest increase from 1.32 million tons in the same period of 2023. Sales of cast metal slightly decreased to 1.30 million tons from 1.32 million tons last year, but the company increased its share of value-added products, reaching 82% of total sales compared to 77% last year. EGA’s adjusted EBITDA remained stable at 4.2 billion dirhams ($533 million), aligning closely with the 4.15 billion dirhams from 2023.

EGA's alumina refinery in Al Taweelah saw a rise in output, supplying 1.22 million tons to its smelters, up from 1.15 million tons last year. In Guinea, bauxite exports increased by 5% to 7.19 million tons, highlighting the company’s strong supply chain and continued growth in raw material supplies.

Looking ahead, EGA is making strides in its sustainability efforts by advancing the construction of a new aluminum recycling plant in Al Taweelah. This facility is projected to begin production in 2026 with a capacity of 170,000 tons of secondary aluminum billets per year.

In May 2024, EGA took significant steps toward global expansion with the acquisition of German specialty foundry Leichtmetall and a majority stake in U.S.-based secondary smelter Spectro Alloys. These acquisitions are part of EGA's long-term strategy to broaden its international footprint, with more expansion plans expected by the year’s end.

Speira Boosts Low-Grade Aluminium Recycling with New Investment

German aluminium producer Speira is investing approximately €11 million in four new tiltable rotary furnaces at its Grevenbroich and Töging plants in Germany to enhance the recycling of lower-grade aluminium scrap. This investment includes advanced burner technology and automated charging systems to increase metal yield and reduce carbon emissions. The new furnaces will be capable of recycling heavily contaminated scrap and aluminium dross, contributing to a more sustainable recycling process.

Ralf Koring, Speira’s head of recycling services, emphasized the company’s commitment to maximizing the recycling of all aluminium-containing materials, not just pure scraps. The furnaces will be delivered and installed in stages, with the Grevenbroich furnaces starting production in May 2024 and May 2026, and the Töging furnaces in October 2024 and October 2026.

Earlier this month, Speira announced a €35 million investment in a new furnace at its facility in Holmestrand, Norway, to process an additional 22,000 tonnes of aluminium scrap annually.

Germany Launches €1 Billion Raw Materials Fund to Strengthen Supply Chains

Germany has approved a €1 billion ($1.1 billion) raw materials fund aimed at boosting domestic and international raw material projects. The initiative, managed by state-owned development bank KfW, is designed to strengthen value chains and reduce reliance on foreign imports. The fund will focus on critical areas such as mining, processing, and recycling, and the German government will contribute through equity capital.

Eligible projects must have a binding offtake agreement and a completed feasibility study, as outlined by KfW in May. A government-led raw materials committee will oversee project negotiations and approvals. This strategic move aligns with Europe's growing emphasis on securing critical minerals, a priority under the EU’s Critical Raw Materials Act.

Germany’s initiative mirrors similar efforts in France and Italy, which have also launched raw materials funds. Italy's fund, valued at €1 billion, is expected to attract an additional €1 billion from private investors, while France has committed €500 million to its fund. The European Bank for Reconstruction and Development, along with the EU, launched a joint initiative in July to provide up to €100 million in equity investments for critical materials projects.

Key minerals such as lithium, copper, battery metals, and rare earth elements—essential for industries like aerospace and defense—are primary targets for these European initiatives.

European Chip Joint Venture Begins Construction of Advanced Semiconductor Plant in Germany

European Semiconductor Manufacturing Company (ESMC), a joint venture formed by Taiwan Semiconductor Manufacturing Company (TSMC), Robert Bosch, Infineon Technologies, and NXP Semiconductors, has officially started construction on a groundbreaking new chip manufacturing plant in Dresden, Germany. This plant, strategically located next to Bosch's existing semiconductor wafer fabrication facility, is set to become the European Union's first foundry capable of producing fin field-effect transistors (FinFET).

Construction of the plant, which is expected to begin later this year, marks a significant milestone for the EU's semiconductor industry. The facility will be equipped to produce 40,000 300mm (12-inch) wafers per month using TSMC's 28/22 nanometer (nm) planar complementary metal-oxide-semiconductor (CMOS) technology and its more advanced 16/12nm FinFET process technology. These technologies utilize metals such as silicon, gallium, and indium, essential for manufacturing high-performance chips.

The Dresden plant aims to bring TSMC’s cutting-edge semiconductor manufacturing capabilities to Europe, addressing the rapidly growing demand for advanced chips in the automotive and industrial sectors. With the global semiconductor shortage highlighting the need for robust local production, this facility is expected to play a crucial role in strengthening Europe’s technological independence.

The total investment for the Dresden plant is projected to exceed €10 billion. The European Commission has approved €5 billion in funding from the German government under EU state aid regulations, underscoring the strategic importance of this project to the region's economic and technological future.

Evion's India Joint Venture to Ship First Expandable Graphite Order

Evion Group Graphite

Australian graphite producer Evion has announced that its joint venture with Indian producer Metachem Manufacturing in Pune, India, is set to ship its first order of expandable graphite this month. This marks a significant milestone for the partnership and the Indian graphite market.

First Order and Production Details

The joint venture's initial order, a substantial 386 tonnes, is destined for German trading firm Technografit. Production of this order was slated to take place between January and March.  Prior to scheduled maintenance in late December, approximately 120 tonnes of the order was produced or "partially treated" from early November to mid-December. 

Evion has confirmed that the order is on track for completion and will be shipped to Europe over the coming months.  The sale price for this initial shipment averaged between $3,000 and $3,300 per tonne on a free-on-board (FOB) basis, while the joint venture anticipates production costs ranging from $1,500 to $1,750 per tonne. This healthy margin demonstrates the potential profitability of the venture.

Future Production and Expansion Plans

Evion also revealed that the joint venture has secured 500 tonnes of graphite concentrate on-site, ready for processing. This material is planned for export between April and September, primarily to European markets.  The company anticipates sales prices to be roughly 10% higher during this period.  Evion plans to provide further production guidance within the first quarter of the year, including details on new sales and buyers. 

The joint venture expects to sell over 2,000 tonnes of expandable graphite during its first full year of operations, having commenced production in April 2024.  Looking ahead, both companies are considering expanding the plant's capacity to 4,000 tonnes per year.  The original agreement establishing the joint venture had projected a production capacity of 2,000 to 2,500 tonnes per year for the initial three years. This potential expansion signals the partners' confidence in the market and their commitment to growth.

Mercedes-Benz Opens Lithium-Ion Battery Recycling Plant in Germany

Battery Recycling Plant

Mercedes-Benz has inaugurated its advanced lithium-ion battery recycling facility in Kuppenheim, southern Germany, marking a significant step in its mission to establish a closed-loop system for critical minerals essential for electric vehicle (EV) production.

The new plant aims to process 2,500 metric tonnes per year of active and inactive materials from shredded battery modules. The active material, known as black mass, contains high-value critical minerals such as nickel, lithium, and cobalt. These will be refined and reused to produce over 50,000 battery modules annually for Mercedes-Benz's EV lineup.

Innovative Recycling Process

The facility utilizes a cutting-edge mechanical-hydrometallurgical process, which Mercedes-Benz claims can recover more than 96% of battery-grade critical minerals from spent lithium-ion batteries. The mechanical phase sorts and separates inactive materials like plastics, copper, aluminum, and iron. Meanwhile, the hydrometallurgical phase processes the black mass to extract critical minerals for reuse in battery production.

Sustainable Operations

Mercedes-Benz's Kuppenheim facility is powered entirely by green electricity, incorporating a photovoltaic system with a peak output of over 350 kilowatts. This aligns with the company's broader commitment to sustainability and reducing carbon emissions.

Technology Partnership with Primobius

The plant was developed in collaboration with Primobius, a joint venture between Australian process technology innovator Neometals and German engineering firm SMS. Mercedes-Benz's subsidiary Licular spearheaded the project, leveraging Primobius' expertise to implement cutting-edge recycling technologies.

Future Expansion Potential

While the Kuppenheim plant represents a significant milestone, Mercedes-Benz is cautious about scaling operations further. A spokesperson highlighted that production volumes could expand in the "medium to long term," contingent on insights gained from the facility’s initial operations.

This recycling initiative underscores Mercedes-Benz's dedication to creating a sustainable supply chain for critical minerals, enhancing EV production, and reducing environmental impact.