Milewski points to Russia having fired an estimated 11 million artillery shells in 2022, the majority of which can contain – depending on shell and manufacturing process – at least an estimate 0.5kg of copper. This, he says would amount to 5,500 tons of copper, or the equivalent of copper used in 1,170 wind turbines.

Copper demand is already forecast to increase by more than 100% by 2035 with many analysts warning there may not be enough copper to meet decarbonization goals in the next few decades after years of underinvestment in the mining industry and falling ore grades.  And those projections, according to Milewski, do not account for surging military demand against the backdrop of increasing geopolitical volatility around the globe.

Of course, copper is just the proverbial tip of the iceberg. According to the National Mining Association, the U.S. Department of Defense uses nearly 750,000 tons of minerals on an annual basis – a number that was calculated around 2016/2017 at a time when the U.S. was not facing any major conflicts.

Fast-forward to 2024 and the U.S. is supporting allies in the Ukraine and Israel while the situation in the Taiwan Strait looks increasing vulnerable.  Meanwhile, particularly ammunition stockpiles are running so low that NATO officials have warned that Western militaries are scraping “the bottom of the barrel” forcing NATO to provide Ukraine with supplies not from full warehouses, but rather “half-full or lower warehouses in Europe.”

The issue is compounded by the fact that production time to rebuild weaponry stocks can take anywhere between three and 18 years, depending on equipment according to the Centre for Strategic and International Studies – however that analysis focuses only on manufacturing and production times.

As followers of ARPN well know, supply chains for the metals and minerals underpinning U.S. military technology and munitions are “extremely vulnerable” due to a perennial over-reliance on supplies from adversary nations, i.e. China.

For all the talk about decoupling supply chains in recent years, the needle has not moved much, and the latest USGS Mineral Commodity Summaries still has the U.S. 100% import reliant for 12 metals and minerals, while an additional 29 critical mineral commodities had a net import reliance greater than 50% of apparent consumption — a small drop by two over last year’s report.

However, some important steps have been taken in recent years, and are beginning to bear fruit. Milewski lists several military budget ramp-ups to “try and resolve the massive shortfall.”

As ARPN previously outlined, a notable example of such efforts is the series of (Defense Production Act) DPA Presidential Determinations involving specific Critical Minerals, beginning with President Trump’s July 2019 designation of the Rare Earth permanent magnet supply chain as being “essential for the national defense,” followed by President Biden’s designation of what ARPN calls the “Battery Criticals” as DPA Title III eligible in March 2022, followed by Platinum and Palladium in a DPA Presidential Determination in June 2022.  Earlier this spring, two further Presidential Determinations (February 27, 2023 Presidential Determination, and DPA Presidential Determination (2023-5)), effectively created an entirely new category of critical minerals – “Defense Criticals” as ARPN calls them – by way of designating airbreathing engines, advanced avionics navigation and guidance systems, and hypersonic systems and their “constituent materials” as priority DPA materials.

Those DPA actions, funded by Congressional appropriations, are now producing Department of Defense funded projects to encourage domestic development of these “defense criticals” and their supply chains.

Milewski highlights the following:

• Graphite: a $37.5 million agreement between the DoD and Graphite One (Alaska) to fast-track a domestic graphite mine;
• Antimony: two awards — $24.8 million and $15.5 million — by the DoD to Perpetua Resources to secure a domestic source of antimony [an additional conditional award of up to $34.6 million under the existing Technology Investment Agreement was announced earlier this week];
•  Lithium: a $90million agreement to secure lithium production between the DoD and Abermarle;
• Nickel: a US $20.6 million agreement between the DoD and Talon Nickel to increase domestic nickel production.

He closes:

“We see the U.S. military shifting its position and capacity to secure its critical mineral supply gaining more momentum than it has for arguably the past 30 years. However, the U.S. military is America’s largest government agency, and it will take time.”

However, with conflict brewing in many parts of the world, time is a luxury we do not have, and strengthening critical mineral supply chains should be a key priority for policy stakeholders in 2024.

The post U.S. Military Faces Compounding Problems – Surging Tensions, Depleted Stockpiles, Critical Mineral Supply Chain Challenges appeared first on American Resources Policy Network.

– A Look at 2023
Through the Prism of Critical Mineral Resource Policy - 

In the waning days of December 2022, ARPN and others were gearing up for a watershed year in the critical minerals realm – a year which could be a “breaking point if there is to be an EV revolution/transformation,” and one that would give us a glimpse into the new world order in the Post Petro Age in which the sands of geopolitics have shifted.

We set out to track the following themes, all of which we found to be intertwined:

• A focus on the Super Criticals (see our Year in Review post for more info);
• the growing importance of geopolitics, with China taking center stage and alliances and partnerships continuing to be forged to reduce reliance on Beijing;
• the acceleration of the green energy transition which will require vast amounts of critical minerals;
• as well as industry’s efforts to sustainably green our future by harnessing the materials science revolution.

As we close out 2023 with ARPN’s annual attempt to take stock of what has happened on the critical mineral resources front in the past 12 months — to assess where we are, and, filled with hope for a New Year, where we are headed – we believe we picked the right themes.

2023 – Enter the Post-Petro Tech Age?

Early 2023

Geopolitics certainly took center stage on the critical minerals front with the Russia/Ukraine war continuing to place a strain on global supply chains and resource nationalism gaining a bigger foothold in particularly the Southern hemisphere.

As Peter Schechter and Juan Cortiñas had outlined in a February 2022 piece for Marsh McLennan’s Brink News ARPN featured at the time, the shunning of laissez-faire economics, particularly in Latin America, is not new. “What’s different this time,” they say, “is that these new interventionist policies are not only focused on the traditional energy sector. Instead, the region’s attention is turning to increasingly valuable minerals that are key to the new green economy quickly gaining momentum across the world.”  

Resource Nationalism 

In early 2023, we saw this trend play out in Chile, where President Gabriel Boric announced his plan to nationalize the country’s lithium industry to boost the Latin American nation’s industrial base and protect the environment.  While his plan fell short of full nationalization, observers called Boric’s announcement a “shock move”  – but it was one that tied into an overall trend in the region:

Chile’s move came on the heels of a comprehensive lithium nationalization plan enacted by Mexico which culminated in President Andres Manuel Lopez Obrador signing a decree handing over responsibility for lithium reserves to the country’s energy ministry in February of this year.

Bolivia’s ruling socialists have also favored state control over the nation’s vast untapped mineral resources but are relying on Chinese partners to harness them.

Meanwhile, some speculated at the time that had it not been for his ouster, Peru’s President Pedro Castillo, who won a narrow victory in 2021 and had initially pledged to nationalize much of the country’s mining sector, might have pursued an approach similar to Boric’s in Chile.

The moves tied into a bigger trend, as indicated by prior similar developments in Indonesia, Myanmar and Zimbabwe.

 Tech War Theaters – Semiconductors and Critical Minerals 

Meanwhile, the Tech Wars between China and the West continued to intensify, and Western nations began taking steps to counter Chinese dominance in the critical minerals realm.

A key theater of the Tech Wars had emerged: Semiconductors, which have become indispensable components for a broad range of electronic devices. Semiconductors have been dubbed the “DNA of technology” which has “transformed essentially all segments of the economy” and are critical to national security where they enable the “development and fielding of advanced weapons systems and control toe operation of the nation’s critical infrastructure,” as the Department of Commerce-led chapter in the Biden Administration’s 100 Day Supply Chain Review report outlines.

While the U.S. took steps to impose new export controls to China’s access to advanced computing chips, its ability to develop and maintain super computers and manufacture semiconductors in 2022, Washington’s allies in Europe, Japan, Canada, Australia also took steps to reduce Chinese influence in their critical mineral industries. The governments of the Netherlands and Japan announced their intention to emulate the U.S. export controls in March.

A late 2022 proposal to bolster the Investment Canada Act (ICA) to empower government ministers to block or unwind critical mineral investments if these are considered as a threat to national security, considered a defensive measure against China which has invested $7 billion in Canada’s base metals sector in the past two decades, was expected to be finalized in the spring.

Australia’s Treasurer Jim Chalmers in early 2022 blocked a request by a Chinese company to boost its investment in Australian REE company Northern Minerals via a prevention order, the first move of this kind since the Treasurer had expressed concerns over the “concentrated nature of the China-dominated critical minerals supply chain” elevated by the Russia-Ukraine war, and a move that some considered a “sign of what’s to come.”

West Bolsters Domestic Supply Chains 

While these steps were taken to reduce Chinese influence over domestic industries, the West also stepped up efforts to strengthen its own critical mineral policies and sectors.

The European Union released its long-awaited action plan to “ensure the EU’s access to a secure, diversified, affordable and sustainable supply of critical raw materials” on March 16. The Critical Raw Materials Act (CRMA)  includes a comprehensive set of actions aimed at shoring up European critical mineral supply chains by streamlining the permitting process for raw materials projects and allowing for selected “Strategic Projects” to benefit from support for access to financing and shorter permitting timelines (24 months for extraction permits and 12 months for processing and recycling permits).  The Act – which was finalized later in the year, also requires EU member states to develop national programs for resource exploration.

Australia also forged ahead with its push to strengthen critical mineral supply chains for its own industries and for the benefit of its partners with the federal government in Canberra releasing guidelines for “new grants to help develop Australia’s critical minerals sector, support downstream processing, create jobs across regional Australia and support global efforts to achieve net-zero” in early 2023.

The Canadian government, which had launched the Canadian Critical Minerals Strategy in December of 2022 backed by up to $3.8 billion in funding, announced details on the implementation and a first round of funding for new critical minerals programs and initiatives.

The Minerals Security Partnership (MSP), an initiative to bolster critical mineral supply chains while ensuring that “critical minerals are produced, processed and recycled in a manner that supports the ability of countries to realize the full economic development benefit of their geological endowments”  took its collaboration to the next level by formalizing and agreeing on guiding principles for how the MSP will develop projects around the world with local value-add, sustainability, and high environmental, social, and governance (ESG) standards front and center. Meetings were followed by bilateral trade agreements as well as U.S.-EU discussions to launch a “critical minerals club.”

And stateside, U.S. President Joe Biden once more invoked Title III of the Defense Production Act (DPA) to strengthen critical mineral supply chains – and in doing so, effectively created a new category of Critical Materials – which ARPN has dubbed the Defense Criticals (see our post here). His February 27, 2023 Presidential Determination was followed by another DPA Presidential Determination (2023-5), designating airbreathing engines, advanced avionics navigation and guidance systems, and hypersonic systems and their “constituent materials” as priority DPA materials.

Mid 2023

We posited in early 2023, that against the backdrop of surging demand and geopolitical volatility, we could expect to see more active government involvement in the critical minerals sector – and the coming months certainly delivered.

China Tightens Export Ratches as West Gets Reality Check on Decoupling

In July, China upped the ante in the Tech Wars by placing export restrictions on gallium and germanium – key components of semiconductor, defense and solar technologies. Beijing’s move was considered a “show of force ahead of economic talks between two rivals that increasingly set trade rules to achieve technological dominance,” according to the Wall Street Journal. As Alastair Neill, board member of the Critical Minerals Institute, told the Wall Street Journal: “If you don’t send high-end chips to China, China will respond by not sending you the high-performance elements you need for those chips.” 

While some chipmakers downplayed fears of shortages, former Chinese Vice Commerce Minister Wei Jianguo’s comments to the China Daily newspaper “that countries should brace for more should they continue to pressure China, describing the controls as a ‘well-thought-out heavy punch’ and ‘just a start,’”  prompted fears that more export curbs on critical materials, including on rare earths could be on the menu, and analysts called for  big investments on the part of the United States and its partners to reduce their reliance on China.

Later that month, China announced a new set of export controls — this one on certain drones and drone-related equipment — to “safeguard national security interests,” only to follow it up with restrictions on graphite later in October. The decision to require export permits for certain graphite products was seen by analysts as a play “to control supplies of critical minerals in response to challenges over its global manufacturing dominance.”

China’s moves also underscored the massive challenge of decoupling for Western nations.  In the case of graphite, which is the largest component by volume and mass in EV batteries and has been deemed the “unsung player” in the battery supply chain, China “is on track to retain over 85% of the global anode market share by the end of the decade,” according to Benchmark Mineral Intelligence.

While momentum to decouple was continuing to build, a new report by the consultancy Rhodium Group and the German Mercator Institute for China Studies (MERICS) pointed to the real-world challenges of decoupling from China from a European perspective:

European national governments and the EU may have worked to devise policies to strengthen domestic and regional critical mineral supply chains, but Chinese companies continued to invest in the region: Overall, Chinese foreign direct investment in the EU and the UK dropped, but, as Mary Hui writes for Quartz, “for the first time since 2008, the value of Chinese greenfield investments have exceeded that of M&A flows,” and was “mainly driven by several large-scale initiatives by Chinese battery giants to build factories in Germany, Hungary, the UK, and France.”

As the Rhodium report determined, “Europe has become a key part of China’s global electric vehicle expansions,” adding that “[b]attery investments are now the mainstay of Chinese investment in Europe.” The emerging conundrum is not lost on EU policy makers, who resolved to formally “recalibrate” the EU’s China policy, with an emphasis on “de-risking” by screening investments more closely and resorting to more robust export controls.

The West’s resolve to break China’s dominance may be building, but as Christina Lu wrote for Foreign Policy:

“(…) there are more questions than answers about how these efforts will pan out. As lawmakers continue to hammer out new agreements behind closed doors, it remains unclear how they align with global trading rules and what this momentum means for countries that lack free trade agreements with the United States. Engineering supply chains isn’t as simple as finding new mines, either; it involves an entire ecosystem of processing, refining, and manufacturing capabilities.”

The Rise of Geopolitical Swing States

As the West continued to assess its options against the backdrop of an increasingly assertive China leveraging its advantage in the Tech Wars, a new class of states have entered the spotlight in the context of the global geopolitical realignment – the “geopolitical swing states,” as Goldman Sachs’s Jared Cohen suggested this June, and their role could grow exponentially in the coming years.

Cohen defines a geopolitical swing state as “critical to the world economy and balance of power” but without “the capacity by themselves to drive the global agenda, at least for now.” He adds that “as long as the tensions between the U.S. and China continue to get worse, they will have outsized abilities to navigate geopolitical competition and take advantage of and influence it.” 

According to Cohen, there are four – often overlapping — categories of geopolitical swing states:

• Countries with a competitive advantage in a critical aspect of global supply chains;
• Countries with a unique ability to make themselves attractive for nearshoring, offshoring, or friend-shoring;
• Countries with a disproportionate amount of capital and willingness to deploy it around the world in pursuit of strategic objectives; and
• Countries with developed economies and leaders who have global visions that they pursue within certain constraints.

As Cohen concluded, “[t]he rise of geopolitical swing states may balance the great powers and help stabilize the global order. Their interest-based decision-making could be a source of consistency in uncertain times. Or their newfound prominence may increase global instability by putting more actors and variables in play. But even if today’s world is not yet multipolar, a rising group of countries recognize that they can determine the course of world events. Those geopolitical swing states are aware that their power may be unsustainable, or event fleeting and they are determined to take advantage of the current window of opportunity.”

While the rise of the geopolitical swing states has business implications for multinational businesses and investors, these trendlines are have real-world implications for U.S. stakeholders from a policy perspective, and, in the critical mineral resource realm, underscore the importance of a comprehensive all-of-the-above approach to securing critical mineral resource supply chains.

Fall/Winter 2023 

Critical Mineral Focus Grows, New Players Emerge

Meanwhile, real world challenges associated with securing supplies for the metals and minerals underpinning 21st Century technology prompted more countries to emphasize supply chain security and define their own sets of metals and minerals critical to their own domestic industries.

Perhaps most consequential in light of the fact that it has overtaken China as the most populous country in the world this year, may be India’s push onto the global critical minerals stage.  Following the release of a comprehensive Critical Minerals List, consisting of 30 metals and minerals deemed critical for India’s ambition for cleaner technologies in electronics, telecommunications, transport and defense, in the summer, along with a pledge to encourage public and private investment in exploration, mining and processing to secure the country’s critical mineral supply chains, India announced its consideration of an export ban on four key metals – lithium, beryllium, niobium and tantalum – in a move to ensure the country’s self-sufficiency in crucial minerals for India’s national security and technological advancements. In late November, the Indian government announced its first ever auction of critical mineral leases for commercial mining by the private sector.

But another player has arrived – perhaps in another indication that we have indeed entered the Post-Petro Tech Metals Age: Saudi Arabia.

As part of his Grand Vision 2030 plan to transform the Saudi economy, the oil giant’s Crown Prince Mohammad bin Salman is preparing to invest billions of dollars into the mining sector to harness the potential of more than $1.3 trillion worth of metals and minerals the Saudi government claims are buried in the kingdom, and effectively make mining the so-called “third pillar” of the economy next to oil and gas. Rumors of a deal with Tesla have been swirling, even though they have been denied by Elon Musk himself.

Analysts say that while the crown prince’s plans are met with plenty of skepticism, even if only partially successful, implications of Saudi Arabia turning into a metals hub could have far-reaching implications not just for metals mining, but geopolitics and trade, especially if the other component of the crown prince’s plan to buy up resources from elsewhere to be refined and processed at new facilities in Saudi Arabia.

As Bloomberg reports, the kingdom’s long game is to position itself as an alternative supplier to China for the metals and minerals underpinning the green energy shift and 21st Century technologies.  The news outlet cites Khalid Al Mudaifer, vice minister of mining affairs, who said in an interview that “Saudi Arabia needs more than one engine to achieve its vision,” and that to transform itself into an economic and industrial powerhouse, the kingdom needs minerals.

Global Tensions Mount – Gaza and Tech War Confrontation

If the watershed moment for geopolitics in 2022 was the Russian invasion of Ukraine, this year’s defining moment was probably the Hamas-led incursion from the Gaza Strip into the Gaza envelope of neighboring Israeli territory on October 7, 2023, which initiated the ongoing Israel-Hamas War. Throwing a wrench into arguably efforts to de-escalate tensions in the Middle East, the conflict threatens domestic stability in many states in the region and has exposed the deep-rooted nature of obstacles to normalization.

While China has claimed neutrality and has called on both sides to exercise restraint, China, while criticizing Israel’s massive bombardment of Gaza in response to the incursion, but never officially condemned the initial attack started by Hamas. Experts believe that the Israel-Hamas war is viewed in Beijing as a convenient opportunity to gain ground against the United States in the battle for influence in the Arab world, as tensions between China and the West, and specifically the U.S. continue to mount. 

As Hot Wars Rage, All Arrows Point to Escalation of Tech War 

 With hot wars raging in Central Europe and the Middle East, the question is, do we have bandwidth to focus on a war that’s metaphorical – for now, at least:  The Tech War pitting China versus the U.S.?

While the recent meeting between U.S. President Joe Biden and his Chinese counterpart Xi Jinping on the sidelines of the APEC summit in San Francisco last month was seen by some as a step towards alleviating tension between the two global powers, U.S. Secretary of Commerce Gina Raimondo’s latest speech and subsequent comments at the Reagan National Defense Forum in California left no doubt that, at least on the trade front, all arrows very much point to confrontation.

The Secretary did not mince words, stating: “(…) make no mistake about it, China’s not our friend, and we need to be eyes wide open about the extent of that threat. I am ready to win, and I’m ready to do that with all of you, but it’s time to open our aperture and challenge the way we’ve done business in every way if we’re going to meet the threat China poses.”

When asked if there were other U.S. origin products or types of technologies that the U.S. Government was “looking at in a similar fashion right now” – i.e. would consider imposing export controls on, she said:

“Absolutely, in biotechnology, AI models, AI products, cloud computing, supercomputing. So short answer is yes.”

Unsurprisingly, China has already voiced criticism of Raimondo’s comments with officials lamenting the “Cold War mentality” on the part of the U.S. which showed its “desire for hegemony.”

Diplomatic efforts to improve ties between the countries in the wake of Raimondo’s remarks may continue but to the keen observer it appears all but certain at this point that we’ll be seeing a further escalation of the Tech Wars in the coming months, with the export control ratchet playing a central role.

The question is, which critical mineral will find itself in the crosshairs this time. 

Turning the Same Stone Twice

With more confrontation on the horizon, there are some silver linings, thankfully.  Not only are domestic policy stakeholders more attuned to the critical minerals challenge and are working on policy solutions including permitting reform, the mining industry itself has been stepping up its game.

In their quest to secure critical mineral supply chains against the backdrop of surging demand and rising geopolitical pressures, stakeholders are leaving no stone unturned – quite literally — and have in fact begun turning the same stone twice, harnessing the materials science revolution to unlock minerals that were previously bound up, and extracting minerals from unconventional sources such as rock piles and tailings.

In 2023, ARPN featured several of these initiatives:

• The “Atlas of Australian Mine Waste”, an Australian government mapping project of sites containing mine waste with reprocessing potential,
• The USGS’s solicitation for proposals for FY2023 grants to collect data on mine waste using funds from the Bipartisan Infrastructure Act in the context of the Earth Mapping Resources Initiative (Earth MRI), in the context of which more than $5.8 million will go towards mapping critical-mineral resources in Alaska in partnership with the Alaska Division of Geological & Geophysical Surveys. Minerals included in the context of USGS and the Alaska Division of Geological & Geophysical Survey research projects Alaska are: Arsenic, antimony, bismuth, cobalt, graphite, indium, platinum group metals, rare earth elements, tantalum, tellurium and tin.
• Australia-based New Century Resources current operation of the largest tailings retreatment operation at its zinc tailings retreatment operation in Queensland,
• A Reuters lists of six major projects outside of China aimed at extracting the critical minerals from waste or byproducts, including Iluka Resources Ltd’s and VHM Ltd’s operations in Australia, Rainbow Rare Earths Ltd’s endeavor in northeast South Africa, Swedish state-owned LKAB’s plans to extract REEs from two existing mines, and two U.S. operations:

• Phoenix Tailings, a privately held U.S. company plans to launch operations using waste materials from a former iron ore mine in New York using its own processing technology.

• U.S. Energy Fuels, originally focused on uranium production, started acquiring monazite, a byproduct of mineral sands, to extract REEs with plans to open its own separation plant by 2024.

• Global miner Rio Tinto’s production of tellurium at its Kennecott copper operation in Utah, where roughly 20 tons of the material are generated from by-product streams generated during the copper refining process; and the company’s partnership with CR Minerals Co. LLC to extract a material called pozzolans from Rio Tinto’s Boron California operations, which can be substituted for or combined with cement to decarbonization construction materials. Meanwhile, in Canada, the miner is producing scandium from titanium waste, becoming the first North American producer of scandium in the process.
• The October 2023 Fortune Minerals/Rio Tinto announcement of a collaboration to develop technology to improve the recovery of cobalt and bismuth from co-product streams of minerals recovered at Rio Tinto’s Kennecott smelter in Utah which will be processed at Fortune Minerals’s smelter operations.

As the materials science revolution marches on and continues to unlock new technologies allowing for the safe and commercially viable recovery of mine waste tailings, harnessing this – to date largely untapped — potential could play a significant role in a comprehensive “all-of-the-above” approach to bolstering critical mineral supply chains.

U.S. Supply Chain Initiative, Plan to Release National Defense Industrial Strategy

On the policy front, the Biden Administration recently announced new steps to bolster supply chains for U.S. domestic industries. One highly anticipated component with implications for the critical minerals sector is the Department of Defense’s release of a first ever National Defense Industrial Strategy (NDIS), which, according to the White House, “will guide engagement, policy development, and investment in the defense industrial base over the next three to five years.”

2023 – Metals in Focus

From Battery Criticals to Defense Criticals, and Copper’s Rising Star

In keeping with last year’s trend lines, ARPN-dubbed Battery Criticals – Lithium, Cobalt, Graphite, Nickel and Manganese – continued to dominate the critical minerals discourse (along with the Rare Earths) against the backdrop of surging needs of the green energy transition.

See our coverage of these materials here.

As previously outlined, however, President Biden’s invocation of Title III of the DPA effectively created a new category of Critical Materials – which ARPN has dubbed the Defense Criticals – a whopping list of 35:

See our post with more context here.  

Meanwhile, one mainstay metal’s star has continued to rise in 2023 – Copper. 

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.”

While Copper is a key component of technology in the context of decarbonization efforts, the material was left off the overall U.S. government’s critical minerals list. Congressional efforts to change this may have not succeeded in 2023, but the Department of Energy designated the material a critical material as part of its 2023 Critical Materials Assessment, further raising the material’s clout.

Meanwhile, on December 16, 2023, the Australian government released an update to its list of critical minerals deemed essential to the nation’s energy and security requirements, and also released a new Strategic Materials List of commodities with plans to scope the creation of Strategic Critical Minerals Hubs around the country.   Bearing testimony to the material’s strategic and economic value, Copper made the Australian Government’s Strategic Materials list (along with nickel, aluminum, phosphorus, tin and zinc), a list that identifies commodities which, while not currently considered at risk of supply chain disruption, are essential for the energy transition and the Australian government “will continue supporting the extraction and processing of these minerals and monitoring their market developments.”

It remains to be seen whether the Australian developments will provide a further boost to U.S. domestic efforts to afford copper Critical Mineral status, but it is clear that with or without government action, the material’s star is not going to fade anytime soon.

Conclusion

Time may tell whether 2023 was in fact a watershed year in the critical minerals realm. It appears that we have indeed entered to Post-Petro Tech Age, and it was certainly a year in which tensions between two key global players – the U.S. and China – have reached new heights. Whether or not China overplays its hand in the long run is almost beside the point, as, in the short- to medium term its chokehold in the sector is strong, and we know that the country does not shy away from confrontation.   To not fall behind in the Tech War, decoupling the West’s critical mineral supply chains from China must be the name of the game.

As the West continues this quest, a wary realization appears to have emerged — that the need to coordinate Critical Mineral policy coexists with the growing awareness that even increased supply of essential metals and minerals may not keep pace with rising demand.

How the U.S. and its allies navigate this new resource relationship – multiplied across several score of Critical Minerals – may be one of the principal commercial, diplomatic and national security challenges of this century, and will be a guiding question for 2024.

The post ARPN’s Year in Review – 2023 appeared first on American Resources Policy Network.

One key point of contention was and is the global race for critical minerals, in the context of which the U.S. has taken steps to decouple from Beijing in the wake of pandemic-induced supply chain challenges, surging demand and rising trade and geopolitical tensions.  However, with China controlling much of the critical minerals supply chain, diversifying supply chains away from China is a daunting proposition given the complexity of value chains.

“The US attempt to pull away from China in the electric vehicle (EV) race is like navigating a road trip without a map, given the vast expanse of China’s routes through the critical minerals supply chain that is essential for EV battery production,” writes Sonja Cheung of the Asia Business Council in a new piece for the Hongkong-based South China Morning Post, adding that Washington’s efforts need to be more “assertive” to succeed.

Cheung points to the fact that while China owns most of the cobalt mines in the Democratic Republic of the Congo and has substantial lithium investments worldwide, the U.S. has so far  – while in talks with several other countries and the European Union “made just one trade deal, with Japan earlier this year.”  (A deal with nickel-rich Indonesia was inked after Cheung’s piece was released).

She argues that “to stand a realistic chance of countering China’s strong position in the EV market, Washington needs to double down on combining policy support, financial incentives and advances in technology, to reduce its reliance on imported materials.”

Concludes Cheung:

“The blueprint for accelerating the US EV industry is multifaceted – it involves not only extending tax credits but also installing a robust charging infrastructure across the nation and ensuring EVs are more competitively priced.

The US stands at a strategic juncture and investing in Canada’s abundant critical minerals supply could be a game-changer. As the world’s fifth-largest producer of graphite and nickel, Canada is not only a neighbour but also a natural ally with the potential to be a powerhouse in lithium, magnesium and rare earth elements – all vital in EV machinery. Strengthening this partnership could fortify North American supply chains and reduce reliance on China.”

To those of us used to asking Siri for directions, going on a road trip without a map sounds daunting, but this is one trip the U.S. cannot skip.  Thankfully, there are important pointers in the form of a comprehensive “all-of-the-above” approach the United States can use to navigate the road ahead, encompassing increased domestic production, permitting reform, recycling, R&D, and friend-shoring.  Of course, as is the case all too often, the biggest challenge ahead may be making it past the Washington, DC gridlock.

The post Navigating Without a Map? The Challenge of Decoupling from China appeared first on American Resources Policy Network.

In a piece posted at Oilprice.com Mark P. Mills (via Zerohedge) takes a deep dive into this question.  As Mills points out, with America’s longstanding bond with cars showing no signs of weakening in spite of soaring cost, the push towards widespread adoption of EVs is running into significant challenges in practical application and underlying physics, and, as followers of ARPN well know, a complex mix of chemistry, geology and geopolitics.

Mills laments that the underlying premises of the “ostensible inevitability, the enthusiasm, the subsidies, and the mandates for EVs are anchored in (…) claims (…) that are simply wrong ” –  EVs are not simpler than conventional cars, they just have a complexity of their own, they do not entail less labor to build but rather shift where the labor takes place, and the upstream supply chains, i.e. the sourcing of material inputs, happens “elsewhere since the mines and refineries are not in America.”

Meanwhile, the mineral challenges are significant, says Mills:

“While copper is the long pole in the tent, it is only one of the mineral challenges. The realities of costs and emissions for EVs is dominated by a simple fact: a typical EV battery weighs about 1,000 pounds to replace the fuel, and the tank weighing together under 100 pounds.  That half-ton battery is made from a wide range of minerals including copper, nickel, aluminum, graphite, cobalt, manganese, and of course, lithium. And to get the materials to fabricate that half-ton battery requires digging up and processing some 250 tons of the earth somewhere on the planet. Those numbers, it’s important understand, are roughly the same no matter what the specific battery chemical formulation is, whether it’s lithium nickel manganese, or the popularly cited lithium iron phosphate.”

As the piece points out, the sheer quantity of materials needed “has led proponents to claim that there are, after all enough minerals on the planet and there’s nothing to worry about” – an argument that becomes irrelevant when you consider that “the data show that, overall, the mines operating and planned can’t supply even a small fraction of the 400% to 7,000% increase in demand for minerals that will be needed within a decade to meet the ban-the-engine goals.” 

Ultimately, Mills concludes, that “the realities of physics and engineering mean that politicians pushing for an all-EV future run a high risk. Quite aside from the eventual discovery that EVs will disappoint with only a tiny impact on global CO2 emissions, the bigger impacts will come as consumers find vehicle ownership costs and inconveniences both escalating.”

While this may be true, it appears that, to stay with transportation analogies, the train has left the station.  Politicians are all in for the EV revolution — but to lessen the blow to consumers, they will need to embrace frameworks that will bolster the domestic supply chains for the critical minerals underpinning this shift, across all segments of the value chain.

As the horse and carriage gave way to the “motor carriage” with its superior horsepower, EVs are inexorably redefining the driving experience, even as internal combustion engines co-exist in some manner.  The pace of change will certainly rest on the understanding of the role a host of Critical Minerals play in this transformation – and the willingness to extract them in ways old and new.

The post The EV Transition is Here – But Its Enthusiasts Ignore Its Political and Economic Implications appeared first on American Resources Policy Network.

A new piece by the Office of Applied Innovation at Goldman Sachs illustrates the challenge.

Against the backdrop of growing demand for critical minerals in the context of the green energy transition, national defense and other high-tech applications, Goldman Sachs’s analysts expect geopolitical competition to increase, with the rise of resource nationalism and a five-fold increase in export controls on critical minerals, many imposed by China but also other countries, a sign of what’s to come.

The authors believe that “future success in diversifying and building more resilient global supply chains will require investments and partnerships by the public and private sectors at every step of the value chain, streamlined project development, cooperation with likeminded partners, a global engagement strategy, and training a new generation of mining professionals.” 

While acknowledging the difficulty of “derisking” or “diversifying” critical mineral supply chains in light of related costs and complexities, they argue that the right strategy – effectively a comprehensive all-of-the-above approach that includes strategic investments and the application of advancements made in the context of the materials science revolution – can approach this goal “in a way that reduces geopolitical risks, creates new market opportunities, and provides a more sustainable path to the new, green economy.”  

The piece stresses the importance of a holistic supply chain approach, and emphasizes the need to focus efforts to diversify critical mineral supply chains not only on the upstream supply side, but also on the downstream segments of the value chain – i.e. processing and manufacturing — where China continues to have the upper hand.

Goldman Sachs suggests the following six steps towards building “more diverse and resilient critical mineral supply chains”:

1. Investing in every step of the value chain.  The authors highlight the need for significant financial investment to bolster critical mineral supply chains, arguing that while vehicles like the United States’ Inflation Reduction Act (IRA) and the EU’s Critical Raw Materials Act (CRMA) are promising government initiatives, more “strategies that offer incentives across the supply chain (…) and priorities where supplies are most likely to fall short of demand” are needed.
2. Streamlining project development.  Permitting reform will not only be key to building an “ex-China”supply chain for critical minerals, say the authors, it could also help “reduce the industry’s carbon footprint and advance sustainability goals.”
3. Strengthening cooperation with like-minded partners. Pointing to recent bi-and multilateral agreements on critical minerals, including the Mineral Security Partnership of which the U.S. is a founding member, the authors argue that economic competition can in fact increase international cooperation with like-minded partners.
4. Competing Globally. The authors argue that countries will have to seek out new opportunities and partnership abroad – and while China has a leg up by having pursued a comprehensive investment strategy to “secure and control a global and domestic supply” for decades, there are opportunities for other countries to develop alternatives.
5. Training a new generation of mineral professionals. Goldman Sachs stresses the importance of human capital, urging a recommitment to closing what has become a “talent deficit” with mining and mining engineering programs at American colleges and universities having seen a steady decline.
6. Focusing on R&D. Technological innovations hold great potential, and new production techniques, new sources, new extraction methods, and substitution methos – many of which ARPN has featured in recent months — may hold the key for significant changes to critical mineral supply chain security.

They close by arguing that “building a more diverse and resilient critical mineral supply chain would come at short-term and medium-term economic costs. But it would also reduce the potential for critical minerals to be used for geopolitical advantage and provide long-term security, environmental, and economic gains. In geopolitics, as in economics, there are rarely clear solutions. More often, there are complex choices and tradeoffs.”

The time to act, however, is now — because “waiting for a geopolitical shock to make necessary investments in more diverse, resilient supply chains is not a strategy that will serve countries, companies, or consumers well.” 

Here’s hoping the message resonates in Washington, D.C. and beyond.

The post Goldman Sachs: Geopolitics of Resource Supply Demands Complex Choices and Tradeoffs – And Sooner Rather Than Later appeared first on American Resources Policy Network.

This week, the Indian Ministry of Mines released a comprehensive Critical Minerals List, consisting of 30 metals and minerals deemed critical for India’s ambition for cleaner technologies in electronics, telecommunications, transport and defense, according to the government.

The list comprises the group of 17 rare earth elements (REEs) and six platinum group metals (PGMs) as complexes. It also encompasses four of what ARPN has dubbed the “battery criticals” lithium, cobalt, graphite and nickel (India’s list does not include manganese which rounds out the five battery criticals), as well as antimony, beryllium, bismuth, gallium, germanium, hafnium, indium, molybdenum, niobium, phosphorous, potash, rhenium, silicon, strontium, tantalum, tellurium, tin, titanium, tungsten, vanadium, zirconium, selenium, and cadmium.

Lastly, the list also includes copper, a mainstay metal and key component of the green energy transition which the United States has thus far failed to add to its own list of critical minerals in spite of numerous pushes for its addition.

According to Indian web news hub Rediff.com, the government plans to encourage public and private investment in exploration, mining and processing to secure the country’s critical mineral supply chains, and will seek to “facilitate the adoption of advanced technologies and international collaborations to enhance efficiency and environmental sustainability in the extraction and processing of critical minerals.”

One of the first such international collaborations was just made official during a state visit of India’s Prime Minister Narenda Modi to Washington, D.C. last week, where Modi and U.S. President Joe Biden announced the country’s joining of the Minerals Security Partnership alongside several bilateral and defense deals.

The MSP is a partnership between the United States, Canada, the United Kingdom, France, Germany, Japan, South Korea and several other countries convened in June 2022 as an initiative to bolster supply chains while aiming “to ensure that critical minerals are produced, processed, and recycled in a manner that supports countries in realizing the full economic development potential of their mineral resources.”

As the rest of the world aims to decouple its critical mineral supply chains from China, which has long dominated most of the critical minerals sector across all links of the supply chain, India is looking to harness its geopolitical wealth to become a “global hub for critical mineral production and reinforce its position as a major player in the global economy.”

In keeping with that objective, India’s recent moves have global implications.

At the beginning of this year, a New York Times piece called on G20 leaders gathering in Davos, Switzerland, to “pivot to the new reality provoked by the Covid-19 pandemic, the war in Ukraine, the growth of extreme inequalities and aggressive Russian and Chinese autocracies.” 

In the critical mineral realm, these recent events served as a catalyst for a new “Great Game,” which the geopolitics of mineral resource supply had triggered and which gained momentum with the adoption of the Paris agreement in 2015.

India’s recent critical mineral moves are highly relevant in the context of this new “Great Game,” particularly as relations between India and China are strained by an ongoing border conflict and growing regional rivalry, both of which are shaping South Asia’s security landscape and strategic environment.

With India having overtaken China as the world’s most populous country and set to become the third-largest economy in the coming years, India’s recent moves could be seen as a direct challenge by Beijing.

As Frédéric Grere and Manisha Reuter outline for the European Council on Foreign Relations, “New Delhi still exerts a dominant role in South Asia and, specifically, the Indian Ocean, but as China consolidates its position in the region, its attitude towards India has become more assertive. India remains resolute about preventing Chinese hegemony in Asia, repeatedly stressing that a multipolar world starts with a multipolar Asia, and seeking partnerships with a variety of countries, including the US and the EU. Beijing is concerned about India’s growing military ties with the US and tends to consider India’s intentions through the lens of its own rivalry with the US.”

The new Great Game may have just gotten Greater.

The post India Ups the Ante in New “Great Game,” Releases Critical Minerals List and Joins MSP appeared first on American Resources Policy Network.

With the world having become increasingly interconnected and interdependent in the years that followed the collapse of the Soviet Union, fears that globalization is dead are likely overblown, but, as the Wall Street Journal pointed out earlier this year, it is certainly changing.

The world is becoming more fragmented, and, as Jared Cohen, president of Global Affairs and co-head of the Office of Applied Innovation at Goldman Sachs wrote earlier this month, “in the 2020s, everything is geopolitical.”

As he outlines: “Each great power has a privileged position in the global economy, and they all face new risks and uncertain futures.” 

He elaborates:

“The United States is leaning more into its status as the holder of the world’s reserve currency, using the dollar and related payment systems to sanction adversaries and competitors. China is leveraging dependency on its position in supply chains. And Russia—with nowhere near the power of China or the U.S., but with more appetite for risk—has wielded energy to intimidate and coerce its neighbors and limit global support for Ukraine. There is no country or multilateral organization that has the capacity to arbitrate these tensions.”

With the above-referenced events at the top of this decade and the accelerating global push towards net zero carbon emissions a new class of states have entered the spotlight in the global geopolitical realignment – the “geopolitical swing states,” and their role could grow exponentially in the coming years.

Goldman Sachs’s Cohen defines a geopolitical swing state as “critical to the world economy and balance of power” but without “the capacity by themselves to drive the global agenda, at least for now.” He adds that “as long as the tensions between the U.S. and China continue to get worse, they will have outsized abilities to navigate geopolitical competition and take advantage of and influence it.” 

According to Cohen, there are four – often overlapping — categories of geopolitical swing states:

• Countries with a competitive advantage in a critical aspect of global supply chains;
• Countries with a unique ability to make themselves attractive for nearshoring, offshoring, or friendshoring;
• Countries with a disproportionate amount of capital and willingness to deploy it around the world in pursuit of strategic objectives; and
• Countries with developed economies and leaders who have global visions that they pursue within certain constraints.

As Cohen concludes, “[t]he rise of geopolitical swing states may balance the great powers and help stabilize the global order. Their interest-based decision-making could be a source of consistency in uncertain times. Or their newfound prominence may increase global instability by putting more actors and variables in play. But even if today’s world is not yet multipolar, a rising group of countries recognize that they can determine the course of world events. Those geopolitical swing states are aware that their power may be unsustainable, or event fleeting and they are determined to take advantage of the current window of opportunity.”

While the rise of the geopolitical swing states has business implications for multinational businesses and investors, these trendlines are have real-world implications for U.S. stakeholders from a policy perspective, and, in the critical mineral resource realm, underscore the importance of a comprehensive all-of-the-above approach to securing critical mineral resource supply chains.

As Cohen closes:

“For years, geopolitics mattered more to certain industries than others. Now they matter to everyone.”

The sooner U.S. policy stakeholders realize this and pursue a comprehensive “soup-to-nuts” approach that embraces nearshoring, offshoring, and friendshoring, while also focusing on bolstering the domestic critical minerals framework, the better.

The post Rise of “Geopolitical Swing States” Underscores Need for All-Of-The-Above Approach to Mineral Resource Security appeared first on American Resources Policy Network.

Concerns over China’s dominance over a large majority of the key critical mineral value chains has spurred efforts to decouple supply chains from China all over the globe.

Followers of ARPN are aware of U.S. efforts which include the invocation of the Defense Production Act for several critical minerals, the passage of the Inflation Reduction Act and partnership agreements with key allies as well as public-private partnership to bolster domestic critical mineral supply chains.

In Europe, the January 2023 announcement of the discovery of one of the largest rare earth elements (REE) deposits in Europe in the Kiruna mine located Sweden’s Lapland region was hailed by some as the advent of a new dawn for European resource policy, and European Union stakeholders hope that the recently released Critical Raw Materials Act, if passed, will jump start the reshoring process and “de-risk” the regional bloc’s reliance on China by streamlining the permitting process for raw materials projects and allow for selected “Strategic Projects” to benefit from support for access to financing and shorter permitting timelines.

However, as Luke Patey outlines in a piece on the European REE supply chain push for the China-focused online magazine The Wire, the process of “decoupling” is fraught with more significant real-world challenges than some would have thought considering the complexity of critical mineral supply chains, and especially REE supply chains.

For all the upbeat coverage of the Kiruna mine’s new deposit, Patey points to observers in the industry who are more cautious noting that China has “invested tens, if not, hundreds of billions of dollars in research and production to build up its industry over many years,” and cautioning that finding the REE deposits is “just step one.”

As he writes, “[t]he EU now faces the meticulous task of ticking off all nodes of the supply chain to turn its green aspirations into an industrial reality” – from mine to manufacturing – and the midstream steps of building out processing capacity, metallization and magnet making are all “steps that the EU is sorely lacking in.”

A visual of the geographical concentration of the REE permanent magnets value chain and final applications developed by the Center for European Policy Studies (CEPS) and modified by The Wire tells the story of China’s dominance:

Ultimately, Patey says:

“Reshoring, in other words, is more than just reclaiming the anchor of the supply chain. For Europe — and the U.S. — to succeed in their new critical mineral ambitions, they will need to build out links far beyond the mine.” 

He adds that while these efforts are underway “[t]he elephant in the room is that, even if they all succeed, doing all these steps on European soil does not automatically make them competitive with Chinese suppliers — both on price and on tech know-how.”

Meanwhile, efforts to build mine to manufacturing supply chains for critical minerals, and especially REEs, continue to run into the “not in my backyard” challenge — an issue that continues to permeate policy discussions on this side of the Atlantic as well. As Patey phrases it, “the rare earths supply chain blends together not only challenges of national security and industrial competitiveness, but also economic and ecological welfare,” and while the newly released Critical Raw Materials Act intends to address these challenges, critical mineral extraction still faces local resistance in many parts of the regional bloc.

It is a daunting challenge; however, it is one that stakeholders – here, across the Atlantic, or elsewhere – have to tackle comprehensively and swiftly.  China has already demonstrated its willingness to play politics with its resource leverage – and, as ARPN recently outlined, is gearing up to do it again as the weaponization of trade is back on the menu in U.S.-Chinese relations.

The post The Pitfalls of Decoupling – A Look at Europe’s REE Supply Chain Push appeared first on American Resources Policy Network.

Leaders must “pivot to the new reality provoked by the Covid-19 pandemic, the war in Ukraine, the growth of extreme inequalities and aggressive Russian and Chinese autocracies,” writes the NYT.

In the critical mineral realm, these recent events have served as a catalyst for the new “Great Game,” which the geopolitics of mineral resource supply had triggered and which had gained momentum with the adoption of the Paris agreement in 2015 which in turn had committed countries to significantly reduce greenhouse gas emissions and transition to renewables.

Over the course of the last few months, awareness of the importance of securing critical mineral supply chains and decoupling form adversaries, i.e. China, continued to grow against the backdrop of an increasingly volatile geopolitical landscape and mounting environmental pressures.  While, as the New York Times suggests, “the shape of an alternative international system is unclear,” we are seeing first steps towards a realignment as nations around the world rethink and reorganize their critical mineral supply chains.  

ARPN has discussed several developments involving the United States and key allies like Canada and Australia, but Asian nations, too, are taking steps to diversify their supply chains away from China, particularly in the rare earths (REE) space.

In spite of having signed a deal with Vietnam on rare earth development after having experienced the ramifications of an over-reliance on Chinese minerals first hand with the 2010 rare earths standoff between China and Japan, Japan’s domestic rare earth production has remained limited to date, with more than two thirds of the country’s rare earth supplies coming from China.  With demand surging in the context of growing EV markets, Japan is looking to “curb excessive dependence on specific countries, carry forward next-generation semiconductor development and manufacturing bases, secure stable supply for critical goods including rare earth, and promote capital reinforcement of private enterprises with critical goods and technologies,” according to a government strategy paper cited by Qu4tro Strategies this month.

To do so, Tokyo inked a critical mineral agreement with Australia in October of 2022 and Japan’s Organization for Metals and Energy Security (Jogmec) is working with private companies to take control of its holding in a joint venture to develop dysprosium-terbium heavy rare earths in Namibia.  Jogmec is also an investor in Australia-based Lynas Rare Earths’s latest push to increase its meaning capacity in Western Australia.

Vietnam, not traditionally known as a global mining powerhouse, is looking to become a key player in the global REE supply chain.  While, as Qu4tro Strategies outlines, North Korea is believed to be home to the world’s largest rare earth deposits, Vietnam’s large REE reserves are more viable as an alternative to Chinese REEs, as North Korea’s political situation and economic sanctions prevent the country from becoming a link in the global supply chain.

While exploration in Vietnam has so far been unable to tap into the country’s considerable mineral potential, that may be changing. As a fast-growing economy, Vietnam is attracting companies trying to find new regional bases as U.S.-Chinese trade tensions rise, and post-Covid supply chains remain strained.

In recent months, several countries have entered into partnership agreements with bot the Vietnamese Government and private companies to establish “an integrated supply chain for rare earths and other critical minerals.”

Qu4tro Strategies cites the December signing of an agreement between Vietnam and South Korea to jointly explore and develop core minerals including rare earths in Vietnam, as well as a partnership between Australia Strategic Minerals (ASM) and Vietnam Rare Earths for “long-term supply of rare earths to provide feedstock for ASM’s Korean Metals Plant.” 

Trade between Canada and Vietnam is reported to increase under the Trans-Pacific Partnership free trade agreement, and the Canadian province of Saskatchewan is actively exploring the “potential for the countries to collaborate on green energy, including sustainable mining and rare earth elements.”

The Middle East, traditionally known as a leader in the fossil fuel realm, could also emerge as a critical mineral player in a newly realigned world, particularly as nations like Saudi Arabia incentivize investment towards creating integrated value chains, with the country currently processing 145 exploration license applications sent in by foreign companies, according to a new report issued by the Future Minerals Forum in Collaboration with the Payne Institute for Public Policy Colorado School of Mines.

Meanwhile, Africa’s resource richness is well known. As the Future Minerals Forum’s report outlines, trade tensions with China as well as Russia’s ongoing war have triggered many Western countries to turn to Africa for investment opportunities in critical mineral supply during 2022.

Discussions between Minerals Security Partnership countries (see our post here) have begun involving African regions as targets for potential partnerships, and five countries — the DRC, Mozambique, Namibia, Tanzania and Zambia – have initiated conversations on development opportunities to “diversify and bolster critical mineral supply chains while lowering trade reliance with China and Russia” during the UN General Assembly conference in September 2022.  Deals made at the U.S.-Africa Leaders Summit, which included a commitment of over $150 million dollars into Zambia’s mining sector to develop copper and Cobalt, are a case in point.

However, as the authors of the Future Minerals Forum’s report point out, of Africa, “the scale and pace of investment inflows will largely hinge on the restructuring of domestic governance and policy changes.”

As leaders continue to deliberate on the new realities of the post-Cold War world order in Davos this week, we will continue our focus on the realignment underway in the minerals sector and will zero in on the West in our second post this week.

The post A New Critical Minerals World Order? — A Look at the Post-Cold War Realignment in the Wake of Covid, War in Ukraine and Geopolitical and Economic Tension appeared first on American Resources Policy Network.

For most of us, the first week of January means it’s time to go back to the grind after an extended period of family time, food coma, rest and – hypothetically, at least — reflection.  It also means trying shake the brain fog and mental rust that has settled in order to dive back into the swing of things.

Today, it’s time to meet 2023 head-on.

If you could use a refresher to get you up to speed on where we are in the critical minerals space, take a look at our “Year in Review” post, especially if you missed it amidst the pre-holiday craziness in December.

In it, we argued that in some ways, 2022 was the year in which strengthening supply chains moved from “rhetoric to reality” as much progress was made, including important groundwork to build out a secure North American critical minerals supply chain.  However, we also cautioned that much more remains to be done, and to overcome the many challenges, new alliances will need to be forged.

As Shane Lasley argues in Critical Minerals Alliances 2022, a magazine covering 29 metals and minerals (when counting rare earths as 14)  deemed critical to North American supply chains as well as related policy issues:

 “The optimum solution to laying the foundation for the next epoch of human progress will only be discovered through the forging of unlikely alliances between the woke and old school, environmental conservationists and natural resource developers, liberals and conservatives, national laboratories and private sector entrepreneurs, local stakeholders and global mining companies, venture capitalists and innovators, and everyone else with visions of a cleaner, greener, and high-tech future.”

Now the question is, what lies ahead?

As we look at overall trend lines in the critical minerals space, we see the following themes emerge:

• A focus on the Super Criticals (see our Year in Review post for more info);
• the growing importance of geopolitics, with China taking center stage and alliances and partnerships continuing to be forged to reduce reliance on Beijing;
• the acceleration of the green energy transition which will require vast amounts of critical minerals;
• as well as industry’s efforts to sustainably green our future by harnessing the materials science revolution.

All of these themes are intertwined, and more may emerge in the coming months, but rest assured that ARPN will be covering these issues extensively as we go forward.

Of course, we are not the only ones to have paused and reflected on what’s to come in 2023.  In a new piece for InvestorIntel.com, editor in chief, critical minerals, Jack Lifton stipulates that “2023 is a breaking point if there is to be an EV revolution/transformation.”

Arguing that “[i]t is not at all certain that high-tech, critical minerals producers and processors, will be ready or even existent by the time the minerals can be delivered to their end-user manufacturers,” Lifton says that “[i]t’s time that car makers performed a due diligence on the critical minerals’ supply space.”

In his view, car makers must — specifically for minerals, metals and manufactured components dependent upon lithium, cobalt, nickel, graphite, manganese and the rare earths —

• “[a]scertain whether or not the supply of finished components necessary for the assembly of motor vehicles (…) can meet current and all future demand;
• and predict and mandate price maximums for critical minerals that they can afford if their products are to be sellable.”

Benchmark Mineral Intelligence’s Simon Moores says that “2023 will be the end of the start up phase for electric vehicles and battery supply chains” as we are “entering scale up.” He adds: “This may seem like demand (which industry could not fulfill) is falling when it’s high and volatile. A sky high but bumpy ride ahead.”

In the waning days of December the stage was set for 2023 with decisions to come standing to determine national fortunes and human progress in decades ahead.

As 2023 rolls down the runway, it’s time to buckle up.

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