South Korea’s battery maker SK Innovation Co. signed a deal with the world’s largest cobalt producer Glencore PLC to secure cobalt, a core material for electric vehicle (EV) batteries, for the next six years.

The deal will allow stable arrival of supplies of 30,000 tons of cobalt enough to produce batteries to power 30 million units of fully electric cars through 2025 from the Swiss-based commodities giant, the company said Wednesday. The agreement strengthens the Korean company’s readiness against surging demand for EV batteries, it added.

Industry watchers estimated the global EV battery market to grow by an average of 25 percent per year to 182 trillion won ($153 billion) by 2025, which would boost the demand for cobalt, the critical metal for EV batteries. The demand for cobalt is forecast to increase to 32,000 tons next year and 92,000 tons in 2025.

Regarding the concerns for possible human rights violations including child labor while mining the metal, the two companies said they agreed to receive external inspection every year to ensure ethical sourcing. There is a growing voice that the scrutiny over the mining practices should be strengthened to address human right violation issues such as child or forced labor especially in mines in the Democratic Republic of Congo and other African nations.

By Song Gwang-sup and Choi Mira

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