critical minerals

Earlier this week, the American Geosciences Institute hosted a webinar entitled “Underpinning Innovation: The Science and Supply of America’s Critical Minerals and Materials.” Speakers for the event, which was co-sponsored by a variety of expert organizations, included:

Lawrence D. Meinert, Mineral Resources Program, U.S. Geological Survey;

Steven M. Fortier, National Minerals Information Center, U.S. Geological Survey; and

Rod Eggert, Colorado School of Mines; Critical Materials Institute, Ames Laboratory.

The event, the goal of which was to “address efforts taken at the federal level to ensure a steady supply of critical minerals and materials,” will hopefully help raise awareness of an issue that continues to fly under the radar as electoral politics and policy gridlock continue to dominate Washington, DC: the United States’ mineral resource dependencies which have significantly increased over the last 60 years, as a recent USGS study has pointed out.

We will provide a more thorough recap of the event, along with a forthcoming link to a recording of the event in a few days, so check back soon. In the meantime, you can already view the speakers’ presentation slides here.

 

Last week, we highlighted what has been one of the bright spots in the metals and minerals sphere in recent months – Lithium.  Potentially one of the most important critical materials of our time because of its application in battery technology, its rise to stardom has cast a shadow on another material that may be equally critical: Cobalt.  As John Petersen writes for Investor Intel:

“For the last 10 years we’ve been deluged with news stories and investment analyses that extoll the virtues of lithium-ion batteries and speculate on the technology’s potential to change the world’s energy landscape forever. While the occasional curmudgeon like my colleague Jack Lifton questions the availability of enough lithium or flake graphite to satisfy soaring demand from the battery industry, everybody has overlooked or ignored the most critical mineral constraint – Cobalt.”

While this is certainly true for the mainstream, readers of our blog may be familiar with Cobalt’s critical mineral status.

In 2011, it was one of only four minerals to appear on all three then-published lists of critical metals: the U.S. Department of Energy’s Critical Materials Strategy list, the American Physical Society’s Panel on Public Affairs & Materials Research Society’s list of Energy Critical Elements, and the European Commission’s Critical Raw Materials list.

We pointed out at the time that with its applications in industrial and various critical defense applications, and in light of the fact that more than 50% of the world’s Cobalt is mined in the Democratic Republic of the Congo (DRC) – hardly a reliable trading partner – it came as no surprise when Cobalt also took a top tier spot in the American Resources Risk Pyramid, a risk screen for metals and minerals used in U.S. defense applications we created in 2012.

According to USGS data, the U.S. is home to significant Cobalt deposits, but our import dependency currently stands at 75 percent.

But as Robin Bromby points out, the supply situation has deteriorated with the fall in copper and nickel prices, the metals that are mined with cobalt as a by-product. He explains:

“According to Formation Metals, demand growth for cobalt is running at 5.4% a year but supply growth is running at just 2.4%. Cobalt is expected to go into deficit this year; Formation expects mine closures and other factors to mean global output will decline 11% this year. (The biggest threat may be that the nickel prices stay depressed, which will put pressure on nickel laterite mines around the world, and therefore further reduce cobalt by-product.)”

And, as John Petersen puts it bluntly, this will have consequences for the Lithium-Ion battery industry:

“In my view the battery industry is careening toward a natural resource cliff at 120 mph while fiddling with the touch-screen and tweeting about its unlimited potential. The supply side of the cobalt equation is entirely dependent on global demand for nickel and copper. The demand side of the cobalt equation includes a rich variety of manufacturers that must have cobalt for products the world considers essential. 

Whenever increasing demand crosses swords with inflexible supply, the inevitable outcomes are chronic shortages and substantially higher mineral prices.”

So if Cobalt isn’t on your critical (tech) minerals list yet, the time to put it on your radar is now.

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