# Nickel and Cobalt Price Volatility Forecasting Using a Self-Attention-Based Transformer Model
## 1 Introduction  
In recent times, there has been a focus by governments as well as non-profit organizations to cut down on fossil-fuel-based energy sources and increase the consumption of environmentally friendly and renewable sources of energy. To cater to this, private sector-based industries are focusing on battery-based energy storage solutions, which extensively use metals such as Nickel and Cobalt for their regular operations. This results in a kind of uncertainty in the prices of these metallic commodities, which ultimately results in the volatile nature of their pricing behavior. Numerous studies have been conducted on the connection between resources and economic growth to determine the relationship between resource readiness and how it helps a country in the expansion of its economy. Since natural resources are a necessary component of activities such as manufacturing, it would be reasonable to assert that having access to these basic materials stimulates the economy. However, this is not the case with every country or region. For example, studies such as [1, 2] reveal how oil-rich countries such as Venezuela and Nigeria lag behind oil-, scarce countries of East Asia. Additionally, a significant amount of greenhouse gases has been released into the atmosphere because of world economic progress, indirectly resulting in a significant rise in global temperatures and consequent climate change. To curb this phenomenon, it is necessary to put more focus on those energy mechanisms consuming fewer GHGs, such as battery-dominated power sources for automobile and various other industries. Nonferrous base metals such as Lithium, Nickel, and Cobalt are extensively used in new-age battery technologies and, hence, have witnessed frequent price variations, especially in the last decade. Due to the limited size of the Lithium market, there is a lack of active trading in lithium futures, resulting in a limited level of market liquidity to sustain a healthy lithium futures market. Moreover, the majority of the global lithium supply is generated by only a handful of nations and a limited number of corporations. This situation could create a concentration risk and restrict the ability of market participants to mitigate their market risk. On the other hand, both Nickel and Cobalt have an active financial trading market since they are widely employed in a wide range of industries, including the production of computer parts, home appliances, automobiles, aircraft, military applications, and coinage; see [3]. One of Nickel's most significant benefits over other metals is its high resistance to oxidation and corrosion. Because of its economical price and superior energy density in comparison to similar products, nickel is a critical metal in the production of EV batteries [4; 5]. Between 2017 and 2025, there will be a 39% yearly rise in the application of Nickel in batteries for electric vehicles. According to estimates, battery manufacturing will account for 37% more of the world's Nickel usage by 2030 than it did in 2017 [5]. Similarly, Cobalt is also one of the essential elements of the clean energy generation supply chain. Composite materials, electric cars and mobile phone batteries, and the move to renewable energy all depend on Cobalt, a vital element that makes it possible to store renewable energy. Additionally, due to rising prices and product performance losses, Cobalt replacement is essentially impossible. In that regard, the use of Cobalt in known technologies is inevitable. Cobalt is also produced as a by-product of other significant base metals such as Nickel, thus making its prices more in sync with it; see [6]. If these metal price predictions are not accurate, they can distort economic analyses and lead to significant financial losses on investments. Additionally, there is a significant need for companies to assess the scope and financial viability of mining decisions beforehand.