Gateway Metals

In a new piece for The Hill, American Resources Policy Network principal Daniel McGroarty zeroes in on the intersection between trade and resource policy.

Against the backdrop of the current negotiations to update the North American Free Trade Agreement (NAFTA), McGroarty argues that one of the metals ARPN followers have come to know as a key Gateway Metal – Copper – should be included in the new set of rules on NAFTA’s “auto rules of origin” provision on which negotiators from the U.S., Canada and Mexico may be nearing agreement.

He explains:

“Metals used in our cars have simply been “deemed to originate’ within NAFTA, no matter that they come from Asia, the EU or elsewhere. Not surprisingly, the percentage of non-NAFTA materials in NAFTA country products has risen from 14 to 27 percent in the first 15 years of the treaty.

President Trump and his trade team have prioritized removing this blind spot on raw materials. According to officials close to the talks, there is an emerging consensus to add aluminum and steel to the country of origin requirements, which will strengthen the demand for these key metals.

That’s progress. But before the ink dries, here’s one more metal that the Trump team should be considering that would bring benefits to the western part of the U.S.: copper.” 

Followers of ARPN will understand the underlying reasons: Copper is far more than your old school mainstay metal, and is becoming increasingly indispensable for a broad range of technologies, including the electronic vehicle sector. It is also a Gateway Metal to co-products like Rhenium, Tellurium, Cobalt and REEs, all of which can be found on Secretary of the Interior Ryan Zinke’s recently-released draft critical minerals list – thus inviting beneficial national security implications to the suggested addition of Copper to NAFTA’s content list.

Concludes McGroarty:

“Right now, the U.S., Canada and Mexico are all among the world’s top 10 copper-producing countries (Nos. 4, 8 and 10, respectively), collectively producing over 2 million metric tons a year. With demand already outpacing supply, there’s a ready market for more North American copper production. There is simply no reason to allow non-NAFTA countries “copper citizenship” (or steel or aluminum for that matter) when it comes to calculating the North American content in our cars.

Doing so punishes North American metals and minerals producers, and contributes to a chilling effect that depresses the incentives for increased resource production. And while Mexico doesn’t produce much in the way of aluminum or steel, its significant copper production would give it a ‘metals win’ in the NAFTA negotiations.

With copper usage in electric vehicles ready to redefine metals requirements in the automotive sector, the U.S., Canada and Mexico should ensure that the supply chain for copper inputs is part of the strategy to make North America’s integrated supply chain — from mine to market — as competitive as possible.”

To read the full piece click here.

And to learn more about Gateway Metals and their Co-Products, read ARPN’s latest report here. 

Presidential Executive Order (EO) 13817 on a Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals, was issued on December 20, 2017. Pursuant to the EO, the Department of Interior, in coordination with the Department of Defense, was tasked with compiling a list of Critical Minerals within 60 days. The DOI List was published on February 16, 2018, with a public comment period running through March 19, 2018.

ARPN’s Daniel McGroarty filed two sets of comments, the first identifying a group of “gateway” metals critical for defense applications but absent from the DOI List, and the second articulating the gateway/co-product relationships between metals and minerals on the DOI List. The articulation exercise revealed four metals and minerals absent from the DOI List which are gateways to minerals that are on the List.

The DOI list as published on February 16, 2018, includes the following 35 minerals:

• Aluminum (bauxite), used in almost all sectors of the economy
• Antimony, used in batteries and flame retardants
• Arsenic, used in lumber preservatives, pesticides, and semi-conductors
• Barite, used in cement and petroleum industries
• Beryllium, used as an alloying agent in aerospace and defense industries
• Bismuth, used in medical and atomic research
• Cesium, used in research and development
• Chromium, used primarily in stainless steel and other alloys
• Cobalt, used in rechargeable batteries and superalloys
• Fluorspar, used in the manufacture of aluminum, gasoline, and uranium fuel
• Gallium, used for integrated circuits and optical devices like LEDs
• Germanium, used for fiber optics and night vision applications
• Graphite (natural), used for lubricants, batteries, and fuel cells
• Hafnium, used for nuclear control rods, alloys, and high-temperature ceramics
• Helium, used for MRIs, lifting agent, and research
• Indium, mostly used in LCD screens
• Lithium, used primarily for batteries
• Magnesium, used in furnace linings for manufacturing steel and ceramics
• Manganese, used in steelmaking
• Niobium, used mostly in steel alloys
• Platinum group metals, used for catalytic agents
• Potash, primarily used as a fertilizer
• Rare earth elements group, primarily used in batteries and electronics
• Rhenium, used for lead-free gasoline and superalloys
• Rubidium, used for research and development in electronics
• Scandium, used for alloys and fuel cells
• Strontium, used for pyrotechnics and ceramic magnets
• Tantalum, used in electronic components, mostly capacitors
• Tellurium, used in steelmaking and solar cells
• Tin, used as protective coatings and alloys for steel
• Titanium, overwhelmingly used as a white pigment or metal alloys
• Tungsten, primarily used to make wear-resistant metals
• Uranium, mostly used for nuclear fuel
• Vanadium, primarily used for titanium alloys
• Zirconium, used in the high-temperature ceramics industries

Daniel McGroarty: Public Comment DOI-2018-0001-0126 posted on March 6, 2018 concerning Secretary Zinke’s Draft Critical Minerals list

I want to commend the Department of Interior for its work to establish a unified Critical Minerals List (the “DOI List”), and to open the list for comment. Any list is a moment-in-time exercise, based on many factors, not least of which are technology development and industrial demand, which without question contribute to our evolving understanding of what is and is not a critical mineral or metal.I have testified on critical minerals before various House and Senate committees, I serve on the advisory boards of several U.S. companies developing critical minerals and metals projects, both mining and reclamation/recycling, and I am founder of the American Resource Policy Network, a virtual think-tank that educates and informs on resource dependencies and their impacts.

I offer here four additional metals, in rank order, that I believe merit inclusion on the DOI List, largely from a national security perspective.

From a national security perspective, the single best unclassified source for metals and minerals dependency assessments remains the Reconfiguration of the National Defense Stockpile Report to Congress (2009) and its appendices, which offer a rare view into defense scenarios which may be adversely impacted by lack of timely access to critical metals and minerals. While these studies are nearly a decade old, most of the weapons platforms dependent on critical metals/minerals remain in service today, and in many instances, U.S. foreign supply dependencies have only grown more acute.Many of the DOI List metals/minerals figure repeatedly in the Reconfiguration Report. Detailed here are several additional metals and minerals that are not on the DOI List, and should be added, based on relevant defense criteria.Cause of Significant Weapons System Delay. Appendix C of the Reconfiguration Report, Table 1, lists a declassified study, based on classified scenarios, that indicates that lack of access to various metals and minerals has “already caused some kind of significant weapon system production delay for DoD.”

Of the 21 metals/minerals found to have caused a significant delay, 16 are on the Department of Interior List; 5 are not:

• Copper
• Molybdenum
• Zinc
• Nickel
• Cadmium

Shortfall Scenarios. Appendix C of the Report, Table 1, lists a declassified study, based on classified scenarios, that assesses the likelihood of a shortfall of various metals and minerals during 1) a National Security Emergency, and 2) a Peacetime Supply Disruption scenario. Of the 25 metals/minerals found to be in shortfall during a National Security Emergency or Peacetime Supply Disruption, 17 are on the DOI List, while 8 are not:

• Copper
• Zinc
• Quartz
• Lead
• Mercury
• Nickel
• Silicon carbide
• Silver

Defense Use by Volume. Appendix B of the Report, Table ES-1, lists DoD defense materials, usage by volume. 6 of the Top 10 materials in the table are included on the DOI List; 4 are not:

• Copper
• Lead
• Zinc
• Nickel

Three metals are present in each of these snapshots: Copper, Zinc and Nickel, while Lead appears twice.The first three are also the primary “gateway” to co-product metals/minerals not typically mined in their own right. Copper is the practical access point to at least 4 minerals on the DOI List (Cobalt, Rhenium, Tellurium and potentially the Rare Earths [100% dependency]). Zinc is the gateway to DOI Listed minerals Indium, Gallium (100% dependencies) and Germanium, while Nickel is gateway to Cobalt and the Platinum Group Metals. Lead is gateway to Antimony, Bismuth and Tellurium.Gateway/Co-Product issues have a significant impact on the DOI List.To cite just one example, such is the dependence of cobalt, for instance, on copper and nickel mining, according to a February 2018 report by the Columbia (University) Center on Sustainable Investment:

“…The survival of a cobalt project therefore largely depends on nickel and copper prices. If the prices of these two metals are unfavorable, then it is highly unlikely that a mining project will undergo development, regardless of how high cobalt prices are.”

Recommended Expansion of the DOI List:For these reasons, I recommend that the DOI Critical Minerals List be expanded to include, in this rank order:

1. Copper
2. Zinc
3. Nickel
4. Lead

I would be pleased to provide additional detail upon request.# # #

Daniel McGroarty: Public Comment DOI-2018-0001-0303 posted on March 14, 2018
Primary Minerals, Gateways & Co-Products – Articulated Chart of DOI’s 35 Critical Minerals

***Supplementing Public Comment DOI-2018-0001-0126 posted on March 6, 2018

The DOI Critical Minerals List (released Feb. 16, 2018) contains 35 minerals/metals. What the alphabetized list does not convey are the relationships of the various metals/minerals – most importantly, the fact that, as a practical matter, many of the metals/minerals are not mined in their own right, but obtained as “co-products” of primary metal mining.

The attached chart articulates the 35 metals and minerals into Primary and/or “Gateway” Minerals and Co-Product minerals, indicating which Primaries are typically “gateways” to DOI Listed co-products.

Two additional categories are depicted:

• “Hybrids” (metals/minerals that, depending on the deposit, are primary mining products or co-products of other metals/minerals)

• “Recovered” (3 of the 35 DOI Listed minerals, that are neither mined nor co-products of primary mining, but recovered by individualized processes)

Working back from the Listed Co-Products to their “gateway” metals/minerals indicates that there are 4 “gateway” metals/minerals that are not on the DOI List:

Copper, Gold, Nickel and Zinc (see comment below)

I offer to the DOI review team several observations based on the chart:

Encouraging Co-Product Production is Key to Meeting Strategic/Critical Mineral Needs.

As is shown, 13 of the 35 DOI Listed minerals are Co-Products – more than 1/3 of the entire List – essentially only accessible via primary mining of other metals/minerals.

Important Metals/Minerals are Missing from the DOI List.

A depiction of Gateway/Co-Product relationships shows that 4 metals/minerals missing from the DOI List — Copper, Gold, Nickel, Zinc – access 7 unique minerals that are deemed Critical.

Copper is Gateway to Critical Co-Products.

Of the Gateway metals/minerals, Copper is the most “versatile” – with 5 potential Co-products on the List.

# # #

For a full size pdf version of the chart click here.

Visual Capitalist has put together a great visualization of Secretary of the Interior Ryan Zinke’s draft list of 35 metals and minerals deemed critical to U.S. National Security. The list was released earlier this month, pursuant to Executive Order 13817 issued on December 20, 2017, “A Federal Strategy To Ensure Secure and Reliable Supplies of [...]

Last month, the American Geosciences Institute ran a webinar entitled “Tracking the Global Supply of Critical Materials.”  Speakers for the event, which discussed “efforts to gather information and develop tools that can be used to ensure a secure national and global supply of mineral resources, and identify and quantifying vulnerabilities in this supply, among others,” [...]

If you’re one of nearly half of all Americans, you will have already made a few New Year’s resolutions for 2018.   Among the most popular are personal betterment goals like “losing weight,” and “exercising more.”  While we’re all for making personal resolutions, at ARPN, we’re more concerned with the goals our policy makers are [...]

Only one day after USGS released its new report “Critical Minerals of the United States” – a study which underscores the United States’ over-reliance on foreign minerals – a new executive order directs Interior Secretary Ryan Zinke to publish within 60 days a list of critical minerals to be followed by a report (after another [...]

Against the backdrop of growing threats to U.S. security – recent flash points involve Russia, China, Iran, and North Korea – a new Presidential Executive Order “On Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States,” zeroes in on defense readiness. The E.O. requires heads from various [...]

Happy Birthday, America! Another trip around the sun, and we’re back on the eve of the 4th of July gearing up for parades, barbecues and fireworks in honor of the men and women who have fought, and continue to safeguard our freedom today. Last year, we used this opportunity to point out that while we cherish [...]

Remember the Light Rider?  A few months ago, we highlighted this high-tech motorcycle, which, because it is held together by an intricate web of “Scalmalloy,” is perhaps the lightest motorcycle in the world. Scalmalloy is an “aluminum alloy powder ‘with almost the specific strength of titanium’ [used] to build incredible structures by fusing thin layers of the material together.” One [...]

At ARPN, we have consistently highlighted the importance of Gateway Metals, which are materials that are not only critical to manufacturing and national security in their own right, but also “unlock” tech metals increasingly important to innovation and technological development. With advancements in materials science, these co-products, many of which have unique properties lending themselves [...]