American Resources Policy Network
Promoting the development of American mineral resources.
  • Securing the Supply Chain for Graphite — the “Unsung Player” in Battery Supply Chain –“Herculean Task,” But One That Must Be Prioritized In Push Toward Net Zero Carbon

    Even before the Biden Administration announced the most aggressive plan to curb tailpipe emissions to date with new vehicle pollution standards proposed by the Environmental Protection Agency (EPA) last month, automotive OEMs and Tier 1 suppliers were facing difficulties getting both the parts and raw materials needed for their electric vehicle (EV) components.

    The newly proposed rules requiring automakers to reduce carbon emissions by 56% in their 2032 models compared to 2026 models will only add fuel to the fire at a time when geopolitical and trade tensions between the United States and our allies on one hand, and China on the other are soaring.

    Recent policy developments, such as the Biden Administration’s invoking of the Defense Production Act (DPA) for the five “battery criticals” — graphite, lithium, cobalt, nickel and manganese –  as well as the rare earths, declared DPA priority materials during the Trump Administration, plus the passage of the Inflation Reduction Act (IRA), the energy provisions of which contained EV tax credits observers said would send important signals to investors and industry that the U.S. was serious about domestic supply chains, have provided hope for a positive change, but, as ARPN pointed out recently, “after decades of dwindling domestic resource production and rising import reliance, no one ever said turning an aircraft carrier this size would be easy.”  

    Lithium has, to an extent, become the poster child of the push to strengthen EV battery supply chains – after all, it’s mostly “Lithium-ion” batteries we’re talking about. Concerns are certainly well-founded with material shortages for lithium predicted to hit in just a few short years, but a recent Autoweek story and interview with Graphex Technologies CEO John DeMaio outlines “another serious material issue on the horizon: graphite sourcing.”  

    As ARPN has previously argued, while much of the focus has been on the cathode of the EV battery, the anode warrants a close look, and may in fact be our “Achilles heel when it comes to building out a battery supply chain independent of China.”

    DeMaio explains:

    “As far as the percentage of the components in a battery cell, almost the entire anode is graphite. So that makes graphite about 45% of the individual cell.

    On a total component basis for an EV battery, graphite is about 25% to 28% of the whole thing. It’s by far the largest component by volume and mass in the battery. And people don’t realize that a lithium-ion battery is sometimes up to 15 times more graphite than lithium. It’s really the unsung player.”

    While to date, the supply chain for this “unsung player” is quite firmly dominated by China, the sourcing provisions in the energy passages of the recently passed Inflation Reduction Act (IRA), coupled with the recently announced grants to “supercharge” U.S. EV battery and electric grid supply chains are important steps towards mitigating that potential single point of failure.

    Projects currently underway are expected to qualify for the IRA credits, and ultimately help “domesticate” the graphite supply chain, including Graphex’s pitch coating facility coming online in Michigan, and Graphite One, Inc.’s cooperation with two U.S. national laboratories under the Department of Energy umbrella in an effort to establish an all-American mine-to-manufacturing supply chain. Graphite One, Inc.’s Graphite Creek deposit near Nome, Alaska was recently recognized by the U.S. Geological Survey as the largest U.S. graphite deposit and among the largest in the world.

    As DeMaio points out, it’s a “herculean task at hand” because “the United States (…) is so intertwined with China that it’s a little impractical to think we’re going to extract ourselves overnight.”

    The challenge becomes even bigger if one considers that, as scholars at the Wilson Center’s Environmental Change and Security Center have argued “the Biden administration’s efforts to free up federal funds for domestic mining activities has highlighted the inherent conflict between accessing the minerals needed for climate action and the administration’s commitment to environmental and social justice.” 

    However herculean the task may be, it is one we cannot shy away from because as ARPN has previously pointed out, lofty goals of net carbon neutrality – and that includes the just-released proposed EPA emission standards –  will not be achievable if we don’t embrace a push to secure critical mineral supply chains from “soup to nuts” to borrow a term used by Energy Secretary Jennifer Granholm.

    All of which brings us back to what we have noted often at ARPN — the first word in supply chain is… supply.

  • Looming Export Controls and Critical Mineral Over-Reliance Prompt Realignment Not Just Between China and West, But Also in Asia – A Look at South Korea

    As the Wall Street Journal reports, a new OECD study has found that export restrictions on Critical Minerals have increased more than fivefold from January 2009 to December 2020, suggesting that “export restrictions may be playing a non-trivial role in international markets for critical raw materials, affecting availability and prices of these materials.”  

    While this significant shift to export controls – according to the WSJ mostly in the form of taxes – has been noticeable and relevant, it may just have been the tip of the iceberg.

    In the wake of a global pandemic, related supply chain shocks and with the Russia-Ukraine war raging on, the trade dimension of geopolitics has become the new frontier in the tech wars between Beijing and Washington, DC – a relationship in which conflict has been smoldering over the past few years, especially over Rare Earth Elements (REEs).

    As we outlined in a recent post, Western nations have made decoupling from China – which has long held a strategic stranglehold over Critical Mineral supply chains – a priority and have pursued a strategy of “friendshoring.”

    Observers were waiting to see if China would retaliate in response to the United States’ recently imposed set of sweeping controls on advanced semiconductors and semiconductor manufacturing equipment aimed at China and a related agreement with Japan and the Netherlands.

    It may not prove to be a long wait.  According to Nikkei reporting earlier this month, China has since announced that it is considering prohibiting exports of certain rare earth magnet technology through updates to a technology export restrictions list last issued in 2020.

    The looming export control ratchet and increasing tensions between China and the West are troubling South Korea – which has in the past walked a fine line between the United States and China – its leading economic partner and increasingly dominant neighbor – and has publicly balked at the U.S. effort to isolate China from semiconductor supply chains.

    Regardless of that fine line, public opinion towards China has been souring in South Korea, and diplomatic relations with the country are also getting tense as Seoul summoned China’s ambassador to protest Beijing’s criticism of remarks made by President Yoon in an interview with Reuters on Taiwan.

    The looming specter of China restricting technology exports has South Korea’s industrial sector worried, prompting the government to announce a “strategy to secure core minerals” to reduce its dependence on Chinese critical mineral imports for from the current 80 percent to 50 percent by 2030.

    In the context of this strategy, the South Korean Ministry of Trade, Industry and Energy designated 33 as critical minerals and named 10 of those as strategically critical minerals, including the “battery criticals” lithium, nickel, cobalt, manganese and graphite and five types of rare earth materials considered crucial in 21st century tech applications including the manufacture of semiconductors.  ARPN followers will note that Korea’s 10 “strategically critical minerals” list  – assuming the five REEs are those used in permanent magnets — squares up with ARPN’s “Super Criticals,” circa April 2022.

    As part of a push to “expand and strengthen bilateral and multinational cooperation with resource-rich countries” a public-private delegation of officials from South Korea’s public and private sectors is currently visiting Chile and Argentina toexplore ways to boost cooperation on supply chains of lithium and other major minerals and the development of natural resources.” 

    The country is also stepping up domestic and global investment.  Last month, South Korean President Yoon Suk Yeol announced that the government and companies including Samsung Electronics Co. would invest $422 billion into chip making and EV manufacturing projects in what Bloomberg calls “the nation’s most aggressive effort yet to win a heated global race for tech supremacy.”

    Seoul is further looking to  provide $5.32 billion on financial support to its domestic battery makers looking to invest in infrastructure in North America, while also looking to upgrade its partnership with India with a focus on trade, investment and strengthening critical mineral supply chains.  To put South Korea’s $5.3 billion in context, at 1/12th the size of the U.S. economy, that’s equivalent to the U.S. Government allocating more than $60 billion to Critical Mineral supply chains.

    Whether or not China escalates export controls for critical minerals remains to be seen – though officials already finished taking expert comments on the planned restrictions reported by Nikkei earlier this month and the changes are expected to go into force this year – it is becoming increasingly clear that a “huge realignment” in the critical minerals space is underway, and its one that not only sees the West looking to reduce Chinese resource dominance, but also sees allegiances shift in Asia itself.

  • A New Chapter in the Tech Wars? Weaponization of Trade Back on the Menu as U.S.-Chinese Tensions Soar

    The world breathed a collective sigh of relief when Chinese drills in the seas and skies surrounding Taiwan wrapped up without further incident this Monday. Nevertheless, tension between the U.S. and China over the island, which some analysts consider “the most dangerous standoff between global superpowers, even as the war in Ukraine rages,” remain high, and a recent development in [...]
  • Bolstering the Domestic Supply Chain for “Battery Criticals” – A Look at Cobalt

     In this post, we continue our review of the “battery criticals” (lithium, cobalt, graphite, nickel and manganese) against the backdrop of the just-released 2023 iteration of the USGS Mineral Commodity Summaries.  Next up:  cobalt. With the material accounting for up to 20% of the weight of the cathode in a typical lithium-ion EV battery, cobalt was considered the highest [...]
  • As Critical Mineral Dependencies Persist, Promising “Battery Criticals” Projects Provide Opportunity to Ensure that “the Supply Chain for America Begins in America” – A Look at Graphite

     For all the talk about reducing our over-reliance on foreign critical mineral resources against the backdrop of soaring demand, strained supply chains and increasing geopolitical tensions, last week’s release of the annual USGS Mineral Commodity Summaries report still paints a sobering picture. While the number of metals and minerals for which the U.S. remains 100% import dependent [...]
  • Winning the “Energy Battle of the Twenty-First Century” Will Take More Than “Myopic” Policy Approach

    Earlier this week, the Biden Administration unveiled a road map for reducing the transportation sector’s carbon emissions to net-zero by 2050. Two weeks into the new year, the green energy transition continues to gain steam.  However, as Morgan D. Bazilian of the Colorado School of Mines and Gregory Brew from the Jackson School of Global Affairs at Yale [...]
  • As Green Energy Push Accelerates, EV Battery Focus Shifts Toward the Anode – A Look at Natural vs. Synthetic Graphite

    As the global push towards net zero carbon emissions accelerates, the understanding that critical minerals hold the key to achieving climate goals has grown.   With EV battery technology at the heart of the green energy transition, the “Battery Criticals” (lithium, cobalt, nickel, graphite and manganese) have entered the spotlight.   While initially the main focus was on the cathode materials [...]
  • DoL “List of Goods Produced By Child Labor or Forced Labor” Zeroes in on Lithium-Ion Batteries, Adding Pressures for Already Strained Material Supply Chains

    Pressures on already strained battery material supply chains are mounting, and not just due to geopolitical tensions and rising demand in the context of the green energy transition. The U.S. Department of Labor has included lithium-ion batteries into its “List of Goods Produced by Child Labor or Forced Labor” – a list of 158 goods from 77 [...]
  • U.S. Secretary of State Anthony Blinken Invokes Critical Mineral Supply Chain Security in Policy Speech

    In yet another indication that increasing demand and supply chain challenges in the wake of the coronavirus pandemic and war in Ukraine have raised the geopolitical stakes, U.S. Secretary of State Anthony Blinken explicitly referenced critical minerals and the United over-reliance on China both in terms of mining and processing in a speech outlining U.S. policy [...]
  • From OPEC to OMEC — From Footnote to Public Policy?

    Against the backdrop of the accelerating global push towards net zero carbon emissions, the authors of a May 2021 KPMG study on “geographical and geopolitical constraints to the supply of resources critical to the energy transition” and the associated “call for a circular economy solution” titled the first chapter of their report “From OPEC to ‘OMEC’: the new global energy ecosystem.” In a [...]