In a column for Reuters, market analyst Chris Kimmerle argues that U.S. policy makers need to do more to ensure a steady supply of critical non-fuel mineral resources, and in doing so must address geopolitical risks and other supply challenges.
A variety of critical metals and minerals are not only essential components of items ranging from household gadgets to high-tech weaponry, but are also indispensable elements of many alternative energy applications. Consequently, critical metal needs for the United States, which as of 2009 consumed roughly 12 % of total global rare earth production, continue to grow. With new critical metal development coming online in a number of countries, the free market may make more of the sought-after materials available in the long run, but, as Kimmerle points out, geopolitical challenges – i.e. China’s restrictive trade policies, resource nationalism and political instability in supplier nations – remain:
“(…) the political risk in this market requires federal support to insure continuing access to a reliable supply or else the United States and other markets are in danger of replacing dependence on imported oil with new dependence on a more concentrated supply of for imported critical metals.“
In other words, unless we reassess our minerals strategy – which must include the exploration and development of the mineral riches beneath our own soil – the Obama administration’s green energy goal of cutting U.S. oil imports by one-third by 2025 run the risk of leading us from the frying pan straight into the fire.