EQS-News

What’s Driving Demand For Phosphate Globally?

EQS-News: Arianne Phosphate What’s Driving Demand For Phosphate Globally? 07.12.2022 / 14:20 CET/CEST The issuer is solely responsible for the content of this announcement. The World Of Phosphate Phosphate is growing as a commodity because of its use in batteries and fertilizer. The phosphate market is expected to witness a compound annual growth rate of 5% between 2022 and 2028 primarily because of these two industries.

Electric vehicles (EVs) have long banked on lithium-ion batteries composed of nickel, cobalt and manganese, but in recent years, North American and European carmakers are following China’s lead and developing lithium iron phosphate (LFP) batteries. LFP batteries are safer, cost less than alternatives and last longer. Phosphate is a better alternative to nickel and cobalt needed for lithium-ion batteries, and as EVs evolve, phosphate demand is projected to grow.

Also pushing LFP growth is its use in energy storage. Within the next five years, LFP use in energy storage will outpace its use in EVs resulting in further demand growth for phosphate.

Phosphate is also an essential component of fertilizers and is used in various food and industrial products. Commercial fertilizers are composed of nitrogen, phosphate and potassium (NPK) — the Big 3 — which play a key role in plant nutrition.

The global population is expected to exceed 9 billion by 2050 so fertilizer will be increasingly needed to boost crop production. As the agriculture sector increases globally to meet demand, the need for phosphate will also increase.

Why Phosphate Could Remain A Major Player

Despite LFPs becoming the leading battery chemistry for EVs, EV technology is developing rapidly, and there is always the chance that predictions can be wrong and other chemistries like sodium-ion surpass LFPs. But fertilizers are a much more stable industry and the Big 3 components of fertilizers are far less likely to change.

This is important to recognize because fertilizer production accounts for 85% of phosphate use. Phosphate is a commodity that is projected to grow in demand regardless of the EV market. The phosphate demand curve would look different without batteries, but fertilizers use most phosphate anyway. The reality is phosphate isn’t going anywhere soon.