demand

Gathering for the Financial Times’s Mining Summit both in person and online last week, chief executives of global copper mining companies sounded the alarm on the insufficient number of copper mines currently under development to supply the surging material needs of the ever-accelerating green energy transition.

Copper prices may have dropped, however demand for the metal, which is not only a key mainstay metal, but also an indispensable component in green energy technology, is expected to increase drastically to keep pace with the material requirements of the global push towards net zero carbon emissions.

According to the Financial Times, its growing application in this field will result “in it being dubbed the ‘metal of electrification’, with forecasts that it will double to a 50mn tonne market by 2035 compared with 2021 levels, according to S&P Global, which predicts a ‘chronic gap’ between supply and demand.”

While U.S. import reliance for copper hovered around 30 to 35 percent in the 2010s, that number has gone up to more than 40 percent in the 2020s, according to the USGS Mineral Commodity Summaries. 

Miners are pointing out that a confluence of complex permitting timelines, rising inflation and the fact that the commodity is “harder to find in high quantities in the ground” may have led to a situation “where it’s likely there won’t be enough copper to meet decarbonization goals in the next few decades.”

As the Wall Street Journal outlined earlier this month, these circumstances have prompted mining companies to target “a new but also old source – closed mines, also known as brownfield sites.” The Wall Street Journal points to Sweden-based miner Bluelake Mineral, seeking to reopen a mine site in northern Norway that closed 25 years ago, as well as to Rio Tinto’s Resolution Copper project near Superior, Arizona, which is considered one of the most significant undeveloped copper deposits in the world and would reuse the historic Magma Mine which started production in 1910 and operated until 1996. While the project has strong support from the surrounding community, and began the permitting process in 1997, it is still awaiting permits to begin operation.

With Copper becoming increasingly critical in the context of decarbonization efforts – the material has not (yet) been added to the overall U.S. government’s critical minerals list, the Department of Energy recently designated the material a critical material as part of its 2023 Critical Materials Assessment – and with geopolitical volatility reaching heights not seen in decades with this month’s Hamas assault on Israel, securing key mineral supply chains becomes all the more pertinent, and U.S. stakeholders should look to embrace domestic opportunities to unleash our mineral potential where possible.

The Russian invasion of Ukraine and subsequent additional supply chain challenges have prompted the European Union — already grappling with strained supply chains in the wake of the coronavirus pandemic — to step up its critical minerals game.

During her State of the Union address on September 14, European Commission President Ursula Von der Leyen announced plans to introduce legislation to identify potential strategic critical raw material projects along the supply chain and build up reserves in areas where supply is at risk.

Highlighting that almost 90% of rare earths and 60% of lithium are currently being processed in China, Von der Leyen said “[a] single country currently dominates almost the entire market. We must avoid becoming dependent again, as with oil and gas.”

She added:

“We know this approach can work. Five years ago, Europe launched the Battery Alliance. And soon, two third of the batteries we need will be produced in Europe.

Last year I announced the European Chips Act. And the first chips gigafactory will break ground in the coming months.”

The announcement is more than timely.  The European Union expects its own demand for rare earths alone to increase fivefold by 2030.  And the latest analysis by ARPN’s friends at Benchmark Mineral Intelligence finds that more than 300 new mines for graphite, lithium, nickel and cobalt would “need to be built over the next decade to meet [global] demand for electric vehicle and energy storage batteries,” and that is already taking into account the recycling of raw materials — without factoring in closed loop solutions, the number shoots up to almost 400.

In the U.S., the energy provisions in the recently passed Inflation Reduction Act, following on the heels of the invocation the Defense Production Act for the “battery criticals” lithium, cobalt, nickel, graphite and manganese, are expected to send a strong signal to investors that the United States, too, is serious about “building the secure, responsible industrial base our economy and national security needs.”

However, many issues remain.

One of them is the “costly and inefficient permitting process” making it “difficult for American businesses to invest in the extraction and processing of critical minerals in the United States,” as Ford Motor Company’s chief government affairs officer Christopher Smith lamented in a recent letter to the U.S. Department of Interior.

The other challenge is an “inter-departmental tug-o-war” that hinders actual progress.  As Shane Lasley  wroterecently for North of 60 Mining News:

“While the departments of Commerce, Defense, and Energy are forging ahead with programs and investments aimed at ensuring America has the minerals and metals needed to support the clean energy objectives outlined by the White House, and enabled by the Bipartisan Infrastructure Law and Inflation Reduction Act, DOI is pumping the breaks on a domestic project that would produce the requisite raw materials.”

It remains to be seen if stakeholders on both sides of the Atlantic are able to advance their critical mineral ambitions, but one thing, in the words of Forbes contributor Wal van Lierop, is clear: “[W]ithout massive investments in base metals and key minerals, Europe and North America will fail to meet their carbon emission targets and face a new form of energy insecurity.” 

Amidst the global push towards carbon neutrality, “Critical Minerals” has become a buzzword.  As the green energy transition has gone mainstream and electric vehicles and renewable energy sources dominate the news cycle, so has talk about growing demand for some of the specialized materials underpinning this shift — most notably the Rare Earths, and the battery [...]

In a new piece for Forbes, Jude Clemente, principal at JTC Energy Research Associates, LLC, outlines the size and scope of the ambitious climate goal of electrification to fight climate change, and discusses the underlying challenges associated with the shift. Clemente argues that the likely surge in electricity demand as the world seeks to decarbonize [...]

While we’re still waiting for policy makers and other stakeholders to take further action, in 2018 an important step was taken to set the stage for mineral resource policy reform with the release of the Department of Interior’s List of 35 Minerals Deemed Critical to U.S. National Security and the Economy. Throughout the drafting stage [...]

In 2007, a new mineral found in Serbia made headlines around the world. “Kryptonite Discovered in Mine” – wrote the BBC about the discovery of a material the chemical formula of which – sodium lithium boron silicate hydroxide – happened to match the one of the famed kryptonite stolen by Lex Luthor from a museum in the [...]

Cobalt is a rising star among critical minerals, in large part because of its key role in battery technology.  However, that’s hardly the only reason. The ongoing materials science revolution has produced a new long-term use for Cobalt that may prove to be a technological breakthrough: A California-based company has announced that it has found [...]

In recent weeks, we have seen a flurry of articles and commentaries in national publications discussing reforms to address our ever-growing reliance on foreign mineral resources.  The two most recent examples are member of the ARPN expert panel Jeffery A. Green’s piece in Real Clear Defense entitled “Dangerous Dependence on China for Critical Minerals Runs [...]

As the race for the metals and minerals driving the electric vehicle revolution heats up, and China continues to jockey for pole position, Sweden is tossing its hat into the ring.  According to recent media reports, the Swedish government has earmarked 10 million kronor ( roughly one million Euros) to explore the option of digging [...]

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,” [...]