Terrafame shifts battery chemical sales to Asia with Toyota deal

Terrafame now sells almost all its battery chemicals outside Europe and will supply materials to a joint venture between Toyota and Panasonic, Yle reports. The Finnish mining company began producing battery chemicals in Sotkamo in 2021, initially aiming to serve Europe’s car industry.

Chief executive Antti Koulumies said Europe lacks enough factories to process nickel and cobalt sulphate into materials used in battery cells. Battery and battery-material production is concentrated in Asia, particularly China, Japan and South Korea, where manufacturers also make batteries for European and US carmakers.

Koulumies called for EU action to attract more battery-chemical processing to Europe. Terrafame’s latest agreement is with PPES, the Toyota and Panasonic joint venture. The company has not disclosed the deal’s value. Terrafame has also signed billion-euro agreements with European carmakers Renault and Stellantis.

Battery metals accounted for nearly half of Terrafame’s revenue in the first half of this year, and the company expects their share to grow. It is also looking to recover more copper from mined ore through bioleaching and is studying whether to begin recovering scandium, a rare earth metal.

Terrafame aims to raise annual nickel production from about 30,000 tonnes to 36,000 tonnes by improving bioleaching. Koulumies said the company already produces about 70 per cent of the nickel mined in the EU.

The company wants to become a broader multi-metal producer to reduce the effect of fluctuating prices. If battery-chemical prices fall, it could earn more from metals and intermediate products with stronger market prices.

Construction is under way on Terrafame’s fifth primary leaching heap, which is due to be completed next summer. Koulumies estimates it will contain metals worth about one billion euros, including nickel, zinc and copper, as well as smaller amounts of cobalt, uranium and scandium. He hopes the company, which has so far made a loss, will begin to recoup its investment in the early part of the next decade.

Terrafame is seeking a new main permit to continue mining. The application includes a new open-pit area at Kolmisoppi, which the company plans to use alternately with its current Kuusilampi pit. Koulumies said Kolmisoppi is vital to the mine’s future: it would extend the mine’s life and improve its cost competitiveness. A refusal or delay, he said, would create serious challenges in securing ore from the current pit.