It’s back to the grind.
The parades, barbecues, pool parties and fireworks to mark this year’s Independence Day are over. There’s much to be thankful for, especially at a time when the impact of Russia’s war on Ukraine, now in its second year, reverberates around the globe and geopolitical tensions continue to mount.
ARPN has always used the occasion of Independence Day to remind ourselves that “while we cherish the freedom we are blessed with in so many ways, we must not become complacent, as there are areas where we’re increasingly becoming less independent” — with our reliance on foreign mineral resources being a case in point.
Thankfully, stakeholders are increasingly aware of the urgency to strengthen critical mineral supply chains, and, on the heels of a global pandemic, ongoing war between Russia and Ukraine, and growing resource nationalism, a flurry of activity has dominated the critical minerals space, ranging from domestic efforts over bilateral trade agreements to multilateral alliances.
For the U.S., a notable example of domestic efforts is the series of DPA Presidential Determinations involving specific Critical Minerals, beginning with President Trump’s July 2019 designation of the Rare Earth permanent magnet supply chain being designated as “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 – the “defense criticals” and designated airbreathing engines, advanced avionics navigation and guidance systems, and hypersonic systems and their “constituent materials” as priority DPA materials.
(for more on the Defense Criticals, read our post here.)
Followers of ARPN are further aware of policy initiatives like the United States’ Inflation Reduction Act (IRA) or the European Union’s Critical Raw Materials Act (CRMA), which are currently being followed by bilateral trade agreements, as well as U.S.-EU discussions to launch a “critical mineral club.”
While the United States and our partners have taken several important steps to decouple critical mineral supply chains from China, Beijing, having systematically built out its dominance across the entire value chain from mining over processing to manufacturing, still has a chokehold on many key critical minerals, and particularly the EV battery supply chain.
And for all of the recent U.S. policy efforts, the latest USGS Mineral Commodity Summaries report confirmed that our critical mineral dependencies still persist.
There is momentum to change this, however, as we have previously argued:
“Those familiar with the inner-workings of Washington, D.C. know all too well that particularly in an election year policy efforts can quickly lose steam or fizzle over attempts to placate certain constituencies. Against all affirmations to strengthen domestic supply chains, the not-in-my-backyard (NIMBY) sentiment is still strong.”
As followers of ARPN well know, the stakes are too high to let the momentum for comprehensive reform fizzle.
With a new “Great Game” afoot in the global mineral resource realm (see our most recent post on the issue here), the U.S. must double down on its push to secure critical mineral supply chains from “soup to nuts” to borrow a term used by U.S. Energy Secretary Jennifer Granholm.
With the West’s resource dependence running deep, and Beijing’s determination to continue its global quest for resource dominance unbroken, the critical mineral arms race will continue to heat up. Stakeholders here and elsewhere must gear up for the long haul.
As ARPN stated in a previous post, Rome wasn’t built in a day.
Neither was the United States of America.
But built it was, challenges were overcome — and we are celebrating the men and women who have fought for and continue to safeguard our freedoms this week.
Here’s hoping that one day we will be able to say the same for the critical mineral supply chains that anchor the technology economies of the 21st Century.