China Drops to Second in BloombergNEF’s Global Lithium-Ion Battery Supply Chain Ranking as Canada Comes Out on Top

Source: | · BLOOMBERGNEF · | February 5, 2024

Canada has overtaken China for the top spot in BloombergNEF’s (BNEF’s) Global Lithium-Ion Battery Supply Chain Ranking, an annual assessment that rates 30 countries on their potential to build a secure, reliable, and sustainable lithium-ion battery supply chain.

This marks the first time China has not claimed the number one position. Canada’s consistent manufacturing and production advances, and strong ESG credentials, have helped it become a leader in forming the battery supply chains of the future. Strong integration with the US automotive sector means Canada is also a big winner of the ‘friendshoring’ ambitions of the Inflation Reduction Act. The country’s position in BNEF’s ranking is propelled by policy commitment at both the provincial and federal level.

While China still has the strongest established supply chain, the increasing importance of sustainability across the lifecycle of lithium-ion batteries means the region must take a more proactive approach to tackle ESG issues to benefit its supply chain in the long term.

Overall, North America’s supply chain has been excelling due to strong policy commitment and implementation, with Canada and the US claiming two of the top three positions. Mexico, the only country to make progress in all supply chain categories assessed by BNEF, rose an impressive nine positions in the ranking to 19th. Scaling up a domestic electric vehicle industry will be difficult for the nation, though existing mining and automotive activities are good starting points. The US IRA has played a crucial role in boosting Mexico’s prospects when it comes to the EV and energy storage sectors, but the government will need to actively support the budding sector to make these improvements sustainable.