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American Resources Policy Network
Promoting the development of American mineral resources.
  • Latest Tesla Deals with Chinese Suppliers Underscore Critical Mineral Supply Chain Challenges

    As pressures continue to mount, U.S. stakeholders are beginning to realize the urgency of building supply chains “that are safer, more secure and not beholden to a country that has multiple human rights violations, predatory lending practices, and vast national security complications.”  For now, however, too often, automakers still have to turn to Chinese suppliers to meet their material needs.

    Underscoring the extent of China’s chokehold on critical mineral supply chains, especially for the “battery criticals” lithium, cobalt, nickel, graphite, and manganese, Tesla Inc. signed two new long-term contracts with two of its existing Chinese battery materials suppliers, according to Bloomberg.

    The company signed pricing agreements with Zheijang Huayou Co. and CNGR Advanced Material Co. for supplies, specifically ternary precursors used for energy storage, until the mid-2020s.

    As followers of ARPN know, China dominates not only the resource development segment of the EV battery supply chain, but also the processing segment for the battery criticals.  As Manhattan Institute senior Fellow Mark Mills told the Daily Caller News Foundation: “If you want to build EVs, one needs access to the entire suite of specialty chemicals, and the vast majority of those are produced in China – the issue is not the mining per se, but the refining wherein China utterly dominates most relevant chemicals. Or else one could wait 5 to 10 years – if you’re lucky – for non-Chinese refineries to be built.”

    Amidst the global push towards net zero carbon emissions, demand for EVs will continue to soar, in the U.S. fueled in part by the adoption of an ambitious climate agenda by the Biden Administration, further driving up demand for critical minerals.

    The question becomes whether the net zero transition deepens dependency on Chinese and foreign-sourced Critical Minerals – or galvanizes a push to provide new sources of supply in the U.S..

    Thankfully, positive policy developments that could help reduce our over-reliance on China are underway.

    U.S. President Joe Biden in March of this year invoked the Defense Production Act to encourage domestic production of the metals and minerals deemed critical for electric vehicle and large capacity batteries, including nickel, and the Administration has acknowledged that “the need to domestically produce more metals is rising as EV’s go mainstream, but that new mines must not harm the environment.”   The development followed the adoption of a broader “all-of-the-above” approach to supply chain security on the part of the Biden Administration in 2021, and may be strengthened with the adoption of provisions contained in the Inflation Reduction Act just passed by the U.S. Senate.

    The package would require that by 2024, 40% of the minerals used in EV batteries would have to be extracted, processed or recycled in the U.S. or by a free trade partner — a requirement that increases to 80% by 2027 – and 100% for battery components by 2029. According to John Adams, U.S. Army brigadier general (ret.), the sourcing requirements for the battery criticals could be key to addressing “emerging energy security vulnerabilities before they are intractable crises.” 

    On the supply side, the mining industry is ready to meet this challenge and has increasingly been harnessing advances in materials science and technology to help develop domestic critical minerals supplies while maintaining and advancing responsible mining practices.   A case in point we recently highlighted was  Tesla’s  deal with Talon Metals Corp, developing a new nickel project in Minnesota, which Elon Musk singled out“due to plans to make the electric vehicle battery metal in a way it considers more environmentally friendly.”

    As we outlined, this is the mine site for which the U.S. Department of Energy recently announced a $2.2 million award to fund to a Rio Tinto-led project to achieve carbon capture by a process that mineralizes the carbon in rock – a process far more stable than methods that inject carbon, where it remains vulnerable to seepage and fracturing due to earthquakes.

    These are positive developments, but more must be done. Until then, there will be more announcements of automakers signing deals with Chinese companies — certainly not an ideal scenario at a time when tensions between the U.S. and China are mounting over Taiwan.

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  • U.S. Army Brigadier General (ret.): Congress Has Opportunity to Make “Critically Important Leap Forward to Build the Secure, Responsible Industrial Base our Economy and National Security Needs”

    In a new piece for RealClearEnergy, John Adams, U.S. Army brigadier general (ret.), argues that the newly proposed Inflation Reduction Act, negotiated by Senators Chuck Schumer (D-NY) and Joe Manchin (D-WV) is not only the most ambitious climate bill in U.S. history, but also represents an opportunity to bolster our nation’s economic and national security. 

    General Adams points to the fact that the energy components of the package, in his words, “do far more than just tackle emissions.” In his view, the provisions aim to “use the energy transition to rebuild the nation’s industrial base and ensure that the energy and transportation jobs of tomorrow are American jobs.”

    The package would require that by 2024, 40% of the minerals used in EV batteries would have to be extracted, processed or recycled in the U.S. or by a free trade partner — a requirement that increases to 80% by 2027.

    General Adams believes that the sourcing requirements for the battery “criticals” contained in the package — lithium, nickel, cobalt, manganese and graphite — are key to addressing “emerging energy security vulnerabilities before they are intractable crises.”

    He credits Sen. Joe Manchin, who believes that “trading the ugly geopolitics of petro-dictators only to sleepwalk into complete dependence on a battery supply chain dominated by China is a mistake the country cannot make,” for zeroing in on the threat Chinese dominance of critical mineral supply chains poses to the nation’s energy security.

    Followers of ARPN well know that our clean energy future hinges on massive critical mineral inputs, and demand projections for the battery criticals, but also key clean energy metals like copper, are on an ever-high trajectory.  Meanwhile, our import reliance for critical minerals is significantly up from decades ago and has shown no signs of decreasing in the past few years, with China having cornered not just the extraction, but also the processing segment of the supply chain.

    As General Adams closes:

    China has worked diligently to turn mineral supply chains into an economic leg up but also an enormous source of geopolitical leverage — not unlike how Russia has leveraged its energy trade with Europe. What Senator Manchin recognizes is that our energy future is on a collision course with our mineral insecurity and China’s mineral dominance. 

    The mineral sourcing requirements in the reconciliation bill – coupled with other incentives to encourage domestic mining, mineral processing and recycling– are precisely the bold measures needed to address this alarming vulnerability. This legislation is a critically important leap forward to build the secure, responsible industrial base our economy and national security needs.”

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  • New Report Warns: Looming Copper Shortfall Could Delay Global Shift Away From Fossil Fuels

    The mainstream media and parts of the political establishment may just now have begun to realize it — but followers of ARPN have long known that our nation’s critical mineral woes are real, and go beyond the often discussed battery criticals (lithium, cobalt, nickel, graphite, and manganese) and include one of the key mainstay metals: [...]
  • Beyond the Rare Earths and Battery Criticals – U.S. Armed Services Committee Seeks to Address Supply Chain Challenges for Antimony

    Underscoring the growing awareness that our nation’s overreliance on foreign supplies of critical minerals underpinning 21st century technology stretches beyond the much-discussed Rare Earths and battery criticals lithium, cobalt, nickel, graphite, and manganese, the U.S. House Committee on Armed Services has released draft legislation to address China’s stranglehold on the supply chain for antimony. Used [...]
  • “Critical” Without the Label? – A Look at Boron

    While critical mineral resource policy is finally receiving the attention it deserves against the backdrop of increasing supply chain challenges, a look at the materials stealing the spotlight would have you believe the list of metals and minerals deemed critical from a U.S. national and economic security perspective is much shorter than it is. The [...]
  • A Visual Reminder: Breaking Down the EV Battery

    In case anyone needed a visual reminder of how the EV revolution is adding fuel to the fire of the overall critical minerals challenge we’re facing, Visual Capitalist has put together a handy graphic depicting the material inputs for EV batteries. Here’s a snippet – for the full graphic and context, click here. The infographic [...]
  • As Stakes Continue to Get Higher, Critical Minerals Challenge Goes Mainstream with Realization Issue Goes Beyond “Battery Criticals”

    Supply chain challenges in the wake of the coronavirus pandemic, Russia’s war on Ukraine, rising resource nationalism in the southern hemisphere, and now China’s Xi Jinping doubling-down on its zero-Covid policy this week which may lead to more lockdowns with serious economic and trade consequences – critical mineral supply chains can’t seem to catch a break. As [...]
  • Presidential Determination Invokes Title III of Defense Production Act to Encourage Domestic Production of Battery Criticals

    A confluence of factors — pandemic-induced supply chain shocks, increasing resource nationalism in various parts of the world, and Russia’s invasion of Ukraine extending into its second month — has completely altered the Post-Cold War geopolitical landscape and mineral resource security calculus. Responding to the resulting growing pressures on critical mineral supply chains and skyrocketing [...]
  • Russia’s War on Ukraine and Rising Resource Nationalism to Reshape Global Post-Cold War Order and Resource Supply Chains – A Look at Cobalt

    With a single electric vehicle battery requiring between 10 and 30 pounds of cobalt content, the lustrous, silvery blue, hard ferromagnetic, brittle nickel and copper co-product has long attained “critical mineral” status. However, with most global supplies of the material coming from the Democratic Republic of the Congo, where mining conditions often involve unethical labor standards and [...]
  • Russia’s War on Ukraine Hits Critical Mineral Supply Chains: A Look at Nickel

     While in the early days of Russia’s invasion of Ukraine, concerns over how the war would impact global supply chains were mostly focused on oil and natural gas, it quickly became apparent that the ramifications of drawn-out hostilities would stretch far beyond the global oil and gas sector. With Ukraine considered the “breadbasket of Europe,” Russia’s invasion [...]

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