Written by Bryan Lutz, Editor at Dollarcollapse.com:
Battery metals aren’t following the rising tide in commodities and they don’t care about American politics.
They are following their own story, and they’re also going up, just like gold and silver.
If you only read American headlines, you’d think the EV revolution is over. US sales hit their lowest monthly level since 2022 in January. Ford’s CEO says 2026 sales could be “cut in half or more.” Automakers are taking billion-dollar write-downs and pivoting back to gas trucks.
So, the narrative seems tidy: EVs were overhyped, the subsidies are gone, and now it’s time to move on.
There is one problem though. The rest of the planet didn’t get the memo.
The Story Battery Metals Are Actually Telling
In 2025, global EV sales went up by 20%, hitting 20.7 million units. China crossed 50% EV market share for the first time and is heading toward 80% by 2030. Europe grew EV sales by 33%, with Germany up 48% and the UK up 27%. Vietnam doubled its EV share to nearly 40%, overtaking the EU for penetration. Thailand crossed 20%. BYD more than doubled exports to over a million units. Emerging markets grew 48% in a single year.
The “EVs are dead” story is an American story being projected onto a global market doing the exact opposite. And battery metals don’t care about American politics.
(via the Visual Capitalist)
From Obituary to “Structural Growth Story”
Last year, battery deployment crossed 1 TWh globally. And now the stats are coming in….
Raw materials bill topped $2 billion in December for the first time in 27 months. Lithium and nickel prices are accelerating into 2026. Cobalt sulphate is up over 200% year-on-year. Mining stocks are up nearly 90% since early 2025. Battery metals trading volume doubled. The thing is the same analysts who called the EV trade dead are now rebranding it a “structural growth story.”
Mining.com report:
CHART: EV battery metals index jumps to 27-month high
“The EV Metal Index pairs metals demand with prices in the EV battery supply chain. That paints a very different picture of the battery metals market and shows just how deep the slump of the last few years has been for raw material suppliers to the industry.
But even by this measure, the outlook has become much brighter.
The raw material bill for the contained lithium, graphite, nickel, cobalt and manganese in the batteries of EVs sold over the course of 2025 climbed to $15.8 billion, an almost 13% gain over the year before.
Granted, that’s still almost half of the extraordinary level reached in 2022, but 2026 is already shaping up to be another year of strong growth – and a much better pricing environment.”
And that Government Subsidy Question
There are fair objections. to EV / batter metal growth out there. In the sound money world, this is the big one:
Are the same the places where EV sales are booming also the places with the biggest government subsidies?
Yes, but let’s factor that in to our understanding on supply and demand.
Subsidies are responsible for growth, everywhere. Europe’s 33% EV sales growth in 2025 was driven by EU emissions mandates, and the reintroduction of subsidies in Germany, the UK, France, Italy, and Spain. Then there are the emerging markets. Emerging markets like Brazil and Thailand are surging on the back of Chinese EV imports enabled by local tax breaks. For example, Chinese-made EVs account for over 85% of EV sales in South and Central America.
But then when the subsidies are taken away….
China built its dominance on years of purchase tax exemptions and trade-in incentives, and the moment Beijing introduced a 5% purchase tax in January 2026, sales dropped 20% year-over-year. And then when the US killed its $7,500 tax credit and sales are expected to decline 29% in 2026. Canada removed subsidies and sales fell 41% in a single year.
So yes, government money is a major engine of EV adoption, but think about this through a sound-money lens.
Governments worldwide are subsidizing electrification with money they’re borrowing and printing. Those subsidies are driving the demand that’s consuming battery metals at record rates. The 1 TWh of battery deployment, the 20.7 million EVs sold, the $2 billion monthly raw materials bill. All of that is being turbocharged by fiscal spending that no major government can actually afford. Yet, the metals are being consumed regardless.
They go into batteries, into cars, into grid storage. They don’t come back. As a result, the supply deficit is structural. Eventually, it exists whether the demand is organic or subsidized, because more mines aren’t being built to meet future demand.
So, here’s the irony:
If subsidies continue, demand keeps growing and the deficit deepens. If subsidies get pulled back globally (as we’re seeing in the US and starting to see in China) demand slows, mining investment dries up even further, and the deficit still deepens because the supply response dies with it. Mines may close, or shut down for awhile, but the market still requires the metals.
The metals don’t care whether the buyer is a subsidized consumer in Stuttgart or an unsubsidized fleet operator in Shenzhen. A tonne of lithium consumed is a tonne of lithium consumed. And there aren’t enough tonnes.
What the Prices Are Telling Us
1. The deficit is arriving on schedule. Lithium is heading toward shortage in 2027. Cobalt is already running a deficit causing the DRC regulate export quotas cutting supply in half. Indonesia slashed its nickel quota by a third, spiking prices 30% in one month.
2. Governments are pushing prices higher from both ends. Subsidizing demand with borrowed money on one side. Restricting supply with export quotas and resource nationalism on the other. This is a bullish setup.
3. Repricing has barely started. Lithium at $13,250 per tonne is a fraction of its $80,000+ peak. Cobalt at $24-29/lb is recovering, not euphoric. And energy storage (something few people thought to price in because of data center growth…) is growing 44% annually, now a quarter of all battery demand. Regardless of EV sentiment in the US, the demand floor for battery metals keeps raising.
The metals are following their own story. That story says higher.
—-
References:
- Benchmark Mineral Intelligence, Global EV sales reach 20.7 million units in 2025, growing by 20%, January 14, 2026
- Electrek, Europe surges, US stumbles, China cools: EV sales dip in 2026, February 12, 2026
- IEA, Global EV Outlook 2025: Expanding Sales in Diverse Markets
- Institute for Energy Research, EV Sales Grew 20% Globally in 2025, February 2026
- Ember, The EV leapfrog — how emerging markets are driving a global EV boom, December 15, 2025
- S&P Global Mobility, January 2026 US auto sales reflect a chilly start to the new year, February 2026
- MINING.COM / Adamas Intelligence, EV battery metals index jumps to 27-month high, February 2026
- CME Group, Q1 2026 Metals Update, 2026
- Crux Investor, Battery Metals: The Strategic Investment Case for 2026
- Fastmarkets, Battery Raw Materials Outlook 2026, January 2026
- Visual Capitalist / IEA, Ranked: EV Share of New Car Sales by Country in 2025, February 2026
