Draft amendments to the Automotive Production and Development Programme, gazetted in May 2026, propose adding critical minerals used in electric vehicle battery production to the list of ‘standard materials’ eligible for production incentives.
The International Trade Administration Commission (Itac) confirmed in June 2026 that it planned to expand the automotive incentive programme to include materials such as rare earths, iron, lithium, graphite, copper, and cobalt, reported Creamer Media. Half of their value would be counted as locally value added.
The current incentive programme already covers standard materials like aluminium, steel, and platinum group metals, but not battery-specific minerals. This move aims to kick-start a local battery materials processing industry and move South Africa beyond raw mineral exports.
South Africa holds significant reserves of manganese and lithium, and the country is already the world’s top supplier of manganese ore, with about 70% of global identified resources, according to a News24 report. A feasibility study by the Localisation Support Fund released in March 2026 indicated a gigafactory of 5–10 GWh per year is viable for South Africa, driven by demand from the battery energy storage systems market.
Speaking at the 19th Pujiang Innovation Forum in Shanghai on 12 September 2026, Professor Phuti Ngoepe, Director of the Materials Modelling Centre at the University of Limpopo, said a deeper collaboration with China is on the table.
Currently under discussion between South Africa and China is the establishment of the China–Africa Innovation Alliance on Mining and Metallurgy. The aim is to bring the national facilities in South Africa and China together, alongside other role players, to address the challenges we face through research, pilot demonstrations, industry participation, skills development and technology transfer.
Professor Ngoepe also detailed the beneficiation steps needed to convert raw ore into battery-grade materials. “The minerals are processed into input materials used in manufacturing, such as manganese sulphate or copper sulphate, which are required to produce cathodes. The next stage involves purifying these input materials to battery-grade quality.”
The proposed policy changes align with the South African Automotive Master Plan 2035 and broader green industrial policy objectives. Minister of Science, Technology and Innovation, Professor Blade Nzimande, noted at the same forum that rapidly advancing fields such as artificial intelligence, quantum technologies, and advanced materials were reshaping national development.
Unconfirmed reports from SAnews, the government’s official news service, state that a pilot plant producing manganese sulphate from manganese metal has already been completed with support from the Department of Science, Technology and Innovation. Researchers have also completed a pre-feasibility study on producing manganese sulphate directly from ore. These specific projects have not yet been publicly confirmed by independent sources. Itac opened a four-week public comment period on the incentive expansion in June 2026. Outcomes from that process are not yet public.