Critical Minerals

May 11, 2025 by Dr Rajiv Desai

Critical Minerals:

Tesla would not go out of business if supplies of cobalt vanished. But without it, the current generation of electric vehicles would not be able to drive as far between charges or remain in service as long without replacing the batteries.

Section-1

Prologue:

Archaeologists and historians describe early civilizations and periods of human history using terms such as the Stone Age, the Copper Age, the Bronze Age, and the Iron Age. Such descriptions reflect the fundamental importance of nonfuel minerals, metals, and materials technology and applications. Early civilizations were built to a significant degree using the seven metals of antiquity (in order of discovery): gold (6000 BC), copper (4200 BC), silver (4000 BC), lead (3500 BC), tin (1750 BC), iron (1500 BC), and mercury (750 BC). Each discovery led to a range of innovations and applications that provided a marked advantage until such time as it was adopted by competing civilizations or overtaken by other innovations. Advances were not limited to military technology but extended to agricultural implements, food storage and preparation, therapeutic and cosmetic applications, and many other aspects of daily life and culture. The much later discovery of arsenic, antimony, zinc, and bismuth in the thirteenth and fourteenth centuries was followed by platinum in the sixteenth century and another 12 metals or metalloids in the eighteenth century, bringing the total number of known metals and metalloids to 24. Most known metals and metalloids were discovered only in the past two centuries.

Minerals are solid, naturally occurring inorganic substances with a definite chemical composition and a crystalline structure that can be found in the earth’s crust. Minerals can contain a combination of metallic, non-metallic, and metalloid elements. Metals are elementary substances, such as gold, silver and copper that are crystalline when solid and good conductors of heat and electricity, occurring naturally in minerals. Many minerals contain metals as their primary or secondary constituents. For example, the mineral galena (PbS) contains the metal lead, and the mineral hematite (Fe2O3) contains the metal iron. Metals are often extracted from minerals through processes like smelting, leaching, or other metallurgical techniques. Non-metallic minerals are those that lack metallic properties, meaning they are poor conductors of heat and electricity, not malleable, and break down easily. Examples include salt, mica, quartz, limestone, and clay. Metalloids have properties of both metals and nonmetals. Silicon is not a metal, but it is a metalloid. It is brittle at room temperature, which is a property of nonmetals. It is an intrinsic semiconductor, which is not a property of metal. Silicon dioxide, or silica, is a very common compound in the Earth’s crust, forming rocks and minerals like quartz and sand. Metalloids can be found in various minerals, and some minerals are even named after them, such as arsenopyrite (containing arsenic) and stibnite (containing antimony).

A critical mineral is a nonfuel mineral that is essential for use and faces considerable supply chain vulnerabilities. For example, silicon is essential for manufacturing computer chips; lithium is essential for manufacturing batteries; and rare earth elements are essential for manufacturing magnets, batteries, phosphors, and catalysts used in such products as wind turbines, electric vehicles, screens/touchscreens, and petroleum refining. Demand for these components in the health care, transportation, power generation, consumer electronics, defense, and refining and manufacturing sectors is projected to grow in the next decade, likely leading to increased demand for critical mineral resources. The definition of whether a mineral is considered critical or not is somewhat flexible, since this classification depends on not only the context and the stakeholder’s point of view, but is also subject to change over time because the current techno-socio-economic paradigm largely defines the criticality level of minerals. Just as oil was key to progress during the last century, critical minerals are crucial to this century’s energy transition. Some trade experts call critical minerals the “bedrocks” of a new era in technological advancement — not unlike how the invention of the steam engine during the first industrial revolution dramatically changed the world, powering boats, trains and factory machines. Growing dependency on critical minerals is leading to anxieties over continuing supply and the geopolitical influence they bestow.

What does your smartphone have in common with a solar panel, or an EV battery, or a piece of military equipment? They’re all made using critical minerals — an essential ingredient in powering the modern technology that we use every day. In recent years, the concept of critical minerals has gained popularity because the new technologies that are shaping the ongoing green and digital transitions (together known as the ‘twin transition’) utilise far higher amounts of minerals than more traditional technologies. For example, the construction of a wind farm requires nine times more minerals than that of a natural gas power plant, and the manufacturing process to build an electric car needs six times more minerals than that of a gasoline-powered car. In another powerful comparison, the photovoltaic energy is portrayed as requiring up to 40 times more copper than the fossil-fuel combustion. Furthermore, the construction of wind farms and electric cars use seven different types of minerals, while a natural gas power plant and a conventional car use only two. Manufacturing a single electric car, for example, requires more than 200 kilograms of combined copper, lithium, nickel, manganese, cobalt, graphite and rare earth elements, compared to less than 35 kilograms of just copper and manganese for an internal combustion model. The IEA forecasts that meeting the Paris climate agreement’s goal of keeping average global warming well below 2ºC above pre-industrial temperatures will result in a quadrupling of demand for critical minerals by 2040. Achieving net-zero emissions by 2050 would mean a sixfold increase. Thus, while previously the energy sector represented only a small portion of the total minerals demand, it is emerging as the major force in mineral markets and as a result of this transformation, minerals bring new challenges to the energy security. Although the metal-intensive transition to the net-zero economy will reduce dependencies on conventional hydrocarbon resources, it may lead to new and unanticipated interdependencies, including dependencies on raw materials.

The criticality level of minerals is usually determined by the economic importance of the minerals and the risk of disruption to their supply chains. From the ‘twin transition’ perspective, a mineral’s economic importance depends on how relevant it is for producing new technologies, while the supply chain disruption risk refers to the likelihood of a shortage due to a mineral’s physical scarcity or market concentration. The reason why the supply chains of critical minerals are so complex is that disruption risks can emerge from different stages of the supply chains. Some minerals are critical because they are present in minimum concentrations as by-products of so-called ‘major’ minerals (minerals that are present in higher concentrations in mineral deposits); for example, ruthenium, rhodium and palladium are by-products of platinum. Other minerals are critical due to market concentration in the downward processing stages; for instance, over 40% of the global smelting and refining capacity for copper, lithium, rare earths and cobalt is concentrated in China. While not geologically scarce, critical minerals are already in short supply. This stems from their versatility as integral components of nearly all modern technologies — not only within clean tech, but also in consumer electronics, communications and medical equipment, advanced weapons systems and the supercomputers needed to develop artificial intelligence (AI). Some large deposits of critical minerals are also hard to access, given their location in increasingly fragile states. All of these different factors make this subject an undoubtedly fascinating one to study.

Mining is the foundation that allowed the United States to be a military leader, providing the minerals needed to manufacture tanks, missiles, fighter jets, and warships. But as with everything else in today’s world, these weapons now require computerised systems and increasingly AI to operate, and this requires access to minerals that were only of limited importance in the past. Today the United States is 100 percent import-reliant for 12 of the 50 minerals identified as critical by the US Geological Survey (USGS) and over 50 percent import-reliant for another 29. China is the top producer for 29 of these critical minerals. China has a stranglehold on minerals processing, refining between 40 and 90 percent of the world’s supply of rare elements, graphite, lithium, cobalt, and copper. According to the International Energy Association, China is responsible for 63% of the world’s rare earth elements, including 45% of molybdenum. Additionally, China has acquired a majority stake in the Cobalt mines of the Democratic Republic of Congo, which accounts for 70% of the world’s output. Notably, China is a significant importer of lithium, with up to 55% of production occurring in Australia. While Australia is the leading lithium producer globally, more than 99% of the value in lithium battery production is added during chemical processing, cell manufacturing, and assembly, currently dominated by China. South Africa mines 72% of the world’s platinum and Indonesia is the largest producer of nickel.

From smart phones and laptops, to batteries and solar panels, cosmetics and medical devices, we rely on critical minerals every day. Critical minerals sustain the nation’s infrastructure and manufacturing, and are essential to scaling up and advancing modern technologies, including but not limited to those related to communications, national security and energy generation & storage. Critical minerals play a vital role in the economic and national security of both industrialized nations and developing countries. These minerals serve as the foundational elements for essential modern technologies in various sectors, including energy, communication, space exploration, nuclear industry, manufacturing of mobile phones, computers, batteries, electric vehicles, solar panels, wind turbines, and more. Studying critical minerals is vital because they underpin modern technology, energy transition, and national security, making their understanding essential for economic development, technological advancement, and global stability.

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Abbreviations and synonyms:

CM = Critical Mineral

CMM = Critical Minerals and Materials

CRM = Critical Raw Materials

3Ts = tin, tungsten, and tantalum

ASM = artisanal and small-scale mining

DRC = Democratic Republic of the Congo

ENAMI = Empresa Nacional de Minería

EU = European Union

GHG = greenhouse gas

IEA = International Energy Agency

IRENA = International Renewable Energy Agency

IGF = Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development

IPCC = Intergovernmental Panel on Climate Change

OECD = Organisation for Economic Co-operation and Development

MSP = Mineral Security Partnership

REE = Rare Earth Elements

ESS = Energy Storage Systems

GW = Gigawatts

EV = Electric Vehicle

PGE = Platinum Group Elements

PGM = Platinum group minerals

AMD = Acid Mine Drainage

USGS = United States Geological Survey

GSI = Geological Survey of India

PSU = Public Sector Undertaking

R&D = Research & Development

LIB = lithium-ion battery

LFP = lithium- iron-phosphate (LiFePO4)

REO = rare earth oxides

ESG = environmental, social, and governance

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Section-2

Metals and minerals:

The Earth’s crust is the outermost layer of the Earth made of rocks, minerals, and metals. It’s the thinnest layer of the Earth, but it’s where most geological processes occur. The crust is broken into tectonic plates that move over time, which shapes the Earth’s surface. The two elements that make up about 75% of Earth’s crust are silicon and oxygen. The average thickness of the crust is about 15 – 20 km.

Minerals are naturally occurring elements or compounds that have been formed through slow inorganic processes and occur in the earth’s crust. The earth’s crust is composed of many kinds of rocks, each of which is an aggregate of one or more minerals. In geology, the term mineral describes any naturally-occurring inorganic solid substance with a specific composition and crystal structure. A mineral’s composition refers to the kinds and proportions of elements making up the mineral. The way these elements are packed together determines the structure of the mineral. More than 3,500 different minerals have been identified. There are only 12 common elements (oxygen, silicon, aluminum, iron, calcium, magnesium, sodium, potassium, titanium, hydrogen, manganese, phosphorus) that occur in the earth’s crust. They have abundances of 0.1 percent or more (more than1,000 ppm). All other naturally occurring elements are found in very minor or trace amounts. Remember – all the minerals are non-renewable.

Silicon and oxygen are the most abundant crustal elements, together comprising more than 70 percent by weight. It is therefore not surprising that the most abundant crustal minerals are the silicates (e.g. olivine, Mg2SiO4), followed by the oxides (e.g. hematite, Fe2O3). Other important types of minerals include: the carbonates (e.g. calcite, CaCO3) the sulfides (e.g. galena, PbS) and the sulfates (e.g. anhydrite, CaSO4). Most of the abundant minerals in the earth’s crust are not of commercial value. Economically valuable minerals (metallic and nonmetallic) that provide the raw materials for industry tend to be rare and hard to find. Therefore, considerable effort and skill is necessary for finding where they occur and extracting them in sufficient quantities.

Mineral resources are essential to our modern industrial society and they are used everywhere. For example, at breakfast you drink some juice in a glass (made from melted quartz sand), eat from a ceramic plate (created from clay minerals heated at high temperatures), sprinkle salt (halite) on your eggs, use steel utensils (from iron ore and other minerals), read a magazine (coated with up to 50% kaolinite clay to give the glossy look), and answer your cellphone (containing over 40 different minerals including copper, silver, gold, and platinum). We need minerals to make cars, computers, appliances, concrete roads, houses, tractors, fertilizer, electrical transmission lines, and jewellery. Without mineral resources, industry would collapse and living standards would plummet. In 2010, the average person in the U.S. consumed more than16,000 pounds of mineral resources. With an average life expectancy of 78 years, that translates to about1.3 million pounds of mineral resources over such a person’s lifetime. Here are a few statistics that help to explain these large values of mineral use: an average American house contains about 250,000 pounds of minerals, one mile of Interstate highway uses 170 million pounds of earth materials, and the U.S. has nearly 4 million miles of roads. All of these mineral resources are nonrenewable, because nature usually takes hundreds of thousands to millions of years to produce mineral deposits. Early hominids used rocks as simple tools as early as 2.6 million years ago. At least 500,000 years ago prehistoric people used flint (fine-grained quartz) for knives and arrowheads.

Note:

In the realm of health and nutrition, the terms electrolytes and minerals are often used interchangeably, leading to confusion among consumers and even professionals. While all electrolytes are minerals, not all minerals are electrolytes. Electrolytes are minerals that can carry an electrical charge when dissolved in water. They include sodium, potassium, chloride, magnesium, calcium, and phosphorus.

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Find out what is the difference between ore, metal, minerals and rocks:

A geologist defines a mineral as a naturally occurring inorganic solid with a defined chemical composition and crystal structure (regular arrangement of atoms). Minerals are the ingredients of rock, which is a solid coherent (i.e., will not fall apart) piece of planet Earth. There are three classes of rock, igneous, sedimentary, and metamorphic. Igneous rocks form by cooling and solidification of hot molten rock called lava or magma. Lava solidifies at the surface after it is ejected by a volcano, and magma cools underground. Sedimentary rocks form by hardening of layers of sediment (loose grains such as sand or mud) deposited at Earth’s surface or by mineral precipitation, i.e., formation of minerals in water from dissolved mineral matter. Metamorphic rocks form when the shape or type of minerals in a preexisting rock change due to intense heat and pressure deep within the Earth.

All materials – including fuel, water, metals etc. – needed by modern society are derived from the earth’s crust. The raw material from which minerals are extracted is known as ore. Ore is sediment that contains one or more valuable minerals, typically metals, that can be mined, treated and sold at a profit. Ore is extracted from the earth through mining and treated or refined, often via smelting, to extract the valuable metals or minerals.

Minerals are obtained from the ground by a process known as ‘mining’. There are two types of mining; surface mining and subsurface mining.

Some minerals are extracted from the earth’s surface. When the ore deposits are very large, a huge pit is created as excavating machines scrape off the earth to reach the mineral ore. The ore is then taken away to be refined. The size of the ore bed increases as mining continues, and eventually, the pit becomes a very large bowl-shaped hole in the earth’s surface.

Sometimes, the ore is found in a very wide area but it’s not very deep in the ground, the method used to remove the ore is known as strip mining. Instead of creating one large pit in the ground, long, narrow trenches are dug out. Once the ore is removed, the soil dug out is dumped back into the strip, filling up the trenches.

Some minerals are found very deep below Earth’s surface. To remove these minerals from the ground, subsurface mining is employed. First, a deep hole is dug, at the end of which long tunnels are created horizontally in all directions. Usually, the ore is embedded in rocks, so one way is to blast apart the material and then send the ore pieces up to the surface. Another method is known as longwall mining, which is when mineral is sheared from the wall and collected on a conveyor belt to be taken up. This is a very efficient way of extracting mineral from an underground mine. Another method is solution mining, which is when hot water is injected into the ore to dissolve it. Once the ore is dissolved, air is pumped into it, and it’s bubbled up to the surface.

Huge quantities of ore are mined to obtain proportionately very small quantity of the pure mineral. For instance, only about 6% of ore is Copper; 40% to 70% Iron. Gold is so expensive because anywhere between 2 tons to 100 tons of ore is refined to produce 1 ounce of Gold!

The enrichment factor, which is the ratio of the metal concentration needed for an economic ore deposit over the average abundance of that metal in Earth’s crust, is listed for several important metal. Mining of some metals, such as aluminum and iron, is profitable at relatively small concentration factors, whereas for others, such as lead and mercury, it is profitable only at very large concentration factors. The metal concentration in ore can also be expressed in terms of the proportion of metal and waste rock produced after processing one metric ton (1,000 kg) of ore. Iron is at one extreme, with up to 690 kg of Fe metal and only 310 kg of waste rock produced from pure iron ore, and gold is at the other extreme with only one gram of Au metal and 999.999 kg of waste rock produced from gold ore.

And then, there is deep sea mining. Practically all of the mineral and energy resources found on land are present under the sea as well. Development, however, is limited by extraction costs that increase with depth of water, by the relative abundance of resources on land, and by political questions involving ownership of deep ocean resources.

This, in brief, is how minerals are obtained.

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Here is the difference among terms related to mining that can be easily mixed up:

Mineral:

Mineral is an inorganic solid and crystalline natural body formed as a result of physicochemical process interactions in geological environments. Each mineral is classified and named not only based on its chemical composition, but also in the crystalline structure of the materials that comprise it. To find out a mineral composition, a chemical and physical analysis is performed, which determines relative proportions of different chemical elements of that mineral and its crystalline structure (for instance, quartz, pyrite, hematite, etc.).

Rock:

Rocks are aggregates of one or more minerals. Thus, it can be stated that every rock is comprised by minerals. It is possible to find out what they are made of by means of analyzing their chemical or mineralogical composition. The latter expresses different mineral proportions that comprise the rock.

Ore:

It is a rich mineral aggregate in a specific mineral or chemical element that is economically or technologically viable for extraction (mining). Copper, for instance, occurs naturally in some rock types, but it is only possible to become an ore when it concentrates in large quantities and it is possible to be extracted from nature.

Metal:

Metals are elementary substances, such as gold, silver and copper. They are crystalline when solid and naturally occur in minerals. They are often good conductors of electricity and heat, shiny and malleable. The metals we use day-to-day are converted from metallic ores to their final form. This usually requires the use of chemicals and special technology.

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Common Groups of Metals:

Metals are often grouped by their properties or function.

Precious metals: This includes gold, silver, platinum and diamonds. About 90 per cent of the total gold production comes from gold mines. The remaining 10 per cent is produced as a by-product from mining other metals, such as copper and nickel. Precious metals are traded on world markets and used in a range of applications from jewellery to electronics to catalytic converters in cars.
Base metals: This mainly means copper, lead and zinc, which have a lower value. Refined forms of these metals are commonly traded on world markets. These are the basic building materials for much of the world around us.
Ferrous metals: Those with a high iron content, which includes all types of steel. Chromium, cobalt, manganese and molybdenum are commonly included in this group because their major use is to improve the properties of steel.
Non-ferrous metals: This includes aluminium, copper, lead, magnesium, nickel, tin and zinc, since they have principal uses unrelated to steelmaking. Note that there is some overlap with the base metals group – the choice of the group depends on the context.
Rare earth metals: These are not actually all that rare but their extraction is complex and difficult. They include scandium, yttrium, lanthanum and the 14 elements (lanthanides) following lanthanum in the periodic table. They have widespread uses, though in small volume, in the manufacturing of glass, ceramics, glazes, magnets, lasers and television tubes, as well as in refining petroleum.
Alloys: These are made by mixing two or more metallic elements to form a new, unique substance that has differing chemical and physical properties to its component parts. Over 90 per cent of the metals in use today are alloys. Alloying elements are usually added to pure metals to enhance their strength or improve properties, such as corrosion resistance, wear resistance and ability to be cut. Demanding industrial requirements, such as extreme temperature resistance, strength for high-pressure applications, fatigue resistance, weight reduction or toughness, often in combination, have led to the development of a wide range of alloys.

The most common alloys are broadly classified as steels. These characteristically strong alloys, formed from iron and carbon, can be mixed with other elements to further improve performance and durability. For example, a car contains more than 10 different steel alloys for body parts, gears, drive trains, crankshafts, valves and so on.

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The difference between Minerals and Metals:

Metal is an element and mineral is a compound.
Most metals are naturally present as minerals.
Metals are reactive than minerals.
Metal and the respective minerals of that metal have different appearances and other properties.

Some ores and minerals:

Aluminium	Bauxite Kaolinite (a form of clay)	AlO_x(OH)_3-2x [where 0 < x < 1] [Al₂ (OH)₄ Si₂O₅]
Iron	Haematite Magnetite Siderite Iron pyrites	Fe₂O₃ Fe₃O₄ FeCO₃ FeS₂
Copper	Copper pyrites Malachite Cuprite Copper glance	CuFeS₂ CuCO₃.Cu(OH)₂ Cu₂O Cu₂S
Zinc	Zinc blend/Sphalerite Calamine Zincite	ZnS ZnCO3 ZnO

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As nonfuel minerals or materials, Critical Minerals and Materials (CMM) are essential to our modern economy and national security and have a supply chain vulnerable to disruption. In addition to REEs, CMM include aluminum (bauxite), antimony (Sb), arsenic (As), barite (BaSO4), beryllium (Be), bismuth (Bi), cesium (Cs), chromium (Cr), cobalt Cr), fluorspar (CaF2), gallium (Ga), germanium (Ge), graphite (natural), hafnium (Hf), helium (He), indium (In), lithium (Li), magnesium (Mg), manganese (Mn), niobium (Nb), platinum group metals, potash, rhenium (Re), rubidium (Rb), scandium (Sc), strontium (Sr), tantalum (Ta), tellurium (Te), tin (Sn), titanium (Ti), tungsten (W), uranium (U), vanadium (V), and zirconium (Zr). The average mean CMM concentration in carbon ore and select alternate materials is shown in Figure below.

Figure above shows comparison of critical minerals concentration in coal ore, sedimentary rock and phosphate rock.

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In summary:

-Minerals are naturally occurring, inorganic substances with a specific composition and structure. Minerals are the building blocks of rocks and ores.

-Rocks are made up of one or more minerals or mineraloids.

-Ores are rocks or minerals that contain economically valuable materials.

-Metals are pure elements extracted from ores. Metals are elements or alloys that have specific physical and chemical properties and are often derived from ores through extraction and refining processes.

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Economic value of minerals:

Minerals that are of economic value can be classified as metallic or non-metallic.

Metallic minerals are those from which valuable metals (e.g. iron, copper) can be extracted for commercial use. Metals that are considered geochemically abundant occur at crustal abundances of 0.1 percent or more (e.g. iron, aluminum, manganese, magnesium, titanium). Metals that are considered geochemically scarce occur at crustal abundances of less than 0.1 percent (e.g. nickel, copper, zinc, platinum metals). Some important metallic minerals are: hematite (a source of iron), bauxite (a source of aluminum), sphalerite (a source of zinc) and galena (a source of lead). Metallic minerals occasionally but rarely occur as a single element (e.g. native gold or copper).

Non-metallic minerals are valuable, not for the metals they contain, but for their properties as chemical compounds. Because they are commonly used in industry, they are also often referred to as industrial minerals. They are classified according to their use. Some industrial minerals are used as sources of important chemicals (e.g. halite for sodium chloride and borax for borates). Some are used for building materials (e.g. gypsum for plaster and kaolin for bricks). Others are used for making fertilizers (e.g. apatite for phosphate and sylvite for potassium). Still others are used as abrasives (e.g. diamond and corrundum).

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A quick note on terminology on mineral production and reserves.

There are two forms of production.

The first is mine production. As the name suggests, this is what’s directly mined out of the ground. This is often impure and mixed with other minerals or rocks. It usually needs to be refined to get it into a usable or final form.

That’s the second form of production. Refined production is the conversion and separation of the raw mineral into a pure or final form used in manufacturing. And the countries that do the mining are often different from those doing the processing and refining. Technically speaking, processing is the first step in separating the valuable mineral, while refining is the process of further purifying and refining the concentrate for specific applications.

Another key metric to focus on is reserves. Reserves tell us how much known and assessed mineral deposits can be mined economically with current technologies and market conditions. These are not to be confused with “resources”, which describes the total amount of available minerals. Reserves are resources that are economically viable today. Both metrics — reserves and resources — can change over time as we find new deposits and known ones become more economical.

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Heterogeneous distribution of metal resources:

The temporal evolution of the metallic mineral systems depends on cooling of a hot early Earth, its tectonic history, oxygen levels in the atmosphere, biogenic activity in the hydrosphere, and preservation conditions. Metallic mineral deposits are ∼10 to >10,000 times enriched in metal relative to crustal abundance and hence are rare, with mines exploiting mineral deposits occupying only about 0.02% of the Earth’s land surface. The deposits are part of larger scale mineral systems that require the rare conjunction of specific geodynamic, fertility, architecture, and preservation parameters that are related to the tectonic evolution of the continents and recycling of metals through the crust and mantle via the Earth’s unique subduction system. As each continent and country within it had its own tectonic history, the distribution of these rare metallic mineral deposits is incredibly heterogeneous. Countries or regions such as China, Russia, and Australia, and to a lesser extent western South America, Brazil, Canada, and South Africa, dominate global critical metal reserves and/or production. China is particularly well placed because it owns abundant critical metal deposits and obtains trace critical metals through processing of metallurgical by-products of global ores. Through its balanced energy policies, it dominates the clean energy industry. There is already evidence for the use of critical metals, particularly REEs, in trade disputes between the United States and China, and industrial weaponization of those metals and other energy sources is likely to become a future global problem as shortfalls in supplies increase. From a geoscience viewpoint, global exploration to provide a more homogeneous distribution of critical metal deposits is urgently required. However, it is hampered by increasing political and human rights issues and sovereign risks that are becoming more challenging for most major mining and exploration companies.

Scarce critical metal systems:

Scarce critical metals (Ni, Cu, Zn, Pb, Co, Li, Ga) have crustal abundances between 10 and 100 ppm. These metals rarely occur alone in any single mineral deposit of this group of metal systems. By contrast, they normally represent natural concentrations in multielement mineral systems that form in a wide range of tectonic settings including: (1) arc-related settings such as porphyry Cu and related skarn systems, (2) near craton margin settings such as mafic intrusion-related Ni-Cu±PGE and komatiite-hosted Ni-Cu systems, (3) submarine rift-related VMS Zn-Pb±Cu deposits, (4) IOCG Cu-Au deposits, (5) Li-Cs-Ta (LCT)-bearing pegmatites, (6) evaporite-related Li-rich brines, and (7) Ga specifically occurring as a by-product in mining of coal seams.

The future of metallic mineral resources and their exploration:

Since the Industrial Revolution, the increase in global population from about 1 to 8 billion has placed increasing pressure on metals supplied by mining and processing of metallic mineral deposits discovered by increasingly sophisticated exploration by professional mining and mineral exploration companies. Concern about climate change, promulgated by the UN-based IPCC, has led to Net Zero mitigation of CO2 policies which are attempting to transition from conventional energy supply to clean energy supply via technologies that require ever-increasing amounts of metals, particularly critical metals. There seems to be little political recognition that the metals that are the cornerstone of the so-called renewable energy transition are nonrenewable resources. In the past few years, there have been growing predictions that supply of these metals must increase between 100 and 1000%, dependent on the specific metal, with strong indications of short-term shortfalls and long-term indications that many critical metals may be highly depleted or exhausted at economically viable metal grades and increasing energy requirements during the first cycle of Net Zero remediations ending in 2050. The most obvious remedy is to discover more metallic mineral deposits through sophisticated global mineral exploration but there are increasingly serious natural, environmental, and social impediments to overcome. Add to this the large average times from deposit discovery to metal production, and it is self-evident that current mineral exploration discovery rate cannot alone solve the urgent problems of increasing metal demand and of metal deposit exhaustion. Recycling of metals from existing clean energy devices such as wind turbines, solar panels, and EVs, or better still manufacturing recyclable technologies, are other possibilities, but there is little progress. There is an urgent need to move to a circular economy in terms of critical metals where there is conservation of metals discovered by mineral exploration via manufacture of economically recyclable clean energy technologies and continuing recycling of those critical metals for the future. To preserve our materials-based civilization, it will be necessary to develop a balanced portfolio of energy sources, involving fossil fuels, nuclear fission and clean energy, while researching the use of hydrogen and nuclear fusion as potential future major energy sources. Without immediate action, Albert Einstein’s prediction that “I do not know with what weapons World War III will be fought, but World War IV will be fought with sticks and stones” may well become true.

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Section-3

Introduction to critical minerals (CMs):

Humanity developed from bipedal hominidae via hunters and collectors to a modern high tech society in about 6 Ma. Survival was ensured by a thorough and sustainable use of the available resources during 5,999,750 a, which was learned and perfected during this evolution. In the last ~250 a, humanity left the path of sustainability in the Anthropocene and destabilized the global ecosystem to an extent, which endangers now the future of humanity itself.

The first use of stone tools dates back to 3.3 M years, where specific geological materials were selectively exploited for a specific hominin purpose (Harmand et al., 2015). This could be seen as the first mining activities of hominidae. The used resources during early evolution of hominidae were water and soil, and only the necessary extraction of geo-resources was performed in a sustainable way. With the discovery and use of fire about 790,000 years ago (Goren-Inbar, 2004), the flint stone business started to grow and enabling Homo erectus to expand its territories into colder climates. When hunting was successful, Homo neanderthalensis and Homo sapiens had meat for nutrition, and used the skin for clothing (~75,000 a), what enabled them to push the limit of their expansion even to more colder climates following their prey. Due to their success, they could start to enjoy their free time and used it for art work (Henshilwood et al., 2002) and made their homes cozier with artistic cave paintings (~35,000a). The related pigment mining (hematite) was started by Homo sapiens in Ngwenya mine, Swaziland where it was first dated to around 43,000 years ago. They also learned to use bones and tendons to produce weapons like spear, arc, and arrows to improve their success in hunting (16,000–18,000a). Again, specific geological materials like obsidian, flint or chert (silicified rocks) were used and mined for arrow heads and tools, a technological advancement for more efficiency in their survival strategies. From the hunted prey, everything was used, so that a very sustainable use of the natural resources was achieved. Nothing was defined as waste and human being were still part of a sustainable ecosystem.

With the end of the last Ice Age (around 12,000a), Homo sapiens started to settle down during the agricultural revolution (Harari, 2014) and first pottery were developed, requiring additional mining activities, in this case for clay, to supply the development of human civilization.

With the discovery of metallurgical processes to recover copper by smelting between the later Stone Age and early Bronze Age, named Chalcolithic Age or Copper Age, metal mining had its break through around 7000 years ago (Radivojević et al., 2010), and human kind started to leave the path of sustainability. During the Bronze Age, Au and Sn were also metallurgical extracted. Now, humanity started to use the natural geo-resources, water, soil, and metals.

The use of iron starts about 6000 years ago, and is finally responsible by the combination of iron oxide and coal mining in the steel production to trigger the industrial revolution in the 18th Century (~1760–1840). Until the industrial revolution, mining was a critical aspect for the technological development. But due to the fact that mainly local high ore grade enrichments of specific elements were exploited from local, and mainly oxide ores, the environmental impact was limited. Although, Agricola in 1556 mentioned yet the first environmental impact of mining. The benefit of the technological developments was only accessible to a limited number of members in the high society, while the grand majority of the human population still was living in a classical agricultural setting. During the industrial revolution, people started then to migrate from the country side towards the industrial centers, resulting in the first industrial urbanizations.

The change from oxide ore to sulfide ore extraction, which is related to the invention and the first industrial applications of the flotation technique in the late 19th and early 20th century (Fuerstenau et al., 2007), marks a critical change in the development of supply and use of metals in modern human society. Flotation separates valuable minerals from waste rock (gangue) by exploiting differences in their wettability, using air bubbles to selectively float hydrophobic particles to the surface. This new technique made low ore-grade sulfide deposits economically profitable. This made the metals cheaper and available for a broader use in technical application, from which the wide mass of humans could take advantage through the industrialization process. Until today, the very same approach is applied in mineral processing. Recovery improvements were achieved by diminution of the grain size during the comminution process.

Flotation enabled the exploitation of low ore grade sulfidic deposits (e.g. porphyry copper), to supply the increasing demand of copper due to the increasing electrification during the early 20th century. These deposit types (e.g. Chuquicamata, Chile, Bingham, USA), which contain only about 0.2–2.5% wt% Cu, result in the production of enormous amounts of waste material (96–99%) in form of so-called waste-rock dumps (Bao et al., 2020; Smuda et al., 2007) and tailings impoundments (Smuda et al., 2014). These waste materials represent a threat to the nearby society, as acid mine drainage (AMD) (Dold, 2014), dust, and tailings dam failures threaten closely living populations.

With the invention of computers, development of the Internet, Smart Phones, and many other smart high-tech gadgets in the last 30 years, demands for metals and new demands for elements like REE’s, PGE’s exploded, making their supply critical for industrial and economic development (EU, 2017). Additionally, with the change from fossil energy towards renewable energy matrices around the globe together with the electrification of the transport infrastructure, new resources for battery production, the so-called battery elements Co, Ni, Li, Mn, with new and mostly unknown environmental challenges are needed to be explored and exploited. This represents the latest step in the development of raw material demand and mining processes.

A fundamental principle of sustainable economic development and smooth manufacturing cycle, particularly in well-established economies, is the uninterrupted supply chain with raw materials that is free from disturbances and bottlenecks, contributing to the pricing instability and market volatility, thus disrupting the production. This condition is valid for a variety of technologies since raw materials play an important role in defense, the economy, renewable energy development and infrastructure. Growing reliance on raw materials has intensified the competition to identify new resources and establish stable, long-term supply chains. Although the increasing interest in minerals resources, caused by global competition, reached such enormous attention in recent years, the subject is not new and has been considered for decades. The minerals awareness was initiated after World War I as a warranty of sustaining military power. The term “strategic and critical minerals” was used as early as 1938 when emphasizing that the industrial nations should be self-sufficient in regard to certain materials, portrayed as the “materials essential in the promotion of modern warfare”. Similar terminology was used in the “Strategic and Critical Materials Stock Piling Act” of 1939, when political conflicts dominated concerns about the security of raw materials supplies. At present, in the USA and Canada the term “critical minerals” is used while “critical raw materials” (CRM) is used by the European Union. The other terminology includes “strategic minerals” or “advantageous minerals” used by China.

Critical minerals (rare earths, platinum group elements, nickel, zinc, etc.) are essential for high-technology products (Ballinger et al., 2019), but the market often overlooks their importance. These minerals exist primarily in co-associated forms, and the current small scale of their market means they are often sold as a by-product from other bulk mineral extraction. Critical minerals are often hidden in indirect and embedded trade, leading to the analysis of their reserves being neglected in assessing minerals production and import/export trade (Fortier et al., 2019). The supply of critical minerals and their products’ environmental and social impacts are also often overlooked in assessing the transition of fossil energy economies.

As the global political response to climate change accelerates and clean energy and transportation technologies advance, net-zero goals are becoming technically, economically, and politically feasible (Burger et al., 2022; Boire and Nell, 2021). Countries are putting forward their carbon-neutral roadmaps and investing heavily in emissions reduction. Clean energy and transportation systems are seen as central to future national competitiveness. Critical minerals are needed for this technological shift to meet the goal of net-zero (Gielen and Lyons, 2022). For example, a typical electric car requires six times the mineral input of a conventional vehicle, and an onshore wind power plant requires nine times the mineral resources of a natural gas plant (Kirsten et al., 2020). According to the International Energy Agency (IEA), “the average amount of minerals required for a new power unit has increased by 50 % since 2010, as the share of renewables in new investment has risen” (IEA, 2021). In carbon emission reductions alone, the World Bank estimates that about 3 billion tons of critical minerals will be needed to decarbonize the global energy system by 2050 (Prassl, 2020), with the production of minerals such as graphite, lithium, and cobalt needed to increase by nearly 500% by 2050 to meet the need for clean energy. Meeting the demand for critical minerals on such an enormous scale will require changes to the existing order of production and trade regulation of critical minerals. In contrast to the strong demand for these minerals, their supply is highly inelastic and fragile. Many deposits are in developing and highly underdeveloped countries, where mining has historically had challenges with corruption, pollution, human rights, and violence. Mineral extraction, therefore, often becomes a catalyst for negative community impacts (Sovacool, 2019).

Engineered application of some chemical elements of metals, non-metals and minerals into high-tech products have made our modern lives much easier than ever before. These chemical elements include REEs (e.g., cerium, lanthanum, neodymium, dysprosium, praseodymium, scandium, erbium, europium, terbium and yttrium), precious metals (e.g., rhodium, palladium, and platinum), radioactive metals (e.g., uranium and radium) and alkaline metals (e.g., magnesium, potassium, and Li). Their applications are widespread in high-tech industries which are critical to modern society and sustainable development. Such industries include telecommunications, renewable energy, electric vehicles, aerospace, medical, agriculture and defense technologies. Moreover, the uses of these minerals in these industries are expected to grow significantly in the coming decades. This is likely due to increasing population with increasing standards of living for the vast majority of the world’s population, and meeting the targets of the low-carbon society to contain the impacts of climate change. For example, the demand for Li, Co, manganese (Mn) and aluminum (Al) is expected to be increased by 12 times in 2050 compared to 2013. However, the supply of these minerals may be at risk due to various reasons including geological scarcity, geopolitical issues and trade policies. The geopolitical and trade policies pose the greatest threat to the supply disruptions of these minerals as their production is concentrated only in few countries. For example, the production of REEs, Co and Li are concentrated mainly in China (59%), the Democratic Republic of Congo (DRC) (68%) and Australia (49%), respectively. Furthermore, for most of the critical minerals, there are no true substitutes, meaning that the consumers, economies and deployment of low-carbon technologies could be significantly affected if they are subject to supply restrictions. Due to the perceived unreliable supply of these minerals against their multi-sectoral importance, they are known as critical elements or critical raw materials (CRM) or critical minerals in many of the world’s largest economies such as the United States of America (USA), European Union (EU) including United Kingdom (UK), and Australia.

In many cases, critical elements are geologically dispersed (Henckens et al., 2016), concentrated in a few geographic locations (Gloser et al., 2015), or recovered as a byproduct of another commodity (Redlinger and Eggert, 2016; Nassar et al., 2015). Critical element supply might benefit from additional research or proactive policies, such as improved mineral processing, diversifying the supply chain, and stockpiling (Jaffe et al., 2011). Further research would also help determine which critical elements would benefit from market transformation and improved economic opportunities (Sykes et al., 2016).

Critical minerals (CMs) are metals and non-metals that are considered vital for the economic well-being of the world’s major and emerging e-economies. Yet their supply may be at risk due to geological scarcity, geopolitical issues, trade policy and other factors. CMs ranked as most critical for the world’s major industrial economies (plus their use in futuristic developments in energy, health, construction and transportation sectors as well as in space, nuclear, defence and artificial intelligence) of USA, Japan, Republic of Korea, European Union and the UK include rare earth elements (REEs), platinum group metals (PGMs), lithium (Li), beryllium (Be), gallium (Ga), germanium (Ge), indium (In), tungsten (W), cobalt (Co), niobium–tantalum (Nb–Ta), molybdenum (Mo), antimony (Sb), vanadium (V), nickel (Ni), tellurium (Te), chromium (Cr), tin (Sn), thorium–uranium (Th–U), zirconium (Zr), hafnium (Hf), selenium (Se), rhenium (Re), phosphate, potash, etc. From the perspective of each country, the list of CMs may change. The CMs occur in three major sources: primary – in different minerals/ores that are extracted from the earth; secondary – in waste materials such as e-waste, and tertiary – in imports.

Key points:

Geographical Distribution of Critical Minerals: Found unevenly across regions; key reserves in Africa (cobalt), Australia (lithium), China (rare earths), and South America (Lithium Triangle).
Mining and Extraction of Critical Minerals: Methods include open-pit mining, underground mining, and in-situ leaching; each poses environmental challenges.
Economic Importance of Critical Minerals: Crucial for electronics, batteries, and renewable energy systems, influencing global trade and economic stability.
Global Supply Chain of Critical Minerals: Involves mining, processing, manufacturing, and distribution; influenced by logistical, geopolitical, and environmental challenges.
Critical Minerals in Sustainable Development: Essential for technologies like EV batteries and solar panels, highlighting the need for sustainable management and sourcing.

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Definitions of critical minerals:

Critical minerals refer to mineral resources, both primary and processed, which are essential inputs in the production process of an economy, and whose supplies are likely to be disrupted on account of non-availability or risks of unaffordable price spikes. These minerals lack substitutability and recycling processes. The global concentration of extraction and processing activities, the governance regimes, and environmental footprints in resource abundant countries adversely impact availability risks. While some of these minerals are inputs for traditional industries, many are crucial for the high-tech products required for clean energy, national defence, informational technology, aviation, and space research (Chadha, 2020).

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These ‘critical minerals’ are not only vitally important but are also experiencing major risks to their security of supply. These risks can be caused by combinations of factors including but not limited to rapid demand growth, high concentration of supply chains in particularly countries, or high levels of price volatility. Many of these critical minerals are produced in comparatively small volumes or as companion metals (meaning they’re produced as by-products of other mining activities), are non-substitutable in their applications and have low recycling rates.

Figure below shows that Critical minerals are a subset of all important minerals.

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Rare earth elements (REEs) are a subset of critical minerals and materials. Figure below shows Critical Minerals including Rare Earth Elements in periodic table.

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Defining Minerals Criticality:

Minerals criticality is a subjective concept that has been shaped throughout decades. A number of criticality studies were conducted in an effort to define a consensus of currently critical materials, essentially defining the modern criticality paradigm, which allows the interpretation of local perspectives in a global context. The supplies of critical minerals are recognized to be a subject of great societal and environmental risk and uncertainty. It should be emphasized that the scarcity of a mineral in the Earth’s crust alone does not automatically make it critical. A classification of the mineral as critical is derived through its importance to key industry sectors or applications and the overall functioning of the country economy. The criticality criteria may vary across geographical regions, though the essence remains similar. Material criticality is defined as “economic and technical dependency on a certain material, as well as the probability of supply disruptions, for a defined stakeholder group within a certain time frame”.

According to the IEA, the classification of materials as critical is based on:

Their significant economic importance for key sectors in the regional economy and/or national security;
A high-supply risk due to the very high import dependence and high level of concentration of a set of critical raw materials in particular countries;
A lack of viable substitutes, due to the very unique and reliable properties of these materials for existing, as well as future applications.

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Critical minerals are defined in the Energy Act of 2020. According to the Act, minerals are considered “critical” if they fit three criteria:

-1. The mineral must be “essential to the economic or national security of the United States.”

-2. The mineral must “serve an essential function in the manufacturing of a product… the absence of which would have significant consequences for the economic or national security of the United States”

-3. The mineral must have a supply chain that is “vulnerable to disruption (including restrictions associated with foreign political risk, abrupt demand growth, military conflict, violent unrest, anti-competitive or protectionist behaviors, and other risks through-out the supply chain)”.

In addition, the Act specifies that the “critical minerals’ cannot include fuel minerals such as oil, gas, coal or uranium. Water, ice, snow or “common varieties of sand, gravel, stone, pumice, cinders and clay” are also excluded from being critical minerals.

Geoscience Australia refers to critical minerals as “metals, non-metals and minerals that are considered vital for the economic well-being of the world’s major and emerging economies, yet whose supply may be at risk due to geological scarcity, geopolitical issues, trade policy or other factors”.

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The European Union (EU) defines them as critical raw materials (CRMs) that have “high importance to the economy of the EU and whose supply is associated with high risk”. The criticality is judged by two main parameters, economic importance and supply risk.

Factors affecting Criticality are addressed in figure below:

The importance of a metal is evaluated based on:

(i) its end-use applications; and

(ii) its substitutability (index) which, in the context of importance, is a measure of the cost and performance of substitute material in these applications.

The supply risk for a metal is evaluated based on its:

(i) Substitutability (index), which, in the context of supply risk, is the measure of the production and criticality of the substitute metal;

(ii) End-of-life recycling rates (EOL-RR), which is the proportion of metal produced from EOL scrap and other low-grade residues; and

(iii) Global supply, which is affected by factors such as the number of producing countries, trade agreements and supply chain bottlenecks (European Commission, 2017).

Consequently, the degree to which a metal, mineral or material is considered critical, is determined by geopolitical factors that change with time (Spooren et al., 2020). For example, Australia has 24 “critical minerals” (Austrade, 2020) compared to the EU’s 30 “critical raw materials” (European Commission, 2020). The EU has also seen an increase in the number of raw materials being deemed critical over time. In 2011, 2014 and 2017, there were 14, 20 and 27 raw materials deemed critical, respectively, compared to the 30 in 2020 (European Commission, 2020). It is likely that the number of metals (as well as minerals and materials) considered critical will continue to fluctuate over time, highlighting the need for regular assessments of metal criticality.

The concentration of critical metals in the Earth’s crust is variable. For example, vanadium occurs at an average crustal abundance of 138 ppm whereas indium’s abundance is 0.052 ppm (Rudnick and Gao, 2014). Mineralogically, critical metals either occur as structural components of minerals, as substitutions within other minerals and ores, or in some cases as native elements (e.g. rhenium, tellurium; John et al., 2017; Goldfarb et al., 2017). In many instances, minerals formed with critical metals as a structural component do not occur in sufficient concentrations to make their extraction economical. An example of this is indium – while there are 12 defined indium minerals, the occurrence of these minerals is rare (Schwarz-Schampera, 2014). Conversely, economic concentrations of critical metals regularly occur in minerals where they have substituted for a chemically similar base metal. For example, rhenium is principally hosted in molybdenite [MoS2], with rhenium substituting for molybdenum, and the concentration of rhenium in molybdenite can be up to several weight percent (John et al., 2017). This association is also reflected in many of the principal deposit types for critical metals. For example, cobalt shares chemical similarities with copper and nickel, and is often found in magmatic sulphide and stratiform sediment-hosted deposits endowed with these metals (Dehaine et al., 2021). Consequently, critical minerals are often produced as a by-product of major commodity mining. For example, indium, germanium and gallium are typical by-products of zinc refinement (Werner et al., 2017; Ruiz et al., 2018; Foley et al., 2017). Significant concentrations of critical metals have also reported to mining wastes over time due to processing infrastructure being unsuitable for extraction of the substituted critical mineral. For example, Werner et al. (2017) estimated that a minimum of 24 kt of indium is present in mining wastes globally. Unfavourable economics, inefficient processing and mineralogical factors may also have resulted in critical metals reporting to mining wastes over time (Lottermoser, 2010).

With a movement towards low-carbon economies, demand for critical metals is set to expand worldwide over the coming decades. For example, cobalt and nickel are incorporated in batteries used in electric and hybrid-electric vehicles (Slack et al., 2017), and germanium substrates are used to form the base layer in multijunction solar cells (Shanks et al., 2017). Concurrently, there is a drive to transform the mining industry into a circular economy system, requiring transformation of mining and processing wastes into valuable products. Processing of mining wastes rich in critical metals both aids in meeting this demand and aligns with achieving a circular economy mining system. However, to extract these minerals, processing technologies need to be developed or adapted to mining wastes, which have different properties (e.g. particle sizes, poor mineral liberation) compared to run of mine ores and concentrates.

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THE CRITICALITY MATRIX:

The two important dimensions of criticality are importance in use and availability. Importance in use embodies the idea that some nonfuel minerals or materials are more important in use than others. Substitution is the key concept here. For example, if substitution of one mineral for another in a product is easy technically, or relatively inexpensive, one can say that its importance is low. In this case, the cost or impact of a restriction in the supply of the mineral would be low. On the other hand, if substitution is technically difficult or is very costly, the importance of the mineral is high, as would be the cost or impact of a restriction in its supply. This concept of importance at a product level significantly includes the net benefits customers receive from using a product—the benefits to human health of nutritional supplements or pollution control equipment, the convenience of cell phones, the durability of an automobile, and so on.

A nonfuel mineral can be important at a scale larger than a product as well as at the product level. A mineral might be important to the commercial success of a company and the company’s profitability (importance at a company level). A mineral might be important in military equipment and national defense. Production of a mineral—or products that use the mineral as an input—might be an important source of employment or income for a local community, a state, or the national economy (importance at a community, state, or national level). In all of these cases, the greater the cost or impact of a restriction in supply, which depends importantly on the substitutability of the mineral in question, the more important is the mineral.

Availability is the second dimension of criticality. Fundamentally, society obtains all nonfuel minerals through a process of mining and mineral processing (primary supply). Later, however, in the course of fabrication and manufacturing—and ultimately after products reach the end of their useful lives—society can obtain mineral products through the processing of scrap material (secondary supply). Availability reflects a number of medium- to long-term considerations: geologic (does the mineral exist?), technical (do we know how to extract and process it?), environmental and social (can we extract and process it with a level of environmental damage that society considers acceptable and with effects on local communities and regions that society considers appropriate?), political (how do policies affect its availability both positively and negatively?), and economic (can we produce a mineral or mineral product at costs consumers are willing and able to pay?). In addition, it is important to consider the reliability or risk of supply in the short term. Is the nation vulnerable to unexpected disruptions in availability due to, for example, import dependence, market power in the hands of a small number of powerful producers, thin or small markets that are unable to respond quickly to changing circumstances, or significant changes in public policy that cut off supply or increase costs?

In both dimensions of criticality, time is an important consideration. In the short term (period of a few years or less) or the medium term (less than 10 years), both mineral users and producers generally are less able to respond quickly or effectively to changing market conditions than over longer time periods. Even within a particular period, however, some minerals will be more important in use and more vulnerable to supply disruptions than other minerals. For a given adjustment period (short term to long term), the critical minerals are those that are relatively difficult to substitute and are subject to supply risks.

Figure below illustrates concept of criticality and the criticality matrix.

The vertical axis embodies the idea of importance in use and represents the impact of supply restriction. The horizontal axis embodies the concept of availability and represents supply risk. One can evaluate a mineral’s criticality by evaluating its importance in use and its availability, and locating it on the figure. The degree of criticality increases as we move away from the figure’s origin, as shown by the arrow and the increased shading. The degree of criticality increases as one moves from the lower-left to the upper-right corner of the figure. In this example, mineral A is more critical than mineral B. In this sense, criticality is appropriately considered a “more-or-less” issue rather than an “either-or” issue. That is, minerals exhibit differing degrees of criticality depending on the circumstances. Some minerals are more critical than others; it is a matter of degree rather than absolutes. To be sure, some mineral users or government officials may want to create a list of critical minerals, implying that minerals not on the list are not critical, for purposes of planning or policy making.

The energy transition has an insatiable appetite for critical minerals. And it’s an appetite that’s only growing; between now and 2050, demand for the minerals and metals most key to decarbonization is projected to skyrocket. According to a report released recently by Ernst & Young, demand for graphite and cobalt is set to increase by well over 200%; demand for lithium, by 910%; and for rare earths, by 943% as seen in figure below.

The good news for clean tech is that there’s likely enough to go around; the earth’s crust has no shortage of the critical minerals to power the energy transition. However, both exploration and processing are highly geographically concentrated, primarily in China. Plus, finding critical minerals (including discovering new ones) is very difficult, and very expensive.

Materials Criticality Matrix, Medium Term (2025-2035) is depicted in figure below.

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Criticality perspective among nations:

To help determine criticality, two perspectives can be considered:

-1. Security and Control of Supply

Minerals are considered critical when they are of high economic importance but are scarce and therefore subject to high import dependency. A key element in this definition is the vulnerability of the supply chain due to risks associated with potential supply disruptions, governance issues, political risks, or the overconcentration of production in a few countries. This definition is largely adopted by European countries, the United States, and Japan, for instance.

-2. Value Capture

Minerals are also considered critical when they are present in abundance, and the country has a strategic interest in using its dominant position to gain competitive advantage in the global supply chain. Countries using this lens to define criticality are Canada, Australia, and China. This lens is also relevant for countries with substantial reserves of minerals and metals needed for the low-carbon transition, such as Indonesia (nickel, bauxite), Gabon (copper, manganese), Mozambique (graphite, bauxite), Namibia (rare earth elements, tantalum), Nigeria (manganese, lithium), Bolivia (lithium, gallium), and Kazakhstan (copper-lead-zinc).

Figure below shows criticality perspective among nations:

* Indicative assessment based on a compilation of country statements (e.g., Executive Order, Mineral Strategy), recent data on production, reserves and discoveries (e.g., copper in Peru, chromium in Sudan), and international reports and publications (e.g., IEA Country Reports).

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There are also factors that can influence or inform what criticality means to individual countries and/or regions, and these factors can be determined by considering criticality from the following five dimensions:

-1. ECONOMIC

Economic security
Strategic or competitive advantage
Industrial development objectives
Social development goals
Infrastructure development needs

-2. SUPPLY CHAIN

Supply risks and vulnerability
Import dependency
Geographic concentration of production and processing (refinery)
Viability of substitutes and availability of secondary sources • Value chain opportunities

-3. TECHNOLOGY

Essential input to clean technologies
Required for low-carbon transition
Technological innovations and emerging mineral substitutes

-4. GEOPOLITICAL

National security considerations
Risks of resource nationalism and stockpiling
External shocks and geopolitical realignments

-5. GEOLOGICAL

Natural resources endowment
Availability of reserves and production capacity
Location and quality of ores, metal or mineral content, and depletion rates

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Critical minerals: A review of elemental trends in comprehensive criticality studies, 2018:

Mineral criticality is a subjective concept that has evolved throughout history. An abundance of literature on this topic has been published over the last decade, encompassing a variety of criteria and methodologies. To authors knowledge, this work is the first large-scale effort to organize and analyze recent comprehensive criticality studies in order to determine if a consensus exists within the global community as to which elements are critical. Here, authors set aside methodological differences and analyze the results of 32 comprehensive nonfuel mineral criticality studies that evaluate at least 10 elements. Of the 56 elements or elemental groups evaluated, the three most commonly identified as critical in these studies are the rare-earth elements (REE), the platinum-group metals (PGM), and indium. Most of the studies also identify tungsten, germanium, cobalt, niobium, tantalum, gallium, and antimony as critical.

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Core mineral versus Critical mineral:

The term “critical minerals” has become so broad that it risks losing its meaning. Virtually every metal essential to modern industry is now labeled critical, diluting the term’s significance. However, a clear distinction must be made between minerals that are vital yet accessible and those that pose a serious supply risk due to lack of domestic reserves, dependence on geopolitical adversaries, or absence of control over processing capabilities.

Core minerals are those that are essential but remain accessible through normal market mechanisms, without requiring government intervention. The distinction is crucial because it determines whether policymakers can rely on free market forces or must adopt state-led strategies to secure supplies.

It also was clear at Mining Indaba 2025 conference in Cape Town that what is critical to one country isn’t necessarily of much importance to another. This means that a critical mineral is one that you need, but you don’t have domestic reserves, your strong allies also don’t have sufficient deposits and you don’t control enough of the supply chain to ensure you get what you need when you need it. A mineral in this situation is distinct from what commodity analysts refer to as a core mineral, which is one that you need but you are fairly confident that you will be able to source now and in the future.

Why is this distinction important?

From a Western perspective, a core mineral is one that you largely can leave to market forces to supply, relying on private mining companies to explore, develop and produce on commercial terms.

However, a genuinely critical mineral is likely to require a different strategy to acquire, such as directly funding new mines, building strategic relationships with host countries and offering offtake agreements that aren’t dependent on market prices.

China has proven much more adept at targeting minerals it sees as critical, investing in mines and infrastructure in foreign countries and in processing plants at home, thereby locking in control of the supply chain.

This has seen China, the world’s biggest importer of commodities, come to dominate much of the global supply chain for minerals vital to the energy transition, such as lithium, cobalt, nickel and rare earths.

The British Geological Survey assesses that there are 18 minerals that have high potential criticality for the UK. China has the leading market share in the 12 listed in the figure below in 2023.

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Two major drivers:

Critical minerals are minerals and metals that play an actual or potentially important role in countries’ economies. They are indispensable for industrial processes and essential to manufacturing sectors but are vulnerable to supply chain disruptions due to factors such as geographic concentration, political instability, or market volatility (Ramdoo et al., 2024).

Two largely interrelated movements are fuelling the rush for critical minerals worldwide.

The first is the transition toward low-carbon and decarbonized energy systems, which has ignited a surge in exploration for and production of the “battery minerals” (graphite, cobalt, nickel, and lithium, among others) needed to power low greenhouse gas (GHG) emissions technologies. In its Sixth Assessment Report (AR6), the Intergovernmental Panel on Climate Change (IPCC) warns that under high GHG emissions scenarios, global temperatures could surpass 2ºC above pre-industrial levels by mid-century (IPCC, 2023). Achieving net-zero emissions will require transformative technological changes, which offer the most viable pathway to mitigating warming and limiting severe climate impacts.

The second movement is the transition to the digital economy. Technologies that fall into the category of “digital industry” include big data analysis, machine learning, industrial Internet of Things, augmented reality, 3D printing, and robotics (Hushko et al., 2021). The tangible impact of digital technologies—the metals and resources essential to their production—becomes clear when one considers, for example, the demand for wireless technology and computing alone. The digital economy even extends to the extraction of the very minerals being coveted, as a number of large-scale mines are becoming increasingly automated (Ramdoo et al., 2024).

These two major drivers occur while the demand for societal needs, industrialization, and development stays high. The most conservative forecasts indicate that enormous supplies of critical minerals will be required to satisfy the projected demand over the next 3 decades (International Energy Agency [IEA], 2022b). Significant attention has been paid to battery minerals because of their use in energy storage and electric vehicle (EV) technologies. The Sustainable Development Scenario developed by the IEA in line with the Paris Agreement

(climate stabilization below 2°C global temperature rise, aiming to reach net-zero globally by 2050) suggests that global demand in 2040 compared to 2021 could grow 40 times for lithium and between 20 and 25 times for nickel, cobalt, and graphite (Fu et al., 2020; Hailes, 2022; IEA, 2022ba; Ritoe et al., 2022). In Europe alone, to meet the escalating demand for EV batteries and energy storage, the supply chain will require securing 18 times more lithium by 2030 and up to 60 times more cobalt by 2050 compared to 2020 (Bobba et al., 2020).

The development of critical mineral lists by an increasing number of countries has driven the demand upward, putting significant pressure on traditional producers of certain commodities: the Democratic Republic of the Congo (DRC) for cobalt; Madagascar, Mozambique, and China for graphite; Chile, Bolivia, and Argentina for lithium; Indonesia and the Philippines for nickel; China and Indonesia for tin; and Chile, the DRC, Peru, and Zambia for copper (U.S. Geological Survey, 2023). To meet this demand, governments and industries have led efforts to identify and explore new sources of critical minerals.

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Critical Minerals vs. Critical Materials:

A lot of people often confuse these two terms with each other. It is worth remembering that while they are closely related, there are distinct differences between the two terms:

Category	Critical Minerals	Critical Materials
Definition	Naturally occurring minerals and elements essential for key industries	Broad category including critical minerals, metals, and engineered materials crucial for industrial and technological uses
Examples	Lithium, cobalt, nickel, rare earth elements, graphite	Rare earth magnets, semiconductors, advanced composites, battery materials
Importance	Essential for clean energy, defense, and high-tech industries	Key for manufacturing, national security, and infrastructure
Supply Chain Risks	Often scarce, geopolitically controlled, or difficult to extract	Can be resource-intensive, expensive, or require complex processing
Applications	Batteries, renewable energy, aerospace, electronics	Military equipment, electric vehicles, medical devices, communication systems
Policy Focus	Mining, refining, recycling, and securing supply chains	Research, innovation, sustainable sourcing, and material substitution

Note:

The terms “critical mineral” and “critical minerals and materials” are often used interchangeably, referring to the same concept: essential minerals that are vital for economic and national security. The distinction is subtle, with “critical minerals” typically focusing on the raw mineral substance, while “critical minerals and materials” additionally include processed or refined forms of those minerals.

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Primary vs secondary mineral:

A mineral is a naturally occurring, inorganic solid substance that has a well-ordered chemical structure. There are two main types of minerals as primary minerals and secondary minerals. Primary minerals are those that form during the initial crystallization of a rock from magma or lava, while secondary minerals form later due to weathering or alteration of existing minerals. The key difference between primary and secondary minerals is that primary minerals form from igneous primary rocks whereas secondary minerals from form weathering of primary rocks. Therefore, primary minerals occur in the soil but not formed in the soil, but secondary minerals occur in soil and form in the soil as well. Some examples of primary minerals include quartz, feldspar, muscovite, granite, etc. while some examples of secondary minerals include clay, gypsum and alunite.

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Primary vs secondary materials:

Primary raw materials are natural, unprocessed substances extracted directly from the Earth, while secondary raw materials are materials that have been recycled or recovered from waste and used in manufacturing processes instead of virgin materials. Economics and regulations influence the degree to which current needs are met by primary or secondary material (from the global perspective, any tertiary material is fundamentally either primary or secondary). However, a number of other characteristics contribute to the desirability of choosing between different sources for materials. In general, primary material benefits from the technological knowledge gained from millennia of discovery and processing, but resource conflicts and other issues can make the exploitation of these stocks problematic. In contrast, secondary or recycled materials possess fewer issues that are potentially problematic, but the collection and reprocessing technologies for those materials are less highly developed.

Attributes of Primary and Secondary Materials:

	Advantages	Disadvantages
Primary materials	Extensive extraction and processing experience	High energy and water use and air emissions
	Established product specifications and markets	Political disruption a possibility
	Technologies to control impurity levels are well developed	Impacts are “hidden” (often occur in countries other than those in which the material is used)
		Extraction and processing generate high volumes of mine rock, tailings, slags, and residues
Secondary materials	Mostly available in user countries	Collection can be difficult and reprocessing technology is relatively primitive
	Low energy and water use and air emissions	Inappropriate recycling practices pose occupational and environmental health risks in some countries
	Socially and politically acceptable
	Processing generates low volumes of waste
	Quality of recycled material is suitable for most applications	Quality of recycled material may not be suitable for some applications

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Critical vs strategic mineral:

The term “critical minerals” is the most common terminology, and it is often used interchangeably with the terms “strategic minerals,” “strategic and critical minerals,” and “energy transition minerals.” There is no universally agreed upon definition of what “criticality” means, and criticality changes over time, depending on the needs of society and the availability of supply. Criticality is also very country- and context-specific, particularly with respect to mineral endowment, the relative importance of the minerals to industrial and economic development, and a strategic assessment of supply risks and volatility. These considerations would then determine the mineral strategy of each country and/or region.

Recognizing that a nonfuel mineral or mineral product can be obtained as either primary or secondary material, what does it mean to say that one of these minerals or mineral products is a critical mineral? In the context of federal communications regarding minerals, the terms “critical” and “strategic” as mineral or material descriptors have been closely associated, but usually not clearly differentiated. DeYoung et al. (2006) noted that, historically, “strategic materials” in the United States have generally been associated with material availability in times of war or national emergency; the term “critical material” did not enter the federal lexicon until just prior to World War II when it was introduced in the language for the Strategic and Critical Materials Stock Piling Act of 1939 (P.L. 96-41, 1939). The Strategic and Critical Materials Stockpiling Act of 2005 (50 U.S.C. 98 et seq.) defines strategic and critical materials as those that are needed to supply the military, industrial, and essential civilian needs of the United States during a national emergency that are not found or produced in the United States in enough quantities to meet such needs. Specific distinctions between “strategic” and “critical” are not offered in these documents.

The association of the term strategic mineral almost exclusively with national security and military needs or requirements during national emergencies is implicit in the synonyms for “strategic,” which include planned, tactical, and calculated. “Critical” in general English usage can refer to something that is vital, important, essential, crucial, or significant. These differences are supported and further refined by definitions in the academic literature suggesting that materials for military uses are strategic, while those for which a threat to supply from abroad could involve harm to the nation’s economy are critical (Evans, 1993, in DeYoung et al., 2006). This definition builds on the use of the term critical materials in the context of discussion around the establishment of the National Critical Materials Council in the mid-1980s. Critical materials in this context encompassed any materials—from metals to alloys to composites—on which the economic health and security of the nation resided (Robinson, 1986). A critical material thus has broader connotations than a strategic material, and its definition can be considered to include civilian, industrial, and military applications that could have measured effects on the nation’s economy should supply of the material under evaluation become restricted. In accordance with these definitions, a critical material may or may not be strategic, while a strategic mineral will always be critical.

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Critical minerals list:

Declaration of Critical Minerals is a dynamic process, and it can evolve over time as new technologies, market dynamics, and geopolitical considerations emerge. Different countries may have their own unique lists of critical minerals based on their specific circumstances and priorities. Most governments maintain their own lists of the minerals they categorize as “critical,” which are usually put together by committees of scientists and engineers. Among the best known: the European Union’s list of Critical Raw Materials and the U.S. Geological Survey’s List of Critical Minerals. Canada and Australia also have their own, but they serve somewhat different purposes because they are linked to their strong domestic mining industries. Canada’s list focuses on helping partners and allies dependent on its exports, while Australia’s takes note of the need to “leverage growing global demand” — since many industrial powers (notably the U.S.) have neglected their mining industries.

Critical mineral lists are dynamic and subject to periodic changes, and differ regionally or organizationally. They are influenced by factors such as supply, demand, and geopolitical risks. For instance, the green energy transition and decarbonization efforts have elevated the importance of certain minerals globally, including lithium, cobalt, manganese, and titanium. These minerals are essential for rechargeable batteries, metal alloys, and electronics – crucial components for low-carbon technologies aligned with the Paris Agreement. However, what started out as compilations to inform policy and sustain economic efficiency has in recent years morphed into lists that are central to geopolitical strategy. For one thing, some of these minerals are as tightly bound to energy technologies in the 21st century as fossil fuels were in the 20th century. Electric vehicles, wind turbines, solar panels and batteries (among other technologies) are central to the net-zero transition and are all heavily dependent on critical minerals.

Figure below shows comparison of Critical Mineral Lists:

Major producer countries tend to focus on the importance of mineral exploitation to their economy and trade balances. The Democratic Republic of the Congo (DRC), for example, issued a decree listing three minerals as strategic – cobalt, germanium and columbite-tantalite (“coltan”) – of which the DRC has significant reserves. Following this designation, the country now legislates conditions for access, exploration and commercialisation of these minerals under a separate framework.

Meanwhile, importing economies typically focus on identifying which minerals are necessary for important or strategic sectors of the economy and for which demand far outstrips domestic production. The European Union’s Critical Raw Materials List, for example, includes materials deemed critical to maintain a healthy economic system and whose supply may be at risk because of geopolitical, geographical, geological or other factors. The list includes battery materials (e.g. lithium, cobalt, graphite), rare earth elements, and several other minerals that EU countries do not produce in significant quantities. It is updated every three years to reflect industry developments and supply changes.

Some countries try to address all potentialities when identifying critical minerals. In Brazil, for example, three categories of minerals are considered strategic: minerals that are imported in large quantities and that supply vital sectors of the economy (e.g. molybdenum and phosphate); minerals important for the manufacture of high-tech products (e.g. cobalt and graphite); and minerals essential for the economy because they generate a trade balance surplus (e.g. aluminium, copper and iron).

According to one research, only seven minerals currently appear on all the lists: cobalt, gallium, lithium, platinum, the light rare earth element (LREE) neodymium, and the heavy rare earth elements (HREEs) dysprosium and terbium.

Cobalt and lithium were to be expected given that they are key ingredients in lithium-ion batteries and, in the case of cobalt, in superalloys used by the defence and aerospace sectors. The same could be said of platinum, a key component in proton exchange membrane (PEM) technology, used in electrolysers to produce hydrogen and in fuel cells which power fuel-cell electric vehicles. These three, along with nickel, were the only minerals highlighted for their long-term supply risk in the China State Council’s New Energy Vehicle Industrial Development Plan (2021-35), one of the closest things to an official Chinese critical minerals list.

The unanimous recognition of gallium makes sense in light of China’s dominance over global production (98%) and its introduction of export controls on all gallium-related materials recently. Gallium arsenide is used to manufacture semiconductor wafers used in integrated circuits and in optoelectronic devices such as laser diodes, light-emitting diodes (LEDs), photodetectors and solar cells. As the US Geological Survey notes, these technologies are crucial to national security due to their use in defence and aerospace applications as well as in high-performance computers and telecommunications equipment.

Neodymium earns its place on the basis that it is the primary REE used in Neodymium-Iron-Boron (NdFeB) permanent magnets, considered the world’s strongest permanent magnet. The superior strength of NdFeB makes it the preferred type of magnet for EV motors in battery-electric vehicles and fuel cell electric vehicles, generators of wind turbines, and many military weapons systems.

Dysprosium and terbium’s importance comes down to their ability to retain their magnetic properties under higher temperatures than neodymium. NdFeB only performs better than samarium-cobalt (SmCo) up to temperatures of around 150 degrees Celsius and is only recommended for use up to around 230 C, whereas SmCo magnets can be used up to around 350 C. The addition of small amounts of dysprosium and terbium enables NdFeB magnets to maintain their strong performance in applications that expose them to higher temperatures. These include military applications such as fin actuators in missile guidance and control systems (which control the direction of the missile), and electric drive motors in aircraft, tanks, ships and missile systems. The rule also applies to civilian applications such as EVs and offshore wind turbines, which are often manufactured without a gearbox to make them more heavy-duty and reduce their maintenance requirements.

China controlled about 92% of the approximately 120,000 ton global NdFeB permanent magnet market in 2020, with Japan accounting for about 7% and the rest of the world only 1%, according to a US government report on the effects of imports of NdFeB magnets on national security. Any US effort to loosen dependence on China would be constrained by vulnerability to disruptions further up the supply chain, given that China controls around 69% of rare earths mining, 89% of separation into individual rare earth oxides, and 90% of metal refining and alloy production.

What is (or isn’t) deemed a critical mineral varies from country to country. The most recent list published by the US Geological Survey identifies 50 of them. The EU equivalent consists of 34, while Japan has designated the same number of ‘rare metals.’ Australia and Canada both identify 31 critical minerals, though their lists aren’t identical; for example, arsenic is considered essential in the former but not the latter. Meanwhile, India’s list comprises 30 critical minerals, China’s includes 24, and the UK version is made up of just 18. Although all the mineral lists contain common threads, they still vary considerably because countries use different criteria as the basis for national prioritisations. The most common criterium is whether a particular mineral is of significant importance to the national economy, but other key criteria include whether its supply chain is subject to high risk of supply disruption, whether it is important for national defence or security, and whether the country has significant untapped reserves. Criteria diversity reflects the differences in countries’ development priorities and industry needs.

Figure below shows comparison of strategic and critical mineral designations of selected countries:

These lists are not static, however, as they can be updated to reflect a country’s changing priorities. The United States generally focuses on minerals that are prone to supply chain disruptions and that are critical for either national security or economic development. Thus, fuel minerals such as uranium were removed in the latest revision to the US critical minerals list and rare earth minerals were unbundled and are now listed separately as cerium, gadolinium, lanthanum, neodymium, praseodymium and samarium.

US Critical Minerals List:

The U.S. Geological Survey’s 2022 list identifies 50 critical minerals crucial to the nation’s economy and security. Below is the complete list of critical minerals in the country, the usual mineral resources where they are extracted, and what these minerals are used for.

-1. Aluminum: Aluminum is primarily derived from bauxite ore, with major production in Australia, China, and Guinea; essential for aerospace, transportation, and construction industries.

-2. Antimony: Antimony is primarily mined in China and Russia from stibnite ore; essential for flame retardants, lead-acid batteries, and alloys.

-3. Arsenic: Arsenic is mainly obtained as a byproduct of copper and lead smelting, with production concentrated in China and Morocco; and used in semiconductors, wood preservatives, and glass manufacturing.

-4. Barite: Barite is a non-fuel mineral extracted from sedimentary deposits, primarily in China, India, and the U.S.; utilized as a weighting agent in drilling fluids for oil and gas exploration.

-5. Bauxite: Bauxite is the principal ore of aluminum, sourced from tropical and subtropical regions, including Australia, Brazil, and Guinea; vital for aluminum production and refractory materials.

-6. Beryllium: Beryllium is primarily mined in the U.S. and China from beryl minerals; used in aerospace components, electronics, and precision instruments.

-7. Bismuth: Bismuth is mainly recovered as a byproduct of lead and copper refining, with China as the dominant supplier; used in pharmaceuticals, cosmetics, and low-melting alloys.

-8. Cesium: Cesium is extracted from pollucite deposits, primarily in Canada; used in atomic clocks, medical applications, and oil and gas drilling fluids.

-9. Cerium: Cerium is primarily obtained from bastnäsite and monazite ores, with significant production in China and the United States; used in catalytic converters, glass polishing, and as a catalyst in self-cleaning ovens.

-10. Chromium: Chromium is sourced from chromite deposits in South Africa and Kazakhstan; vital for stainless steel, superalloys, and corrosion-resistant coatings.

-11. Cobalt: Cobalt is mainly sourced from the Democratic Republic of Congo and used in battery electrodes, superalloys, and catalysts.

-12. Dysprosium: Dysprosium is extracted from ion-adsorption clays, mainly in China; essential for permanent magnets in electric vehicles and wind turbines, as well as in nuclear reactor control rods.

-13. Erbium: Erbium is sourced from monazite and bastnäsite ores, primarily in China; utilized in fiber optic communications, lasers, and as a colorant in glass and ceramics.

-14. Europium: Europium is obtained from bastnäsite and monazite minerals, with major production in China; critical for phosphorescent applications in television and computer screens, as well as in anti-counterfeiting measures in currency.

-15. Fluorspar: Fluorspar is extracted from China, Mexico, and South Africa; used in aluminum production, fluoropolymer manufacturing, and steel refining.

-16. Gallium: Gallium is recovered as a byproduct of aluminum and zinc production, with significant output from China, and is essential for semiconductors, LEDs, and solar panels.

-17. Gadolinium: Gadolinium is extracted from monazite and bastnäsite ores, mainly in China; used in medical imaging contrast agents, nuclear reactor shielding, and as a component in high-strength magnets.

-18. Germanium: Germanium is a byproduct of zinc ore processing, with production mainly from China, Canada, and Russia; used in fiber optics, infrared optics, and solar cells.

-19. Graphite: Graphite is sourced from China, Brazil, and Canada; serves as the primary material for anodes in lithium-ion batteries and is used in lubricants.

-20. Hafnium: Hafnium is a byproduct of zirconium refining, mainly from Australia; crucial for nuclear control rods, aerospace alloys, and superalloys.

-21. Helium: Helium is extracted from natural gas fields, mainly in the U.S., Qatar, and Algeria; essential for cryogenics, medical imaging, and scientific research.

-22. Holmium: Holmium is sourced from monazite and bastnäsite minerals, primarily in China; utilized in high-strength magnets, nuclear control rods, and as a colorant in glass and cubic zirconia.

-23. Indium: Indium is obtained as a byproduct of zinc mining, primarily in China, South Korea, and Japan. This material is used in touchscreens, flat-panel displays, and solar cells.

-24. Lanthanum: Lanthanum is obtained from bastnäsite and monazite ores, with significant production in China and the United States; used in hybrid vehicle batteries, camera lenses, and as a catalyst in petroleum refining.

-25. Lithium: Lithium is primarily extracted from spodumene deposits in Australia and brine pools in South America; essential for rechargeable batteries in electric vehicles and portable electronics.

-26. Lutetium: Lutetium is extracted from monazite and xenotime minerals, mainly in China; utilized in PET scan detectors, catalysts in petroleum refining, and in specialized glass and ceramics.

-27. Magnesium: Magnesium is extracted from seawater and magnesite deposits, with production concentrated in China, Russia, and the U.S.; used in lightweight alloys, refractories, and pharmaceuticals.

-28. Manganese: Manganese is sourced from deposits in South Africa, Australia, and Gabon; and used in steel production, batteries, and specialty alloys.

-29. Nickel: Nickel is found in laterite and sulfide deposits in countries such as Indonesia and the Philippines. It is utilized in stainless steel production and lithium-ion batteries.

-30. Niobium: Niobium is extracted from pyrochlore deposits, primarily in Brazil and Canada; crucial for steel strengthening and superconducting magnets.

-31. Phosphorus: Phosphorus is primarily extracted from phosphate rock deposits, mainly in China, Morocco, and the U.S.; used in fertilizers, chemicals, and batteries.

-32. Platinum Group Elements (PGE): PGEs are mined in South Africa and Russia; crucial for catalytic converters in vehicles and various industrial applications.

-33. Potash: Potash is sourced from evaporite deposits, with significant production in Canada, Russia, and Belarus; essential for fertilizer production.

-34. Rare Earth Elements (REE): REEs are extracted from mineral sands and bastnäsite deposits, notably in China, and are critical for permanent magnets in windmills, electric vehicle motors, and various electronics.

-35. Rubidium: Rubidium is obtained from lepidolite and pollucite ores, primarily from Canada; used in atomic clocks, medical imaging, and electronics.

-36. Rhenium: Rhenium is a byproduct of molybdenum mining, with major production in Chile and the U.S.; used in jet engine superalloys and catalysts.

-37. Samarium: Samarium is sourced from monazite and bastnäsite ores, primarily in China; essential for permanent magnets, nuclear reactor control rods, and as a catalyst in chemical reactions.

-38. Scandium: Scandium is sourced from lateritic deposits and as a byproduct of uranium mining, mainly in China and Russia; used in aerospace alloys and solid oxide fuel cells.

-39. Selenium: Selenium is recovered as a byproduct of copper refining, primarily in China, Japan, and Canada; used in glass manufacturing, solar cells, and electronics.

-40. Silicon: Silicon is derived from quartz and silica deposits, with major production in China and the U.S.; used in semiconductors, solar panels, and construction materials.

-41. Strontium: Strontium is extracted from celestine minerals, primarily in China, Spain, and Mexico; used in fireworks, ceramics, and medical imaging.

-42. Tantalum: Tantalum is sourced from coltan ores in the DRC, Rwanda, and Australia; used in capacitors, medical implants, and aerospace components.

-43. Tellurium: Tellurium is a byproduct of copper refining, mainly from China and the U.S.; used in solar panels, thermoelectrics, and alloying additives.

-44. Thulium: Thulium is obtained from monazite and xenotime minerals, with major production in China; used in portable X-ray devices, lasers, and as a radiation source in cancer treatment.

-45. Tin: Tin is extracted from cassiterite deposits in countries like China, Indonesia, and Peru, and used in solder, plating, and various alloys.

-46. Titanium: Titanium is primarily sourced from ilmenite and rutile ores, mainly in Australia, South Africa, and Canada; used in aerospace, pigments, and medical implants.

-47. Tungsten: Tungsten is sourced from China, Vietnam, and Russia; utilized in cutting tools, electronics, and military applications.

-48. Uranium: Uranium is extracted from sedimentary and igneous deposits, primarily in Kazakhstan, Canada, and Australia; essential for nuclear power generation.

-49. Vanadium: Vanadium is extracted from titaniferous magnetite and uranium ores, mainly in China and Russia; used in steel alloys and grid-scale battery storage.

-50. Zirconium: Zirconium is derived from zircon minerals, largely in Australia and South Africa; essential for nuclear reactors, ceramics, and corrosion-resistant coatings.

Coal is now a “critical mineral” under Amended Executive Order regarding Immediate Measures to Increase American Mineral Production:

On April 8, 2025, President Trump issued an Executive Order entitled “Reinvigorating America’s Beautiful Clean Coal Industry”, to amend Executive Order 14241 (“EO 14241”) regarding the accelerated production of critical minerals and to require additional actions from various federal agencies to support domestic coal production and its related power and emerging technologies sectors. The Executive Order mandates the Chair of the National Energy Dominance Council (“NEDC”) to entitle coal to the same benefits as other minerals (including the newly added uranium, copper, potash, and gold) designated in EO 14241, and calls upon multiple agencies (including the Department of State, Treasury, Interior, Energy, Agriculture, Labor, and Commerce, the Environmental Protection Agency (EPA), the Office of the U.S. Trade Representative, the United States International Development Finance Corporation (DFC), and Export-Import Bank (EXIM), among others) to support domestic coal production.

Note:

Coal is not considered a mineral. While coal is formed underground and is solid, it’s primarily organic in origin, meaning it’s derived from the remains of ancient plants and animals. Minerals, on the other hand, are inorganic, meaning they are not formed from living organisms. Trump ought to know that coal is fossil fuel and not mineral.

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Overview of Uses of critical minerals:

Critical minerals refer to the mineral resources, both primary and processed, that are the building blocks of essential modern-day technologies and whose supply may be disrupted. While some such materials provide inputs to traditional industries, many are crucial for high-tech products required for clean energy, national defence, information technology, aviation and space research. Such products include mobile phones, computers, batteries, electric vehicles, green technologies like solar panels and wind turbines, energy storage systems (ESS) for renewable energy and data transmission hardware.

Critical minerals have been classified into three categories based on their end-use industries:

Traditional — titanium, vanadium
Sunrise — lithium
Mixed use — cobalt, nickel, graphite, light rare earth elements (LREEs), heavy rare earth elements (HREEs)

There are eight minerals considered to be of greatest interest and these include lithium, cobalt, nickel, graphite, LREEs, HREEs, titanium and vanadium. The rare earth elements (REEs) are a set of 17 metallic elements. These include the 15 lanthanides on the periodic table plus scandium and yttrium. REEs are necessary components of more than 200 products across a wide range of applications, especially high-tech consumer products, such as cellular telephones, computer hard drives, electric and hybrid vehicles, and flat-screen monitors and televisions.

Critical minerals are used in a wide range of applications across various industries due to their unique properties and characteristics. Here are some common uses of critical minerals:

-1. Renewable Energy Technologies:

Rare Earth Elements (REEs): Used in the production of permanent magnets for wind turbines and electric vehicle motors.
Lithium: Essential for lithium-ion batteries used in energy storage systems and electric vehicles.
Cobalt: Stabilizes battery chemistry and enhances performance in lithium-ion batteries.
Graphite: Serves as an anode material in lithium-ion batteries.

-2. Electronics and Telecommunications:

Rare Earth Elements: Used in the production of smartphones, computers, and other electronic devices for their magnetic and luminescent properties.
Indium: Critical for producing transparent conductive coatings used in touchscreens and liquid crystal displays (LCDs).
Gallium: Used in semiconductors, LEDs, and solar cells for its unique electrical properties.

-3. Transportation:

Lithium: Powers electric vehicles (EVs) by storing energy in lithium-ion batteries.
Cobalt, Nickel: Used in EV batteries to improve energy density and performance.
Platinum Group Metals (PGMs): Catalytic converters in vehicles use PGMs to reduce harmful emissions from internal combustion engines.

-4. Aerospace and Defense:

Tungsten: Used in aerospace applications for its high melting point and density, such as in aircraft parts and armor-piercing ammunition.
Titanium: Lightweight and corrosion-resistant, titanium is used in aircraft components, missiles, and armor plating.
Rare Earth Elements: Critical for advanced defense technologies, including radar systems, missile guidance systems, and communications equipment.

-5. Industrial Applications:

Platinum Group Metals: Used as catalysts in chemical processes, petroleum refining, and emission control systems.
Tantalum: Used in electronics, aerospace, and medical devices for its corrosion resistance and high melting point.
Antimony: Used as a flame retardant in plastics, textiles, and electronics.

-6. Energy Storage and Generation:

Vanadium: Used in vanadium redox flow batteries for grid-scale energy storage.
Nickel: Used in rechargeable batteries, such as nickel-metal hydride (NiMH) and nickel-cadmium (NiCd) batteries.
Copper: Essential for electrical wiring and transmission lines in power generation and distribution systems.

These examples highlight the diverse and critical roles that these minerals play in supporting modern technologies, infrastructure, and industrial processes. As demand for these minerals continues to grow, ensuring a stable and sustainable supply chain becomes increasingly important for global economic development and the transition to a low-carbon future.

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The CMs have many uses because of their important role in several industries, based on the conventional, high-tech and cutting-edge technologies, to meet diverse needs of the society (Table below). Thus, they play an important role in both conventional industries like metallurgy and in the production of steel, ceramics, refractories, automobiles and jewellery, and high-tech industries such as nuclear, space, telecommunications, consumer electronics, super-alloys and defence.

CMs/metals (atomic no.)	Uses
Antimony (Sb, 51)	In batteries and flame retardants
Arsenic (As, 33)	Lumber preservatives, pesticides and semiconductors
Beryllium (Be, 4)	As metal: as an alloying agent in aerospace and defence industries; X-ray window, as canning material in nuclear reactors; for high-speed computers and audio components. As oxide: electrical insulator, in microwave communications, alloys (Be–Cu in electrical and electronic industries; Be–Al as hardener in Al–Mg alloy melting)
Bismuth (Bi, 83)	In medical and atomic research; its low melting point alloys with Pb, Sn, Fe and Cd are used in fire detectors and extinguishers
Caesium (Cs, 55)	In research and development (R&D) used as a catalyst in hydrogenation of a few organic compounds; metal in ion propulsion systems; in atomic clocks; ‘getter’ in electron tubes, photoelectric cells and vacuum tubes and IR lamps
Chromium (Cr, 24)	Primarily in stainless steel and super-alloys
Cobalt (Co, 27)	Co-oxide nanoparticles in Li-ion batteries for electric vehicles and Co in super-alloys
Gallium (Ga, 31)	For integrated circuits and optical devices like LEDs
Germanium (Ge, 32)	For fibre optics and night-version apparatus
Gold (Au, 79)	For jewellery; in electronics and computers, medicine and dentistry, and medals and statues
Graphite (natural; C, 60)	For lubricants, batteries and fuel cells
Hafnium (Hf, 72)	For nuclear control rods, alloys and high-temperature ceramics
Helium (He, 2)	For MRIs, lifting agent, inert shield for arc welding, refrigeration, gas for aircraft, coolant for nuclear reactors, medicine and cryogenic research; to detect gas leaks
Indium (In, 49)	Mostly used in LCD screens
Lithium (Li, 3)	Primarily for Li-ion/polymer batteries for electric vehicles; in ceramics and glass industries; nuclear fusion and for many chemical compounds
Nickel (Ni, 23)	For alloys, batteries, coins, cars, mobile phones, jet engines, cutlery and bathroom taps and shower heads
Niobium (Nb, 41)	For making steel; Zr–2.5% Nb alloy for pressure tubes in heavy-water nuclear reactor, Zr–Nb–Cu for garter springs, SS super-alloys, superconductors, micro-alloyed steel; magnetic films of Fe–Nb nitride used in corrosion resistance
PGMs (Pt-78, Pd-46, Os-76, Rh-45, Ru-44 and Ir-77)	Pt as catalytic converters, oxygen sensors and spark plug in automobiles; Pd in almost all electronics; Ir to make high-purity crystals that have applications in medical, petroleum and security industries
Potash	As fertilizer in agriculture; in the manufacture of K-bearing chemicals such as detergents
REEs (La-57, Ce-58, Pr-59, Nd-60, Pm-61, Sm-62, Eu-63, Gd-64, Tb-65, Dy-66, Ho-67, Er-68, Tm-69, Yb-70, Lu-71, Y-39)	Primarily in batteries and electronics; for superconductors, permanent magnets, metallurgy, nuclear, ceramics, chemicals, electronics (LED displays on smartphones and TVs, energy-efficient light bulbs, disc-drives in laptops), power steering in cars, space, lasers, phosphors, fibre optics, misch metal, renewable wind-energy, defence, etc.
Rhenium (Re, 75)	For lead-free gasoline and super-alloys (in jet engines and in W-/Mo-based alloys, as filaments for mass spectrographs and as an electrical contact material.
Rubidium (Rb, 37)	For R&D in electronics; in vacuum tubes as a getter and in the manufacture of photocells and in special glasses; as a propellant in ion engines on spacecraft
Scandium (Sc, 21)	For alloys (Al–Sc alloys for aerospace industry components and sports equipment such as bicycle frames, fishing rods, etc.) and fuel cells; Sc iodide in Hg vapour lamps
Selenium (Se, 34)	Has antioxidant properties – antioxidants protect cells from damage; may reduce chances of prostate cancer; plays a key role in metabolism
Silver (Ag, 47)	In electronics, coins, jewellery and medicine
Strontium (Sr, 38)	For pyrotechnics and ceramic magnets
Tantalum (Ta, 73)	In electric components, most capacitors; transmitting and vacuum tubes, heating elements and heat shield; carbides for tools, magnetic films of Fe–Ta nitride used in corrosion resistance
Tellurium (Te, 52)	To improve the machinability of Cu and stainless steel; added to cast iron; used in ceramics; to make blasting caps; added Te to Pb to improve the strength and hardness of metal and decrease corrosion; for solar cells
Tin (Sn, 50)	As protective coatings and alloys such as soft solder, pewter, bronze, phosphor bronze and steel; Nb–Sn alloy for superconducting magnets
Titanium (Ti, 22)	Used as a white pigment; as a super-hard metal in alloys, aerospace, metallurgy, chemical and desalination plants; and in plastics and paper industries, drilling (oil wells), biomedical food, slag and flux
Tungsten (W, 74)	To make wear-resistant metals
Uranium (U, 92)	As fuel for nuclear fission reactors; in defence to power nuclear submarines and in nuclear weapons
Vanadium (V, 23)	For Ti-, ferrovanadium- and V-steel alloys; minor alloy metal which toughens steel; by adding V to any steel helps remove oxygen and nitrogen, and gives uniform grain size; V₂O₅ is used as a mordant, a material that permanently fixes dyes to fabrics
Zirconium (Zr, 40)	In high-temperature ceramic industries, Hf-free Zr as cladding material; in alloys, chemical industry, refractories (steel and glass works), medicine, tanning and oil industries.

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Importance of critical minerals:

Economic Importance of Critical Minerals:

The economic importance of critical minerals stems from their essential role in various industries and technologies. These minerals are crucial for economic stability and growth, influencing numerous sectors from manufacturing to renewable energy.

Role in Technology:

Critical minerals are indispensable for modern technology. They are used in the manufacture of:

Electronic Devices: Such as smartphones, tablets, and laptops, which rely on minerals like cobalt and rare earth elements.
Batteries: Lithium and nickel are vital for electric vehicle batteries, integral to the shift towards sustainable transportation.
Renewable Energy Systems: Minerals like tellurium and indium are key components of solar panels and wind turbines.

This dependence highlights the significance of securing a stable supply chain for economic resilience. For example, neodymium, a rare earth element, is critical in producing powerful magnets used in wind turbines and electric vehicle motors. This underscores its importance in advancing clean energy technologies.

Impact on Global Trade:

The trade of critical minerals influences global markets and international relations. Key impacts include:

Geopolitical Tensions: Countries with significant mineral reserves hold strategic advantages, affecting global trade dynamics.
Economic Dependencies: Import-dependent nations are vulnerable to supply disruptions, impacting industries reliant on these minerals.
Price Volatility: Fluctuations in mineral availability can lead to unstable prices, affecting markets and economies worldwide.

The influence of critical minerals extends beyond their immediate applications to global economic stability.

A deeper look into the economic landscape reveals an emerging trend: strategic mineral alliances. Countries are forming partnerships to secure access to critical minerals through joint ventures and trade agreements. These alliances aim to buffer against supply disruptions by diversifying sources and investing in sustainable extraction methods. Moreover, recycling initiatives are gaining traction, aiming to reclaim valuable materials from electronic waste, subsequently reducing reliance on primary mining and mitigating environmental impacts.

Interesting point:

Nations are exploring the potential of asteroid mining as a future source of critical minerals, promising vast untapped resources beyond Earth.

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Critical minerals in the U.S. and their primary industry use:

*Platinum group metals include ruthenium, rhodium, palladium, osmium, iridium, and platinum.

**Rare earth elements include the 15 lanthanide elements (lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, and lutetium) and many times yttrium and scandium are included as rare earth elements.

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The Critical Mineral Industry is Dangerous:

The extraction and processing of critical minerals can pose serious risks to workers, including respiratory diseases and other occupational hazards. Workers in the mining and processing sectors face several occupational risks, including:

Inhalation of Toxic Dust – Many minerals, such as silica and cobalt, produce fine dust particles that, when inhaled as shown in the image above, can cause lung diseases like silicosis and pneumoconiosis.
Chemical Exposure – Chemical agents used in mineral processing, such as cyanide in gold mining or sulfuric acid in lithium extraction, pose severe health risks if not handled properly.
Radioactive Contamination – Some minerals, including REEs and uranium, carry radiation risks, which can lead to long-term health effects like cancer.
Skin Irritation and Burns – Contact with harsh chemicals and mineral residues can cause skin burns, rashes, and other dermatological issues.
Noise and Vibration Hazards – Heavy machinery in mining operations generates extreme noise levels, leading to hearing loss, while vibrations from drills and excavation equipment can cause hand-arm vibration syndrome (HAVS).
Musculoskeletal Injuries – Repetitive motion, lifting heavy materials, and working in awkward postures contribute to back pain and joint problems.
Fire and Explosion Risks – Certain minerals, such as coal and lithium, present flammability risks, increasing the likelihood of workplace explosions or fires.
Accidents from Equipment Use – Operating large-scale mining machinery carries the danger of accidents, including crush injuries, falls, and electrocutions.
Exposure to Heat and Poor Ventilation – Working in underground mines or high-temperature environments without proper ventilation can lead to heat stress and respiratory issues.
Psychosocial Risks – Long working hours, isolation in remote locations, and job insecurity contribute to mental health issues like stress, anxiety, and depression.

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Critical energy transition minerals’ negative consequences:

The transition from fossil fuels to clean energy sources will depend on critical energy transition minerals. Minerals – such as copper, lithium, nickel, cobalt – are essential components in many of today’s rapidly growing clean energy technologies, from wind turbines and solar panels to electric vehicles. The consumption of these minerals could increase sixfold by 2050, according to the IEA, with their market value reaching US$400 billion, exceeding the value of all the coal extracted in 2020. To meet the Paris Agreement goals, more than three billion tonnes of energy transition minerals and metals is needed to deploy wind, solar and energy storage.

However, critical energy transition minerals come with environmental, social, economic, geopolitical, trade, and partnership challenges and opportunities.

While the growth of minerals supply plays a vital role in enabling a clean energy transition, if poorly managed, the production and processing of these minerals can lead to a myriad of negative consequences, including:

Significant greenhouse gas emissions arising from energy-intensive mining and processing activities.
Environmental impacts, including biodiversity loss and pollution.
Social impacts including human rights abuses such as child labour and negative impacts on indigenous people’s rights.

In addition, there is a supply challenge which could slow down the energy transition or make it more expensive and unequal. This is leading to high and volatile prices for critical energy transition materials, rising geopolitical tensions over their control, interference in markets, and strong political pressure to expand mining, including into environmentally and socially sensitive areas.

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Critical mineral resources:

Critical minerals have become an increasingly important policy issue due to increasing demand, price fluctuations, and supply chain concerns. Global supply has since caught up with demand, but given the importance of these minerals to many sectors, future demand is anticipated to continue to grow. New research is informing efforts around recycling and reusing some of these vital materials to support the transition to a circular economy while addressing geopolitical, social justice, environmental, and supply chain concerns. As demand for critical minerals rises, so do concerns about supply shortfalls, which could undermine the energy transition. The supply question is closely linked to both geology and technological advancements, which will shape demand levels for specific minerals and the potential for countries that host those deposits to supply the minerals. To bridge the supply gap, diverse sources will need to be explored in the short and medium terms, including artisanal, small-, and large-scale mining; reprocessing mine waste and tailings; and recycling end-use products.

Three Streams for Sourcing Critical Minerals:

Currently, critical minerals are primarily sourced from underground & open-pit mining and in-situ leach mining. However, emerging options for obtaining them include recovery from nontraditional sources, such as from coal mining waste and geothermal brine, and through recycling end-of-life technologies like lithium-ion batteries. Each of these comes with its own challenges and concerns.

-1. Mining

Lithium, cobalt, manganese, nickel, and other critical minerals today are mined from just a handful of geographically concentrated locations. For instance, cobalt mines are mostly in the Democratic Republic of the Congo (DRC), lithium is concentrated in Australia and South America, and nickel in Southeast Asia.

This geographic distribution of resources, and the fact that refinement of the metals is historically taking place mostly in China, creates a supply chain that can be manipulated or disrupted by geopolitics and natural disasters. In addition, demand is expected to grow much more rapidly than we can effectively mine new supplies. New mineral exploration—alongside innovative recycling and recovery options and improved mining and refining methods—may be able to alleviate some of these challenges.

However, various environmental and social issues posed by the critical mineral mining sector need to be addressed. Mines in areas with limited infrastructure (e.g., Lobito Corridor) must rely on diesel oil for back-up generators and transport to port. In an analysis by the World Bank, diesel consumption accounts for 61% of total emissions intensity of Scope 1 emissions for copper and cobalt mining in DRC. Additionally, without proper regulations and oversight, mining processes can contaminate land and water resources and cause other environmental damage. What’s more, mining in certain regions has been known to use forced and child-labor and infringe on the rights of local indigenous groups.

-2. Recovery from nontraditional sources

Critical minerals can also be obtained through recovery from “nontraditional” sources such as leftover mining wastes, brine from geothermal power plants, and waste from coal-fired power plants. These efforts are mostly at pilot or research scale, though some companies are nearing commercial readiness. For example, a geothermal power company in California is nearing commercial-scale lithium extraction from geothermal brine, possibly starting as soon as 2025. However, high costs, potentially unstable prices for recovered materials, and liability concerns surrounding extraction from retired mining sites are some barriers to development in this area. Given the novelty and scale of these efforts, the potential to meet significant mineral demand through these methods is uncertain.

-3. Recycling and recovery from end-of-life technologies

Some of the pressure on primary production could be relieved by recycling end-of-life technologies, such as the lithium-ion batteries used in electric vehicles. Although not all key minerals can be easily recovered, lithium, nickel, and cobalt, among others, are currently being recovered through battery recycling (e.g., of EV batteries). By recycling the critical materials into new technologies, it is possible to lower our reliance on mined materials, alleviate some of the environmental and social harms associated with mining, reduce greenhouse gas emissions, and strengthen and diversify the supply chain. Recycled materials have been shown to meet or even exceed the performance standards for use in battery manufacturing, and innovations are being developed to lower the costs significantly. The primary limitation of critical minerals recycling is economic—currently, a much larger volume of material can be obtained at a lower cost from mining than from recycling. However, if the environmental, social, and greenhouse gas emissions benefits of recycling are factored in, recycling becomes more cost competitive.

Despite the challenges, EV battery recycling is of great interest to stakeholders around the world as a complement to mining. In the U.S., for example, Redwood Materials has received billions of dollars in loans from the federal government to jump-start operations, signing deals with GM, Toyota, and others to recycle their batteries and manufacturing scrap. Redwood then sells the recovered minerals back to the manufacturers to make more batteries.

The current volume of lithium-ion batteries available for recycling is relatively small and concentrated in personal and other electronic devices. However, this landscape is rapidly changing as the growth in the EV market has ballooned over the last several years (i.e., from 4% of car sales in 2020 to 18% in 2023 globally). In addition, experts project that global demand for EVs will continue to grow over the coming decade, as demand rises in emerging markets and environmental policies continue to phase out internal combustion engines in existing markets. Early EVs are beginning to reach end-of-life, and we’re likely to see an influx of large lithium-ion batteries in coming years.

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Material trilemma:

Rising demand for low-carbon technologies is escalating the need for critical minerals. These technologies require more minerals than their conventional counterparts, such as coal, oil and gas, and so the transition to renewable energy is driving substantial growth in demand for critical minerals. In fact, the energy transition could more than double the overall demand for critical minerals by 2030, according to the International Energy Agency.

To establish a secure global supply of critical minerals, materials markets must balance three priorities: availability, affordability and sustainability. This can be framed as the materials trilemma:

Infographic below illustrates the materials trilemma as it relates to critical minerals.

Collaborative action focused on the materials trilemma will secure a sustainable and affordable supply of critical minerals.

For example, transitioning new primary assets from exploration into production typically involves long lead times due to permitting, technical issues, and other challenges. Collaboration across the value chain and public sector engagement are vital to managing and reducing these lead times.

Boosting secondary (recycled) minerals supply would likewise necessitate collaborative action to increase available feedstock volumes, develop cost-effective recycling technologies, and raise end-of-life-recycling rates.

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Demand and supply:

The surging demand for “critical” minerals has been driven for the most part by their role in the transition to clean energy and a low-carbon economy. The specific demand drivers can be classified into six pathways as seen in figure below:

Rising demand for critical minerals will also place even more significant pressure on extraction, production, and refining processes, presenting both challenges and opportunities for governments to consider.

Minerals and metals are extracted and produced by large-scale mining and artisanal and small-scale mining (ASM) operations. Since it typically takes between 15 and 20 years for large-scale mining to become operational, ASM is playing an increasingly significant role in the production of critical minerals.

In the case of cobalt in the Democratic Republic of the Congo, ASM accounts for around 15%–35% of cobalt production. For tantalum, about 60% of global production comes from ASM. Around 70%–80% of ASM operates within the informal sector, either illegally or in legal grey areas, and the inclusion of ASM in the formal sector presents one among many policy considerations.

In addition to primary sources, critical minerals can also be produced through secondary sources, such as through wastewater for REEs and mine tailings for tungsten, tantalum, and molybdenum. Increasingly, recycling, particularly in the context of the circular economy, is becoming an important and viable source of supply.

New or alternative sources are also emerging, including deep-seabed mining, which is considered controversial but a feasible frontier for manganese, cobalt, nickel, and REEs; marine-derived mining for lithium; and phytomining of native plants to extract or collect minerals from the sap, leaves, and/or fruits. The increased attention and research and development allocated to secondary and emerging sources could have certain implications for supply and demand dynamics, pricing, environmental sustainability, and geopolitics.

A race is raging among global powers to secure access to critical minerals to power the simultaneous energy and digital transitions the world is experiencing. The extraordinary growth in demand for critical minerals is putting upward pressure on prices and stimulating new critical mineral discoveries all around the world. However, in developing countries, this new bonanza presents opportunities but also important risks. While both the energy and digital transitions rely on technologies that require critical minerals, it is the clean energy transition that is most prominently associated with the intensive use of these minerals. Technologies including wind turbines, solar PVs, electricity networks, electric vehicles and nuclear power require minerals such as copper, lithium, nickel, silicon, cobalt, rare earth elements and uranium. Demand for these minerals is expected to grow very quickly as the clean energy transition gathers pace.

The production of critical minerals is relatively scattered. Yet the salient issue is where the residual production of critical minerals net of domestic consumption (i.e. exports), especially of raw critical minerals, is concentrated. The production of critical minerals is highly prevalent in the major economic blocs – China, the US, and the EU. These blocs typically consume more of what they produce, hence making them dependent on exporters of raw critical minerals. Australia, Russia, Kazakhstan, Democratic Republic of Congo, Mozambique, Chile, South Africa, and Zimbabwe, as well as many others, are important exporters of raw critical minerals, and thus are courted by superpowers that strive to ensure secure supplies of such minerals.

The geography of mining versus the processing of critical minerals is very telling. China completely dominates the processing of copper, nickel, cobalt, rare earths, and lithium, but it only dominates in the production of rare earths. Chile and Peru dominate in the production of copper, Indonesia dominates in the production of nickel, DRC dominates in the production of cobalt, and Australia and Chile dominate in the production of lithium. It is mind-boggling that China is the dominant producer in the world economy of offshore wind, onshore wind, solar, and electrical vehicles and has 40-45% global shares in the production of fuel cell trucks, heat pumps, and electrolysers (Leruth et al. 2022).

Critical minerals, essential for key technologies, face significant risks of disruption in their supply chains. These minerals are deemed critical due to their limited availability in specific regions, leading to increased reliance on them across various industries. The vulnerability of these supply chains poses substantial risks to a country’s economic development and national security, given their vital importance in industries, manufacturing processes, and defense equipment. Numerous factors, including market immaturity, social unrest, political decisions, mine accidents, natural disasters, geological scarcity, war, and pandemics, contribute to the risks associated with critical mineral supply chains.

The rapid adoption of clean energy technologies such as solar PV and batteries is driving the demand for critical minerals, creating significant growth opportunities in the market. As the demand for these technologies continues to rise, it becomes imperative for businesses in the critical minerals industry to prioritize sustainable and responsible practices. Adopting responsible practices ensures the well-being and safety of workers, local communities, and indigenous populations. This includes fair labor practices, respecting human rights, and engaging in transparent and ethical business operations. By implementing sustainable practices, businesses can minimize their impact on the environment, including reducing energy consumption, minimizing waste generation, and protecting ecosystems.

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Critical mineral market:

The global Critical Minerals Market size was valued at USD 320.43 billion in 2022 and is projected to reach USD 494.23 billion by 2030, growing at a CAGR of 5.69% from 2023 to 2030. Driven by rising demand and high prices, the market size of key energy transition minerals doubled over the past five years, reaching USD 320 billion in 2022. This contrasts with the modest growth of bulk materials like zinc and lead. As a result, energy transition minerals, which used to be a small segment of the market, are now moving to centre stage in the mining and metals industry. This brings new revenue opportunities for the industry, creates jobs for the society, and in some cases helps diversify coal-dependent economies. The critical minerals market is projected to experience significant growth, potentially reaching $770 billion by 2040, driven by the growing demand for clean energy technologies like electric vehicles and renewable energy sources.

The rare earth metals market is projected to reach a valuation of USD 16.26 billion by 2032, expanding at a compound annual growth rate (CAGR) of 8.75% from 2024 to 2032. The market is mainly driven by the essentiality of rare earth metals technology. As the world pivots more towards EVs, wind turbines, and sophisticated electronic gear, the demand for neodymium, praseodymium, dysprosium, and terbium has risen sharply. All of these are needed for the manufacturing of high-performing magnets used in motors, generators, and other electronic parts. Moreover, government policies encouraging the shift towards green energy solutions, as well as limiting the carbon footprints, have further boosted investments in the extraction and recycling of rare earth metals. Additionally, rare earth elements are being used in the defense and aerospace industries for advanced weaponry systems, radar technologies, and communication components.

The global market is segmented based on mineral type, application, and geography.

By Mineral Type

Based on mineral type, the critical minerals market is categorized into copper, lithium, nickel, cobalt, and rare earth elements.

By Application

Based on application, the critical minerals market is divided into agriculture, electric vehicles, high-tech electronics, telecommunications, energy, and others.

By Geography

Based on region, the global market is classified into North America, Europe, Asia Pacific, MEA, and Latin America.

China holds a leading position in the global critical minerals market. China’s strategic position in mineral processing and its low costs have contributed to its dominance in the market. In 2022, its domestic production reached 210,000 metric tons. At present, China’s rare earth industry is managed by six state-owned mining companies, which theoretically enables China to maintain a firm grip on production.

List of Key Companies in Critical Minerals Market:

Rio Tinto
Vale
Glencore
Freeport-McMoRan
Anglo American plc
Albemarle Corporation
Lynas Rare Earths Ltd
Barrick Gold Corporation
BHP
SQM S.A.

Critical minerals fall in price:

Fast-growing critical minerals markets remain turbulent, with prices falling sharply in 2023 following two years of dramatic increases. Battery materials saw particularly large declines with lithium spot prices plummeting by 75% and cobalt, nickel, and graphite prices dropping by 30-45%. The IEA Energy Transition Mineral Price Index, which tracks a basket price of copper, major battery metals and rare earth elements, tripled in the two years following January 2020, but relinquished most of the increase by the end of 2023 – although copper prices remained at elevated levels.

The main reason for price declines has been a strong increase in supply and ample inventories of technologies made with critical minerals. From Africa to Indonesia and the People’s Republic of China, the ramp-up of new supply outpaced demand growth over the past two years. Together with an inventory overhang in the downstream sector (e.g. battery cells, cathodes) and a correction of overly steep price rises in 2021-2022, this produced downward pressure on prices.

Prices for minerals and metals experienced a widespread decline in 2023, with battery metals experiencing particularly sharp reductions as seen in figure below:

Notes: REE = rare earth elements; Dy-Tb = dysprosium and terbium; Nd-Pr = neodymium and praseodymium. Change in prices between December 2022 and December 2023.

In 2023 and 2024, pressure eased on the market for metals and minerals that go into electric vehicles, wind turbines, solar panels and other clean energy technologies, as a surge in supply outpaced the rise in demand. Prices, which reached record highs in the aftermath of the pandemic, dropped significantly.

However, IEA analysis shows that today’s well-supplied market may not be a good guide for the future, as demand for critical minerals continues to rise. Notably, the recent declines in critical mineral prices have made it harder to attract new investment in production, which rose at a slower rate in 2023 than in 2022.

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FAQs on critical minerals:

What is the difference between strategic and critical minerals?

Strategic minerals focus specifically on military and defense needs, while critical minerals serve broader economic and industrial purposes. Strategic minerals prioritize national security applications, whereas critical minerals include both defense and civilian uses across multiple sectors. The distinction lies in strategic minerals’ military focus versus critical minerals’ wider industrial significance.

Where are critical minerals found?

These minerals exist in diverse geological environments, from sedimentary basins to igneous formations and ocean floors. Their deposits form through various geological processes over millions of years, creating concentrated deposits in specific locations. These minerals occur in both terrestrial and marine environments, with varying degrees of accessibility and economic viability.

They are found unevenly worldwide, with major deposits in China, Russia, DRC, Chile, and Australia. Geological processes have concentrated these resources in specific regions, creating natural monopolies in certain areas. While many countries have some deposits, economically viable concentrations are often limited to specific regions.

What is the difference between critical minerals and rare earth elements?

Critical minerals encompass a broader range of elements crucial for various industries and national security, while rare earth elements (REEs) are a specific subset of critical minerals known for their unique magnetic, luminescent, and catalytic properties.

How does geoscience help inform decisions about critical minerals?

Geoscientists study the formation of critical minerals; explore for and locate them; help determine how to mine them economically, safely, and with minimal environmental impact; help protect water and ecological resources around the mines; and help reclaim disturbed land after mining.

What are rare earth elements?

REEs are a set of 17 metallic elements that are considered critical because of their properties. Depending on their atomic numbers, there are two groups of REE: Heavy REE (9 elements) and Light REE (8 elements).

Unlike the name suggests, REEs are actually not rare. In fact, they are relatively abundant and quite commonly available in the Earth’s crust. What makes these materials rare is how difficult they are to extract and how complex it is to process them.

The single largest and most important end-use for REEs is permanent magnets, making up an estimated 29% of demand in 2020. Permanent magnets, and thus REEs, are essential for clean technologies and consumer electronics, such as electric vehicles, wind turbines, televisions, mobile phones, and other digital devices.

Are rare earth elements the only critical mineral resources?

No. Rare earth elements are hardly the only critical minerals. They’re not even the only minerals critical to the high-end technology sector. One mineral vital to the functioning of your smart phone is gallium, a soft, silvery metal. Without gallium, the semiconductors that power smartphones and data-centric networks would not be possible. Unlike rare earths, gallium is not a common metal in the Earth’s crust, but it does occur regularly alongside aluminum in a mineral known as bauxite. Another critical mineral is manganese, which is an important metal alloying ingredient. Without manganese, stainless steel would not be possible. In addition, it helps other metals resist rust and corrosion, such as iron and aluminum. Manganese is a fairly common element in the Earth’s crust, and exists in many concentrations easily mineable.

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Section-4

Introduction to rare earth elements:

People often confuse critical and rare-earth minerals, but rare earths make up a specific, highly useful category of their own within the critical minerals’ family. The rare earth elements (REEs) are 17 metals in Group 3 of the Periodic Table (figure below) comprising Lanthanide series elements and Scandium and Yttrium (due to similar physical properties and found in the same ores and deposits). Contrary to their name, they are moderately abundant in nature but not concentrated enough to make them economically exploitable.

Until recently, the rare-earth elements (REEs) were familiar to a relatively small number of people, such as chemists, geologists, specialized materials scientists, and engineers. In the 21st century, the REEs have gained visibility through many media outlets because (1) the public has recognized the critical, specialized properties that REEs contribute to modern technology, as well as (2) China’s dominance in production and supply of the REEs and (3) international dependence on China for the majority of the world’s REE supply. Since the late 1990s, China has provided 85 – 95 percent of the world’s REEs. In 2010, China announced their intention to reduce REE exports. During this timeframe, REE use increased substantially. REEs are used as components in high technology devices, including smart phones, digital cameras, computer hard disks, fluorescent and light-emitting-diode (LED) lights, flat screen televisions, computer monitors, and electronic displays. Large quantities of some REEs are used in clean energy and defense technologies. Because of the many important uses of REEs, nations dependent on new technologies, such as Japan, the United States, and members of the European Union, reacted with great concern to China’s intent to reduce its REE exports. Consequently, exploration activities intent on discovering economic deposits of REEs and bringing them into production have increased.

Rare earth elements (REEs) represent the group of 17 elements comprising 15 lanthanides, plus yttrium (Y) and scandium (Sc). Among the REEs, yttrium was discovered first in 1794 by a Finish chemist, Johan Gadolin who isolated an oxide and called it “yttria,” in a mineral collected from a quarry near the village of Ytterby in Sweden. It turned out to be a mixture of several oxides of rare earths, including yttrium oxide. The first individual REE to be isolated was cerium (Jöns Jacob Berzelius and Wilhelm Hisinger, 1803). Most other REEs were isolated individually in the 19th century, and the last naturally occurring one—Lu—was isolated in 1907. It took over 150 years from to first REE to the final discovery of promethium in 1947. Because promethium is a radioactive element, formed from decays of unstable isotopes of europium and uranium, with the longest half-life of 17.7 years for 145Pm, the element does not occur in the Earth’s crust in detectable concentrations.

The rare earth elements (REE) are a group of seventeen metallic elements – the fifteen lanthanides, with atomic numbers 57 (lanthanum, La) to 71 (lutetium, Lu), together with yttrium (Y, atomic number 39) and scandium (Sc, atomic number 21). All have similar chemical properties. The lower atomic weight elements lanthanum to samarium (Sm), with atomic numbers 57 to 62, are referred to as the light rare earth elements (LREE); while europium (Eu) to lutetium, with atomic numbers 63 to 71, are the heavy rare earth elements (HREE). (The dividing line drawn between LREE and HREE can vary somewhat, and the term ‘mid REE’ is also now sometimes used.) Yttrium, although it has a lower atomic weight, is grouped with the HREE because of its chemical similarity. Scandium’s properties are different enough from those of the other REE that most of the scientific and general literature excludes it and focuses on the lanthanides and yttrium.

Names and Symbols of the Rare Earth Elements:

Atomic Number	Symbol	Name	Ionic Radii (Å) (Coordination VIII)
21	Sc	Scandium	Sc^3 +: 0.87
39	Y	Yttrium	Y^3 +: 1.02
57	La	Lanthanum	La^3 +: 1.16
58	Ce	Cerium	Ce^3 +: 1.14, Ce^4 +: 0.87
59	Pr	Praseodymium	Pr^3 +: 1.13
60	Nd	Neodymium	Nd^3 +: 1.11
61	Pm	Promethium
62	Sm	Samarium	Sm^3 +: 1.08
63	Eu	Europium	Eu^2 +: 1.25, Eu^3 +: 1.07
64	Gd	Gadolinium	Gd^3 +: 1.05
65	Tb	Terbium	Tb^3 +: 1.04
66	Dy	Dysprosium	Dy^3 +: 1.03
67	Ho	Holmium	Ho^3 +: 1.02
68	Er	Erbium	Er^3 +: 1.00
69	Tm	Thulium	Tm^3 +: 0.99
70	Yb	Ytterbium	Yb^3 +: 0.99
71	Lu	Lutetium	Lu^3 +: 0.98

The ionic radius is the distance from the nucleus to the outermost electrons in an ion. Coordination VIII refers to an ion surrounded by eight other ions, forming a coordination polyhedron.

REE magnetic properties are determined by the occupancy of the strongly localized 4f electronic shells, while the outer s–d electrons determine the bonding and other electronic properties. Most of the rare-earth atoms are divalent, but generally become trivalent in the metallic state. For example, Yttrium’s electron configuration is 4d¹ 5s², with two valence electrons. In most of its compounds and chemical reactions, yttrium loses three electrons (one from the 4d orbital and two from the 5s orbital) to achieve a stable electron configuration, resulting in a +3 oxidation state.

REEs never occur individually but collectively they are found in various minerals in the Earth’s crust. This is a natural verification that these elements partition similarly in melts, fluids, and minerals on the earth. Exceptions are cerium (Ce) and europium (Eu), which may take different valence states (Ce4 + and Eu2 +) depending on the oxidation state of the melts or fluids in addition to trivalence typical of REEs. Thus, this characteristic is used to assess relative redox conditions in some mineral or rock systems (Henderson, 1996) and affects the concentration of REEs in minerals and ores in natural environments.

The ionic radii of trivalent REE ions are about 1 Å, which are compatible to those of Ca2 +, Na+, Th4 +, etc., and are significantly larger than those of other trivalent ions such as B3 +, Al3 +, and Fe3 + (Miyawaki and Nakai, 1996). Ionic radii of the trivalent REE ions are systematically reduced from La to Lu with increasing atomic number. Slight differences of the ionic radii of REE ions (Table above) also affect the partitioning of REEs into the minerals. The ionic radius of Y3 + is similar to the heavy REE ions, resulting in the similarity of chemical behavior of yttrium with the REEs with larger atomic numbers. The REEs are electropositive so their compounds are generally ionic. From a mineralogical standpoint, these compounds are oxides, halides, carbonates, phosphates, and silicates. Because REE ionic radii are relatively large, substitution reactions usually involve large cations such as calcium or strontium even though some additional charge balancing is often necessary.

The REEs are transition metals. In the transition metals, the s orbital of the outermost shell is filled before filling of the lower electron shells is complete. In atoms of the period six transition elements, the 6s orbital is filled before the 5d and 4f orbitals. In the lanthanides, it is the 4f orbitals that are being filled, so the configuration of the valence electrons is similar in all the REEs, hence all exhibit similar chemical behavior. Because of high ionic charges and large radii, REEs behave as incompatible elements in magma, so that the REEs are more concentrated in the melt, whereas compatible elements such as iron and magnesium are more incorporated into minerals in the early stages of fractional crystallization. This geochemical behavior leads to enrichment of REEs in felsic igneous rocks formed from the residual melt in the later stages of fractional crystallization.

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Abundance of REE:

Table below shows average abundance (concentration) of REE in the earth’s crust (in parts per million). For comparison, average crustal abundances for gold, silver, lead, and copper are 0.004, 0.075, 14, and 60 parts per million, respectively.

Element	Atomic Symbol number		Crustal Abundance ppm
	Light REEs
Lanthanum	La	57	39
Cerium	Ce	58	66.5
Praseodymium	Pr	59	9.2
Neodymium	Nd	60	41.5
Samarium	Sm	62	7.05
Europium	Eu	63	2.0
Gadolinium	Gd	64	6.2
	Heavy REEs
Terbium	Tb	65	1.2
Dysprosium	Dy	66	5.2
Holmium	Ho	67	1.3
Erbium	Er	68	3.5
Thulium	Tm	69	0.52
Ytterbium	Yb	70	3.2
Lutetium	Lu	71	0.8
Yttrium	Y	39	33

In fact, in terms of their overall abundance in the Earth’s crust, the REE are not particularly rare. Most REEs are not as rare as the group’s name suggests. They were named “rare-earth elements” because most were identified during the 18th and 19th centuries as “earths” (originally defined as materials that could not be changed further by heat) and in comparison to other “earths,” such as lime or magnesia, they were relatively rare. Cerium is the most abundant REE, and is more common in the Earth’s crust than copper or lead. All of the REEs, except promethium, are more abundant on average in the Earth’s crust than silver, gold, or platinum. However, concentrated and economically minable deposits of REEs are unusual. Although rare earth elements are relatively abundant in the Earth’s crust, they are rarely concentrated into mineable ore deposits.

Production:

China dominates global production of rare earth metals, accounting for around two-thirds of the global total in 2023. The United States, Myanmar, and Australia were also significant producers.

Figure below shows top countries involved in the Mining of Rare Earth Elements, 2023:

Note: Countries that mined less than 1,000 metric tons are not included in the figure.

a The U.S. Department of State officially recognizes the country of Burma, rather than Myanmar.

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The REE’s distinctive properties are due to their atomic structure, especially the configuration of their electrons, which is unlike that of other elements. While many important properties are shared by all the REE, others are specific to particular elements. Because of their chemical similarities, they occur together in minerals and rocks and are difficult to separate from each other (sometimes referred to as ‘chemical coherence’). However, the numerous practical uses of REE often depend on physical properties (electrical, magnetic, spectroscopic, and thermal) which are specific to particular elements, so the challenge of separating them must be overcome. Their chemical properties depend not only on their atomic structure, but also on their size. Unusually, atomic size of the lanthanides decreases with increasing atomic number, and this results in LREE and HREE occurring in different minerals. For example, lutetium can substitute more readily for other elements in minerals where the available sites are relatively small, where the larger lanthanum ion will not fit. REE compounds are generally ionic and often very stable, as in the case of the oxides. Geologically occurring compounds tend to be oxides, halides, carbonates, phosphates and silicates, but not sulphides. Most of the lanthanides exhibit a trivalent state (i.e. Ln3+, where Ln is the generic symbol for lanthanides) but cerium can also be quadrivalent (Ce4+) and europium is often divalent (Eu2+). Five of the rare earths (excluding promethium) each contain a proportion of a radioactive isotope (138La, 144Nd, 147Sm, 152Gd, 176Lu).

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Rare earths’ superpowers come from their electrons:

Strictly speaking, they are elements like others on the periodic table – such as carbon, hydrogen and oxygen – with atomic numbers 57 to 71. There are two others with similar properties that are sometimes grouped with them, but the main rare earth elements are those 15. To make the first one, lanthanum, start with a barium atom and add one proton and one electron (figure below). Each successive rare earth element adds one more proton and one more electron.

It’s significant that there are 15 rare earth elements: Chemistry students may recall that when electrons are added to an atom, they collect in groups or layers, called shells, which are like concentric circles of a target around the bull’s-eye of the nucleus. The electrons in an atom are arranged in shells that surround the nucleus, with each successive shell being farther from the nucleus. Electron shells consist of one or more subshells, and subshells consist of one or more atomic orbitals. The electron shells are labeled K, L, M, N, O, P, and Q; or 1, 2, 3, 4, 5, 6, and 7; going from innermost shell outwards. Electrons in outer shells have higher average energy and travel farther from the nucleus than those in inner shells. 2n² denotes the maximum number of electrons that a shell can accommodate. n refers to the principal quantum number of the shell. The elements have different shells in which the electrons are present and revolve around the nucleus.

The innermost shell of any atom can contain two electrons; adding a third electron means adding one in the second shell. That’s where the next seven electrons go, too – after which electrons must go to the third shell, which can hold 18. The next 18 electrons go into the fourth shell.

Then things start to get a bit odd. Though there is still room for electrons in the fourth shell, the next eight electrons go into the fifth shell. And despite more room in the fifth, the next two electrons after that go into the sixth shell.

That’s when the atom becomes barium, atomic number 56, and those empty spaces in earlier shells start to fill. Adding one more electron – to make lanthanum, the first in the series of rare earth elements – puts that electron in the fifth shell. Adding another, to make cerium, atomic number 58, adds an electron to the fourth shell. Making the next element, praseodymium, actually moves the newest electron in the fifth shell to the fourth, and adds one more. From there, additional electrons fill up the fourth shell. The 14 metallic chemical elements with atomic numbers 58–71, from cerium through Lutetium, fill the 4f orbitals.

All atoms have a nucleus surrounded by electrons, which inhabit zones called shells. Electrons in the shells farthest from the nucleus are the valence electrons, which participate in chemical reactions and form bonds with other atoms. Most lanthanides possess another important set of electrons called the “f-electrons,” which dwell in a 4f orbitals located near the valence electrons but slightly closer to the nucleus. It’s these f-electrons that are responsible for both the magnetic and luminescent properties of the rare earth elements.

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Basic of electron configuration in atom vis-à-vis REE:

In atomic structure, electrons are not just randomly distributed but occupy specific regions of space called orbitals. The arrangement of electrons in an atom’s orbitals is known as its electron configuration. The concept of atomic orbitals is foundational in the field of chemistry, facilitating our understanding of how electrons are arranged around an atomic nucleus. Atomic orbitals are defined as regions in space where there is a high probability of finding an electron. This probabilistic approach to understanding electron locations stems from the principles of quantum mechanics, which revolutionized our comprehension of atomic structure in the early 20th century.

In essence, atomic orbitals can be thought of as clouds that signify the likely locations of electrons, rather than fixed paths as suggested by earlier models. This leads to a significant realization: the nature of these orbitals is inherently tied to the energies of the electrons they accommodate, and their shapes are dictated by the quantum numbers which describe their properties:

Principal quantum number (n): Indicates the energy level and size of the orbital.
Angular momentum quantum number (l): Defines the shape of the orbital (s, p, d, f).
Magnetic quantum number (ml): Pertains to the orientation of the orbital in space.
Spin quantum number (ms): Represents the electron’s intrinsic spin which can be either +1/2 or -1/2.

Each type of orbital has distinct characteristics that not only influence the behavior of the electrons within them, but also play a vital role in determining the chemical properties of elements. For example, the s orbital is spherical, allowing it to accommodate two electrons, whereas p orbitals have a dumbbell shape and can hold up to six electrons due to their three orientations.

The beauty of atomic orbitals lies not just in their shapes, but in how they help explain the very nature of chemical reactions and bonding.

The simple names s orbital, p orbital, d orbital, and f orbital refer to orbitals with angular momentum quantum number I = 0, 1, 2, and 3 respectively. These names, together with their n values, are used to describe electron configurations of atoms. They are derived from description by early spectroscopists of certain series of alkali metal spectroscopic lines as sharp, principal, diffuse, and fundamental. These properties underscore the profound connection between atomic orbitals and the periodic table of elements.

Shell, subshell and orbitals:

Category	Description	Example
Shell	Highest level of organization, representing energy levels	n=1, n=2, n=3
Subshell	Group of orbitals with the same energy and shape	s, p, d, f
Orbital	Specific region within a subshell where electrons are likely to be found	1s, 2s, 2p, 3s, 3p, 3d

Key points to remember:

Subshells are found within shells.

Orbitals are found within subshells.

A subshell is a grouping of atomic orbitals within an electron shell that share the same principal quantum number and angular momentum quantum number. An orbital, on the other hand, is a specific, three-dimensional region around the nucleus where there is a high probability of finding an electron.

Each subshell has a specific number of orbitals: s (1 orbital), p (3 orbitals), d (5 orbitals), and f (7 orbitals).

Each orbital can hold a maximum of two electrons.

Electrons in the same subshell have the same energy, while electrons in different shells or subshells have different energies.

Different types of orbitals exhibit unique probability distributions and electron density profiles:

s Orbitals: These orbitals display a spherical shape, where the probability of finding an electron is uniform in all directions from the nucleus. As seen in the first principal quantum level, the 1s orbital has a high electron density closer to the nucleus, which diminishes with increasing distance.
p Orbitals: The p orbitals, having a dumbbell shape, show two regions of high electron density on opposite sides of the nucleus. Each of the three p orbitals corresponds to a different orientation along the x, y, and z axes, allowing for varied spatial distributions.
d Orbitals: With a more complex structure, d orbitals feature various lobes and nodes, resulting in intricate probability distributions. These orbitals play an essential role in the chemistry of transition metals, where their unique shapes contribute to bonding and reactivity.
f Orbitals: The f orbitals are the most complex of the electron clouds, characterized by multiple lobes and intricate shapes. Their probability distributions are essential in understanding the properties of lanthanides and actinides.

The evaluation of electron density allows chemists to make predictions about chemical bonding and reactivity, transforming abstract quantum theories into tangible chemical concepts. Ultimately, the idea of probability distributions serves as a bridge between quantum mechanics and the observable properties of atoms. By grasping how electron density varies within different orbital types, students can better appreciate the implications for chemical bonding, molecular structure, and even the resultant color or magnetism of materials. Understanding orbitals through the lens of probability not only enriches our grasp of atomic theory but also enhances our ability to predict and manipulate chemical behavior.

There are four principal orbitals (s, p, d, and f) which are filled according to the energy level and valence electrons of the element. All four orbitals can hold different number of electrons. The s-orbital can hold 2 electrons, and the other three orbitals can hold up to 6, 10, and 14 electrons, respectively. The s-orbital primarily denotes group 1 or group 2 elements, the p-orbital denotes group 13, 14, 15, 16, 17, or 18 elements, and the f-orbital denotes the Lanthanides and Actinides group.

S electrons refer to electrons occupying the “s” orbitals, which are the lowest energy orbitals and can hold a maximum of two electrons. These orbitals are spherically shaped and are the first to be filled in the electron configuration of an atom.

P electrons refer to electrons occupying orbitals designated as “p” orbitals, which is a higher-energy orbital than an s-orbital and has a dumbbell or lobed shape, and can hold up to six electrons, with three orbitals (px, py, pz) at each energy level except the first.

D electrons refer to electrons that occupy the d-orbitals, which are found in the third and higher shells, and are crucial for understanding the properties of transition metal complexes, including their color, magnetism, and reactivity.

F electrons refer to electrons occupying the “f” orbitals, which are the highest energy sublevels after s, p, and d orbitals with a complex, multi-lobed shape, and can hold a maximum of 14 electrons.

Each “s” orbital can hold a maximum of two electrons, and these electrons have opposite spins (spin up and spin down).

Examples:

Hydrogen (H): Has one electron, which occupies the 1s orbital (1s¹).

Helium (He): Has two electrons, both occupying the 1s orbital (1s²).

Lithium (Li): Has three electrons, two in the 1s orbital and one in the 2s orbital (1s²2s¹).

Beryllium (Be): Has four electrons, two in the 1s orbital and two in the 2s orbital (1s²2s²).

Order of Filling the Subshells:

The following image shows the order for filling the subshells:

Electrons are typically added to orbitals in the order of increasing energy (1s, 2s, 2p, 3s, 3p, etc.).

Note:

The term 4f subshell means belonging to the fourth energy level (n=4), contains a maximum of 14 electrons. It is characterized by seven orbitals, each capable of holding two electrons with opposing spins. The f subshell is the first one to appear in the electronic configuration of elements, starting with cerium (Ce) with atomic number 58.

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Rare earths add color and light:

Each rare earth reliably emits precise wavelengths of light when excited. This dependable precision allows engineers to carefully tune electromagnetic radiation in many electronics. Terbium, for instance, emits light at a wavelength of about 545 nanometers, making it good for constructing green phosphors in television, computer and smartphone screens. Europium, which has two common forms, is used to build red and blue phosphors. All together, these phosphors can paint screens with most shades of the rainbow.

Rare earths also radiate useful invisible light. Yttrium is a key ingredient in yttrium-aluminum-garnet, or YAG, a synthetic crystal that forms the core of many high-powered lasers. Engineers tune the wavelengths of these lasers by lacing YAG crystals with another rare earth. The most popular variety are neodymium-laced YAG lasers, which are used for everything from slicing steel to removing tattoos to laser range-finding. Erbium-YAG laser beams are a good option for minimally invasive surgeries because they’re readily absorbed by water in flesh and thus won’t slice too deep.

Beyond lasers, lanthanum is crucial for making the infrared-absorbing glass in night vision goggles. And erbium drives our internet. Much of our digital information travels through optical fibers as light with a wavelength of about 1,550 nanometers — the same wavelength erbium emits. The signals in fiber-optic cables dim as they travel far from their source. Because those cables can stretch for thousands of kilometers across the seafloor, erbium is added to fibers to boost signals.

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Rare earths make mighty magnets:

In 1945, scientists constructed ENIAC, the world’s first programmable, general purpose digital computer. Nicknamed the “Giant Brain,” ENIAC weighed more than four elephants and had a footprint roughly two-thirds the size of a tennis court. Less than 80 years later, the ubiquitous smartphone — boasting far more computing power than ENIAC ever did — fits snugly in our palms. Society owes this miniaturization of electronic technology in large part to the exceptional magnetic power of the rare earths. Tiny rare earth magnets can do the same job as larger magnets made without rare earths.

It’s those f-electrons at play. Rare earths have many orbitals of electrons, but the f-electrons inhabit a specific group of seven orbitals called the 4f-subshell. In any subshell, electrons try to spread themselves out among the orbitals within. Each orbital can house up to two electrons. But since the 4f-subshell contains seven orbitals, and most rare earths contain fewer than 14 f-electrons, the elements tend to have multiple orbitals with just one electron. Neodymium atoms, for instance, possess four of these loners, while dysprosium and samarium have five. Crucially, these unpaired electrons tend to point — or spin — in the same direction. That’s what creates the north and the south poles that we classically understand as magnetism.

Since these lone f-electrons flitter behind a shell of valence electrons, their synchronized spins are somewhat shielded from demagnetizing forces such as heat and other magnetic fields, making them great for building permanent magnets. Permanent magnets, like the ones that hold up pictures on a fridge door, passively generate magnetic fields that arise from their atomic structure, unlike electromagnets, which require an electric current and can be turned off.

But even with their shielding, the rare earths have limits. Pure neodymium, for example, readily corrodes and fractures, and its magnetic pull begins to lose strength above 80° Celsius. So manufacturers alloy some rare earths with other metals to make more resilient magnets. This works well because some rare earths can orchestrate the magnetic fields of other metals. Just as weighted dice will preferentially land on one side, some rare earths like neodymium and samarium exhibit stronger magnetism in certain directions because they contain unevenly filled orbitals in their 4f-subshells. This directionality, called magnetic anisotropy, can be leveraged to coordinate the fields of other metals like iron or cobalt to formulate robust, extremely powerful magnets.

The most powerful rare earth alloy magnets are neodymium-iron-boron magnets. A three-kilogram neodymium alloy magnet can lift objects that weigh over 300 kilograms, for instance. More than 95 percent of the world’s permanent magnets are made from this rare earth alloy. Neodymium-iron-boron magnets generate vibrations in smartphones, produce sounds in earbuds and headphones, enable the reading and writing of data in hard disk drives and generate the magnetic fields used in MRI machines. And adding a bit of dysprosium to these magnets can boost the alloy’s heat resistance, making it a good choice for the rotors that spin in the hot interiors of many electric vehicle motors.

Samarium-cobalt magnets, developed in the 1960s, were the first popular rare earth magnets. Though slightly weaker than neodymium-iron-boron magnets, samarium-cobalt magnets have superior heat and corrosion resistance, so they’re put to work in high-speed motors, generators, speed sensors in cars and airplanes, and in the moving parts of some heat-seeking missiles. Samarium-cobalt magnets also form the heart of most traveling-wave tubes, which boost signals from radar systems and communications satellites. Some of these tubes are transmitting data from the Voyager 1 spacecraft — currently the most distant human-made object — over 25 billion kilometers away.

Because they are strong and reliable, rare earth magnets are supporting green technologies. They’re in the motors, drivetrains, power steering and many other components of electric vehicles. Tesla’s use of neodymium alloy magnets in its farthest-ranging Model 3 vehicles has sparked supply chain worries; China provides the vast majority of the world’s neodymium.

Rare earth magnets are also used in many offshore wind turbines to replace gearboxes, which boosts efficiency and decreases maintenance. Chinese engineers introduced “Rainbow,” the world’s first maglev train line based on rare earth magnets that enable the trains to float without consuming electricity.

In the future, rare earths may even advance quantum computing. While conventional computers use binary bits (those 1s and 0s), quantum computers use qubits, which can occupy two states simultaneously. As it turns out, crystals containing rare earths make good qubits, since the shielded f-electrons can store quantum information for long periods of time. One day, computer scientists might even leverage the luminescent properties of rare earths in qubits to share information between quantum computers and birth a quantum internet.

Although REEs have notable chemical similarities, the gradual filling of the f-orbitals makes them unique for many applications. The mechanical, chemical, optical, and magnetic properties of REs are exploited in various industrial and technological sectors, and in certain research areas. The shielded nature of the f-orbitals leads to well-defined energy levels that are weakly perturbed by the environment and are accompanied by large spin-orbit coupling, which enable application of REs in optical and magnetic applications.

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Applications of Rare Earth Elements:

The versatile nature of rare earth elements is evident in their applications. Some of them are as follows:

Permanent magnet: Neodymium magnets (Nd-Fe-B magnets) are permanent magnets made of neodymium, iron and boron.

-They have the highest magnetic properties of all permanent magnets and can withstand temperatures as high as 230 degrees C.

-They are used in automobiles for anti-lock brakes, in computer hard disk drives, CD-ROMs, digital cameras, etc.

-These magnets are also used in a variety of conventional automotive subsystems, such as power steering, electric windows, power seats, and audio speakers.

Electronics: Rare Earth Elements are used in high-technology devices such as smartphones, hard disks, digital cameras, fluorescent and light-emitting-diode lights, computer monitors and electronic displays.

-Lanthanum makes up as much as 50 per cent of digital camera lenses, including cell phone cameras.

-Eu, Y, and Tb are used in the manufacturing of phosphors (substances that emit luminescence) to be used in many types of ray tubes and flat panel displays for screens that range in size from smartphone displays to stadium scoreboards.

-Erbium is used to make fibre optic cables and laser repeaters.

Green Technologies: They play a critical role in green technologies such as wind turbines and electric vehicles that are going to support net zero carbon emissions goals.

-Nickel-metal hydride batteries are built with lanthanum-based alloys as anodes which are used in electric vehicles.

-Cerium-based catalysts are used in automotive catalytic converters.

-Lanthanum acts as a hydrogen absorber in rechargeable batteries and is an important element in hybrid car batteries.

Petroleum Refining: Lanthanum is used as a catalyst for petroleum refining processes.
Glass Industry: The glass industry is the largest consumer of REE raw materials, using them for glass polishing and as additives that provide colour and special optical properties.
Water purifiers: Cerium shows a strong affinity for elements like phosphorus, hence used in water purifiers.
Healthcare: REEs are also used in advanced medical technologies like MRIs, laser scalpels, non-irritating antiseptic dressings, and even some cancer drugs.
Defence and Space: They are used in satellite communications, guidance systems and aircraft structures.
Steel Making: Cerium, lanthanum, neodymium, and praseodymium, commonly in the form of a mixed oxide known as mischmetal, are used in steel making to remove impurities and in the production of special alloys.
Other applications: The rare earth elements like promethium, samarium, and europium serve specific functions in applications such as beta radiation sources, high-temperature magnets, and fluorescent lighting, respectively.

With new and developing technologies, the uses of REE have extended from well-established applications such as glass polishing, to include high-performance magnets, high-tech catalysts, electronics, glass, ceramics, and alloys. An increasingly important area of REE use is in low-carbon technologies. Large wind turbines can each use up to 2 tonnes of high strength magnets which contain about 30% REE. Up to 20 kg of REE are used in the batteries, electric traction motors and regenerative braking systems of each hybrid vehicle. Many of these uses depend on the distinctive properties of REE (individually or as a group) discussed above. Their use in LCD and plasma screens, for example, depends on their spectroscopic properties – europium (as Eu3+, in the solid state) exhibits red luminescence, while terbium’s (as Tb3+) is green. The thermal properties of REE lend stability to alloys under high stress and temperature, for instance in jet engines.

Most rare earth elements find their uses as catalysts and magnets in traditional and low-carbon technologies. Other important uses of rare earth elements are in the production of special metal alloys, glass, and high-performance electronics. Alloys of neodymium (Nd) and samarium (Sm) can be used to create strong magnets that withstand high temperatures, making them ideal for a wide variety of mission critical electronics and defense applications.

End-use	% of 2019 Rare Earth Demand
Permanent Magnets	38%
Catalysts	23%
Glass Polishing Powder and Additives	13%
Metallurgy and Alloys	8%
Battery Alloys	9%
Ceramics, Pigments and Glazes	5%
Phosphors	3%
Other	4%

The strongest known magnet is an alloy of neodymium with iron and boron. Adding other REEs such as dysprosium and praseodymium can change the performance and properties of magnets. Hybrid and electric vehicle engines, generators in wind turbines, hard disks, portable electronics and cell phones require these magnets and elements. This role in technology makes their mining and refinement a point of concern for many nations. For example, one megawatt of wind energy capacity requires 171 kg of rare earths, a single U.S. F-35 fighter jet requires about 427 kg of rare earths, and a Virginia-class nuclear submarine uses nearly 4.2 tonnes. Rare earth metal production was 390,000 metric tons worldwide in 2024 — that’s up threefold from 132,000 metric tons in 2017.

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Here is summary of extensive applications of REE in the modern technological gadgets in different areas.

Electronics:

Television screens, computers, cell phones, silicon chips, monitor displays, long-life rechargeable batteries, camera lenses, light emitting diodes (LEDs), compact fluorescent lamps (CFLs), baggage scanners, marine propulsion systems.

Manufacturing:

High strength magnets, metal alloys, stress gauges, ceramic pigments, colorants in glassware, chemical oxidizing agent, polishing powders, plastics creation, as additives for strengthening other metals, automotive catalytic converters.

Medical Science:

Portable X-ray machines, X-ray tubes, magnetic resonance imagery (MRI) contrast agents, nuclear medicine imaging, cancer treat ment applications, and for genetic screening tests, medical and dental lasers.

Technology:

Lasers, optical glass, fiber optics, masers, radar detection devices, nuclear fuel rods, mercury-vapor lamps, highly reflective glass, computer memory, nuclear batteries, high temperature superconductors.

Renewable Energy:

Hybrid automobiles, wind turbines, next generation rechargeable batteries, biofuel catalysts.

Others:

The europium is being used as a way to identify legitimate bills for the Euro bill supply and to dissuade counterfeiting. An estimated 1 kg of REE can be found inside a typical hybrid automobile.

Holmium has the highest magnetic strength of any element and is used to create extremely powerful magnets. This application can reduce the weight of many motors.

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Why not use something else?

Rare earth metals have some properties that make them superior to other, more common materials. For example, they make stronger and more lightweight magnets so that electronics can be more portable. They perform well at high temperatures, they are more electrically conductive than other metals, and they are more effective catalysts in chemical reactions. Some of them also emit bright colors, so they are useful in electronic displays and sensors. Given the expense of these materials, however, researchers are looking in to synthetic alternatives.

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Rare earth elements useful in scientific research:

The properties of the REE have led to them being successfully applied to numerous geological research problems. The distribution of REE in a series of igneous rocks, for example, can indicate details of their origins and history, as well as their relationship to one another.

The same techniques can be applied to cosmic materials. It has been shown that some meteorites (achondrites) were formed by processes very similar to those by which many igneous rocks on the Earth are made (fractional crystallisation).

The existence of multiple valencies of some REE, and their different chemical behaviour, can also help to reveal geological processes, if the relative proportions of, say, Eu2+ and Eu3+ are different from the background level (a so-called ‘abundance anomaly’). An instance of this is on the moon – strong but opposite europium anomalies in the rocks of the lunar highlands and the mare basalts have provided useful information on their origins.

The REE’s radioactive isotopes have long half-lives. This makes some of them (with their daughter products) very suitable for geochemical and petrological studies, especially 138La-138Ce, 147Sm143Nd, and 176Lu-176Hf. They are used extensively in the dating of rocks, particularly ancient ones and high-grade metamorphics. They are also used in investigating problems such as ocean mixing, the mixing of magmas, or contamination of the Earth’s mantle by rocks from the crust.

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Section-5

Overview of specific critical minerals:

Note:

REE are already discussed in previous section.

-1. Bauxite

Bauxite is the primary source of aluminum. It’s refined into aluminum oxide and then smelted into aluminum. It’s essential for various technologies, including wind turbines, solar panels, batteries, electrolyzers, and transmission cables.

Production:

Three countries — Australia, Guinea, and China — dominate global bauxite production. They each produced around one-quarter of the total in 2023. Brazil, India, and Indonesia also produce moderate amounts.

Reserves:

Bauxite reserves show a very different geographical pattern. Guinea had the largest reserves in 2023, followed by Vietnam (which is a very small producer of bauxite). China, the third largest producer of bauxite, has only a small amount of the world’s reserves.

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-2. Graphite

Graphite is considered inorganic. It is an allotrope of carbon, a pure element, and is not bound to hydrogen, which is a defining characteristic of organic compounds. Graphite is used across many industries, but is most in demand for its use in batteries, especially EV batteries. Graphite is a key material in steel production and is used for things like brake pads, gaskets, and clutches in the automotive industry. Graphite can either be sourced naturally or artificially. Synthetic graphite batteries are preferred by producers because they are more reliable and have a longer battery life.

Production:

China produces most of the world’s natural graphite. In 2023, it mined more than three-quarters of the global total. Madagascar, Mozambique, and Brazil also produce moderate amounts of graphite.

Reserves:

Graphite reserves are much less geographically concentrated. China has just over one-quarter of the world’s known reserves despite producing more than three-quarters of the global total. Brazil has almost the same reserves as China. Mozambique, Madagascar, Tanzania, and Russia all have at least 5%.

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-3. Lithium:

Arguably the most important critical mineral, this soft, silvery element – which has the lowest density of all the metals – is an essential component of batteries that power electric vehicles, smartphones and laptops, medical devices, drones, and satellites.

Lithium is combined with aluminum and magnesium to make alloys used in aircraft and high-speed trains; compounds of the element are also used in air conditioning units and industrial lubricants. In addition, lithium compounds feature in medicines and are used to treat bipolar disorder and act as a mood stabilizer.

Lithium demand:

More than 10 million electric cars were sold in 2022, according to the International Energy Agency (IEA), and demand for lithium tripled from 2017 to 2022. In 2030, the demand for lithium carbonate equivalent (LCE), an industry term used to classify lithium content, is expected to surpass 2.4 million metric tons. That’s double the figure forecast for 2025. Currently, there is no substitute for lithium that would meet the demands of the mobility sector.

Production:

Australia reigns supreme as the world’s number one lithium producer. In 2023 the global leader produced 86,000 metric tons of the mineral, almost double the quantity mined by runner-up Chile, which produced 44,000 metric tons and has the world’s largest reserves. China is the next biggest, having produced 33,000 metric tons of lithium in 2023. Australia is the world’s largest supplier of lithium and produces it from hard rock mines. Meanwhile, Argentina, Chile, and China produce lithium from salt lakes.

Reserves:

According to the USGS, the world’s ‘identified’ lithium resources (where economic extraction is potentially feasible) total around 98 million tonnes. These include a vast 21 million tonnes in Boliva, 20 million tonnes in Argentina and 11 million tonnes in Chile. These resources sit in an adjoining area, covered by salt deserts, that has been coined the ‘lithium triangle’, which could eventually see energy transition minerals transform South America into an economic powerhouse in the way oil has elevated economies in the Middle East.

The USGS estimates that Bolivia has the world’s largest lithium resources. These are the total amount of lithium that could be extracted. Remember, reserves are resources that can be extracted economically from current technologies and markets. Bolivia was not included in the USGS’s estimates of reserves in 2023, since most of these resources have not yet been properly developed for economic extraction. Chile was home to the largest share of global reserves. Australia, Argentina, and China also have large reserves.

Occurrence:

Lithium never occurs freely in nature but occurs mainly as pegmatitic minerals. Pegmatite is a coarse-textured igneous rock that forms during the final stage of magma’s crystallisation. It contains large crystals and minerals rarely found in other types of rocks.
Due to its solubility as an ion, lithium is present in ocean water and commonly obtained from brines (high-concentration salt solution in water).

We can get lithium from two sources.

First, it can be extracted from hard rocks in the ground, just like we imagine in traditional mines. This is the main type of deposit found in Australia.

Second, it can be extracted from brine – that is, water rich in lithium salt. To get this lithium, salty groundwater has to be pumped to the surface and left to sit in large ponds (fields) for months. When most of the water is evaporated away, lithium can be extracted. These are the typical deposits found in South America, in Chile, Argentina, and Bolivia.

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-4. Cobalt

Cobalt is used in a number of industries: consumer electronics (it’s in most mobile phones and laptops), catalysts for the oil industry, resistant metal alloys, and ceramics. In the clean energy space, it’s mostly used in electric vehicles. Cobalt is a critical element in many lithium-ion battery technologies, supporting their stability and performance by preventing overheating and extending their lifespans.

How much cobalt we will need in the future will depend on how other battery chemistries develop. Many car manufacturers are already turning towards lithium iron phosphate (LiFePO4 or LFP) ones, which do not use cobalt. Others are developing sodium-ion chemistries, which are also cobalt-free. Depending on how these develop, cobalt may not be a critical element of electric vehicles in the future.

Cobalt demand:

Demand for cobalt rocketed by 70% between 2017 and 2022. From now until the end of the decade, demand for the critical mineral is expected to double, buoyed by a surging need for electric vehicle batteries. By 2030, battery demand for cobalt is expected to reach 320 million metric tons.

Production:

Most cobalt is mined in the Democratic Republic of Congo (DRC). It produces almost three-quarters of the global total. Other leading producers include Indonesia, Russia, and Australia. Despite mining most of it, the DRC refines very little. China dominates the supply chain for refined cobalt. It makes up more than three-quarters of global production. Countries such as Finland, Canada and Norway also produce refined cobalt, but in much smaller quantities.

Reserves:

The Democratic Republic of Congo has a slightly smaller dominance when it comes to reserves. In 2023, it had just over half of the world’s known reserves. Australia had the second largest reserves, with around 15% of the global total. That’s far larger than its share of global production, which is around 2%. Cuba and Indonesia each had around 5% of reserves. The world’s identified terrestrial cobalt resources are around 25 million tonnes and 120 million tonnes of cobalt resources have been identified in polymetallic nodules and crusts on the floor of the Atlantic, Indian and Pacific Oceans. These resources, among others, have sparked a global race to develop deep-sea mining operations that threaten to cause massive disruption to marine ecosystems if pursued recklessly.

The Democratic Republic of Congo (DRC) is by far the largest global supplier of cobalt but locals in the capital of Kinshasa will be hesitant to celebrate that potential windfall as they have yet to see the benefits of their abundant diamond reserves – a widespread phenomenon in many commodity-rich developing countries known as the ‘resource curse’. This curse refers to a phenomenon where countries rich in natural resources, particularly minerals and commodities like oil, often experience economic and political challenges – typically caused by geo-economic exploitation by richer nations – that can hinder their development and overall well-being. Just ask Venezuelans how flush they currently feel from their vast oil reserves. Even if countries have realised the potential of their reserves, they might not have the money to exploit it. In many African countries right now, it is Chinese companies that are exploiting these resources, not the country itself. While some countries with abundant resource wealth have achieved successful development, others have not due to resource curse.

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-5. Copper

Copper has been used by humans for thousands of years and is now the world’s third-most consumed metal. Thanks to its malleability, durability, and conducting properties, the element is an essential component of electrical equipment. Copper is a critical element in solar photovoltaics, wind power, battery storage, and electricity grids. It’s used in cabling, wiring, and electrical transformers. Although aluminum can be used as a substitute for applications such as electric wires, copper will be a hard element to replace in clean energy technologies. Copper is also one of the world’s most recyclable metals.

Copper demand:

Annual demand for this essential metal is expected to reach over 36.6 million metric tons by 2031, up from around 25 million metric tons in 2020, according to American management consultancy firm McKinsey. Worryingly, the world’s copper supply is expected to be 30.1 million metric tons in 2031, leaving a shortfall of around 6.5 million metric tons. To make matters worse, the demand is only expected to increase, with a staggering 50 million metric tons required by 2035.

Production:

Chile is currently the world’s leading copper source by a wide margin, producing 5.3 million metric tons of the metal last year. Peru was next with 2.6 million metric tons, followed by China with 1.7 million metric tons. Again, China dominates the refined copper supply chain. It produced just under half of the global total in 2023. Chile and the DRC were also among the top producers, but with a lower share than their mined total.

Reserves:

Chile boasts the lion’s share of the copper that exists in global mines today. The country possesses 20% of global supply: 190 million tonnes, valued today at $1.6trn. Australia (97 million tonnes), Peru (81 million tonnes), Russia (62 million tonnes) and Mexico (53 million tonnes) also have significant reserves of their own.

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-6. Nickle

Nickel is another key ingredient in Li-ion batteries, particularly in advanced cathode chemistries. It’s a key component in the cathodes of lithium-ion batteries in electric cars and stationary storage. How much nickel will be needed for batteries in the future will depend on how other battery chemistries develop. Many car manufacturers are already turning towards lithium iron phosphate (LFP) ones, which do not use nickel. Others are developing sodium-ion chemistries, which are also nickel-free. It’s also an important alloy in wind and solar power and would be used in electrolyzers for green hydrogen production. Thanks to its resistance to corrosion, nickel has long been used to make alloys such as stainless steel.

Nickel demand:

A report published by Global Industry Analysts predicts that nickel demand will hit 3.5 million metric tons by 2030 – up from 1.8 million metric tons in 2022 – as the green transition gathers pace. Mining Weekly believes the demand could be even greater, at 3.8 million metric tons. Whichever figure is correct, one thing is clear: the rise in demand will likely to lead to supply issues that will require significant price increases or a shift in technology.

Production:

Indonesia is the world’s largest nickel mining and refining center. Last year, the Southeast Asian nation produced 1.8 million metric tons of the metal, with production rising more than sixfold since 2010. The Philippines takes second place with 400,000 metric tons, while Russia and the French territory of New Caledonia are placed third and fourth respectively.

Reserves:

Australia and Indonesia boast the world’s largest reserves of nickel in global mines today. Both have 21 million tonnes of the stuff, which in today’s prices equates to approximately $425bn. Brazil (16 million tonnes), Russia (7.5 million tonnes) and New Caledonia (7.1 million tonnes), a French colonial territory in the South Pacific, also possess substantial reserves. There are around 300 million tonnes of identified land-based nickel resources around the world today. However, extensive nickel resources have also been found in manganese crusts and nodules on the ocean floor.

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When combining the value of all the lithium, cobalt, copper and nickel reserves in mines today, two big winners of the energy transition are apparent: Chile and Australia. Both countries have a long and proud history of mining, and it appears that gravy train is set to keep chugging for the foreseeable future. Chile sits atop the lot, with an eye-watering $1.89trn worth of critical mineral reserves, followed by Australia’s hefty $1.49trn holdings. Russia, Peru and Indonesia lead the best of the rest, with $671bn, $667bn and $644bn reserves, respectively, followed by Mexico ($437bn), the DRC ($356bn), Brazil ($333bn), Poland ($247bn) and Kazakhstan ($165bn).

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-7. Chromium

More than 90% of the world’s chromium output is used in the form of ferro-chrome in the production of stainless steel – the essential component that makes it resistant to corrosion. Chromium is a key component in geothermal and concentrated solar power (CSP). It’s also used in wind turbines, and for radiation shielding in nuclear power plants.

Production:

Chromium production is concentrated in a relatively small number of countries. South Africa produced over 40% of the total in 2023. Kazakhstan, Turkey, India, and Finland were also large producers. While China produced 35 million tonnes of stainless steel in 2023, accounting for around 60% of global output, the country lacks its own chrome resources and is heavily dependent on imports.

Reserves:

The distribution of chromium reserves is a close reflection of global production. Kazakhstan and South Africa hold most of the world’s reserves. India, Turkey, and Finland also have large quantities, but significantly less than the two leaders.

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-8. Manganese

Manganese is widely used in solar and wind power, and in lithium-ion batteries for electric cars and stationary storage. Small amounts are also used in geothermal energy production. It’s used in steel production to increase strength, and reduce wear and tear.

The scarcity of manganese in China and its reliance on imported materials are [the main] reasons why it is [regarded as] a critical mineral, with around 80% of the manganese consumed in China imported from the seaborne market. According to Chinese customs data, the country imported 31.4 million tonnes of manganese ore in 2023 – a 5% increase on the 29.93 million tonnes imported in 2022.

Production:

South Africa, Gabon and Australia dominate mined production of manganese. In 2023, South Africa produced just over one-third of the global total. Ghana, China, India, Brazil and Cote d’Ivoire are also significant producers.

Reserves:

South Africa is also home to the largest known deposits of manganese reserves. It had around one-third of the total in 2023. Australia, China, Brazil and Ukraine also had significant reserves. Combined with South Africa, they had more than 90% of the world’s reserves.

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-9. Molybdenum

Molybdenum has a very high electrical conductivity but expands very little when exposed to heat. This makes it a very useful material for clean energy. It’s mostly used in solar and wind power generation.

Production:

China and several American countries — Chile, Peru, the United States, and Mexico — produce most of the world’s molybdenum. China produced more than 40% of the total in 2023.

Reserves:

Combined, China and the United States had around two-thirds of the world’s known reserves of molybdenum in 2023. Peru, Chile, Russia and Australia also had significant reserves.

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-10. Silver

Silver plays a crucial role in industrial applications, being a core component of electronics and batteries. Its most important role in clean energy is in solar photovoltaics and electric vehicles. Its high conductivity makes it very effective in connecting batteries to other electronic components in electric cars. Silver paste is used as a layer on the front and back of solar panels, where it’s a very efficient conductor of electricity.

Production:

Silver production is highly concentrated in China and Latin America, where Mexico, Peru, Chile, Bolivia, and Argentina are all key producers.

Reserves:

The world’s silver reserves are mostly distributed across Latin America, Australia, Russia, and China. No single country dominates global reserves. Peru had the largest share of reserves in 2023, but only 18% of them.

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-11. Uranium

Uranium is a critical mineral according to some governments and organizations, but not according to others. The United States, for example, does not consider uranium a critical mineral due to its primary use as a fuel. However, countries like Japan have designated uranium as a critical mineral due to their heavy reliance on imports and lack of domestic production. Uranium is the primary fuel for nuclear energy production. Uranium ore can be mined from typical open pits or excavation sites. However, this method of mining has been overtaken by “in-situ leaching”. In this method, water and other elements are circulated through uranium deposits underground. The uranium is then dissolved out of the deposit and extracted for enrichment into a fuel that can be used in nuclear plants.

Kazakhstan is by far the world’s largest producer of mined uranium. In 2022, it accounted for more than 40% of the global total. Namibia, Canada, Australia, and Uzbekistan were also large producers. Russia is the world’s largest producer of enriched uranium, which is then used into fuel rods in other countries. In 2023, it produced around 40% of the global total.

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-12. Tungsten

Tungsten is widely used to manufacture hard alloys, steel alloys, molybdenum tungsten alloy and electronic components such as filaments among other products. The reason why tungsten was listed as a critical alloy is because tungsten has a high melting point and can be used to make many top-class weapons, such as tanks, Armor-piercing bullets, aircraft engines and so on. China is the world’s largest tungsten producer and exporter, has about 60% of the world’s tungsten reserves, and accounts for about 80% of global tungsten production and about 40% of global tungsten exports.

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-13. Vanadium

Vanadium is widely used in metallurgy, chemical engineering and in steelmaking, among other industrial uses, such as vanadium redox batteries. Around 80% of all the vanadium produced is used in steel production, with 7% used in vanadium-alumina alloy production, 8% in chemical engineering and around 5% in the production of vanadium redox batteries. Vanadium is mined mostly in China, South Africa and eastern Russia. In 2022 these three countries mined more than 96% of the 100,000 tons of produced vanadium, with China providing 70%. Admittedly, vanadium is a critical alloy because of its use in the chemical engineering sector and, in particular, in aerospace.

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-14. Titanium

Titanium is a metal that has a silver-grey appearance. It is high strength, lightweight, and is corrosion-resistant, heat resistant (due to high melting point), and biocompatible (compatible with living tissues and has low reactivity with the human body). It is found in various minerals, rocks, and soils. It is also present in plants, animals, natural waters, deep-sea dredgings, meteorites, and stars. Uses of titanium include nuclear applications, defence, aerospace, marine, and construction industries, high-performance alloys, electrical goods, medical implants, and jewellery.

China is the world’s largest producer of titanium, but Ukraine ranks among the top ten for proven reserves and accounts for 7% of global production. Other major suppliers include Russia, Mozambique, Australia, and Canada. The U.S. mines relatively small quantities of titanium in Nevada, Utah and Virginia.

The metal’s strength-to-weight ratio and resistance to heat make it crucial for aerospace. For example, titanium is used in the F-35 Joint Strike Fighter’s bulkheads and engine parts to withstand the high temperatures generated during supersonic flight. Before Russia’s invasion, Ukraine was a key supplier of titanium to the military sector.

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-15. Zirconium

Zirconium is a greyish-white metal. Properties are soft, malleable, lustrous, ductile, and corrosion-resistant. Zircon mineral (zirconium silicate) is commonly found in beach sands. Baddeleyite (pure zirconium dioxide) is the only other important zirconium mineral. Top Producers are 1st Australia > 2nd South Africa > 3rd China > 4th Ukraine > 5th Mozambique. Uses include nuclear applications, aerospace and defence industries, production of superalloys, capacitors, medical implants, ceramics, and zircon Gemstones.

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-16. Beryllium

Beryllium is a steel-grey metal with chemical properties resembling those of aluminium. Properties are light, high melting point, excellent thermal conductivity, low density and brittle. It does not occur freely in nature. It is primarily extracted from beryl and bertrandite minerals. Beryl forms gemstones, such as emeralds and aquamarine. Top Producers of Beryllium are 1st United States > 2nd China > 3rd Mozambique > 4th Brazil > 5th Russia. Uses include nuclear applications, aerospace and defence industries, production of alloys and semiconductors (due to its ability to improve the electrical performance of semiconductors). Beryllium is transparent to X-rays, making it an ideal material for X-ray windows. Beryllium windows are used in X-ray tubes to allow X-rays to pass through and be directed towards the patient or object being examined.

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-17. Niobium

Niobium is a grey metal that looks like steel or, when polished, like platinum. Properties are soft, ductile, corrosion-resistant, and superconductive (at low temperatures). It is primarily obtained from the minerals columbite-tantalite (coltan) and pyrochlore. Top Producers of Niobium are 1st Brazil > 2nd Canada > 3rd Rwanda > 4th Nigeria > 5th Mozambique. Uses includes nuclear applications, alloys, electronic components, orthopaedic and dental implants, etc.

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-18. Tantalum

Tantalum is bright, silver-grey metal. Properties are very hard and has high density, high melting point, and corrosion resistance. It is obtained from the mineral columbite-tantalite (coltan). Top Producers are1st Democratic Republic of Congo > 2nd Brazil > 3rd Rwanda > 4th Nigeria > 5th China. Uses are nuclear applications, aerospace and defence industries, production of capacitors, medical implants, super alloys, etc.

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Section-6

Critical minerals for clean energy transition:

The world is far from seeing a decisive downturn in emissions. Putting emissions on a trajectory consistent with the Paris Agreement, as analysed in the World Energy Outlook Sustainable Development Scenario (SDS), requires a significant scale-up of clean energy deployment across the board. In the SDS, the annual installation of solar PV cells, wind turbines and electricity networks need to expand threefold by 2040 from today’s levels, and sales of electric cars need to grow 25-fold over the same period. Reaching net-zero emissions globally by 2050 would demand an even more dramatic increase in the deployment of clean energy technologies over the same timeframe.

An energy system powered by clean energy technologies differs profoundly from one fuelled by traditional hydrocarbon resources. While solar PV plants and wind farms do not require fuels to operate, they generally require more materials than fossil fuel-based counterparts for construction. Minerals are a case in point. A typical electric car requires six times the mineral inputs of a conventional car and an onshore wind plant requires nine times more mineral resources than a gas-fired plant of the same capacity. Since 2010 the average amount of minerals needed for a new unit of power generation capacity has increased by 50% as renewables increase their share of total capacity additions. The transition to clean energy means a shift from a fuel-intensive to a material-intensive system.

As the world transitions towards net-zero emissions, ensuring a secure, sustainable, and ethical supply of critical minerals becomes increasingly vital. Minerals such as copper, nickel, cobalt, lithium, and rare earth elements (REEs) – including dysprosium, neodymium, and praseodymium – play a crucial role in the energy transition. These elements are indispensable for the production of clean energy technologies like wind turbines, solar panels, electric vehicles, and energy storage systems. However, supply chains for critical minerals face numerous risks and challenges. These include limited or concentrated supply sources, market immaturity, high production costs, political factors, social unrest, natural disasters, mine accidents, and technological difficulties in extraction and production processes. As a result, securing a reliable supply of these critical minerals is becoming a pressing concern for nations transitioning to clean energy infrastructure and technologies.

The types of mineral resources used vary by technology. Lithium, cobalt and nickel play a central role in giving batteries greater performance, longevity and higher energy density. Rare earth elements are used to make powerful magnets that are vital for wind turbines and EVs. Electricity networks need a huge amount of copper and aluminium. Hydrogen electrolysers and fuel cells require nickel or platinum group metals depending on the technology type. Copper is an essential element for almost all electricity-related technologies. These characteristics of a clean energy system imply a significant increase in demand for minerals as more batteries, solar panels, wind turbines and networks are deployed. It also means that the energy sector is set to emerge as a major force in driving demand growth for many minerals, highlighting the strengthening linkages between minerals and clean energy technologies.

Mineral use in low-carbon technologies:

Clean energy technologies – from wind turbines and solar panels, to electric vehicles and battery storage – require a wide range of minerals and metals. The type and volume of mineral needs vary widely across the spectrum of clean energy technologies, and even within a certain technology (e.g. EV battery chemistries). “Critical minerals” refer to a group of minerals like lithium, cobalt, nickel, copper, and rare earth elements that are essential components in many clean energy technologies, such as solar panels, wind turbines, and electric vehicle batteries, making them crucial for the successful transition to a low-carbon energy system; the increasing demand for these minerals as the world moves towards renewable energy sources presents both opportunities and challenges regarding their supply, sustainability, and geopolitical implications.

Here are some green technologies and examples of the critical minerals they rely on:

Rechargeable batteries: lithium and cobalt
Electric vehicles: lithium, cobalt, copper, nickel and graphite
Wind and solar power: copper and nickel
Electrical grids: copper
Electric arc furnaces: graphite.

Given the increasing focus on decarbonisation, the global demand for the minerals used in the technologies required for realising a low-carbon economy will increase significantly in the coming years. Over 70% of the global capacity for manufacturing clean technologies is concentrated in only 5 countries. China is the dominant country across manufacturing, bulk material production and critical mineral production. For critical minerals mining, Chile is the largest producing country for copper, Australia for lithium, Indonesia for nickel and Congo for cobalt.

Table below shows minerals used to develop different low-carbon technologies (LCTs):

Note that structural steel and aluminium would be used in similar amounts in internal combustion vehicles as well. Tin is used in solder to create electrical connections, for example in electronic circuits. Thus, although not necessarily used directly in clean energy technologies, tin is an important enabling material for the energy transition.

Low-carbon energy generation:

Solar PVs:

Copper is used in solar cells to create conductive gridlines that carry electrical current generated by the solar cell. These gridlines are typically made of thin copper wires or ribbons that are placed on top of the solar cell surface. Copper is a good conductor of electricity and is highly durable and corrosion resistant, making it ideal for use in solar cells. Aluminium is used in the frame and casing of solar panels as well as in the wiring and connections between panels. Aluminium is lightweight and has a good strength-to-weight ratio, making it ideal for use in the supporting structure of the solar panel (Assad, Nazari, and Rosen 2021).

Wind:

Wind turbines often utilise PM generators, particularly, direct-drive permanent magnet synchronous generators (PMSG), because of their low weight and high power density. These PMSGs are made using NdFeB magnets, which are highly potent magnetic materials and contain REEs such as neodymium (Nd), praseodymium (Pr), and dysprosium (Dy) (IEA 2022b).

Hydropower:

Copper is used in the production of hydropower generators, turbines, and transformers. It is an excellent conductor of electricity and is essential for the transmission of electricity. Aluminium is used in the construction of transmission lines, which are used to transport electricity from hydropower plants to the grid. Rare earth elements are used in the production of permanent magnets that are used in generators and turbines. These magnets are essential for the efficient production of hydropower (Quaranta and Davies 2022).

Concentrated solar power (CSP):

The expansion of concentrated solar power is expected to increase the demand for several minerals. Copper is used in the production of wires and cables that are used to connect components in the CSP system. Tellurium is used in the production of high-efficiency solar cells. Nickel is used in the production of CSP components, including heat exchangers and storage tanks. Cobalt is used in the production of high-temperature alloys and CSP components, including receivers and heat exchangers (Caccia, et al. 2018).

Geothermal:

Nickel is used in the production of geothermal well casing, which is used to line the borehole drilled into the earth’s surface to access the geothermal reservoir. Nickel alloys, such as Inconel, are commonly used in high-temperature and high-pressure geothermal wells due to their excellent corrosion resistance, high strength, and good fatigue resistance. Chromium is used in the production of geothermal heat exchangers, which transfer heat from the geothermal fluid to the power generation system. Chromium alloys, such as stainless steel, are commonly used in geothermal heat exchangers due to their good corrosion resistance and high temperature strength. Chromium also helps prevent scaling and corrosion, which can reduce the efficiency and lifespan of the geothermal power plant (Assad, Nazari, and Rosen 2021).

Low-carbon energy systems:

Electricity networks:

Copper is used in various components of electrical networks, including transmission lines, distribution lines, transformers, and electrical equipment. Copper is an excellent conductor of electricity, which means that it can carry electrical current with very little resistance. This is important for minimising energy losses and ensuring the efficient transmission of electricity over long distances. Copper wires are also used in transformers to step up or step down the voltage of electrical current as it is transmitted through the network. Copper is also used in electrical equipment, including motors, generators, switchgear, and circuit breakers. Copper is a good conductor of heat, which means that it can efficiently dissipate the heat generated by electrical equipment, helping prevent overheating and potential failures. Copper is also used in grounding systems, which help protect people and equipment from electrical hazards by providing a safe path for electrical current to flow in the event of a fault or lightning strike (Copper Alliance 2022).

EVs and energy storage:

Lithium-ion batteries (LIB) are a front-runner energy storage technology used in several applications, and their demand and future uptake will be dominated by Electric Vehicles (EVs) and stationary energy storage applications. LIB contain several metals used in the cell anodes, cathodes, electrolytes, and separators, where some of the metals are transitioning towards becoming critical materials due to possible raw material scarcity and geopolitical conditions (Blengini, et al. 2020).

Traction motors:

Permanent magnets (PM) synchronoustraction motors that are widely used in EVs contain neodymium-iron-boron (NdFeB) magnets. NdFeB magnets contain REEs such as neodymium (Nd), praseodymium (Pr), and dysprosium (Dy). Alternatives to PM-based motors include induction motors, which contain high quantities of copper (Raminosoa, et al. 2020).

Hydrogen:

-Fuel cells:

Fuel cell (FC) technology is can be used in the transportation and power generation industry. With the increasing demand for FC technology, the demand for certain materials used in FC is expected to increase significantly (Tokimatsu, et al. 2018). Platinum is used in proton exchange membrane (PEM) fuel cells, which are used to convert hydrogen to electricity. It is used as a catalyst in the fuel cell’s electrode, facilitating the reaction between hydrogen and oxygen. Nickel is used as a catalyst in the production of hydrogen through steam-methane reforming. Cobalt is used in the production of hydrogen through electrolysis. Cobalt is also used in the electrode of the electrolysis cell. Molybdenum is used in the production of high-strength alloys used in hydrogen storage tanks. Rare earth elements such as neodymium, dysprosium, and praseodymium are used in the production of hydrogen FC vehicles’ electric motors. They are also used in the production of electrolysis cells, which are used to produce hydrogen from water. Titanium is used in the production of hydrogen storage tanks and as a component in the production of PEM fuel cells (Tokimatsu, et al. 2018).

-Electrolysers:

Electrolysers are used for producing hydrogen from electricity. The manufacture of electrolysers requires the use of vital minerals such as platinum, iridium, yttrium, zirconium, lanthanum, and nickel (Tokimatsu, et al. 2018).

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The aggregate mineral demand from a wide range of clean energy technologies under the IEA’s Stated Policies Scenario (STEPS) and the Sustainable Development Scenario (SDS), includes:

Low-carbon power generation: solar PV, wind, other renewables and nuclear;
Electricity networks;
Electric vehicles and battery storage;
Hydrogen (electrolysers and fuel cells).

The global clean energy transitions will have far-reaching consequences for mineral demand over the next 20 years. By 2040, total mineral demand from clean energy technologies double in the STEPS and quadruple in the SDS. In both scenarios, EVs and battery storage account for about half of the mineral demand growth from clean energy technologies over the next two decades, spurred by surging demand for battery materials. Mineral demand from EVs and battery storage grows tenfold in the STEPS and over 30 times in the SDS over the period to 2040. By weight, mineral demand in 2040 is dominated by graphite, copper and nickel. Lithium sees the fastest growth rate, with demand growing by over 40 times in the SDS. The shift towards lower cobalt chemistries for batteries helps to limit growth in cobalt, displaced by growth in nickel.

Electricity networks are another major driving force. They account for 70% of today’s mineral demand from the energy technologies, although their share continues to fall as other technologies – most notably EVs and storage – register rapid growth.

Mineral demand from low-carbon power generation grows rapidly, doubling in the STEPS and nearly tripling in the SDS over the period to 2040. Wind power plays a leading role in driving demand growth due to a combination of large-scale capacity additions and higher mineral intensity (especially with growing contributions from mineral-intensive offshore wind). Solar PV follows closely, with its unmatched scale of capacity additions among the low-carbon power generation technologies. Hydropower, biomass and nuclear make only minor contributions given their comparatively low mineral requirements and modest capacity additions.

The rapid growth of hydrogen use in the SDS underpins major growth in demand for nickel and zirconium for use in electrolysers, and for copper and platinum-group metals for use in fuel cell electric vehicles (FCEVs). Despite the rapid rise in FCEVs and the decline in catalytic converters in gasoline and diesel cars, demand for platinum-group metals in internal combustion engine cars remains higher than in FCEVs in the SDS in 2040.

Demand for rare earth elements (REEs) – primarily for EV motors and wind turbines – grows threefold in the STEPS and more than sevenfold in the SDS by 2040.

In total, between 2022 and 2050, the energy transition could require up to 6.5 billion tonnes of materials, cumulatively, of which 95% is accounted for by steel, copper and aluminium. By contrast, some other material needs are small in tonnage terms but critical to the production of specific clean energy technologies. The total stock of pure lithium required in all electrical vehicles between now and 2050, for instance, is likely to be around 20 million tonnes. These numbers compare with today’s annual coal extraction of over 8 billion tonnes.

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The IEA identified nine critical metals for clean energy transition, including copper, cobalt, nickel, lithium, REEs, chromium, zinc, PGMs, and aluminum, and compared their criticality to different sectors as shown in figure below:

Figure above shows criticality of metals for the clean energy transition. BEV: battery electric vehicle, PHEV: plug-in hybrid electric vehicle, HEV: hybrid electric vehicle, FCEV: fuel cell electric vehicle, REEs: rare earth elements, PMGs: Platinum group metals, PV: photovoltaic, CSP: concentrated solar-thermal power. Scale: “1″ means low criticality, “2″ denote moderate criticality, and “3″ denote high criticality.

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The case of transportation electrification:

Modern society is accelerating the transition to a clean energy system worldwide. An increasing number of countries, industrial sectors, and enterprises are striving to reduce their greenhouse gas (GHG) emissions to the “net zero”, which requires the large-scale deployment of a variety of clean energy technologies such as electric vehicles (EVs), photovoltaic panels, and wind turbines. Transportation is identified as one of the key sectors for achieving decarbonization goals. Decarbonizing the transportation sector—which emits about 30 percent of US carbon dioxide each year—will require unprecedented growth in electric vehicle sales. As demand increases, so will demand for batteries and the minerals such as manganese, lithium, and cobalt that are key components in those batteries. CO2 emissions from road transportation accounted for 78% of the total global transportation CO2 emissions in 2020. The operation of internal combustion engine vehicles (ICEVs) is a major source of unsustainable energy consumption owing to almost exclusive reliance on liquid fossil fuels. Alternative fuels such as electricity, hydrogen, and biofuels have been recognized as having the potential to mitigate GHG emissions. Advances in battery and fuel cell technologies have made alternative fuel vehicles such as battery electric vehicles (BEVs) and fuel cell electric vehicles (FCEVs) promising strategies to decarbonize the transportation sector. In 2021, investments in the electrification of the transportation sector accounted for 36% of total global clean energy transition investments. In turn, the ongoing clean energy transition significantly relies on critical metals. Critical metals are those with high technological vitality to the functionality of various emerging technologies but may suffer a potential supply risk. Critical metals such as copper, lithium, nickel, cobalt, platinum group metals (PGMs), and rare earth elements (REEs) are essential components in today’s EV technologies. There are concerns about the supply risks of those metals due to the rapid growth of transportation electrification and mobilization. International Energy Agency (IEA) estimates that the primary demand (total demand net of recycled volume) of copper, lithium, and cobalt will far exceed their committed mine production in 2030.

Critical metals used for automobiles:

EVs consume six times more critical minerals than ICEVs. Regarding the automotive sector, BEVs, PHEVs, and HEVs are more sensitive to copper, cobalt, nickel, lithium, REEs, PGMs, and aluminum. Cobalt, nickel, and lithium are the primary raw materials for the current cathode of LIBs. Aluminum and copper are manufactured as a foil to be used as current collectors at the cathode and anode, respectively, in an LIB to ensure the stability of the current collector. It is worth noting that aluminum and copper are the main raw materials for the entire automotive industry. REEs, especially the most critical ones, neodymium and dysprosium, are used to manufacture permanent magnets for electric motors in EVs. In contrast, FCEVs depend more on PGMs (e.g., platinum, rhodium, and palladium) and nickel, which are used to catalyze the sluggish oxygen reduction reaction at the cathode in a proton exchange membrane fuel cell stack.

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Fossil fuel versus clean energy technology: quantum of critical minerals:

The dramatic shift from fossil fuels to clean energy has trained a spotlight on the vital role of minerals and mineral-dependent supply chains in the energy transition. Compared with fossil fuel-based technologies, clean energy technologies are far more mineral-intensive throughout their life cycles as seen in figure below:

As low-carbon technologies rely heavily on mineral inputs, demand for minerals required for the clean energy transition is expected to rise dramatically. Meeting this demand is of strategic importance to all.

The transition to a clean energy system brings new energy trade patterns, countries and geopolitical considerations into play as seen in figure below.

Figure above shows supply chains of oil and gas, and selected clean energy technologies.

DRC = Democratic Republic of the Congo; EU = European Union; US = United States; Russia = Russian Federation; China = People’s Republic of China. Largest producers and consumers are noted in each case to provide an indication, rather than a complete account.

Supply chain issues: fossil fuel versus critical minerals:

Today’s international energy security mechanisms are designed to provide some insurance against the risks of disruption, price spikes and geopolitical events in the supply of hydrocarbons, oil in particular. These concerns do not disappear during energy transitions as more solar panels, wind turbines and electric cars are deployed. However, alongside the many benefits of clean energy transitions, they also raise additional questions about the security and resilience of clean energy supply chains, which policy makers need to address.

Compared with fossil fuel supply, the supply chains for clean energy technologies can be even more complex (and in many instances, less transparent). In addition, the supply chain for many clean energy technologies and their raw materials is more geographically concentrated than that of oil or natural gas. This is especially the case for many of the minerals that are central to manufacturing clean energy technology equipment and infrastructure.

Today’s mineral supply and investment plans fall short of what is needed to transform the energy sector, raising the risk of delayed or more expensive energy transitions. Today’s supply and investment plans are geared to a world of more gradual, insufficient action on climate change (the STEPS trajectory). They are not ready to support accelerated energy transitions. While there are a host of projects at varying stages of development, there are many vulnerabilities that may increase the possibility of market tightness and greater price volatility:

High geographical concentration of production:

Production of many energy transition minerals is more concentrated than that of oil or natural gas. For lithium, cobalt and rare earth elements, the world’s top three producing nations control well over three-quarters of global output. In some cases, a single country is responsible for around half of worldwide production. The Democratic Republic of the Congo (DRC) and People’s Republic of China (China) were responsible for some 70% and 60% of global production of cobalt and rare earth elements respectively in 2019. The level of concentration is even higher for processing operations, where China has a strong presence across the board. China’s share of refining is around 35% for nickel, 50-70% for lithium and cobalt, and nearly 90% for rare earth elements. Chinese companies have also made substantial investment in overseas assets in Australia, Chile, the DRC and Indonesia. High levels of concentration, compounded by complex supply chains, increase the risks that could arise from physical disruption, trade restrictions or other developments in major producing countries.

This creates sources of concern for companies that produce solar panels, wind turbines, electric motors and batteries using imported minerals, as their supply chains can quickly be affected by regulatory changes, trade restrictions or political instability in a small number of countries. The Covid-19 pandemic already demonstrated the ripple effects that disruptions in one part of the supply chain can have on the supply of components and the completion of projects.

The implications of any potential supply disruptions are not as widespread as those for oil and gas. Nonetheless, trade patterns, producer country policies and geopolitical considerations remain crucial even in an electrified, renewables-rich energy system.

Long project development lead times:

It has taken 16.5 years on average to move mining projects from discovery to first production. These long lead times raise questions about the ability of supply to ramp up output if demand were to pick up rapidly. If companies wait for deficits to emerge before committing to new projects, this could lead to a prolonged period of market tightness and price volatility.

Declining resource quality:

Concerns about resources relate to quality rather than quantity. In recent years ore quality has continued to fall across a range of commodities. For example, the average copper ore grade in Chile declined by 30% over the past 15 years. Extracting metal content from lower-grade ores requires more energy, exerting upward pressure on production costs, greenhouse gas emissions and waste volumes.

Growing scrutiny of environmental and social performance:

Production and processing of mineral resources gives rise to a variety of environmental and social issues that, if poorly managed, can harm local communities and disrupt supply. Mining can devastate the environment if done unsustainably, leading to deforestation, water pollution and what is known as dewatering. Just to take one example, it takes 2 million litres of water to extract a single tonne of lithium. But some 50 per cent of global copper and lithium production are concentrated in areas with water scarcity. Consumers and investors are increasingly calling for companies to source minerals that are sustainably and responsibly produced. Without efforts to improve environmental and social performance, it may be challenging for consumers to exclude poor-performing minerals as there may not be sufficient quantities of high-performing minerals to meet demand.

Higher exposure to climate risks:

Mining assets are exposed to growing climate risks. Copper and lithium are particularly vulnerable to water stress given their high water requirements. Over 50% of today’s lithium and copper production is concentrated in areas with high water stress levels. Several major producing regions such as Australia, China, and Africa are also subject to extreme heat or flooding, which pose greater challenges in ensuring reliable and sustainable supplies.

These risks to the reliability, affordability and sustainability of mineral supply are manageable, but they are real. How policy makers and companies respond will determine whether critical minerals are a vital enabler for clean energy transitions, or a bottleneck in the process.

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Protect communities and environment:

The United States and the world are poised to experience a gold rush-style procurement of critical minerals for renewable energy and EVs. This is understandable and necessary– the United States needs to alleviate its massive carbon footprint. Transitioning to low-carbon technologies will ensure sustainable energy and the energy infrastructure for the future, position the United States as a world leader in green energy production and jobs, and safeguard national energy security. But the tricky issue of mining, which is environmentally destructive and intrusive for frontline communities, remains. Often, the narrative deems that we can either subject frontline and Indigenous communities to the worst effects of mining activities or fail in the fight climate change. This is far from the truth; we can place comprehensive environmental protections, mine clean-up plans, and human rights protection policies to protect local and Indigenous communities and the environment while becoming a leader in fighting climate change. It’s just a matter of prioritizing human rights over profit margins.

How can the energy transition minerals industry be made more sustainable?

First and foremost, the world needs to address the demand for minerals while limiting the environmental and social impacts associated with their production. An important strategy is to reduce the mining of virgin minerals. There are two keys to this. Firstly, renewable technology must become more efficient to allow mineral users to do more with less. Secondly, industries must find ways to use minerals longer, a process known as circularity. For example, firms should design products that can be repaired and recycled and from which metals can be recovered. This will lessen the need to mine virgin minerals.

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IEA: Shortage of Critical Minerals could delay Energy Transition:

The IEA said that to reach the 1.5 to 2-degree-Celsius target laid out in the Paris Agreement would mean a quadrupling of mineral requirements for clean energy technologies by 2040. To reach net-zero carbon emissions by mid-century would mean a six-fold increase by 2040.

Lithium is one of the most important metals, with demand expected to rise 40 times over the next two decades. Cobalt demand could rise by between six and 30 times. Copper demand for power lines alone is expected to double. The danger is that surging demand outpaces supply, resulting in a dramatic price increase, which would not only delay the energy transition but also make it much costlier. “Given the urgency of reducing emissions, this is a possibility that the world can ill afford,” the IEA said. For example, a doubling of lithium or nickel prices would increase battery costs by 6 percent. If both lithium and nickel prices doubled at the same time, it would wipe out all of the anticipated cost reductions that the agency foresees in battery manufacturing in the years ahead.

One of the problems is that the mining capacity of these minerals is concentrated in a handful of countries, and the processing capabilities are also concentrated in just a few others. Many of the minerals are even more geographically concentrated than what is seen for oil and gas. The top three producing countries of lithium, cobalt, and rare earth elements account for over three quarters of global output. The Democratic Republic of the Congo accounts for roughly 70 percent of cobalt production, and China makes up 60 percent of rare earth elements production. Even more staggering is China’s 90 percent market share for rare earths processing.

High prices would induce more supply, but the lead times for new projects is extensive. The IEA says that it can take an average of over 16 years to move mining projects “from discovery to first production.” As a result, if companies wait for the demand signals to appear before they greenlight new capacity, it could result in “a prolonged period of market tightness and price volatility.”

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Critical minerals supply crunch is going to hurt green transition, warns McKinsey:

The world is heading for a turbulent period of energy transition where constraints on the supply of critical materials are increasingly likely to slow the pace of change, according to an influential new study. US consultancy giant McKinsey & Co forecast shortages of critical minerals in both high and low-paced energy transition scenarios and found that access to materials will slow the delivery of wind turbines and solar panels while also restraining output of electric vehicles. In the case of dysprosium, a rare-earth element (REE) used in many electric motors, there is a risk of supply falling as much as 70%, McKinsey said in a report published recently. Among the higher volume minerals, nickel — used in lithium-ion batteries — is expected to fall between 10% and 20% behind demand by 2030, McKinsey found. The report suggested that the approximately 500 cobalt, copper, lithium and nickel mines operating today will need to increase by between 40% and 80% to meet demand for batteries, depending on the McKinsey demand scenario applied.

Without decisive mitigation actions, such shortages could raise supply-chain costs for lower-carbon products, slowing the affordable transition to lower carbon alternatives and causing price volatility across materials, the report suggests. This could ultimately increase greenhouse gas emissions by between 400 million and 600 million tonnes during the remainder of the decade, it warned.

Shortages of dysprosium and terbium, magnet materials used in electric vehicles and wind turbines, were identified as primary causes of this increase beyond earlier projections which, McKinsey said, “shows that bottlenecks in just one or a few materials can delay the deployment of lower-carbon technologies across multiple industries and thus slow the transition to net-zero emissions”. The assessment showed that most materials within the scope of the report will face a shortage by 2030, across all scenarios.

“Most battery materials, especially lithium and cobalt, will continue to be constrained despite ongoing shifts in battery chemistry, including the reduction in cobalt intensity and the partial shift from nickel-manganese-cobalt (NMC) toward lithium- iron-phosphate (LFP) batteries,” McKinsey stated.

Among the list of elements likely to fall short of supply were copper, crucial to the speedy build-out of transmission and distribution lines needed to connect renewable power sources to grids and thus a major risk factor for renewable energy investment, as well as iridium, a rare element used in many hydrogen electrolysers and tin, used as solder in semiconductors.

McKinsey estimates that between $3tn and $4tn of investments in mining, smelting and refining are needed to meet the shortfall in supply, with annual spending demands for $300-$400m some 50% higher than last decade.

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Reducing supply risk of critical materials for clean energy via foreign direct investment, a 2024 study:

Existing research on the security of the supply of critical materials for clean energy generally aggregates information at the country level, a practice that obscures the extensive role of foreign direct investment (FDI) in the production of critical materials. FDI refers to an ownership stake in a company or project by an overseas investor. Here authors establish a database for global mining of lithium, cobalt, nickel and platinum at company level, covering 240 countries and regions. Authors show that 47% of lithium, 71% of cobalt, 41% of nickel and 34% of platinum mined in 2019 were under FDI. They then explore how FDI may affect supply risks by proposing a supply risk index that allocates production of the critical materials to the country of origin of investors instead of the country where production is located. Authors present upper and lower bounds of the supply risk index that reflect scenarios where either all investors or only state investors prioritize the home-country demand, respectively. This study presents an approach for assessing the national supply risks of critical materials, considering the geographical allocation of FDI.

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Section-7

Critical minerals for national security:

Critical minerals are essential for many modern technologies and industries. These minerals are vital for national security and economic stability. They are used in everything from smartphones to electric vehicles and advanced military systems. The control of critical minerals has significant implications for national defense. Countries that dominate the supply of these minerals can influence global markets and security dynamics. The reliance on critical minerals has made them a top national security priority due to their importance to the economy, military and climate change objectives. They are not only essential for technological advancement but also play a crucial role in national security and economic stability.

NATO releases list of 12 defence-critical raw materials in 2024:

Aluminium is pivotal in producing lightweight yet robust military aircraft and missiles, enhancing their agility and performance. Graphite is crucial for the production of main battle tanks and corvettes due to its high strength and thermal stability. In submarines, graphite is used in the construction of hulls and other structural components, significantly reducing acoustic signatures and enhancing stealth capabilities. Cobalt is another critical material, essential for producing superalloys used in jet engines, missiles, and submarines, which can withstand extreme temperatures and stress.

The availability and secure supply of these materials are vital to maintaining NATO’s technological edge and operational readiness. Disruptions in their supply could impact the production of essential defence equipment. Identifying these key materials is NATO´s first step towards building stronger, better protected supply chains, crucial for Allied defence and security.

List of NATO Defence Critical Raw Materials:

Aluminium

Beryllium

Cobalt

Gallium

Germanium

Graphite

Lithium

Manganese

Platinum

Rare Earth Elements

Titanium

Tungsten

The Department of Defense (DOD) uses 750,000 tons of minerals annually. DOD uses large quantities of rare earths and other critical materials in its weapon systems but has limited influence on the markets for these materials. DOD estimates that its total demand for rare earths is less than 0.1 percent of global demand.

Figure below shows Notional Uses of Rare Earths and Other Critical Materials in Department of Defense (DOD) Weapon Systems:

U.S. Defense Use of Minerals:

Mineral	Defense Use	U.S. Net Import Reliance in 2022
Antimony	Antimony metal is used in most of the military’s lead-acid batteries. Indium antimonide semiconductors are used in forward-looking infrared vision systems and infrared homing missiles. Antimony trisulfide is used in fuses, small arms ammunition, mortar rounds, and artillery projectiles.	84%
Beryllium	Beryllium metal is used in intelligence, surveillance, and reconnaissance guidance systems, chassis and support arm/beam components, neutron reflectors, and X-ray mirrors.	6%
Bismuth	Bismuth-based alloys are used in machining.	97%
Chromium	Chromium metal is used as superalloys in turbine engines for jet aircraft, tanks, and marine applications.	84%
Cobalt	Used in superalloys for jet engines, Stellite alloys, nickel–metal hydride (NiMH) and lithium-ion batteries, samarium-cobalt, and Alnico magnets.	73%
Gallium	Used in electronics and missile guidance systems. Gallium arsenide (GaAs) is used for radar, short wave infrared tracking, night vision, and satellite communications. Gallium antimonide is used for night vision and missile guidance.	100%
Germanium	High-purity germanium is used in infrared lenses for most of the Department of Defense’s night vision technology, thermal imaging systems, and infrared tracking systems in combat vehicles. These applications are essential for tracking ground targets and heat-seeking missiles and conducting nighttime operations. High-purity germanium substrates are also used in the manufacture of solar cells that power defense and national security space satellites. These satellites are critical for reconnaissance, missile detection, and communication.	> 50%
Graphite (natural)	Used in batteries, lubricants, body armour, engine turbine components, coatings for aircraft manufacture, and missile parts.	100%
Indium	Used in infrared imaging systems and communications systems.	100%
Lead	High-purity lead is used for thin-plate pure lead batteries used in aircraft and some navy vessels.	38%
Lithium	Used for repairs of fighter jet structures, safety-critical batteries, and batteries in electronics.	> 25%
Magnesium	Used in helicopter transmission housings, armour applications, broadcast and wireless communication equipment, radar equipment, torpedoes, antitank ammunition rounds, batteries, flare and ordnance applications, and infrared and missile countermeasures. Also used an alloy for aircraft, vehicle engine casings, and missile construction.	> 50%
Nickel	Used in superalloys for high-temperature sections of jet engines and maraging steel (aerospace and military use).	54%
Niobium	Used in superalloys for turbine engines, rocket sub-assemblies, and memory metal for hydraulic couplings.	100%
Palladium	Used in circuit boards and brazing and soldering in aerospace applications.	31%
Rhenium	Used in high-temperature alloys including superalloys for air transport and land power generation turbine engines.	70%
Strontium	Used for pyrotechnics (e.g., signal flares).	100%
Tantalum	Used in nickel superalloys for high-temperature sections of jet engines and capacitors for Department of Defense military specification and U.S. space applications. Also used in shaped charge and explosively formed penetrator liners, missile systems, ignition systems, night vision goggles, and global positioning systems.	100%
Tellurium	Used in thermal imaging devices such as short and mid-wave infrared sensors, thermoelectric coolers for infrared detectors, integrated circuits, and laser diodes.	> 75%
Tin	Used in alloys for bearings.	77%
Tungsten	Used in high-temperature superalloys for military turbine engines, tungsten filaments for electronics, and lighting and armour-piercing ammunition.	> 50%
Vanadium	Used as an additive in steel, specialty steel, catalysts, titanium-aluminum-vanadium alloys for jet engines, cladding, vanadium-gallium tape for superconducting magnets, and glass coatings.	60%

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The U.S. Military Risks due to Mineral Shortages in a U.S.-China War:

Minerals are foundational in warfighting. They are used in defense platforms like attack submarines, heavy bombers, and mobile missile launchers, and in munitions like submarine-launched torpedoes, air-launched standoff missiles, and ground-launched rockets and missiles. In its last three great power wars—World War I, World War II, and the Korean War—the United States lacked sizable mineral stockpiles yet was the world’s dominant mineral producer. The U.S. military experienced mineral shortages during these wars due to increased defense production, expanded export controls, and contested shipping routes. Today, the U.S. military is at a greater risk of severe mineral shortages if a U.S.-China war were to unfold: the United States has limited mineral stockpiles; low domestic mineral production; and heavy mineral import reliance, including from its great power rival, China.

A mineral shortage can severely undermine war efforts and impact the war’s outcome. Importantly, mineral shortages can prove decisive. C. K. Leith partly attributes the loss of the Central Powers in World War I to mineral shortages, saying, “The acute shortage of essential minerals which they experienced was a very considerable factor in their ultimate defeat.” Similarly, John D. Morgan argues that mineral shortages undermined U.S. industrial mobilization during World War II and prolonged the war. The Allies also experienced mineral shortages in the early part of 1942, hindering defense production and bringing the Allies “dangerously close to losing the war,” according to Donald Nelson, director of the War Production Board during World War II. Critically, mineral shortages in a potential U.S.-China war may not only prolong the conflict but, if severe enough, also contribute to U.S. defeat.

If a U.S.-China war occurs, the U.S. military will likely face mineral shortages. The United States already has limited mineral stockpiles, low domestic mineral production, and heavy mineral import reliance from China, its geopolitical rival. The United States would consume significant mineral volumes for increased defense production in a war, and it would face disrupted mineral imports from expanded export controls and contested shipping routes, posing mineral shortage risks. The US government should stockpile more minerals, incentivize domestic mineral production, and restrict mineral imports from China to mitigate such shortage risks.

Mineral shortages could prove disastrous for the United States, given the serious—sometimes decisive— role of minerals in war. In its last three great power wars—World War I, World War II, and the Korean War—the United States lacked sizable mineral stockpiles but was the world’s dominant mineral producer. Still, it experienced mineral shortages. Following these wars, U.S. officials highlighted the importance of minerals in wartime, urging the country to pursue mineral independence and self-sufficiency. Yet, the United States now has a relatively weak mineral base and faces the possibility of a major war against a minerally superior adversary. Past wars indicate that the United States risks defeat if such a war occurs.

In this case, the words of U.S. Bureau of Mines Director R. R. Sayers in 1941 may be particularly prescient.

Events in 1940 have demonstrated again that in this age of mechanization minerals are indeed the sinews of war. The British have shown that valour can offset, to a remarkable extent, the advantages of superior armament and munitions; but the experience of Finland, Belgium, Greece, and others has revealed the ineffectiveness of heroic men against an avalanche of iron, manganese, aluminum, and petroleum utilized in tanks and airplanes, bullets and bombs.

But instead of Finland, Belgium, and Greece succumbing to Germany’s mineral superiority in World War I, Taiwan, Japan, and the United States may succumb to China’s mineral superiority in a U.S.-China war.

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Challenges Posed by China:

Major Share of Rare Earth Reserves: Not only does China have a major share of rare earth reserves, it has also completely monopolised the processing capacity of these minerals. China processes 35% of the world’s nickel, 50-70% of lithium and cobalt and nearly 90% of rare earths.
Chinese companies have made investments in Australia, Chile, Indonesia and the DRC to source those minerals which it is not endowed with sufficiently.
Monopolising Manufacturing of Finished products: China has also monopolised the manufacture of finished products as it supplies 78% of cathodes, 85% of anodes, 70% of battery cells and 95% of permanent magnets made from rare earths.
Settling Political Scores Against Countries: China, incidentally, has been using its monopoly position on rare earths to settle political scores with countries like the US and Japan by restricting their exports and also the related technology.
China’s dominant position in the business of critical minerals and its willingness to arm-twist other countries has clearly rattled the world community.

Most experts view the United States as being too heavily dependent on China for too many critical minerals. It’s common sense not to be overly reliant on one supplier, especially a top economic and geopolitical competitor, for any commodity or product. Of course, these concerns are heightened as the U.S. relationship with China grows more tense across the board, including as Beijing broadly threatens U.S. national security. One critical mineral we look at is graphite, essential to many industrial processes requiring lubricants, and products including batteries and fuel cells. The United States produces little to no natural graphite, meaning they are virtually 100 percent reliant on imports for graphite supply, with China being the leading import source. China uses its strong market position to manipulate the market, and recently imposed a graphite export ban of significant concern. The United States has a project underway to support a graphite mining project in Mozambique, with processing to be done in Louisiana — an effort to counter Chinese dominance of this critical mineral. This is an example of the United States looking to Africa to help overcome a critical mineral vulnerability.

It’s important to realize that China’s dominant position as a supplier of many critical minerals has been years in the making and won’t be upended overnight. China has systematically engaged with Africa, including through its Belt and Road Initiative, for decades now, well outpacing the United States in resources and political attention committed to Africa. It is encouraging that the United States is more focused on African critical minerals, but progress establishing a significant U.S. mining presence will take time. And China will remain a major player in Africa, regardless.

The U.S. and China are fighting for global tech supremacy, with each vying for cutting-edge technology and the resources used to make it. China has the advantage of being a mining nation — but perhaps more importantly, it’s a world leader in processing raw minerals from other countries. The U.S. used to be a number one mining power, but in the ’70s and ’80s, but they basically got tired of all the environmental damage that came along with. China, which was just opening up its economy at that time, said, fine, we’ll do it. We’re happy to dig this stuff up on our own land and build the refineries here in China. And also they were just very foresighted. Now, China is leveraging its powerful position by restricting mineral exports to the U.S., and the U.S. is trying to reduce reliance on its adversary. That’s why Trump has shown interest in annexing mineral-rich territories like Canada and Greenland. It’s also why the U.S. and Ukraine are negotiating a deal to have Ukraine give the U.S. access to its minerals. Ukraine is relying on the deal to finance its post-war recovery. Critical minerals are a matter of national security not only for the U.S. but for all nations.

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Section-8

World deposits, reserves and production (mainly mining and processing) of critical minerals:

Geological Distribution of Critical Minerals:

Abundance of elements in Earth’s crust per million Si atoms (y axis is logarithmic) is depicted in figure below:

As seen in the chart, rare-earth elements are found on Earth at similar concentrations to many common transition metals. The most abundant rare-earth element is cerium, which is actually the 25th most abundant element in Earth’s crust, having 68 parts per million (about as common as copper). The rare-earth elements are often found together. During the sequential accretion of the Earth, the dense rare-earth elements were incorporated into the deeper portions of the planet. Early differentiation of molten material largely incorporated the rare earths into mantle rocks. The high field strength and large ionic radii of rare earths make them incompatible with the crystal lattices of most rock-forming minerals, so REE will undergo strong partitioning into a melt phase if one is present. REE are chemically very similar and have always been difficult to separate, but the gradual decrease in ionic radius from light REE (LREE) to heavy REE (HREE), called the lanthanide contraction, can produce a broad separation between light and heavy REE. The larger ionic radii of LREE make them generally more incompatible than HREE in rock-forming minerals, and will partition more strongly into a melt phase, while HREE may prefer to remain in the crystalline residue, particularly if it contains HREE-compatible minerals like garnet. The result is that all magma formed from partial melting will always have greater concentrations of LREE than HREE, and individual minerals may be dominated by either HREE or LREE, depending on which range of ionic radii best fits the crystal lattice.

The geological distribution of critical minerals plays a significant role in their availability and potential geopolitical implications. Understanding where these minerals are concentrated globally helps in strategizing their extraction and minimizing supply risks.

Critical minerals are not evenly distributed across the globe. Specific regions and countries have abundant reserves, making them key players in the production and supply of these essential resources.

Africa: Rich in cobalt, especially in the Democratic Republic of Congo.
Australia: Abundant in lithium and rare earth elements.
China: Dominates the production of rare earth elements.
South America: Notable for lithium, particularly in the ‘Lithium Triangle’ of Bolivia, Argentina, and Chile.

This geographic concentration of resources affects global supply chains and requires international cooperation to maintain accessibility. Countries with limited domestic supplies often invest in mining operations globally to ensure access to critical minerals.

Factors Influencing Distribution:

The distribution of critical minerals is influenced by various geological and environmental factors:

Geological Formations	Certain minerals occur only in specific geological formations, such as pegmatites or laterites.
Plate Tectonics	The movement of Earth’s plates can concentrate minerals in certain locations. Due to tectonic plate movements that create favorable conditions for mining, certain areas such as north and southern Africa, as well as the western coast of South America, have concentrated deposits of rare earth minerals.
Climatic Conditions	Weathering processes in tropical regions can lead to the concentration of particular minerals over time.

The ocean floor harbors a vast array of minerals, including manganese nodules and polymetallic sulfides, rich in essential elements. These deposits often occur at tectonic plate boundaries or hydrothermal vent fields. While undersea mining represents a potential new frontier for resource extraction, it also poses significant technical, environmental, and legal challenges. Researchers are continually exploring ways to harness these underwater resources sustainably.

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Table below provides principal deposit types and main host minerals and ores for the selected critical metals:

Metal	Main Minerals/Ores	Principal Deposit Types
Cobalt	Primary (hypogene) minerals: arsenide, sulpharsenides and sulphides. Secondary (supergene) minerals: arsenates, oxides, carbonates, sulphates, and selenides	Stratiform sediment-hosted Cu-Co deposits, Ni-Co laterites deposits, magmatic Ni-Cu(-Co-PGE) sulphide deposits
Gallium	Typically found in varying concentrations in aluminium, zinc and iron ores, and coal. Minerals containing gallium as a structural component are rare	Bauxite, sediment-hosted Pb-Zn deposits, volcanic-hosted hydrothermal deposits, coal
Germanium	Occurs predominantly in Zn sulphide ores. ∼30 germanium minerals exist and include sulphides, oxides, hydroxides, sulphates, germinates and silicates	VMS deposits, MVT lead-zinc deposits, SEDEX deposits, Kipushi-type Pb-Zn-Cu replacement bodies in carbonate rocks, coal deposits
Indium	12 indium minerals; most do not occur in sufficient concentrations to make extraction economical. Occurs in high concentration in minerals such as sphalerite [(Zn,Fe)S], chalcopyrite [(Cu,Fe)S₂], stannite [Cu₂FeSnS₄] and cassiterite [SnO₂]	VMS deposits, epithermal deposits, sediment-hosted Pb-Zn deposits, granite-related deposits, porphyry deposits, skarns, sediment-hosted stratiform Cu deposits
Lithium	The most important lithium resource minerals are spodumene [LiAl(SiO₃)₂], petalite [LiAlSi₄O₁₀], and lepidolite [K(Li,Al)₃(Si,Al)₄O₁₀(F,OH)₂]	Closed-basin, geothermal and oilfield brines, pegmatites (including Li-rich granites), lithium-clays, lithium zeolites
Nickel	The primary hosts are pentlandite [(Ni,Fe)₉S₈] in magmatic sulphides, and nickeliferous limonite [(Ni,Fe)O(OH)] and garnierite [(NiMg)₃Si₂O₅(OH)₄] in laterites	Magmatic sulphide deposits (including stratabound, basal, impact melt, and in extrusive ultramafic rocks), laterites
Rhenium	Molybdenite [MoS₂] is the principal mineral host, with rhenium substituting for molybdenum. Rhenium rarely occurs as its own sulphide mineral	Porphyry copper deposits, sediment-hosted strata-bound copper deposits, vein deposits, uranium deposits
Tellurium	Hosted in various telluride, tellurite and tellurates; however, these minerals typically do not occur in sufficient concentrations to make extraction economical. Common sulphides e.g. covellite have a greater potential for tellurium extraction	Magmatic Cu-Ni-PGM sulphide deposits, IOCG deposits, VMS deposits, porphyry deposits, epithermal deposits, orogenic gold deposits, Carlin-type gold deposits, skarns
Tin	There are >50 types of tin-bearing minerals. The predominant ore metal is cassiterite [SnO₂]	Placer tin deposits, granite-related tin deposits (including vein type and stanniferous pegmatites)
Tungsten	Several minerals are known. However, only scheelite [CaWO₄] and wolframite [(Fe,Mn)WO₄] are of economic importance	Calcic skarn, vein/stockwork deposits, porphyry deposits, greisen deposits, stratabound deposits
Vanadium	Occurs in a wide range of minerals that vary by deposit. It is typically incompatible in silicate minerals and concentrated in oxides	Vanadiferous titanomagnetite deposits, sandstone-hosted deposits, shale-hosted deposits, vanadate deposits

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The map below depicts the skewed distribution of critical minerals resulting in asymmetrical production across the world.

The issue of critical minerals lies at the intersection of science and technology, policy, environment as well as international relations and geopolitics. The vast potential that these critical minerals possess in allowing the economies to transition towards green energy makes it a valuable resource and this value would only increase in the times to come. What makes them ‘critical’ however is another important factor relating to the processing capabilities and the densely concentrated deposits spread unequally across the world that makes some countries more central to their availability while the others create new ways to secure the supply chains for themselves.

Countries like Australia and Chile come to the forefront when we consider the deposits of these critical minerals, however the availability is one thing but the extraction and processing capabilities are a whole different ball game altogether. It’s the latter that has come to dominate the sensibilities of the nation states when it comes to critical minerals.

Who are the top producers of critical minerals?

According to a report released by the International Energy Agency, the major producers of critical minerals globally are Chile, Indonesia, Congo, China, Australia and South Africa.
China dominates in terms of processing.

World’s Largest Reserves and Usage:

Lithium:

Used in rechargeable batteries for electronics and electric vehicles. Largest reserves found in Chile, Australia, and Argentina.

Cobalt:

Key component in lithium-ion batteries. Major reserves located in the Democratic Republic of Congo (almost 70%), Australia, and Russia.

Rare Earth Elements (REE):

China holds the world’s largest rare earth reserves, estimated at 44 million metric tons. It also leads in production, generating 270,000 metric tons in 2024.According to the Oxford Institute for Energy Studies, China currently dominates the rare earth supply chain, producing 70 percent of the world’s supply and handling 90 percent of global rare earth ore processing. This dominance of the discovery-to-production-to-export chain gives the country enormous control over rare earth prices globally, and the U.S. remains heavily reliant on imports from China.

Titanium:

Used in aerospace and defence industries. Major reserves found in Australia, South Africa, and Canada.

Nickel:

Crucial for stainless steel production and battery manufacturing. Main reserves located in Indonesia, the Philippines, and Russia.

Graphite:

Essential for lithium-ion batteries and other high-tech applications. Major reserves found in China, Brazil, and Mozambique.

Gallium, Indium, Germanium:

Used in semiconductors and electronics. Gallium is mainly sourced from China, while indium and germanium reserves are found in China, Peru, and Canada.

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Countries holding the most Critical Minerals Reserves:

	Lithium	Cobalt	Natural Graphite	Rare Earths
Top Country	Chile	DRC	China	China
Top Country Share	34%	57%	28%	38%
Second Country	Australia	Australia	Brazil	Vietnam
Second Country Share	22%	16%	26%	19%
Third Country	Argentina	Indonesia	Mozambique	Brazil
Third Country Share	13%	5%	9%	18%

South America dominates the reserves for lithium, with nearly half of all known reserves located in Chile (34%) and Argentina (13%). Australia, with 22% of global lithium reserves, is in third place.

The Democratic Republic of Congo is home to the highest share of cobalt reserves, at 57%. Australia, at 16%, also possesses a sizable source of the metal.

Natural graphite reserves are relatively spread out geographically. China (28%) and Brazil (26%) hold comparable amounts. Mozambique (9%) rounds out the top three list.

Rare earth minerals are primarily located in Asia, with China (38%) and Vietnam (19%) holding the greatest reserves. Brazil has 18% of known global reserves.

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Distribution of REE in the Earth’s crust and mineralogy:

As mentioned before, REEs are not particularly “rare” in the Earth’s crust but economic accumulations of them are rare. The “all-in-one” diagram in figure below shows all of the different REE deposit types.

You don’t need to be a geologist to fully understand this diagram, but you can see that REEs occur in a vast array of geological environments. Some are intruded into the Earth’s crust from depth and regarded as “primary”, whilst others have been subject to chemical and physical weathering and can be described as “secondary”.

In nature, REE do not exist as individual native metals such as gold, copper and silver because of their reactivity, instead occur together in numerous ore/accessory minerals as either minor or major constituents. Though REE are found in a wide range of minerals, including silicates, carbonates, oxides and phosphates, they do not fit into most mineral structures and can only be found in a few geological environments. The principal economic sources of REE minerals are bastnaesite, monazite, and loparite and the lateritic ion-adsorption clays. There are over 250 minerals which contain REE as important constituents in their chemical formula and crystal structure (Dostal, 2017).

Table below presents the list of some important REE bearing minerals associated with REE deposits.

Mineral	Formula
Allanite	(Y,Ln,Ca)₂(Al,Fe^3þ)₃(SiO₄)₃(OH)
Apatite	(Ca,Ln)₅(PO₄)₃(F,Cl,OH)
Bastnaesite	(Ln,Y) (CO₃)F
Eudialyte	Na₄(Ca,Ln)₂(Fe^2þ,Mn^2þ,Y)ZrSi₈O₂₂(OH,Cl)₂
Fergusonite	(Ln,Y)NbO₄
Gittinsite	CaZrSi₂O₇
Iimoriite	Y₂(SiO₄) (CO₃)
Kainosite	Ca₂(Y,Ln)₂Si₄O₁₂(CO₃).H₂O
Loparite	(Ln,Na,Ca) (Ti,Nb)O₃
Monazite	(Ln,Th)PO₄
Mosandrite	(Na,Ca)₃Ca₃Ln (Ti,Nb,Zr) (Si₂O₇)₂(O,OH,F)₄
Parisite	Ca (Ln)₂(CO₃)₃F₂
Pyrochlore	(Ca,Na,Ln)₂Nb₂O₆(OH,F)
Rinkite (rinkolite)	(Ca,Ln)₄Na(Na,Ca)₂Ti(Si₂O₇)₂(O,F)₂
Steenstrupine	Na₁₄Ln₆Mn₂Fe₂(Zr,Th) (Si₆O₁₈)₂(PO₄)₇.3H₂O
Synchysite	Ca (Ln) (CO₃)₂F
Xenotime	YPO₄
Zircon	(Zr,Ln)SiO₄

The REEs are commonly found together in the Earth’s crust because they share a trivalent charge (+3) and similar ionic radii. In nature, REEs do not exist individually, like gold or copper often do, but instead occur in minerals as either minor or major constituents. In general, these minerals tend to be dominated by either light or heavy REEs, although each can be present. In igneous (magmatic) systems, the large sizes of the REE ions impede their ability to fit into the structure of common rock-forming minerals. As a result, when common silicate minerals crystallize — such as feldspars, pyroxenes, olivine, and amphiboles— most REEs tend to remain in the coexisting magma. Successive generations of this process increase REE concentrations in the residual magma until individual REE minerals crystalize. The REEs can substitute for one another in crystal structures, and multiple REEs typically occur within a single mineral.

REEs generally occur in uncommon geologic rock types and settings. As mentioned earlier, REEs are common in the Earth’s crust but rarely in economic concentrations. Economic REE deposits occur primarily in four geologic environments: carbonatites, alkaline igneous systems, ion-absorption clay deposits, and monazite-xenotime-bearing placer deposits. Even within these deposit types, minable (economic) concentrations of REEs are rare. For example, globally there are more than 500 known carbonatites but only 6 are currently mined for REEs.

Typical abundances for rare earths in the earth’s crust are provided in table below. Ce, at 60–70 ppm, has a similar abundance to Cu. Of course, the actual availability of these rare earths relates to their mineralogy, since having rich ore bodies means that these elements can be mined and processed more easily than if they are distributed evenly within the earth’s crust. Mining of poorer quality ore bodies leads to processing of large amounts of ore, increased energy consumption and CO2 emissions.

Abundance, resources, production and uses of the rare earths:

Element	Crustal Abundance in ppm	Resources tonnes	Production tonnes/annum (Years of Reserve)	Uses, Source of Data and References
Lanthanum (La)	32	22,600,000	12,500 (1,800)	Hybrid engines, metal alloys, catalysis, phosphors, Carbon Arc Lamps, cigarette lighter flints
Cerium (Ce)	68	31,700,000	24,000 (1,300)	Catalysis particularly auto petroleum refining, metal alloys, Phosphors, corrosion protection, Carbon Arc Lamps, cigarette lighter flints
Praseodymium (Pr)	9.5	4,800,000	2,400 (2,000)	Magnets, Optical Fibres, Carbon-Arc Lamps
Neodymium (Nd)	38	16.700,000	7,300 (2,300)	Catalysis particularly petroleum refining, hard drives in laptops, headphones, hybrid engines, Nd-Fe-B magnets
Promethium	NA	NA	NA	Nuclear Battery, Pm
Samarium (Sm)	7.9	2,900,000	700 (4,100)	Sm-Co magnets, IR absorption in glass
Europium (Eu)	2.1	244,333	400 (610)	Red colour for TV and computer screens, (5%Eu, 95%Y), green phosphor (2% Eu)
Gadolinium (Gd)	7.7	3,622,143	400 (9,100)	Magnets, nuclear magnetic resonance imaging, phosphors
Terbium (Tb)	1.1	566,104	10 (57,000)	Phosphors particularly for fluorescent lamps, magnets.
Dysprosium (Dy)	6	2,980,000	100 (29,800)	Magnets, hybrid engines, can increase the coercivity Nd-Fe-B magnets.
Holmium (Hm)	1.4	NA	10	Glass colouring agent, lasers
Erbium (Er)	3.8	1,850,000	500 (3,700)	Red, green phosphors, amplifiers for optical fibres transmission, pink in glass melts, sunglasses.
Thulium (Th)	0.48	334,255	50 (6,700)	Medial X-ray units—X-ray sensitive phosphors
Ytterbium (Yt)	3.3	1,900,000	50 (38,000)	Lasers, steel alloys—grain refiner, stress sensors
Lutetium (Lu)		395,000	NA	Catalysts in petroleum refining, Ce-doped Lu-glass used in detectors for positron emission tomography—PET
Yttrium (Y)	30	9,000,000	8,900 (1,011)	Red phosphors, fluorescent lamps, metals, Y-Fe-garnets resonators, ceramics
Scandium	22	NA	400 kg primary production, 1600 kg/year from Russian stockpile	Aluminium-scandium alloys for aerospace industry, defence industry, high intensity discharge light
Copper	60–70	1,615,000,000	17,000,000	Electrical wiring, heat exchangers, piping and roof construction and increasingly consumer electronics

According to the Unites States Geological Survey (USGS), world resources are enough to meet foreseeable demand but world production falls short of meeting current demand. The production tonnage and resources for individual rare earths are presented in Table above. Copper, a commonly used metal, has been shown as a comparison in the last row of this table. The resources have been calculated using data on the percentage of rare earths found in various ore deposits and the known resources of rare earth containing ores. The only rare earth element estimated to have less than 1000 years resource is Eu at approximately 600 years. However growth in consumption of particularly the heavy rare earth elements has grown by many orders of magnitude in the past two decades, and another order of magnitude increase in demand is not out of the question since Eu is used in red phosphors (along with Y) for low energy consuming lighting suggesting that peak Eu might be as little as 10 to 30 years away. This further underlines the urgent case for recycling. Although this assessment is too simplistic since the life of particular resources will be influenced by the finding of new deposits, technological efficiency such as use of less specific material per product, extraction efficiency of low-grade ore, and finally potentially the stream of recovered metal from recycling. However, it is useful to identify those materials based on these potential critical factors.

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REE Reserves:

Rare earth reserves are less geographically concentrated than global production. In 2023, China held just over one-third of known reserves despite producing more than two-thirds of the worldwide total. Vietnam, Brazil, Russia, India, and Australia all have significant reserves, although most are mining very little.

In which types of rock do these minerals occur?

REE are found principally in carbonatites. These are igneous rocks comprising more than 50% carbonate minerals, principally calcite (calcium carbonate), but in some cases magnesium-bearing carbonates (dolomite, magnesite) or iron-bearing carbonates (siderite), that crystallised from a high-temperature liquid from deep in the Earth. Carbonatites almost always contain REE, which constitute about 3,500 ppm of these rocks, so they are the most obvious place to look for REE.

REE are found in high concentrations in some, but not all, alkaline igneous rocks (which make up only about 0.5% of all igneous rocks). They are characterised by their high contents of alkali metals.

There are also some secondary deposits of REE. These are essentially produced by weathering of primary sources and their subsequent concentration by physical or chemical means. ‘Placer’ deposits are produced by physical concentration of rare earth and other heavy minerals from weathering; ‘laterite’ deposits result from enrichment of REE by in situ chemical alteration. There is one known example of a further type of secondary deposit, known as ion-adsorption clays, in China. The REE in these deposits were released by weathering of REE-rich granites and subsequently adsorbed by clay minerals.

There are also some rare earth mineral concentrations of economic interest in granite pegmatites and some hydrothermal (hot water) vein systems. Researchers have recently found elevated concentrations of REE in deep sea mud in the Pacific Ocean, which may also constitute a potential resource.

In what kinds of geological environment are these rocks found?

The carbonatites and alkaline igneous rocks are characteristically found in the interiors of tectonic plates, that is, away from the active plate margins where volcanic activity is at its greatest. They are commonly associated with the major rift systems, such as the East African and Baikal rifts and the Rhine Graben. The carbonatites are mostly confined to continental areas, while the alkaline rocks also occur over much of the world’s oceanic intraplate areas on volcanic islands. Although more than two thirds of carbonatites that have been dated are Phanerozoic in age (less than 500 million years), they are overwhelmingly concentrated in areas comprising older Precambrian rocks.

Currently the world reserves of REE by principal countries such as China, Brazil, Vietnam, Russia and India, stand at about 130 million tonnes according to U.S. Geological Survey 2018 as seen in the table below:

Country	Reserves in tonnes (in terms of REO)	% Share
Australia	3,400,000	2.56
Brazil	22,000,000	16.67
Canada	830,000	0.63
China	44,000,000	33.33
Greenland	1,500,000	1.14
India	6,900,000	5.23
Malaysia	30,000	0.02
Malawi	140,000	0.11
Russia	18,000,000	13.64
South Africa	860,000	0.65
Vietnam	22,000,000	16.67
USA	1,400,000	1.06
World Reserves	132,000,000	–

REO stands for Rare Earth Oxides, and it refers to the oxides of the 17 rare earth elements (REEs).

These resources are primarily from four geologic environments: carbonatites, alkaline igneous systems, ion-adsorption clay deposits, and monazite-xenotime-bearing placer deposits. China with one-third of world’s REE reserves, is still the world leader in REE exploration and production. Before REE mining boom in China, the US dominated the global market. Mountain Pass initiated operations in 1965 and was the leading producer worldwide for decades (Barakos, 2017). However, mining activities stopped in 1998, mainly due to the competition from China as well as in response to environmental issues in the surrounding area of Mountain Pass (Ali, 2014; Mancheri, 2015). Apart from Mountain Pass, significant exploration projects in the United States include the Bear Lodge, the Bokan-Dotson Ridge, the Round Top and the La Paz projects (Barakos et al., 2018). While the exploration studies worldwide are mainly concentrated on Au, Ag, Cu, platinum group elements (PGE), Ni, Cu, Cr, Li, U, Zn, K and Pb, some countries in Africa and Asia Pacific showed interest in REE exploration in 2017. Apart from China and India, countries such as Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, and Turkmenistan have also identified significant REE-bearing mineral occurrences including alkaline igneous rocks and carbonatites (Kogarko et al., 1995; Mihalasky et al., 2018). There has been continued interest in exploration for REE worldwide. In an annual exploration review, Wilburn and Karl (2018) reported that the United States Geological Survey (USGS) conducted extensive hyperspectral surveys in Alaska and evaluated the mineral potential for REE in addition to other metal deposits throughout the State in 2017. India which account for about 5% of the world’s REE reserves, currently exploits its primary resource, monazite. Significant REE minerals found in India include ilmenite, sillimanite, garnet, zircon, monazite and rutile, collectively called Beach Sand Minerals (BSM). India has almost 35% of the world’s total beach sand mineral deposits.

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Rare earth elements resources production, consumption, and processing activities are significantly uneven around the world. Global production of REOs (210,000 of 300,000 tons in 2022) is dominated by China (70%), followed by U.S. (14%), and Australia (4%) as seen in figure below.

Figure above shows global mine production of rare earth oxides (containing Y; 1985–2022) by country. The up-left corner inset is the production percentage by country in 2022.

2022E is the estimated value.

China also has a dominant share of global REOs processing (~85%), succeeded only by Malaysia and Estonia (IEA (International Energy Agency), 2022). China is also the largest consumer (~150,000 tons of apparent consumption of REOs in 2020), followed by Japan, U.S., and EU28. Projected demand but limited supply for permanent magnets suggest Pr, Nd, Tb, and Dy will result in high prices, whereas La and Ce, mainly used in catalyst industries, likely have steady or declined prices over time due to oversupply. Driven by the global decarbonization and electrification trend, demands for Nd may double or even triple in the next decades, with the clean energy technologies’ share of total demand rising significantly to over 40% for REE (IEA (International Energy Agency), 2022). Considering the economic significance and potential supply instability, the world is searching for more sustainable supplies. Consequently, the number of REE exploration projects and processing plants have been increasing in the recent years.

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Production (mainly mining and processing) of critical minerals:

At present, the U.S. does not mine significant quantities of any of the relevant critical minerals needed for decarbonization. The country is 100% reliant on foreign imports for 12 critical minerals, including graphite, and greater than 50% reliant on imports for another 31 critical minerals, including rare earths (95%), cobalt (77%) and nickel (56%). In the future (likely within 15-20 years), the U.S. will be able to rely on recycling as an alternative to mining for a significant portion of critical minerals. But in the short term (by 2030), there will not be sufficient quantities of these minerals in circulation to make recycling a feasible approach.

Mine production is fairly concentrated. This represents a potential risk to supply chain stability. For each mineral, over half of production occurs in a single country.

	Lithium	Cobalt	Natural Graphite	Rare Earths
Top Country	Australia	DRC	China	China
Top Country Share	51%	73%	72%	70%
Second Country	Chile	Indonesia	Mozambique	U.S.
Second Country Share	26%	5%	10%	14%
Third Country	China	Russia	Madagascar	Australia
Third Country Share	15%	5%	8%	6%

For lithium, the top-producing country is Australia (51%) and for cobalt it is the Democratic Republic of Congo (73%). Meanwhile, China produces the highest share of both natural graphite (72%) and rare earths (70%). Mining is, and will continue to be, essential to the livelihood, development, and progress of billions of people around the globe. As mining patterns shift in response to changing demand, industry and policymakers cannot lose sight of the need for responsible mining. It is both a complex and significant issue, with a perplexing array of minerals coming from mines all over the world—often as byproducts or coproducts of other processes—and ending up as core components in almost every essential technology of a low-carbon future.

Mineral production and processing involve extracting and refining minerals from ore to make them suitable for various industries and applications. This process includes several key steps, such as crushing, grinding, and concentrating valuable minerals. For those minerals to be of used for applications like electric vehicle batteries, they must first be refined and processed into high-grade materials. There are variations in processing for each commodity, but this multi-step procedure typically involves the crushing and roasting of mined ores, followed by a series of chemical treatments to create a purified metal that can be used as an input in consumer products. For REEs, the process is even more complex, as illustrated in the graphic below. The high purity metal must then be converted into magnets to be used for applications like wind turbines and electric vehicle drivetrains. It is a six-step, time- and capital-intensive process requiring advanced expertise and specific machinery.

Mining rare earth elements is fairly straightforward but separating and extracting a single REE takes a great deal of time, effort and expertise. According to one expert, the ore is first ground up using crushers and rotating grinding mills, magnetic separation and flotation gives the lowest-value sellable product in the rare earth supply chain: the concentrated ore. The milling equipment — crushers, grinding mills, flotation devices, and electrostatic separators – all have to be configured in a way that suits the type of ore being mined. No two ores respond the same way.

The next step is to chemically extract the mixed rare earths from the concentrated ore (cons) by chemical processing. The cons must undergo chemical treatment to allow further separation and upgrading of the REEs. This process, called cracking, includes techniques like roasting, salt or caustic fusion, high-temperature sulfidation, and acid leaching which allow the REEs within a concentrate to be dissolved. This separates the mixed rare earths from any other metals that may be present in the ore. The result will be still-mixed-together rare earths.

The major value in REE processing lies in the production of high-purity rare earth oxides (REOs) and metals but it isn’t easy. A REE refinery uses ion exchange and/or multi-stage solvent extraction technology to separate and purify the REEs. Solvent-extraction processes involve re-immersing processed ore into different chemical solutions to separate individual elements. The elements are so close to each other in terms of atomic weight that each of these processes involve multiple stages to complete the separation process. In some cases it requires several hundred tanks of different solutions to separate one rare earth element. HREEs are the hardest, most time consuming to separate. The composition of REOs can also vary greatly. They can and often are designed to meet the specifications laid out by the end product users — a REO that suits one manufacturer’s needs may not suit another’s.

China has a long history as a producer and refiner of critical minerals. REEs were first discovered in the country in 1927, and production began in the Bayan Obo Mining District of Inner Mongolia three decades later. Rare earths have since been found in 21 Chinese provinces and autonomous regions. Thanks to a decades-long strategy of investment and industrial policy, supported by cheaper labor, faster permitting, and looser environmental and labor regulations than in many other countries, China has developed these resources and achieved a dominant global position in many areas.

China has developed significant advantages in the critical minerals sector through a strategy that combines innovation, specific industrial policies, financial incentives, and an original approach to environmental management. Substantial government policy support and subsidies have helped Chinese enterprises invest in research and development and have aided exploration and mining activities when futures remained unclear. By cushioning the financial risk and encouraging investment, the Chinese mining sector has been able to expand its capacity and technological expertise across the critical minerals supply chain. This multifaceted strategy not only secures China’s supply chain efficiency and resilience (two objectives that are not easy to accomplish simultaneously), but also positions the country as a pivotal player in the global transition to renewable energy.

The US Department of Defense also describes how China has taken an aggressive, competitive posture to undermine potential rivals. It notes that China has in the past “strategically flood[ed] the global market” with REEs at lower prices to decrease incentives for foreign companies to start new projects, or to put competing companies out of business. More recently, inflation in Western countries and deflation in China has provided further incentives for Chinese manufacturers to undercut prices offered by their Western counterparts. The results of China’s long-term strategy and asymmetric advantages in the critical mineral field are now clear throughout the supply chain.

Overwhelmingly, China is the main hub for processing critical minerals across the board. The country is responsible for processing 65% of global lithium mined, 74% of cobalt, 100% of natural graphite, and 90% of rare earths.

	Lithium	Cobalt	Natural Graphite	Rare Earths
Top Country	China	China	China	China
Top Country Share	65%	74%	100%	90%
Second Country	Chile	Finland	–	Malaysia
Second Country Share	29%	10%	–	9%
Third Country	Argentina	Canada	–	Estonia
Third Country Share	5%	4%	–	1%

In their raw, rocky form, minerals like lithium and nickel are useless for the energy transition. In order to become component parts for EV batteries and wind turbines, these metals must be refined down to purer substances, often through energy-intensive smelting processes. This is the source of the world’s largest energy transition bottleneck: Virtually all mined metal, whether it comes out of the ground in Indonesia or Canada, must travel to China in order to be refined. The country controls 90 percent of the world’s rare earth refining capacity, around two-thirds of its lithium and cobalt refining capacity, and around a third of its nickel refining capacity.

Why is China such a refining behemoth?

It’s simple: It has a massive head start. The Chinese state recognized early that critical minerals would be key to a future where fossil fuels were on the wane, and it has poured billions of dollars over the past few decades into the construction of new refineries, setting aside environmental concerns that led to the offshoring of some industrial plants from the United States. The country also invested in the upstream production of these minerals in other developing countries through its $1 trillion Belt and Road initiative, enabling it to achieve vertical integration through the supply chain for certain minerals.

Until 1948, most of the world’s rare earths were sourced from placer sand deposits in India and Brazil. Through the 1950s, South Africa was the world’s rare earth source, from a monazite-rich reef at the Steenkampskraal mine in Western Cape province. Through the 1960s until the 1980s, the Mountain Pass rare earth mine in California made the United States the leading producer. Today, the Indian and South African deposits still produce some rare-earth concentrates, but they were dwarfed by the scale of Chinese production. In 2017, China produced 81% of the world’s rare-earth supply, mostly in Inner Mongolia, although it had only 36.7% of reserves. Australia was the second and only other major producer with 15% of world production. All of the world’s heavy rare earths (such as dysprosium) come from Chinese rare-earth sources such as the polymetallic Bayan Obo deposit. The Browns Range mine, located 160 km south east of Halls Creek in northern Western Australia, was under development in 2018 and is positioned to become the first significant dysprosium producer outside of China.

China Myanmar axis:

Kachin State in Myanmar is the world’s largest source of rare earths. China imported US$200 million of rare earths from Myanmar in December 2021, exceeding 20,000 metric tons. Rare earths were discovered near Pang War in Chipwi Township along the China–Myanmar border in the late 2010s. As China has shut down domestic mines due to the detrimental environmental impact, it has largely outsourced rare-earth mining to Kachin State. Chinese companies and miners illegally set up operations in Kachin State without government permits, and instead circumvent the central government by working with a Border Guard Force militia under the Tatmadaw, formerly known as the New Democratic Army. Kachin has profited from this extractive industry. As of March 2022, 2,700 mining collection pools scattered across 300 separate locations were found in Kachin State.

While refining is China’s biggest advantage, the country is also a major player in the manufacturing of batteries, cars, and wind turbines — the final destination industries for all the raw metals we’re mining around the world. Tariffs have prevented the country’s main car makes from going mainstream in the United States, but the affordable BYD (BuildYourDreams) brand now makes up around 15 percent of the global EV market — and just overtook Tesla as the world’s most popular electric car. On wind energy, the country is even more dominant: It produces 60 percent of the world’s wind turbines.

The fact that one of Tesla’s largest factories is located in Germany, thousands of miles away from lithium mines and lithium refineries, is a stark demonstration of a key irony in global development: Wealthy countries like the United States and Germany have done their best to retain well-compensated heavy manufacturing jobs, but they now rely on the developing world for the minerals that supply their manufacturing sectors.

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Critical minerals in Ukraine:

Ukraine’s mineral resources are concentrated in two geologic provinces. The larger of these, known as the Ukrainian Shield, is a wide belt running through the center of the country, from the northwest to the southeast. It consists of very old, metamorphic and granitic rocks. A multibillion-year history of fault movement and volcanic activity created a diversity of minerals concentrated in local sites and across some larger regions. A second province, close to Ukraine’s border with Russia in the east, includes a rift basin known as the Dnipro-Donets Depression. It is filled with sedimentary rocks containing coal, oil and natural gas.

A map below shows critical minerals across the country, including near the Russian border.

Before Ukraine’s independence in 1991, both areas supplied the Soviet Union with materials for its industrialization and military. A massive industrial area centered on steelmaking grew in the southeast, where iron, manganese and coal are especially plentiful. By the 2000s, Ukraine was a significant producer and exporter of these and other minerals. It also mines uranium, used for nuclear power. In addition, Soviet and Ukrainian geoscientists identified deposits of lithium and rare earth metals that remain undeveloped.

However, technical reports suggest that assessments of these and some other critical minerals are based on outdated geologic data, that a significant number of mines are inactive due to the war, and that many employ older, inefficient technology. That suggests critical mineral production could be increased by peacetime foreign investment, and that these minerals could provide even greater value than they do today to whomever controls them.

Ukraine’s Untapped Resource Potential:

Ukraine claims to hold nearly $15 trillion worth of mineral resources, making it one of the most resource-rich nations in Europe. The country is home to the continent’s largest reserves of lithium, titanium, and uranium.

Titanium – Used in aerospace and military applications
Graphite – Essential for battery production
Lithium – A key component of lithium-ion batteries
Beryllium – Vital for defense and telecommunications
Rare Earth Elements – Crucial for electronics, renewable energy, and defense industries

According to data from the Ukrainian geologic survey, Ukraine possesses 5% of the world’s mineral resources, including 23 of the 50 materials deemed critical by the U.S. government. These include:

Element	Reserves (tonnes)	Global Production (%)
Carbon	18,600,000 t	4%
Manganese	140,000,000 t	1.6%
Iron	6,500,000,000 t	1.5%
Beryllium	13,900 t	–
Lithium	Classified	–
Titanium	Classified	7%
Uranium	Classified	2%

Ukraine has long been described as a critical minerals’ powerhouse. Prior to the 2022 Russian invasion, Ukraine registered 20,000 deposits (8,700 of them proven) of ore-bearing minerals, including 117 of the 120 most globally used metals and minerals. Ukrainian and international authorities reported that the country was home to the world’s top recoverable coal, gas, iron, manganese, nickel, graphite, titanium, and uranium reserves. Before the war, Ukraine was among the largest suppliers of noble gasses such as neon (for micro-chip-making) and boasted the most significant known lithium and rare earth deposits in Europe. Most of these minerals are in the so-called “Ukrainian shield,” spanning Luhansk, Donetsk, Zaporzhizhia, and Dnipropetrovsk to Korovohrad, Poltova, and Kharkiv.

Ukraine’s hydrocarbon, critical mineral, and agricultural wealth, coupled with its infrastructure outlay, human capital, and proximity to European markets, amplifies its international geostrategic importance. In a bid to exert its energy independence from Russia, Ukraine launched oil and gas privatization efforts in 2013. However, these were stymied by Russia’s 2014 annexation of Crimea and its subsequent military operation in Donbas. After launching a new national energy strategy in 2017 and accelerating licensing of critical mineral concessions in 2021, Ukraine’s moves were again thwarted by Russia’s full-scale invasion in 2022.

Why the US is so interested:

A list of 50 critical minerals, created by the U.S. Geological Survey, shows that more than a dozen relied upon by the U.S. are abundant in Ukraine. A majority of those are in the Ukrainian Shield, and roughly 20% of Ukraine’s total possible reserves are in areas currently occupied by Russia’s military forces.

Three critical minerals especially abundant in Ukraine are manganese, titanium and graphite. Between 80% and 100% of U.S. demand for each of these currently comes from foreign imports.

Manganese is an essential element in steelmaking and batteries. Ukraine is estimated to have the largest total reserves in the world at 2.4 billion tons. However, the deposits are of fairly low grade – only about 11% to 35% of the rock mined is manganese. So it tends to require a lot of material and expensive processing, adding to the total cost.

This is also true for graphite, used in battery electrodes and a variety of industrial applications. Graphite occurs in ore bodies located in the south-central and northwestern portion of the Ukrainian Shield. At least six deposits have been identified there, with an estimated total of 343 million tons of ore– 18.6 million tons of actual graphite. It’s the largest source in Europe and the fifth largest globally.

Titanium, a key metal for aerospace, ship and missile technology, is present in as many as 28 locations in Ukraine, both in hard rock and sand or gravel deposits. The size of the total reserve is confidential, but estimates are commonly in the hundreds of millions of tons.

Experts warn that Ukraine’s rare earth deposits are overstated, outdated, and largely inaccessible:

A little over £6 trillion of Ukraine’s mineral resources, which is around 53 per cent of the country’s total, are contained in the four regions Mr Putin annexed in September 2022, and of which his army occupies a considerable swathe. That includes Luhansk, Donetsk, Zaporizhzhia and Kherson, though Kherson holds little value in terms of minerals. The Crimean Peninsula annexed and occupied by Mr Putin’s forces in 2014, also holds roughly £165bn worth of minerals.

The region of Dnipropetrovsk, which borders the largely occupied regions of Donetsk and Zaporizhzhia, and sits in the face of an advancing Russian army, contains an additional £2.8 trillion in mineral resources.

Before the Russian invasion, Ukraine had registered 20,000 mineral deposits, with 8,700 of them proven and encompassing 117 of the world’s 120 most used metals and minerals, according to the Center for International Relations and Sustainable Development.

Despite all the hype about rare earths in Ukraine, the country doesn’t even make the top 12 countries ranked by the US Geological Survey as having the largest rare-earth mineral reserves. These countries are, in order, China, Brazil, India, Australia, Russia, Vietnam, the US, Greenland, Tanzania, South Africa, Canada and Thailand.

According to IEEE Spectrum, Ukraine doesn’t have any mineable rare earths. The publication quotes Erik Jonsson, senior geologist with the Geological Survey of Sweden, who says there are four areas with substantial deposits of rare earth ores, and four slightly bigger deposits: Yastrubetske, Novopoltavske, Azovske and Mazurivske. All but one are within the zone that the Russians currently control.

Jack Lifton, executive chairman of the Critical Minerals Institute, is more scathing in his criticism. “If you want critical minerals, Ukraine ain’t the place to look for them. It’s a fantasy,” he says. “There’s no point to any of this. There’s some other agenda going on here. I can’t believe that anybody in Washington actually believes that it makes sense to get rare earths in Ukraine.”

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Critical minerals on the sea floor:

Ocean mining:

In January 2013 a Japanese deep-sea research vessel obtained seven deep-sea mud core samples from the Pacific Ocean seafloor at 5,600 to 5,800 meters depth, approximately 250 kilometres (160 mi) south of the island of Minami-Tori-Shima. The research team found a mud layer 2 to 4 meters beneath the seabed with concentrations of up to 0.66% rare-earth oxides. A potential deposit might compare in grade with the ion-absorption-type deposits in southern China that provide the bulk of Chinese REO mine production, which grade in the range of 0.05% to 0.5% REO.

Deep-seabed mining is the exploitation of resources from the deep-seafloor, from which minerals such as manganese, rare earth elements (REEs), nickel, cobalt and copper can be extracted. The majority of deep-seabed resources are located in areas beyond national jurisdiction, where mineral-related activities are regulated by the International Seabed Authority (ISA), as mandated by the United Nations Convention on the Law of the Sea (UNCLOS). Some seabed resources are within national jurisdiction, where they are subject to domestic regulation, however, UNCLOS requires that such regulation shall be no less effective than that of the ISA.

Deep-seabed mining has gained interest owing to the rising demand for critical minerals. The opportunities and impacts are relatively unknown, and there are significant concerns about disrupting marine biodiversity and ecosystem.

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Section-9

Critical mineral supply chain:

Critical minerals are the key to guaranteeing national economic security, defense security, and resource security. Critical minerals are essential for strategic emerging industries (Ballinger et al. 2019). A recent report by the International Energy Agency (IEA) states that “the average amount of minerals required for a new power generation unit has increased by 50% since 2010 as the share of renewables in new investments has risen” (International Energy Agency 2021). Critical minerals are characterized by their non-substitutability in high-technology areas, the uneven global distribution of resource reserves, and the volatility of the international external environment, which exacerbates security risks in the supply chain of critical minerals (Day 2019; McNulty and Jowitt 2021).

The critical mineral supply chain has a fundamental role in the modernized industrial system (Grandell et al. 2016). Securing critical mineral supply chains is necessary for establishing a safe and efficient modernized industrial system. The concept and connotation of critical minerals supply chain security are rooted in global industrial changes and technological revolutions and are highly time-sensitive and political. The global supply chain of critical minerals is complex and interconnected, crucial for meeting the growing demand in various technology sectors. These minerals’ supply chains span multiple countries, making coordination and management essential for consistent availability.

The pathway of minerals from mines to finished products involves a complex, and often opaque, network of actors and processes. Figure below shows some of the key stages in the value chains of the mineral and metal industries.

Schematic representation of a mineral- or metal-dependent value chain:

The geological presence of resources alone is not sufficient for undertaking mining projects and the actual mining of mineral ores is preceded by multiple stages. These require meeting several enabling conditions, including compliance with mining and environmental regulations, and the acquisition of necessary permits and licenses. After fulfilling legal requirements, mining companies undertake several steps before extracting resources from the ground. This includes assessing the resource base, conducting feasibility studies and, in some instances, constructing demonstration plants. These processes can take several years and involve significant costs.

Subsequently, the mining stage begins, where mineral ores are extracted from either open-pit or underground mines using drilling and/or blasting techniques. The extracted ores are then transported (typically on conveyors or trucks) to a nearby processing plant, where they are converted into shippable products through multiple steps, which vary depending on the raw material and may involve processes such as grinding, crushing and chemical processing. It is worth noting that while these processes are typical for larger-scale mining operations, artisanal and small-scale mining may employ more rudimentary methods, such as manual labour and simple tools. The involvement of traders in the purchase and transport of the refined minerals further underscores the complexity of the mineral supply chain.

The next stage is metallurgy or refining, which is crucial to remove residual impurities from metal to meet the purity requirements of different markets. This process involves various techniques, such as smelting, roasting and electrolysis, and can generate substantial waste and emissions. The final product from refining is sold to manufacturers, who use the metal in a wide range of areas, including electronics, batteries and construction material. Increasingly, there is a growing trend of recycling products, including certain waste products that are generated during their life cycles.

A value chain represents a series of consecutive steps that go into the creation of a finished product. For critical minerals, the value chain includes five segments:

-1. Upstream exploration

-2. Upstream mining and extraction

-3. Midstream- processing, refining, and metallurgy (e.g., semi-finished inputs and materials)

-4. Downstream- component manufacturing and clean, digital, and advanced technology production [e.g., ZEV (Zero Emission Vehicle) manufacturing, aircraft, and semiconductors].

-5. Material recovery and recycling

The new technological revolution and industrial change are reshaping the global technological landscape and economic structure (Fortier et al. 2018). High-tech industries (i.e., clean energy, green transportation, and intelligent manufacturing) will profoundly change critical minerals’ existing supply and demand patterns (IEA 2021). In low carbon emission reduction alone, the World Bank estimates that about 3 billion tons of critical minerals will be required to decarbonize the global energy system by 2050 (Kirsten et al. 2020). In light of this, economies such as the EU, the USA, and Japan are stepping up their efforts to strengthen their critical minerals supply chain security through resource reserves, import-substituting country diversification, global mine acquisitions, and the establishment of international critical minerals alliances (USGS 2021). Western countries such as the USA and some members of the European Union have dominated the global critical minerals supply chain through national security layout at the “upstream end of resources” and technology and intellectual property control at the “downstream application end.” It poses a severe challenge to developing emerging countries and economies (Chang et al. 2017). Ensuring the security and control of critical mineral supply chains is a new challenge for major countries and economies in non-traditional national security.

Challenges in Supply Chain Management:

Managing the supply chain of critical minerals involves addressing various challenges:

Geopolitical Risks:

Political instability in key exporting regions can lead to supply disruptions.

Environmental Constraints:

Strict regulations and environmental concerns can affect mining and processing.

Logistical Issues:

Transporting minerals across countries faces infrastructure and regulatory challenges.

Effective strategies and collaborations are necessary to navigate these complexities and ensure a steady supply of critical minerals.

China’s critical minerals dominance:

China currently leads the world in critical mineral processing and is a leading producer of numerous essential elements. The People’s Republic refines around 40% of the world’s copper, 59% of its lithium, 68% of its nickel, and 73% of its cobalt. The country is also responsible for processing 85% of rare earths and controls 100% of the planet’s refined supply of natural graphite and over 90% of manganese.

China’s dominance of the global critical minerals industry is a major cause for concern for many Western nations, potentially posing a serious threat to their national security and economic wellbeing.

Disquiet over China’s stranglehold came to the fore when Beijing restricted exports of gallium and germanium, two key minerals critical for defense applications. In December 2024, China announced it would ban exports of gallium, antimony, and germanium to America “to safeguard national security interests,” widely seen as a retaliatory move as trade tensions between the two nations escalate.

The US is 100% reliant on China for gallium and 50% dependent on the country for its supplies of germanium, so it’s little wonder that the superpower and its allies are going all out to break China’s near-monopoly.

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Demand of critical minerals:

A supply chain’s primary function is to manage the flow of goods and services from the source to the consumer, and this flow is directly driven by customer demand. The demand for critical minerals is surging due to rapid technological advancements and the global shift towards sustainable practices. Countries like Australia, China, Canada, and the United States are prominent suppliers of critical minerals. However, the global supply chain faces challenges such as geopolitical risks, market fluctuations, and limited reserves. Ensuring a steady and secure supply of critical minerals is imperative to drive global development and economic stability. To address these challenges, governments and organizations are implementing strategies to establish a sustainable supply chain. Some approaches include investing in responsible mining and exploration projects, recycling initiatives, diversification of supply, and developing alternative materials and technologies that reduce dependence on specific commodities. As demand grows, so do concerns about supply chain stability and environmental impacts.

Reasons for Growing Demand for Critical Minerals:

A few key factors have driven the recent increase in demand for critical minerals:

Clean energy transition: Minerals like lithium, cobalt, nickel and copper are crucial for clean energy technologies like batteries, solar panels, wind turbines, and hydroelectrics. As countries and companies invest more in renewable energy and electric cars, demand for these minerals has surged. For example, the U.S. Inflation Reduction Act includes major investments in clean energy that will require more mineral inputs.
Supply chain vulnerabilities: The COVID-19 pandemic and geopolitical tensions have exposed vulnerabilities in global supply chains for critical minerals. Many of these resources are geographically concentrated in a handful of countries. This has led to efforts to diversify and secure supplies. Governments are also increasingly viewing supply chain security for critical minerals as a national security issue. This is driving policies to produce more minerals domestically.
Technological innovation: New technologies like 5G and quantum computing are increasing the need for rare earth elements and other niche minerals. The ongoing digital transformation of the economy is fueling rising demand.
Electric cars: The rapid growth in electric vehicle production is driving up lithium, cobalt and nickel demand in particular as key ingredients in EV batteries.

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Global demand for critical minerals and the products they are manufactured into is likely to increase significantly in coming decades. The International Energy Agency estimates that, in response to global efforts to reach the climate goals of the Paris Agreement, mineral demand for clean technologies will increase by two to six times by 2040, when compared to 2020. For example, electric vehicles need six times the amount of minerals as inputs as compared to conventional vehicles. Similarly, an onshore wind power plant needs nine times the mineral resources than a gas-fired plant. In other words, clean energy transitions imply a significant increase in the demand for critical minerals.

Figure below shows how demand may evolve depending on the International Energy Agency’s different scenarios. Most growth in demand will be from expanding fleets of electric vehicles and battery storage, as well as expanding electricity networks. Low-emission electricity generation, such as renewables, tend to rely more on critical minerals than other types of power generation.

Figure below shows Global minerals demand for clean energy technologies, 2020 compared with 2040

In order to build out enough clean technology to keep global temperature rise to 1.5-2 degrees C (2.7-3.6 degrees F), demand for nickel, cobalt and graphite is expected to grow by about 20 times while lithium demand is expected to grow to 40 times its current level. Demand for rare earth elements is expected to quadruple.

The scale of this global challenge will be felt in the United States as it uses the Inflation Reduction Act to increase clean technology development and uptake. The act includes numerous incentives to drive expansion of zero-carbon energy sources like wind and solar; production tax credits to support domestic manufacturing of these technologies; investment tax credits for zero-emission energy generation and storage facilities; incentives for Americans to decarbonize their homes through upgrades like heat pumps; tax credits for qualifying electric vehicles, and more. Expanding renewable energy infrastructure in the U.S. and coupling it with stationary storage batteries will require significant quantities of critical minerals such as lithium, nickel and cobalt. Likewise, the rapid shift to electric vehicles will depend on new EV batteries that require these same minerals. As the country increases its overall reliance on electricity, moreover, it will require increased transmission which calls for large amounts of copper and aluminum.

As renewable energy and storage capacity increase as part of global climate mitigation efforts, so too will the demand for critical minerals. Even under a scenario where global average temperatures increase by 4 degrees Celsius, the World Bank expects global wind capacity to increase three-fold and solar capacity to increase five-fold by 2050. These numbers jump to 4.5 times and 10 times for wind and solar, respectively, under a 2-degree scenario.

Wind power technology uses copper, aluminum, rare earth elements, zinc, and molybdenum, while solar PV cells contain aluminum, silicon, copper, silver, tin, and lead. Similarly, growth in electric vehicles and power grids with storage capacity drives increases in demand for lithium-ion batteries, which in turn rely on key minerals such as lithium, nickel, manganese, and cobalt. For example, under a 2-degree scenario, demand for relevant minerals in electric storage batteries—aluminum, cobalt, iron, lead, lithium, manganese, and nickel—are all expected to increase by over 1,000 percent.

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Current Scenario for Critical Minerals around the Globe:

-1. Rapid Surge in Demand and Market Growth for Critical Minerals:

-From 2017 to 2022, the demand for lithium tripled, cobalt increased by 70%, and nickel rose by 40%, primarily driven by the energy sector.

-The International Energy Agency (IEA) has estimated that in order to meet the Paris Agreement targets, the share of clean energy technologies in the total demand for critical minerals over the next two decades would be over 40% for copper and rare earths, 60-70% for nickel and cobalt and 90% for lithium.

-In general, mineral demand for clean energy technologies would rise by at least four times by 2040 to meet the climate goals.

-2. Global Efforts through Policy Measures:

-The availability of critical mineral supplies will greatly impact the affordability and speed of energy transitions. To mitigate uncertain global supply chains, countries are implementing new policies to diversify their mineral supplies.

-The US, Canada, the EU and Australia have enacted regulatory legislation, while resource-rich nations like Indonesia, Namibia, and Zimbabwe have imposed restrictions on the export of unprocessed mineral ores.

-3. Concentration of Critical Minerals in Select Countries:

-These resources are concentrated in a few countries and, in the case of lithium, cobalt and rare earths, the world’s top three producing nations control well over three-fourths of global output.

-Specifically, Australia has 55% of lithium reserves, China has 60% of the rare earths, Democratic Republic of Congo (DRC) has 75% of cobalt, Indonesia has 35% of nickel, Chile has 30% of copper reserves.

-4. Geopolitical Tensions and Resource Nationalism:

-It is important to address these challenges because global relations between nations have become more polarised, especially due to events like the US-China trade war and the Russia-Ukraine war. These conflicts have led to sanctions and disruptions in established trade patterns.

-5. Supply-Demand Dynamics:

-As the prices of critical industrial metals, such as copper, are expected to increase in the coming years due to growing demand surpassing supply. This rise in material prices will likely disrupt the production costs of devices like solar panels and electric vehicles.

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The Role of Traceability in Critical Mineral Supply Chains:

Traceability can be understood as the capacity to determine where a particular product originates, where it has travelled, who has handled it, and what modifications it has undergone. If an entity is able to establish these four elements for a particular product with a certain degree of confidence, the product can be said to be “traceable”. Beyond the four outlined elements, traceability can also be used to pass on certain information on a product’s ESG performance. When tracing a product, ESG data can be attached to the four elements to provide a more complete picture of the product’s sustainability performance. For example, when tracing a mineral product incorporated into a battery, information on GHG emissions can be attached along the supply chain – thus providing a sense of the battery’s environmental performance compared to other batteries available on the market. Although traceability can be used to obtain ESG data, establishing the four mentioned elements is the minimum requirement for achieving traceability. Without these four elements, the product cannot be said to be truly “traceable”, even if some ESG data are attached along the supply chain.

Critical mineral supply chains cannot be truly secure, reliable and resilient unless they are also sustainable and responsible. Growing demand for critical minerals will mean new mines, processing facilities and refineries, which can bring attendant risks of harm to the environment, workers, communities and societies. These harms, if not adequately prevented, mitigated or remedied, can disrupt supply and hinder the rapid scale-up of clean energy technologies. To address these challenges, processes, tools and mechanisms are needed to ensure and demonstrate responsible practices across the value chain. Traceability can play an important role in supporting different types of policy goals, including on energy security, and ensuring sustainable and responsible supply chains are supported by strong due diligence processes. Many jurisdictions are already introducing regulations with specific origin and environmental, social and governance requirements that indirectly or directly require supply chain transparency as part of broader supply chain due diligence requirements. If implemented carefully, traceability systems can enable the collection of data on product origin, geographic path, the sequence of entities that held ownership or control over the product and its physical evolution. To the extent that information of this nature can be integrated into traceability systems alongside accurate and reliable data on environmental, social and governance performance, this can enable companies to demonstrate compliance with regulatory requirements while providing governments with tools to monitor regulatory adherence and progress toward sustainability or security-related targets.

Traceability systems must also be tailored to mineral supply chains and risks. Characteristics such as the geographical location of operations, technical complexity of processing, and the number of companies operating in the supply chain can all create unique sourcing challenges that impact the level of visibility that is most effective. For example, the blending of synthetic and natural graphite during the processing stage may obscure full end-to-end traceability. High levels of artisanal and small-scale mining in the cobalt supply chain may require traceability systems to adapt to remain inclusive, for example, by using solutions better suited to low connectivity environments and cognisant of barriers to access in terms of incentives, costs and levels of formality.

Above all, traceability should not be seen as the goal in and of itself – traceability systems should aim to support clear objectives. Any approach that directly requires traceability should be measured, allowing for an increase in pace and stringency to maintain smooth market functioning. Aligning implementation timelines and requirements with industry readiness would foster inclusive engagement with source countries, preventing blanket disengagement. Avoiding being prescriptive on end-to-end traceability and considering technical alternatives for fostering supply chain transparency as necessary can help ensure efforts to promote traceability are fit for policy objectives.

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The critical mineral supply chain for specific minerals:

The global transition towards renewable energy and advanced technologies has sparked a race for control over critical mineral supply chains. The extraction and processing of these minerals are highly concentrated in a few key countries, leading to concerns about the stability and security of global supply chains. Here’s a closer look at the countries dominating the reserves, production, and processing of these minerals, based on data from the US Geological Survey (USGS) and the International Energy Agency (IEA).

Cobalt:

The Democratic Republic of Congo and China lead the charge:

Cobalt is crucial for the production of lithium-ion batteries, which power electric vehicles (EVs) and other renewable energy technologies. The Democratic Republic of Congo (DRC) dominates cobalt production, accounting for 73% of global mine output. This central African nation also holds 57% of the world’s cobalt reserves, highlighting its significant role in the global supply chain. However, the processing of cobalt is dominated by China, which handles 74% of the world’s cobalt refining. This is a critical link in the supply chain because processing is where raw cobalt is turned into battery-ready material. Other players in processing include Finland (10%) and Canada (4%). This imbalance between production and processing highlights the vulnerabilities in the cobalt supply chain, particularly the reliance on China for refining.

Tracing cobalt to the mine sites poses numerous challenges, including potential interaction between large-scale mining and ASM, both commercially and physically, throughout all segments of the upstream supply chain. ASM in the Democratic Republic of the Congo has accounted for an average of 5-15% over the last decade. Cobalt is also typically mined as a by-product of copper and nickel, potentially complicating efforts to separate and trace it individually throughout the supply chain down to the mine level. At the midstream, cobalt refining mostly takes place in China, a market that accounts for almost 80% of refining and smelting operations.

Figure below shows cobalt supply chain.

In contrast with other critical minerals, cobalt has relatively higher levels of company concentration in its supply chain, with the top three owners in the formalised sector accounting for around 45% of both mining and refining. There are not as many small producers operating in the formalised sector of the supply chain. This makes it easier to achieve a high level of traceability, at least outside the ASM sector, provided there is co-ordination among the major actors in the supply chain. However, much of the high social and governance risk associated with the cobalt supply chain stems from the informal sector, which has historically been linked to human rights abuses. Disengaging from this sector due to the challenges of achieving full traceability does not constitute responsible sourcing and may exacerbate the root causes of child labour. There are also high risks associated with the environmental performance of mining and refining, a key concern that traceability solutions may help address.

Lithium:

Australia and Chile compete, but China dominates processing:

Lithium is another key element in battery production, particularly for EVs. Australia is the largest producer of lithium, contributing 51% of global mine production, while Chile follows with 26%. However, Chile holds the largest reserves, with 34% of the world’s lithium reserves, followed by Australia with 22%. Despite being a minor player in terms of production, China once again dominates the processing of lithium, with 65% of global refining capacity. This is crucial as the raw lithium needs to be processed into lithium carbonate or lithium hydroxide for use in batteries. Chile is the second-largest processor, but far behind China, handling only 29% of global lithium refining.

Primarily, lithium is sourced from brines in Latin America (Argentina and Chile) and hard rock in Australia, which together accounted for over 70% of production in 2023. Within those countries, there is a high concentration among the top three lithium-producing operators, who accounted for just over 50% of production in 2024. Despite this, the rest of the world’s production is spread out among a large number of smaller producers, who account for 85% of companies. Although a high level of concentration among top producers could allow for easier traceability in lithium supply chains, the rest of production, being carried out by small producers, could increase the complexity and cost of traceability systems.

The refining of brine or hard rock lithium into lithium carbonate or hydroxide requires extensive processing (Figure below). This process largely occurs in China, which accounted for nearly two-thirds of refined production in 2023. Compared to the mining segment, there is less concentration among companies in refining, with the top three accounting for only 30% of production, and a lower number of small producers. Therefore, the complexities of traceability within the lithium supply chain are largely driven by the diverse extraction methods and the large number of small companies in the mining segment, which could potentially increase costs for tracing lithium supply chains.

Figure below shows lithium supply chain.

In the lithium supply chain, the largest Environmental, Social, and Governance (ESG) risks that should be considered when setting up traceability systems for due diligence revolve around its high water demand and the environmental performance of its refining sector. Brine extraction, a common method of obtaining lithium, is particularly water intensive and typically occurs in arid regions where water scarcity is already a significant concern. Insufficient consultation with local communities and the absence of free, prior and informed consent from Indigenous Peoples have led to opposition to extraction projects, such as in Argentina, Portugal and the United States. There have also been governance issues around the acquisition of licences in Chile, the Democratic Republic of the Congo and Namibia.

Natural graphite:

China’s absolute control:

China’s dominance extends to natural graphite, where it controls 72% of global production and a staggering 100% of processing capacity. This means all of the world’s graphite destined for batteries, lubricants, and other industrial applications must pass through Chinese processing facilities. In terms of reserves, China also leads with 28%, followed closely by Brazil, which holds 26% of global reserves.

Mozambique and Madagascar are emerging players in graphite production, contributing 10% and 8% respectively. However, they lack the processing infrastructure to compete with China, highlighting the need for investment in processing facilities outside of China to diversify supply chains.

Figure below shows Battery-grade graphite supply chain:

Battery-grade graphite supply can be sourced from either natural or synthetic graphite, both of which must meet high purity requirements. Achieving this involves additional processing, which may include the blending of natural and synthetic graphite. This complex processing may complicate traceability efforts for graphite, particularly in the midstream.

Graphite faces significant ESG challenges. Many graphite refining operations are concentrated in areas with carbon-intensive grids, further increasing emissions levels, and in areas with poor social and governance performance. The specific risks vary depending on whether natural or synthetic graphite is considered. Natural graphite tends to have a lower environmental footprint during production, whereas synthetic graphite, produced from carbon-rich materials such as petroleum coke, generates over four times the carbon emissions of natural graphite anodes.

Rare earth elements:

China’s stranglehold:

Rare earth elements (REEs) are critical for a range of advanced technologies, including wind turbines, electric vehicles, and military equipment. China again emerges as the dominant player, responsible for 70% of global rare earth production and 90% of processing. The United States and Australia contribute to production, but their shares are small, at 14% and 6%, respectively.

China’s dominance in rare earth processing is a particular concern for supply chain stability. Processing rare earths is a complex and environmentally challenging task, and China’s experience in this field gives it a significant advantage over other nations. The U.S., which holds 14% of rare earth production capacity, relies heavily on China for processing, as do other countries with REE resources like Australia and Vietnam.

Traceability in this supply chain may be difficult, particularly due to the large number of small producers, which account for almost 50% of all companies mining rare earth elements. Traceability to the individual product level is further complicated by supply chain complexities, as different elements are often extracted together and require complex and costly separation processes. China has only two main rare earth element refiners, making it potentially challenging for other companies in the supply chain to exert leverage on responsible sourcing issues.

Figure below shows REE supply chain:

Notes: LREEs = light rare earth elements; HREEs = heavy rare earth elements.

Rare earth elements face one of the highest weighted average grid intensity scores for refining operations. The supply chain also faces social and governance risks, which may be particularly difficult to trace in cases of illegal mining, such as smuggling from Myanmar, Malaysia and Viet Nam to China. Most rare earth element mining operations in Myanmar occur near the Pang War-Tengchong border crossing with China in Kachin State, which is largely controlled by the Kachin Independence Organisation. Due to the proximity of these critical resources to China, the vast majority is transported across the border for further processing and refining at multiple rare earth element processing facilities throughout China, which often combine raw materials from diverse sources, making traceability difficult.

Nickle:

Indonesia, the Philippines and New Caledonia:

Nickel is primarily used in alloys for stainless steel, with 60% of demand coming from this application in 2023. However, it also plays a dominant role in a variety of battery chemistries, making it an important contributor to the energy transition. In climate-driven scenarios, demand for nickel from clean energy technologies is expected to reach around 50% by 2050. Nickel has moderate geographical concentration for both mining and refining, with the top three countries accounting for around 70% for both processes. This is expected to further increase towards 2030, as many of the announced projects in the pipeline are in the world’s incumbent players. Outside the top three, there are just over 25 other countries that mine or refine nickel in varying quantities.

Nickel ore comes from various sources – laterite ore is found in Indonesia, New Caledonia the Philippines, and Australia while sulphide ore is found in Australia, Canada, China and the Russian Federation (hereafter, “Russia”). These different types of ore require distinct processing methods to produce battery-grade nickel, making traceability in nickel supply chains complex. In recent years, the practice of processing lower-grade nickel into intermediates has emerged, largely taking place in Indonesia. Intermediates are then transformed into battery-grade nickel sulphate in China. Almost 75% of battery-sulphate production takes place in China. Due to the multiple sources of ore and the associated processing pathways, including the intermediate stages, full traceability in nickel supply chains can be highly complex and costly to implement. For certain high-grade nickel with vertical integration – such as production that occurs in Canada – it may be easier and less costly to implement.

Figure below shows nickel supply chain.

Notes: HPAL = high-pressure acid leaching; FeNi = ferronickel; NPI = nickel pig iron; MHP = mixed hydroxide precipitate; MSP = mixed sulphide precipitate.

Nickel has high ESG risks. Its low environmental performance in mining can result in high levels of biodiversity risk, while nickel refining is energy- and carbon intensive, particularly for laterite ore processing in the currently dominant pathways. Refining can also produce high levels of waste, particularly in the emerging processing pathway of high-pressure acid leaching. In Indonesia, a string of corruption cases related to nickel mining and smelting put the spotlight on corruption risks at the licensing stage, as well as the interlinkages between governance and environmental harm. There has also been opposition to projects and operations due to adverse and unmitigated impacts on local communities, particularly Indigenous Peoples, in Indonesia and the Philippines.

Copper:

Copper is among the most complex energy minerals in terms of supply chain logistics. While copper is mainly used in infrastructure, such as for construction and electricity networks, which accounted for 25% and 20% of global demand in 2023, respectively, it also sees demand from numerous applications such as industrial machinery and equipment and the transportation sector. The production of copper is also among the least concentrated of all the minerals, with mining occurring in over 60 countries, and the largest countries – Chile, China and Peru – accounting for less than half of global production.

Figure below shows major Copper Production and Reserves countries:

Unlike other critical minerals, adequate supply is not a significant issue for copper. There are at least 40 years of mineable reserves available, as well as over 700 years of total reserves, much of which is in Australia and Latin America (Figure above). The greater difficulty is in tapping these reserves in a way that is profitable, sustainable, and responsible.

Figure below shows copper supply chain.

Refining is more concentrated, with China accounting for 45% of global copper refining. However, over 55 other countries also produced at least some copper in 2023. In the process of producing final refined copper, the metal is often blended during both the smelting and refining stages, requiring careful consideration of ways to differentiate products down to the batch level when integrating traceability systems into the supply chain. Although copper is less geographically concentrated compared to other energy transition minerals, reducing its geopolitical risks, the diversity of end-uses and the technical process of refining it into a final product increase the complexity of traceability in the copper supply chain.

Copper faces ESG risks that include the high emissions intensity of the grid in refining locations, the energy-, water- and waste-intensive nature of the mining phase, which will become increasingly significant as lower-grade copper deposits are mined, and the high water stress faced by copper production operations in drought-prone regions. Failure to secure a social licence to operate and conduct adequate free, prior and informed consent processes can lead to opposition from local communities and disrupted 0.1% of global copper’s initial mine production targets in 2023. Over the last 5 years, weather-related incidents disrupted an average of 0.4% of global copper’s initial mine production targets.

In certain countries, copper ASM comprises a significant part of national production. In Peru, it is estimated to employ 100000 people working in almost complete informality. The material enters legal supply chains through certain copper concentrators or “invoicers” (licence-holders with no actual mining operations). In 1960, Chile created ENAMI, a state-owned enterprise that to this day buys ASM copper and gold, carries out smelting, and provides credit and capacity building to miners.

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The risks of concentration in mineral supply chains:

The overwhelming dominance of a few countries in both the production and processing of these strategic minerals presents several risks.

First, the reliance on China for processing means that any disruption in Chinese production—whether due to geopolitical tensions, environmental regulations, or trade restrictions—could have far-reaching consequences for the global supply chain.

Second, the concentration of mineral production in countries like the DRC (for cobalt) and China (for graphite and rare earths) raises concerns about ethical sourcing and environmental impacts. The DRC, for example, has been criticised for poor labor practices in its cobalt mines, including the use of child labor. Additionally, the environmental toll of mining in these countries often goes unchecked, further complicating the ethical dimensions of the supply chain.

Efforts to diversify the supply chain:

To mitigate these risks, several countries and companies are investing in diversifying the global supply chain for strategic minerals. The U.S., for example, has ramped up efforts to develop domestic production and processing capabilities. In 2023, three recycling facilities for strategic minerals became operational in the U.S., aimed at reducing reliance on foreign imports.

Countries like Australia and Canada are also ramping up their efforts in lithium, cobalt, and rare earth production, while nations such as Brazil and Mozambique have begun to exploit their graphite reserves. However, despite these efforts, the overwhelming dominance of China, particularly in processing, remains a significant challenge.

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Top 10 countries controlling the critical minerals supply chain:

With the global energy transition under way, critical minerals are fast replacing fossil fuels as the most sought-after natural resources. Critical minerals such as copper, lithium, manganese and nickel are essential to the development of technologies behind solar PV, wind energy, electric vehicles (EVs) and energy storage.

Key critical minerals for the energy transition include copper, cobalt, lithium, nickel and manganese. Mine Magazine has identified those countries that exercise a significant degree of control over overseas mines that contain one of these five minerals as a primary commodity as seen in figure below. The degree of control is determined by examining the domicile of companies with either majority control, or the largest stake in mines that are already in operation, or under development (at the pre-feasibility, feasibility or construction stage).

*Domestic mines in China are excluded from the analysis due to data gaps – it is likely that China would rank much higher on the list of total mine control if domestic mines were included.

Canada, one of the few Western countries with an abundance of cobalt, graphite, lithium and nickel, tops the list for corporate ownership of critical mineral mines already in operation, with a total production of 508 million tonnes per annum (mtpa) overseas as of 2022, and a further 118mtpa at home.

Canada is closely followed by the US, which has 292mtpa of critical minerals production located overseas and 281mtpa located domestically.

China, for which domestic data isn’t available, follows the US, while next on the list is Britain, which is second in the world for overseas ownership of critical mineral mines. Despite owning no domestic mines, British companies control 503mtpa of capacity overseas.

Another country in the top ten is Australia, which boasts the world’s largest lithium reserves, currently valued at more than $425bn, and the world’s second-largest reserves by value of copper and cobalt.

Overseas ownership by destination is depicted in figure below:

South American countries Chile and Peru stand out as the top destinations for foreign investment in critical minerals mines. For Canadian companies, the top destination is Chile, as is the case for several other countries controlling the critical minerals supply chain, including the UK and Australia. The top overseas location for mines owned by US companies, on the other hand, is Peru. Chinese companies own critical mineral mines dotted across all five continents including Africa, where US companies, by contrast, are a lot less present.

Definitely China, the US and Australia are three countries that are really strong economically and also in minerals reserves and mining. As well as controlling several value chains, they have reserves of the base minerals that so many energy transition industries rely upon. They will really dictate the prices of these minerals going forward, and even other countries with large reserves will have to rely on those big three for the investment and technical know-how to exploit them.

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The U.S. Geological Survey (USGS) determined supply risk score of critical minerals:

For 54 minerals that had enough data in 2018 for a quantitative assessment, the USGS analyzed each mineral’s supply risk based on trade exposure, economic vulnerability, and disruption potential factors. Figure below displays the relative vulnerability of a mineral’s supply chain to trade exposure, economic vulnerability, or disruption potential for 54 mineral commodities using production and refinement data for 2018. Such a scatter plot allows the three factors and supply risk to be shown in two dimensions, such that the relative importance of each factor on each mineral’s supply risk may be compared. In addition, each mineral’s criticality can be compared to that of other minerals. The trade exposure factor is based on the U.S. net import reliance on the mineral; the size of the circles for each mineral in Figure below corresponds to normalized trade exposure from 0 to 1, where the larger the circle the greater the trade exposure (i.e., the higher the net import reliance). The economic vulnerability factor is based on high expenditures for commodities in industries with low operating profits where the industries have a higher economic importance for the U.S. economy; the normalized economic vulnerability increases along the vertical axis from a low of 0.0 to a high of 1.0 in Figure below. The disruption potential factor is based on the producing country’s share of the global mineral production and its willingness to continue to supply the mineral; the normalized disruption potential factor increases along the horizontal axis from a low of 0.0 to a high of 1.0 in Figure below. Each mineral’s normalized supply risk score, which is a combination of these three factors, is displayed by color shading, where the darkest blue represents a low risk of 0.0 and the darkest red represents the highest risk of 1.0.

Figure below shows Mineral Commodity Supply Risk:

Notes: The figure includes the 54 mineral commodities quantitatively assessed by the USGS for their supply risk based on extraction and processing data for 2018. Thirty-nine of these mineral commodities are on the 2022 critical minerals list (CML). The plot does not include cesium, erbium, europium, gadolinium, holmium, lutetium, rubidium, scandium, terbium, thulium, and ytterbium, which are on the 2022 CML. The USGS assessed these minerals qualitatively. The vertical and horizontal lines inside the plot denote 0.25, 0.50, 0.75 values on the vertical and horizontal axes to guide readability. The circle plotted for gallium is near the 0.5 horizontal line for economic potential and near the 0.75 vertical line for disruption potential.

Ranking Minerals by Supply Risk Score:

The supply risk for each quantitatively evaluated critical mineral was normalized to a number between 0.0 and 1.0, with 1.0 being the highest supply risk. The supply risk was calculated for each year between 2007 to 2018 where enough annual data were available for each mineral. Then a recency weighted supply risk score was calculated for 2015-2018, with more weight given to the most recent years. This was done to capture more recent trends in each mineral’s supply chain.

The U.S. Geological Survey (USGS) determined a recency weighted supply risk score threshold of 0.4 for designating a mineral critical and placing the mineral on the critical minerals list. The threshold of 0.4 is based on combining the thresholds for three factors: economic vulnerability, trade exposure, and disruption potential. The USGS used the following thresholds for each factor: 0.2 for economic vulnerability, 0.4 for trade exposure, and 0.5 for disruption potential.

Figure below shows Mineral Supply Risk and Leading Producing Countries:

Notes: The minerals above the dotted line are on the 2022 critical minerals list (CML) because they have a higher supply chain risk (red to yellow shading) based on a recency weighted mean supply chain risk score of 0.4 or greater. In addition, beryllium, nickel, and zirconium are on the 2022 CML because they have a single point of failure on their supply chain. Cesium, erbium, europium, gadolinium, holmium, lutetium, rubidium, scandium, terbium, thulium, and ytterbium are on the 2022 CML; however, these minerals were assessed qualitatively and are not listed here because they do not have a recency weighted mean supply chain risk score. The annual supply chain risk is calculated for each year from 2007 to 2018 for each mineral, as shown above. If there are not enough data to calculate the annual risk, the box is white. A recency weighted mean supply risk score was calculated using the USGS quantitative methodology for each mineral using production and processing (i.e., refining) data from 2015 to 2018. Recency weighted means that the score for the most recent year, 2018, was given a higher weight, whereas past years until 2015 were given a lower weight. DRC = Democratic Republic of Congo.

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Minerals and metals supply chain risks:

A supply chain includes extraction, processing, component development, and end-use technology. Recycling or reuse is possible at any step of the supply chain. Besides changes in mineral criticality, supply chains may be vulnerable if they lack diversity and capacity. Some factors that may limit diversity include extraction or processing of some critical minerals in only a few locations. Factors that may limit extraction capacity include reserve locations limitations, technical challenges to extracting the critical mineral, export quotas, environmental impacts, geopolitical volatility, market volatility, and capital requirements.

Extraction or processing of some critical minerals in a few locations limits diversity. For example, in 2019, 60% or more of lithium, cobalt, and graphite resources were extracted in Australia, Congo, and China, respectively, and 60% or more of lithium and cobalt were processed in China (Figure below). China has been a top producer of many REEs since the mid-1990s.

Figure below shows Top Producers and Refiners of Critical Minerals for Batteries in 2019:

Notes:

Mine production refers to the extraction of a mineral resource and is most often quantified in the weight of material mined in metric tons over a specified time period. A metric ton is a unit of weight equivalent to 1,000 kilograms (about 2,204.6 pounds). Total metric tons refer to the total global amount of production in 2019 and the total global amount of refinement in 2019 in the top and bottom tables, respectively. The percentages given in the tables may not sum to 100% for each mineral because not all producers or refiners are listed. The total metric tons for each mineral for global production may not equal the total metric tons for each mineral for global refinement because production and refinement are different processes involving different materials and these steps potentially may occur in different years. Class 1 Nickel is 99.8% pure nickel. Australia refined about 10% of class 1 nickel, which is shown on the map. As the fifth top refiner, Australia is not listed under the heading Percent of Global Refinement in the figure, which shows the top four refiners for Class I Nickel.

According to the U.S. Department of Energy (DOE), a generic supply chain—which includes extraction, processing, components, end-use technology, and recycling and reuse—provides a useful context to consider geologic, technical, environmental, political, and economic factors that impact supply risk.

Supply risks may be (1) geologic—whether the resource exists in nature, (2) technical—whether the resource can be extracted and processed, (3) environmental and social—whether the resource can be extracted and processed in an environmentally and socially acceptable way, (4) political—whether governments influence resource availability through policies and actions, and (5) economic—whether the resource can be extracted and processed at a cost that users are willing to pay.

Critical minerals supply-demand imbalance risks include five risk categories – political, economic, social, technological and environmental – by highest likelihood and impact. As highlighted in the graphic below, these risks range from insufficient capital to address supply-demand imbalances, to a rise in illegal mining and more volatile commodity prices.

Figure above illustrates the ecosystem risks from the supply demand imbalance of critical minerals.

Minerals and metals supply chains have been disrupted with increasing frequency and intensity in recent years. The disruptions have included natural disasters and crises such as wars, earthquakes, climate change triggered crises such as wildfires, floods, and heat waves. More recently, supply chains were disrupted by a global pandemic, that is the COVID 19 novel virus which brought the whole world to a standstill (Kumar et al., 2023; Cantelmi et al., 2022) and the European war between Russia and Ukraine, with several other countries taking a direct or an indirect part (Esfandabadi, Ranjbari and Scagnelli, 2022). On an ecological front climate change induced disasters such as cyclones, hurricanes, heat waves, floods and several others have resulted in disruptions requiring emergency interventions (Qin et al., 2023). When such disruptions are experienced, supply chains may withstand them, but if they are not adequately prepared, they may collapse with often costly consequences (Ellis, 2022). The capacity of supply chains to revert to their original state or to a better position after a disruption has been defined as supply chain resilience (Chu et al., 2020).

Supply chain risk emerged as a new risk in the Ernest and Young (2022) mining industry risks even though it is an issue that has been around the sector for some time. Different methods are used to analyse supply chain risks, including the world governance index (WGI), the Findahl-Hirschman Index (FHI) and the network analysis method (NAM) (Van den Brink et al., 2020; Habib et al., 2016). Several authors have alluded to other risks that indirectly contribute to supply chain disruptions, and they include political supply risks (Grover and Dresner, 2022) and social and legal risks that may accompany environmental damage (Mills, 2022). For example, countries with robust environmental regulations may halt some mining operations if the mineral being mined or the processes used to mine and or process are hazardous. This was substantiated by Chu et al. (2020) who also confirmed environmental risk as a threat to supply chains performance. Other supply chain risks include process and control risk, demand risk and sustainability risk (Colicchia et al., 2010; Corbett et al., 1999).

Ghadge et al. (2012) categorise supply chain risks as organizational risks (inventory risks), network risks (internal interactions) and environmental risks (natural disasters). Focusing on minerals supply chains, Zeng et al. (2021) lists some of the supply chain risks as unpredictable mineral prices, pricing, uncertain mineral resources, changeable market, supply disruptions and unstable geological conditions. Meyer et al. (2021) added some of the supply chain risks as a rise in prices, countless fluctuation in the demand of goods and unpredicted supply shortages. Similarly, Tang and Musa (2011) identified shorter product life cycle and an increasing demand as some of the complications of supply chains, specially, because they affect the operational performance through hamstrung transportation lead time and the need for costly supply-side product monitoring systems. According to Habib et al. (2016) supply risk can also be assessed through the geological and geopolitical supply risk as they relate to a particular resource.

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Sources of supply risk for critical minerals:

Nearly all countries are susceptible to unforeseen supply interruptions since none are self-sufficient in all materials. Even countries with a smaller manufacturing base are prone to trade disruptions. Although they may not rely heavily on direct raw material import, they nonetheless rely on a functioning global market for critical materials and technologies since they import parts or finished goods (e.g. solar panel modules) for renewable energy installations (Patterson, 2018). The risk of supply chain disruption directly affects companies using imported minerals or finished goods to manufacture solar panels, wind turbines and batteries. However, multiple industries can be affected by supply interruptions, which could reverberate throughout the economy. The impact could be widespread given multiple sectors – from industry and digital infrastructure to agriculture – rely on minerals and metal commodities for manufacturing goods. The probability of, and vulnerability to, supply disruptions is measured using various indicators. One review identified no less than 30 indicators of supply risk (Schrijvers et al., 2020). Risk assessments can also be conducted at different levels, including for a single or a group of countries, companies, products and economic sectors.

Here are some sources of supply risk for critical materials.

-1. Supply shortages due to increased demand:

Renewable energy systems and electric vehicles (EVs)— central components of the energy transition—require several times more minerals than their traditional counterparts. In the race to decarbonize, demand for critical minerals such as lithium, nickel, graphite, cobalt, copper, and rare earth elements (REEs) is likely to increase two- to elevenfold over the next decade, reaching $750 billion by 2035. Though more modest in impact, technological advances and urbanization also contribute to the surging imbalance in mineral supply and demand.

Growing demand coincides with significant geological, operational, and technological constraints, including the depletion of existing mines, a general decline in ore quality, and a shift in new development to riskier regions. Under- investment in exploration only aggravates these trends. In addition, stricter social and environmental regulations have protracted typical permitting timelines so much that the average time from exploration to first production is now 16 years. Delays can slash a project’s value by over 60%, diminishing its attractiveness to investors and hampering its overall viability.

Copper is critical to the global energy transition. One major use of copper is in winding wire, used in electric motors, as well as in cabling, used to transmit electricity. Copper consumption growth will be underpinned by rising demand from energy-transition linked sectors, such as wind power generation, solar arrays and, particularly, EVs and the associated charging infrastructure. At the same time, copper is also likely to face supply constraints, due to ore depletion at major mines and recent closures. As a result, the copper market is likely to face periods of tightness, requiring investment in new capacity.

-2. External shocks:

Global critical material supply chains, which are interconnected, are susceptible to disruptions that may be caused by natural events, such as earthquakes, or could result from human action, either intentional (e.g. trade disputes, wars) or unintentional (e.g. power outages). In recent years, for example, global raw material supply chains have been disturbed by shocks such as the COVID-19 pandemic, the war in Ukraine and the global energy crisis. Parts of the critical material value chain are also exposed to the physical effects of climate change – from sea level rise to more frequent and severe weather events. Some materials, for example, nickel, cobalt and rare earths, are mined and processed in areas that are likely to be at a greater risk of heavy rainfall and floods. An example of this could be found in 2020, when a “once-in-a-century” flood in China’s southwest province of Sichuan shut down rare earth processing plants and damaged inventory (Daly and Zhang, 2020). Other mining activities are likely to be hit by drought and water scarcity. For example, approximately 50% of lithium mining is in high water stress areas. Given that lithium mining has a substantial water requirement, this could create conflicts surrounding the use of water (IEA, 2022).

-3. Resource nationalism:

The term “resource nationalism” typically refers to the assertion of control by people and governments, for strategic and economic reasons, over natural resources located on their territory. In recent years, numerous governments have increased state control over their mineral resources to enhance the benefits from extraction or address its adverse impacts. This has been accomplished through, for example, tax regime strengthening, royalty renegotiation, creation of state-owned mineral companies, nationalisation of critical material industries and restrictions on foreign investments. This trend can be observed in many countries, including Australia, Canada, Chile, Mongolia, Namibia, Peru, South Africa and Zambia, among others.

Many countries have also increased scrutiny of foreign investments, not just in the mining industry but across various sectors (UNCTAD, 2023). Australia and Canada, for instance, have recently implemented stricter foreign investment regulations in their mineral sectors. This trend of increased government scrutiny of foreign investments reflects concerns about national security, environmental sustainability, and local ownership and control over natural resources.

-4. Export restrictions on critical materials:

Export restrictions on raw materials are a growing concern in international trade. Incidences of such restrictions have grown more than fivefold over the past decade (OECD, 2023). According to the OECD, about 10% of the global value of critical raw material exports has faced at least one export restriction measure in recent years (OECD, 2023). Export restrictions take multiple forms, including export quotas, export taxes, obligatory minimum export prices, or licensing.

Export restrictions especially for critical materials appear to be on the rise, with several countries implementing major export bans. Zimbabwe banned the export of raw lithium in December 2022 (Marawanyika and Ndlovu, 2022). Similarly, Indonesia banned bauxite export in June 2023 (Shofa, 2023). Around the same time, Namibia prohibited the export of raw lithium and other critical materials (Nyasha Nyaungwa et al., 2023). These recent measures reflect a growing trend of countries taking steps to encourage domestic processing and attract downstream industries.

Quantitative import and export restrictions are largely prohibited under Article XI of the WTO’s General Agreement on Tariffs and Trade, except under certain limited exceptions, such as environmental conservation, national security or assuring raw material supply. These exceptions must meet specific conditions, for example, not protecting domestic industries or discriminating against other countries. The measures should also not unfairly restrict international trade. The growing trend of export restrictions on critical materials has triggered a series of trade conflicts, some of which are being addressed at the World Trade Organization (WTO).

By the early 2000s, China had a near monopoly, mining approximately 95% of the world’s rare earth elements (US Geological Survey and US Department of the Interior, 2010). However, increasing concerns over environmental pollution, illegal mining and resource depletion led the government to decide on developing a downstream industry (Wübbeke, 2013). Starting in 2006, the country introduced several regulations, including export quotas, production quotas, export taxes and restrictions on foreign investment (Shen et al., 2020). Export quotas were introduced gradually, but in 2010, China decreased its export quota for rare earths by 37%, resulting in a surge in rare earth oxide prices since alternative supplies were lacking.

Apart from export quotas, Chinese shipments to Japan were reportedly interrupted for a few weeks between September and November 2010 after the detention of a Chinese fishing trawler’s captain amid a maritime dispute (Wilson, 2018). Reports on the number of delayed rare earth exports, the length of delays and the parties responsible for them continue to be conflicting. Analysis of customs data from the Japanese Ministry of Finance shows that Japanese imports of Chinese rare earths did not decline uniformly following the trawler incident (Johnston, 2013).

In March 2012, Japan, the European Union and the United States requested a World Trade Organization consultation over Chinese rare earth export restrictions. China defended the restrictions as necessary for conservation, whereas the complainants countered that they were, “designed to achieve industrial policy goals rather than conservation”. In 2014, the World Trade Organization Appellate Body decided in favour of the complainants, and China was required to lift its rare earth export restrictions.

-5. Mineral cartels:

The high concentration of mineral production raises concerns of market cartelisation and collusion. Mineral supply is concentrated geographically, and corporations with large market shares in key segments of mineral value chains dominate their mining and refinement. This concentration of production could potentially lead to the formation of commodity cartels, groups of major producers that maximise their profits by co-operating on the production, pricing and/or distribution of commodities.

Demand elasticity is crucial factor that affects the feasibility of a commodity cartel. It refers to how quickly and to what extent a product’s demand might shift in response to high prices. A commodity cartel has limited control over price if a product is highly elastic, meaning consumers are willing to reduce its consumption at higher prices or could swiftly shift to substitutes. Conversely, a commodity cartel may have greater control over price if a product is relatively inelastic, meaning consumers have few or no substitutes.

Platinum:

The Russian Federation and South Africa signed a memorandum of understanding on platinum group metals (PGMs) at the March 2013 BRICS (Brazil, Russia, India, China and South Africa) summit. Together, they hold a substantial share of the PGM market – over 80% of global platinum supply and over 96% of global PGM reserves – hindering the entry of potential competitors (US Geological Survey and US Department of the Interior, 2022). In practice, however, there are major obstacles to the creation of a PGM cartel since none of the countries has a state-owned company monopolising PGM mining. Any production cuts would require the buy-in of several private companies, including Norilsk Nickel, Anglo-American Platinum and Impala Platinum. Further, production cuts designed to increase prices could lead to job losses in the labour-intensive PGM industry, which is the largest mining employer in South Africa. The alternative of purchasing platinum from producers and storing it to support prices could strain government finances (Stoddard, 2013). Finally, sustained high prices would likely adversely impact demand as industrial users would intensify efforts to reduce, reuse or recycle PGMs in catalysts and other applications (Kooroshy et al., 2014). Although the Russian Federation and South Africa reaffirmed their commitment to the 2013 memorandum of understanding in 2018, few details have since emerged.

Nickel:

Indonesia, the world’s largest nickel miner, is considering the potential establishment of an Organization of the Petroleum Exporting Countries (OPEC)- style organisation for certain battery metals, including nickel, cobalt and manganese (Dempsey and Ruehl, 2022). While the country accounts for almost half of the global nickel production, a share larger than that of OPEC countries in oil production, replicating the OPEC model would not be without challenges. For instance, major nickel producers such as Australia, Canada and the Philippines are not supportive of the idea of the OPEC-style organisation (Listiyorini and Harsono, 2022; Serapio Jr and Lopez, 2023). In addition, the existence of untapped reserves outside of Indonesia presents opportunities for supply diversification. Further, multiple private companies, not a single state-owned entity, control Indonesia’s nickel mining. Nationalisation of the country’s nickel industry would therefore have financial and political challenges especially considering that Chinese firms have a strong position in it.

Lithium:

Argentina, Bolivia and Chile are in talks to establish a “lithium OPEC”. Collectively known as the lithium triangle, these three countries hold around 65% of the world’s known lithium resources and accounted for almost 30% of the global production in 2020 (Gielen and Lyons, 2022b). However, there are challenges to the formation of a lithium cartel. Australia, the world’s largest lithium producer and second in terms of lithium reserves, is unlikely to participate in such an endeavour (Mares, 2022). Additionally, many countries have identified significant untapped lithium reserves and resources through ongoing exploration. Further, like platinum and nickel, most lithium mining is under private control, often by foreign companies.

-6. Political instability and social unrest:

Political or social unrest in producing countries, including coups, labour strikes and civil wars, could disrupt mineral supply. The majority of minerals are extracted in countries categorised as either extremely unstable or unstable in the Worldwide Governance Indicators, which measure the quality of governance across six major dimensions, including absence of violence, control of corruption and rule of law.

Examples of such supply-disrupting instability are numerous. For instance, in 1978, the Angolan civil war spilled over to Zaire’s Shaba province (now Katanga in the Democratic Republic of Congo), triggering a sevenfold cobalt price surge in a two-year period due to fears of global cobalt shortages (Gulley, 2022). This “cobalt crisis” prompted a shift from cobalt to rare earths for manufacturing permanent magnets, in a way foreshadowing the “rare earth crisis” of 2010.

Another example is Myanmar, where the mining sector saw protests and strikes erupt following a coup in February 2021. These instabilities caused an 80% decline in export earnings from minerals for the country, which is a major rare earth producer (Frontier, 2022). A further example is Guinea, which witnessed political crisis in 2021, causing supply disruptions and uncertainty in the global aluminium market given that it is the world’s largest bauxite producer.

Critical material supply can also be disrupted due to labour strikes. Labour strikes in the South African platinum sector significantly disrupted global supply chains, with one major strike in 2014 lasting five months and causing a 40% drop in global platinum production (Stoddard, 2014). Chile, the world’s largest copper producer, has also witnessed production disruptions and supply shortages due to labour strikes, of which a major one in 2017 lasted 44 days, causing a significant drop in global copper production (Iturrieta, 2017). In Peru, strikes by copper mine workers have recently led to production shutdowns and delays, causing supply shortages and price volatility in the global copper market (Attwood, 2023). These labour strikes often highlight the workers’ legitimate concerns about poor working conditions.

-7. Market volatility and manipulation:

Critical material markets, like other commodity markets, demonstrate a cyclical nature, exhibiting a classic boom-bust pattern. This is partly due to the extended lead times required to establish new mines, causing a supply-demand gap, especially during periods of rapid demand growth. For major new greenfield mines, advancing from resource discovery to actual production typically takes seven to ten years. This means that technological advancements can trigger resource demands much faster than producers can raise supplies, resulting in periodic price surges.

This dynamic is compounded by the fact that critical minerals are often by-products of other mined base metals. For example, cobalt is typically a by-product of nickel and copper mining, nearly all indium is a byproduct of zinc mining and most rare earth elements are by-products of iron ore mining. The production of these minor metals is therefore strongly influenced by the production of the base metals, which often generate more revenues. For example, investments in new cobalt projects are often linked more to market dynamics for copper than cobalt. In other words, a higher cobalt price does not necessarily incentivise copper miners enough to produce more of it. Supply responses for metals such as cobalt, indium and tellurium are indirectly influenced by price increases due to the peculiar nature of by-product production (Nassar et al., 2015).

In addition to supply and demand dynamics, mineral and metal markets are also prone to market manipulation, which can exacerbate price volatility and supply chain disruptions. Between 2000 and 2010, there were at least 15 cases where antitrust authorities uncovered and penalised attempts to form international private cartels in mining and primary metals (Connor, 2012).

Considering mineral markets are small with relatively little liquidity, there are ample opportunities for traders to develop market-cornering positions that can constrict supply and cause price spikes (Hendrix and Bazilian, 2022). In the past, there were numerous attempts to manage the market and influence prices, creating concerns over corporate market manipulation. For instance, in the 1985 tin crisis, the tin market collapsed when a group of traders, who tried to corner the market, could not find buyers for their large tin holdings due to the unprecedented price surges (Anderson and Gilbert, 1988). Similarly, in the 1996 Sumitomo copper affair, copper prices rose sharply after a single trader at Sumitomo Corporation accumulated a significant amount of copper futures contracts. Sumitomo and other market participants suffered heavy losses when the trader’s positions were revealed, causing a market crash (Kozinn, 2000).

More recently, the LME suspended nickel trading in March 2022 after prices surged by over 250% in just two days. The price surge was attributed to a short squeeze, where traders who had bet against the price of nickel were forced to buy back their positions at higher prices, driving the price even higher (Farchy et al., 2022; Oliver Wyman, 2023). Over a year later, the nickel market remains unstable, with trading volumes falling sharply and prices experiencing frequent uncontrolled swings (Cang and Farchy, 2023).

-8. Lack of investment:

In the recent lithium long-term forecast, Fastmarkets’ analysts spoke of how the current lithium price environment will see some projects struggle to access necessary funding to progress development. The lack of investment in critical minerals can lead to various challenges, including inadequate exploration, limited processing capacity, and reliance on imports. These issues can hamper a country’s ability to reduce its dependency on foreign sources for critical materials, ultimately impacting its economic and national security. In countries like India, domestic policies have not fostered investments in the critical minerals sector, resulting in slow growth across the domestic supply chains. Funding for infrastructure improvements—building reliable roads, constructing power grids, and sourcing energy—is also essential.

-9. Geopolitical risks, tensions and instability:

Geopolitical risks should be assessed considering certain structural trends that could have long-term implications on the availability of mineral commodities. These trends include the geographical concentration of mining and processing, the decline in mineral ore grades, the limited extent of end-of-life recycling, the dependence on by-products for many critical minerals and the limited short-term substitution possibilities for certain materials (Nassar et al., 2020). These structural factors have the potential to magnify the impact and, in some instances, the probability of the geopolitical supply risks.

In recent years, geopolitical tensions have significantly impacted the supply chains of critical minerals. The war in Ukraine has led to scrutiny and regulation of Russian exports, impacting the availability of some critical materials sourced from the region. Additionally, global sanctions on Russia have created logistical challenges, further complicating the supply chain for raw materials including copper and aluminium. Russia’s war in Ukraine has also meant a boost in copper demand, due to the millions of copper-containing shells being used.

Cobalt, a key component in EV batteries, sees around 70% of annual supply sourced from the Democratic Republic of Congo (DRC). Cobalt is primarily a by-product found during copper and nickel mining. A rise in copper prices throughout 2024 has seen a knock-on effect on the cobalt market with a rapid increase in supply causing cobalt prices to fall. With China owning seven out of the ten largest cobalt mines in the DRC, both the US and EU have stepped up efforts to create a domestic supply chain and reduce reliance on China.

The strained relationship between the US and China creates instability for commodity markets including graphite and rare earths. China’s dominance in graphite production – used for battery anodes and other industrial applications – means any trade restrictions or tariffs can lead to significant disruptions and increased costs for manufacturers. With 90% of global rare earth production also coming out of China, supply security is also a concern.

-10. Regional Water Constraints and Their Impact on Resource Availability:

Mineral production is key to our global economy, with new technologies creating higher demand for many minerals. However, large amounts of water are required for mining and processing, which could limit mineral production in some locations. Islam et al. evaluated these constraints using published data on mineral production and water requirements for different minerals, coupled with regional water-carrying capacities from a hydrologic model. They found that mineral production exceeds water resources in many regions because of high production or low water availability. Coal, iron, copper, and gold showed some of the highest overconsumption, coal because of its high production rates and the metals because they require more water to process. Water requirements for mineral production are expected to increase in the future. Notably, while iron production has high water consumption, only 9% of its production exceeded water constraints in 2010. In contrast, copper production, despite having lower water consumption, saw 37% of its current production surpassing the sustainable water limit. This highlights the need for sustainable water use in geological resource production, particularly for water-intensive metals like copper.

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Understanding Availability and Supply Risk:

Minerals, or more specifically the mineral products derived from them, are essential to the functioning of modern processes and products. Some minerals are more essential than others, in the sense that they have few if any substitutes capable of providing similar functionality at similar costs. The availability of these minerals is a function of geologic, technical, environmental and social, political, and economic factors. Some minerals are more prone than others to disruptive restrictions in supply.

Fundamentally, minerals are a primary resource in that we obtain them from the Earth’s crust. At any point in time, however, minerals—or more precisely the mineral products obtained from them—are available as secondary resources through recycling of obsolete or discarded products and materials. Finally, from the perspective of a nation, mineral products are available as tertiary resources embodied in imported products or imported scrap.

For primary production worldwide, mineral exploration, mining, and mineral processing are sectors whose fortunes change significantly from year to year because of the strong link between mineral demand and economic growth. In periods of especially strong economic growth, mineral use in general expands more quickly than production capacity, tending to drive up mineral prices, whereas in periods of slower growth or recession, mineral use tends to grow more slowly than production capacity and prices tend to fall. Given the fragility of the balance between demand and supply, mineral prices tend to swing significantly from one year to another. Since early in this decade, the mineral sector overall has experienced an extended boom (and relatively high mineral prices) due to a number of factors, including unexpectedly large increases in mineral demand in China and some other countries and unexpected interruptions in production at a number of mines due to technical problems and other factors.

The level and location of mine production today depend on the level and location of mineral exploration in the past. The level of exploration tends to follow changes in mineral prices, but usually with a short time lag. The composition of exploration activity varies with mineral prices. In recent years during a period of relatively high mineral prices, exploration by small exploration companies (termed “juniors”) in riskier and more remote locations has increased proportionately more than exploration by larger and more established mining companies. Conversely, when mineral prices fall, exploration by junior companies tends to fall proportionately more than that by larger companies, resulting in relatively less exploration in remote locations and more exploration in proximity to existing mines. The geographic location of exploration and mining also evolves over time. In recent years, relatively more exploration and mining has occurred outside the established areas of Australia, Canada, and the United States.

Turning from primary to secondary production, recycling tends to be concentrated close to semi-fabrication and metal manufacturing facilities and close to urban centers to take advantage of the creation of scrap when buildings are demolished and products are discarded. As a result, most metal recycling occurs in industrialized economies where the majority of metal use historically has occurred. Nevertheless, a significant amount of recycling occurs in developing economies, where perhaps a larger percentage of the available scrap is actually recycled than in industrialized economies. Given the long-term trend of increasing mineral use and low rates of recycling, recycled materials cannot presently meet a large proportion of demand for most materials. Over time, as products used in developing economies become available for recycling, we can expect scrap flows to increase and the location of recycling to become more geographically diverse than at present.

In considering supply risk, it essential to distinguish between short- and medium-term availability of minerals and mineral products, on the one hand, and long-term availability, on the other. In the short and medium term, there may be significant restrictions to supply for at least five reasons.

First, demand may increase significantly, and if production already is occurring at close to capacity, then either a mineral may become physically unavailable or, more likely, its price will rise significantly—demand can increase more quickly than production capacity can respond.

Second, an increase in demand due to growth in new applications of a mineral may be especially restrictive or disruptive if preexisting uses were small relative to the new use (thin markets).

Third, supply may be prone to restriction if production is concentrated; if concentrated in a small number of mines, supply may be prone to restriction if unexpected technical or labor problems occur at a mine; if concentrated in the hands of a small number of companies, supply may be prone to restriction by opportunistic behavior of companies with market power; if concentrated in the hands of a small number of producing countries, supply may be prone to restriction due to political decisions in the producing country.

Fourth, if mine production comes predominantly in the form of by-product production, then the output over the short term (and perhaps even longer) may be insensitive to changes in market conditions for the by-product because the output of a by-product is largely a function of market conditions for the main product.

Finally, the lack of available old scrap for recycling or of the infrastructure required for recycling makes a market more prone to supply restriction than otherwise.

An additional factor, import dependence, often is cited as an indicator of vulnerable supply and has carried the implication that imported supply may be less secure than domestic supply. But import dependence by itself is not a useful indicator of supply risk. In fact, import reliance may be good for the economy if an imported mineral has a lower cost than the domestic alternative. Rather, for imports to be vulnerable to supply restriction, some other factor must be present that makes them vulnerable to disruption—for example, supply is concentrated in one or a small number of exporting nations with high political risk or in a nation with such significant growth in internal demand that formerly exported minerals may be redirected toward internal, domestic use. However, imports may be no less secure than domestic supply if they come from a diverse set of countries or firms or if they represent intracompany transfers within the vertical chain of a firm (for example, imported metal concentrate to be smelted and refined at a company’s domestic processing facilities).

Over the longer term, the availability of minerals and mineral products is largely a function of investment and the various factors that influence the level of investment and its geographic allocation and success. An important investment is that in education and research, and the long-term availability of minerals and mineral products also requires continued investment in mineral education and research. Education and research contribute to determining long-term mineral availability for both primary and secondary resources in all of their dimensions. For primary resources, the first important dimension is geologic availability (in what quantities, concentrations, and mineralogical forms does a mineral exist in Earth’s crust?). Education and research of course do not determine whether and in what form a mineral occurs in Earth’s crust; rather education and research determine our knowledge of Earth’s crust. The second determinant is technical availability (does the technology exist to extract and process the element or mineral?). Technical availability depends on investment in technological knowledge. The third determinant is environmental and social availability (can we mine and process minerals such that the consequences of these activities on local communities and on the natural environment are consistent with social preferences and requirements?). Environmental and social availability depends on investment in activities that appeal to social preferences and that develop means for carrying out mining and mineral processing in socially acceptable ways. The fourth determinant is political availability (to what extent do public policies influence mineral supply?). Political availability depends on investment in the design of public policy and on the political decisions governments make that influence the level and location of production. The fifth and final determinant is economic availability (can we produce minerals and mineral products at prices that users are willing and able to pay?). In some sense, economic availability reflects the combined effects of the other four determinants of availability.

For secondary resources over the longer term, availability depends on four of the same above factors. Technology in the secondary resources sector is far behind that in the primary sector, and many gains are to be had by investing additional engineering time and effort. On the environmental and social front, recycling needs to occur with a greater degree of urgency, and making changes in this area is largely a social challenge. Politically, attention needs to be paid to understanding the national implications of resource scarcity, to providing the funds to better characterize the secondary resource, and to better evaluate opportunities for domestic recovery of secondary materials. Finally, it will be necessary to create economic incentives to make better use of the secondary resources now above the ground and in use, but often more costly to use at present than imported virgin material. Well-designed and competently directed research into improved recycling technologies may prove an effective tool in the reduction of our dependence on imports of critical minerals.

Some authors contend that mineral shortage concerns are overblown:

For many materials, the quantities required for the energy transition are not that significant compared to total consumption – energy applications constitute in many cases only a fraction of total use.
Significant substitution potential exists in such new applications, but also for some existing applications.
Recycling can reduce the need for primary production.
The necessary resources exist – it is a matter of expanding the production volume.

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Challenges to critical minerals supply:

The demand for Critical Minerals (CMs) is soaring because of their extensive use in renewable energy generation, energy storage, energy transmission, scientific instrumentation, and a wide range of communication, military, and transport technologies. However, the supply of CMs faces several critical challenges as narrated below:

With the shift towards renewable energy technologies and electric vehicles, the demand for critical minerals such as copper, lithium, and rare earth elements is increasing rapidly.
Few countries have a monopoly in mining and processing of particular CMs leading to geopolitical and oligopolistic Monopoly. The concentration of critical minerals in few countries, has led to geopolitical monopoly with only a few countries dominating these mineral resources. This leads to oligopolistic (domination by a few large firms) markets. For e.g. Australia controls 55% of lithium reserves, and China has 60% of rare earths. The geographical concentration of these minerals makes them vulnerable to geopolitical risks. Geopolitical tensions, conflicts, trade disputes, or sudden policy changes in those regions can impact their supply. For e.g. the civil war in Democratic Republic of the Congo, has affected the global supply chain of cobalt, as 70% of the world’s reserves of cobalt are located in DRC.
Variable concentration and deposit grades in different geographical areas. The geographical concentration of these minerals has led to resource conflicts. This has increased resource nationalism, and trade fragmentation. For e.g. rising resource nationalism in Africa.
Inadequate assessment of resources
Inefficient mining, extraction, and processing technologies,
Little to no recycling
Limited workforce
Severe environmental and human health impacts associated with CM mining, processing, and production.
Price Volatility- Unlike oil, most critical materials are not widely traded on exchanges, and this limits opportunities to hedge against price volatility. Further, insufficient data on consumption, production, and trade of minerals causes uncertainty, price volatility and delays in investments.
Policy Gaps: Absence of clear regulatory frameworks and incentives for private sector participation.

For environmentally sustainable development of the CM industry, countries need to make significant investments in advanced competitive research, development of efficient environment-friendly mining, extraction, and processing technologies, creation of robust environmental policy frameworks, and workforce development solutions.

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Mineral hub:

Minerals will be the new oil of the world’s future economy. However, nearly 20% of the total global mineral supply that the world will need by 2035 has yet to be found. So how can the world manage? The answer lies in mineral hubs: regional processing centers that consolidate resources and processing capabilities at scale. They can ensure more secure supply lines and drive costs down. The critical partnerships they foster between nations and companies can serve as an important bulwark against geopolitical risks and the global shift toward fragmented, regional supply chains. But the value of mineral hubs goes beyond securing supply. Hubs represent a tremendous economic opportunity for producers and users alike.

Geopolitical realignment could disrupt over 30% of Critical Mineral Trade Flows (figure below) due to various factors:

Note: Real values are expressed relative to a base of 2010 = 100. Foreign exchange rates are floating for the entire period.

1Corridors in the map above represent approximately 54% of global trade in 2022.

Securing Supply:

Critical mineral reserves are heavily concentrated in a handful of countries, complicating efforts by consumer nations to reduce their dependence on any one source. Processing is similarly concentrated: China accounts for more than 60% of all mineral processing, and Indonesia dominates the processing of high-pressure acid leach (HPAL) nickel. In response, the US and the EU, for example, are striving to ensure steady and unfettered access to the materials essential for their industries. Initiatives such as the US Inflation Reduction Act and the EU’s Green Deal Industrial Plan (which includes the Critical Raw Materials Act) reflect efforts to reshore mineral processing and manufacturing within these countries’ borders and among free trade agreement countries. As important as these strategies and tactics are, they alone cannot overcome the growing tensions and pressure points that will affect critical mineral supply along the value chain.

Mineral Hubs are solutions:

Some countries are leveraging their geographic and resource advantages to establish themselves as pivotal players in the mineral supply chain. Chile, for example, is doing so with copper and lithium The growth of these centers marks a paradigm shift in the mineral landscape, driving competition, strengthening supply resilience, and opening new avenues for economic growth and global influence.

Like airport hubs that consolidate passenger and cargo flows before redistributing them, mineral hubs centralize mineral concentrates from various places before processing and selling them to regional or global users. In one location, a hub provides large-scale processing facilities and critical infrastructure to achieve economies of scale and efficiency and keep costs competitive. For example, traditional copper processing facilities generally produce from 25,000 to 100,000 tons of cathode copper each year. A mineral hub can process upward of 500,000 tons, often along with other minerals.

By enabling stable offtake agreements with partners or developers, mineral hubs lock in long-term demand. Beyond its direct benefits, a hub also seeds an integrated ecosystem that fosters innovation, collaboration, and sustainable development.

To this day, large-scale mineral processing hubs are relatively uncommon except in China, which established itself in processing about 40 years ago and quickly surpassed other countries. Although countries such as Australia, Canada, and Indonesia have developed processing capabilities (especially for such minerals as lithium and nickel), China remains the dominant player in the global supply chain.

Indonesia offers a prime example of the hub concept in action. Its ascent as a global nickel-processing hub is not due solely to it holding the world’s largest nickel reserves. Policy adjustments supporting domestic midstream activities, instituted in January 2020, helped accelerate the growth of its processing industry. Indonesia subsequently attracted $21 billion in foreign investment for mining and processing, as well as for strategic partnerships. From 2019 to 2024, the number of smelters in the country increased from 11 to 44, with over 20 more under construction. The value of Indonesia’s nickel exports grew enormously, from $1 billion in 2015 to $20 billion in 2022, reinforcing the country’s importance in the global EV battery supply chain. Domestically, expansion of the industry has created more than 150,000 jobs, contributing to Indonesia’s economic growth and underscoring its strategic importance in the global critical minerals landscape.

Although mineral hubs are still relatively new, there are seven ingredients essential for their success:

A Stable Mineral Supply. A hub needn’t have access to all of the required resources from domestic sources. Strong partnerships and government-to-government (G2G) agreements with resource-rich countries are keys to securing a reliable and uninterrupted flow of ore and concentrates.
Entry into Downstream Markets. Such access, which is critical for ensuring stable sales and reducing risk, may be established through significant domestic downstream demand or through bilateral relationships or free trade agreements with larger end markets like the US and the EU. Consistent demand gives decision makers the confidence to commit the necessary capital to investments in processing facilities.
High Processing Capacity. Large-scale facilities that can process substantial volumes of ores or concentrates enable hubs to maximize efficiency and reduce costs, reinforcing their competitive position.
An Integrated Infrastructure. Well-developed transportation networks—particularly, major railways, highways, and ports—facilitate the efficient movement of materials and promote growth. Hubs also need adequate land for facilities and future expansion, as well as access to water and available reagents.
Affordable, Low-Carbon Energy. Mineral processing is energy intensive, so clean, cost-effective energy is critical to ensuring environmental sustainability and long-term competitiveness.
Access to Low-Cost Capital. Global investors play a vital role in financing large-scale projects. The affordable capital they can attract helps build the hub’s infrastructure and operations to a capacity sufficient to make it a competitive force in the mineral supply chain.
Government Support. Streamlined regulation, a hospitable business environment, and investments in education, training, and R&D contribute to developing a skilled workforce and stimulating innovation, which, in turn, enhance a hub’s competitiveness.

This last point deserves emphasis. Scale and efficiency are critical, but success also depends on strong public-private partnerships. Companies and governments must work together to develop the infrastructure, regulatory frameworks, and workforce necessary to sustain operations. More broadly, such partnerships fuel technological innovation and help attract the investment needed for long-term growth and global competitiveness.

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Strategies to maintain supply of critical mineral:

The scale of materials needed for the energy transition:

Between 2022–2050, the energy transition could require the production of 6.5 billion tonnes of end-use materials, 95% of which would be steel, copper and aluminium which the energy transition will require, with much smaller quantities of critical minerals/materials such as lithium, cobalt, graphite or rare earths. This cumulative material extraction compares with the over 8 billion tonnes of coal currently extracted annually.

There are enough resources and minerals in the world for the energy transition. But in some key minerals – particularly lithium and copper – it will be challenging to scale up supply fast enough over the next decade to keep pace with rapidly rising demand. Governments, regulators, producers and consumers must work together to increase recycling, improve material efficiency, invest in new mining, and regulate environmental and social standards.

Without strong action to improve materials efficiency, increase recycling or increase mined supply, there could be significant supply gaps for six key energy transition materials: lithium, nickel, graphite, cobalt, neodymium and copper. This raises the risk that high prices could delay the energy transition.

To ensure a critical stockpile of critical minerals, several strategies can be implemented. These strategies aim to diversify sources, strengthen domestic production, and establish resilient supply chains. Here are some key strategies:

-1. Identify and prioritize critical minerals:

Create a list of critical minerals that are essential for various industries, such as rare earth elements, lithium, cobalt, and graphite. This list helps in focusing efforts on securing the supply of these minerals.

-2. Diversify sources and reduce reliance on a few countries:

Reduce dependence on a limited number of countries for critical minerals by diversifying sources. This can be achieved through international cooperation, partnerships, and agreements with resource-rich nations.

Figure below shows geographic concentration of critical minerals:

Mining for certain key materials is heavily concentrated (e.g., 70% of cobalt production is from the Democratic Republic of Congo) and China dominates the refining of almost all key materials. Companies and countries should seek to build more geographically diverse supply chains and remove barriers to the domestic development of mining and refining activities – aiming to diversify and de-risk production, not achieve total decoupling. Diversifying critical mineral supplies is advisable, both practically and geopolitically. That means facilitating the siting and investment in new mines and extraction technologies, such as by offering credible policies to invest in diverse supplies and facilitating responsible siting of new production and processing facilities. Diversity in supplies is also important.

Many critical minerals are also geographically concentrated, which complicates their extraction and raises the risk of delivery interruptions. Perhaps the best-known example is the Democratic Republic of the Congo, which has 60 percent of the world’s cobalt reserves — and a history of corruption and armed conflict, as well as a transportation infrastructure vulnerable to weather events. Investors are leery of committing to mining in DRC for those reasons, but also because the global market price of cobalt is highly volatile and because mining executives fear the consequences of criticism back home. From 2018 to 2019, the price of cobalt fell by 70 percent after electric vehicle demand failed to live up to expectations and several horrific news stories broke about the child miners working in DRC. Soon after, major EV leaders — notably Tesla — announced plans to use less cobalt per vehicle, and recently they have even started to use cobalt-free batteries for shorter-range vehicles. Meanwhile, they keep announcing deals to import more cobalt from China.

-3. Develop domestic mining and production capabilities:

Invest in domestic mining and production of critical minerals to reduce reliance on imports. This includes exploring and developing domestic mineral resources, establishing mining operations, and promoting sustainable mining practices.

Large-scale mining projects can take 15-20 years, and the last decade has seen a lack of investment in exploration and production for key energy transition materials. Key solutions include accelerating permitting timescales, increasing output from existing mines, updating geological surveys and improving international data-sharing. Capital investments in key energy transition metals (excluding iron ore and gold) must rise from $45bn per annum to an estimated $70bn per annum through to 2030.

Lithium-ion batteries and the energy transition will require hundreds of new mines to be built around the world. New techniques and processes are available to mine differently, have more focus on waste streams and recycling, and employ cutting-edge data science, autonomous technologies and ways to minimize environmental hazards.

Battery recycling will solve about 20% of our raw material conundrum meaning most of our raw material needs will still come from the ground. Combining the world’s best minds with a laser focus on mines is the only way to solve this challenge.

Adding to the woes of manufacturers dependent on critical minerals is that many can’t be mined or refined economically on their own. This means that many of them are only produced because they happen to be a byproduct of producing more abundant minerals. For example, cobalt, tellurium, rhenium and selenium can be found alongside copper, so sometimes a company will mine ore in significant quantities. But mining companies often discard the byproduct as waste because they lack economical processing and distribution capacity. As a result, there are no proven reserves of indium (often found with zinc), and it’s often not clear where the metal that’s sold actually originates, or who is mining it. There are even large piles of mine wastes from U.S. mining operations that might contain salvageable critical minerals. The U.S. Geological Survey has only recently started to create detailed critical minerals maps and to investigate the location of the aforementioned mining waste in hopes of understanding the viability of co-production with common metals. However, we do know that if the price of copper drops and less copper is mined, there will also be less cobalt, tellurium and rhenium available. And that suggests ironic scenarios in which critical minerals become scarcer because there is a glut in the markets for abundant metals.

-4. Stockpile critical minerals:

Maintain a strategic stockpile of critical minerals to ensure a stable supply during times of disruption or increased demand. The stockpile should be sufficient to meet critical needs for a specified period, such as 100 days.

-5. Enhance recycling and circular economy practices to reduce pressure on primary supply:

Promote the recycling and reuse of critical minerals from end-of-life products, such as batteries. This reduces the need for new mining and helps in conserving resources. Strong action to accelerate technology development, improve materials efficiency and increase recycling could reduce cumulative demand to 2050 by 20-60% for most materials, and technological innovation play a major role in closing specific supply gaps over the short term. Recycling will play a critical role from 2040 and beyond as the stock of clean energy technologies deployed begins to reach end-of-life.

It is estimated that each year ~50 million metric tons of e-waste are disposed in landfills worldwide, and only 12.5% of e-waste is currently being recycled for all metals. Studies on life cycle assessments of CMs such as REEs have indicated that recycling electronic waste could be an encouraging supplement to conventional production processes. An example of recycling iPhones can easily demonstrate the effectiveness of recycling in meeting the CM demands. Recycling of 10,000 iPhones has the potential to yield 190kg of aluminum, 77kg of cobalt, 71kg of copper, 9.3kg of tungsten, 4.2kg of tin, 1.1kg of REE, 0.75kg of silver, 0.18kg of tantalum, 0.097kg of gold and 0.01kg of palladium.

In another example, the current design for a 6MW offshore wind turbine uses 5,800kg of neodymium magnets. Neodymium has a high value and the magnets can be reused, such as in electric vehicle motors. But decision-makers lack information on the exact volume of neodymium magnets within UK wind farms and when they will be available, and in addition there is little capacity for decommissioning wind turbines in terms of ports, equipped yards or specialist engineers.

-6. Strengthen research and development:

Invest in research and development to improve extraction, processing, and recycling technologies for critical minerals. This can lead to more efficient and sustainable methods of obtaining these minerals.

-7. Support domestic industries and supply chains:

Provide financial assistance, incentives, and support to domestic industries involved in critical minerals production and processing. This helps in fostering a robust and resilient supply chain.

-8. Collaborate with international partners:

Strengthen international cooperation and partnerships to ensure a stable supply of critical minerals. This includes sharing information, best practices, and resources with other countries.

-9. Sustainable and responsible material production:

Key challenges include the carbon and water intensity of production; declining ore grades and waste rock production; the indirect deforestation and biodiversity impacts of mining in tropical regions; and social impacts on local mining communities including human rights concerns, labour standards and tax avoidance. Addressing these impacts requires companies to adopt best-in-class practices driven by strong regulations on carbon intensity and environmental impacts. Increased use of voluntary standards and supply chain traceability can also help increase monitoring and transparency.

-10. Reduce use:

Steps such as the recovery and reuse or recycling of critical materials, changes in existing designs to reduce or eliminate the need to use critical materials and consideration of material requirements when planning future energy, transport and digital systems are all steps that would reduce demand for critical materials imports.

For example, reducing the size of electric vehicle batteries by one third could cut the UK’s lithium requirement by 17%. This would save 75 million tonnes of rock being mined for lithium by 2040. This reduction in battery size could be off-set by lightweight designs and innovation in battery technology, and a reliable charging infrastructure. Similarly, a government commitment to banning single use-vapes as well as improvements in repair and recycling of electronics would also have a positive impact.

-11. Substitution:

In battery chemistry, lithium‑iron‑phosphate (LFP) cathodes, which require no cobalt or nickel, now power a large share of entry‑level electric vehicles. On the motor side, Toyota and several European suppliers have demonstrated permanent magnets that replace half the heavy rare‑earth loading with lanthanum and cerium without losing torque. When substitution at the material scale is insufficient, entire architectures are being swapped over the medium term. For example, Tesla has declared its next‑generation platform will eliminate rare earths wholly. Both these approaches reduce reliance on critical minerals sourced from China.

-12. Improve efficiency:

Not only are smartphone firms like Apple expanding their use of recycled REEs, they’re also using less. Smartphones and wearables now sip micrograms where they once swallowed milligrams.

-13. Understand the markets.

The supply chains for this diverse set of minerals and chemicals are often small, illiquid, have poor transparency and even worse price discovery. Lithium carbonate’s price rocketing from $8,500/tonne in December 2020 to $81,000/tonne in December 2022 underlines the aggressive nature of how these inflexible markets can flip. Understanding of these critical minerals and their often complex supply chains is key to making the biggest decisions of this energy storage revolution.

-14. Skilled workforce:

There is also a need to develop a skilled workforce to generate and maintain sustainable CM supply chains. Each CM ore or deposit is unique and requires different mining and processing technology. Therefore, even if we have sufficient resources, we need skilled scientists/workforce to resolve these complex issues. However, in countries like the US, there has been a steady decline in mining industry employment from 25,000 employees (3,750 with science degrees) in the 1980s to 1,500 with only 250 employees holding science degrees. Therefore, it is essential to create a workforce pipeline by engaging and training students at the college level in CM exploration, mining, and processing. Governments will have to invest in education and training to develop workforces with the high level of geological and chemical processing skills and expertise necessary for rare-earth projects.

-15. Forge partnership:

Forge regional and private partnerships to share the effort and the risk. There is only so much that countries can do alone. It is important for governments and public-private consortia to spawn regional alliances to support rare-earth sector growth, ensure global cooperation, and share risk. For instance, a multinational consortium could establish a mine in Australia, processing capabilities in Europe, and downstream production in the US—with financing and output equally divided among the participants. Such a broad alliance could collaborate in setting goals for the project’s environmental benchmarks, inter-regional trade, and sharing R&D and market expertise—all facets that need to be standardized globally to expand activity and performance in the rare-earth sector.

Companies can create individual partnerships as well. Downstream companies need to be certain that they have reliable rare-earth supplies to manufacture their components, and upstream players must be assured of outlets for their mining output. Locking in critical-metal sources now, even before demand has evolved but anticipating future market growth, would boost new mining projects and close the supply gap that will otherwise develop over the next decade. For example, General Motors and General Electric have a joint arrangement to purchase rare earths in the coming years from Australia’s Arafura Rare Earths. Despite this agreement, both GM and GE do not yet have capabilities to create permanent magnets from the metals, but they want to assure supply availability for strategic initiatives pivotal to their growth.

Mineral Security Partnership (MSP):

Countries increasingly recognise the importance of international co-ordination for security of supply. Given the complexity of mineral supply chains, countries can benefit from a co-ordinated approach to collectively manage risks at the global level. The Minerals Security Partnership (MSP) is a collaboration between 14 countries and the EU to secure critical mineral supply. It aims to catalyse public and private investment in critical mineral supply chains globally. The MSP was initiated by the United States in response to concerns over the concentration of critical mineral production and processing in a few countries, particularly China. It was officially launched in 2022 with the participation of 13 countries and the European Union (EU). Some of the key member countries include the United States, Australia, Canada, Japan, South Korea, and India. It is worth taking into account that the MSP does not include countries like Chile, DRC, Indonesia etc. (which are rich in certain critical minerals), raising concerns about its effectiveness. The basic premise of MSP is “friend-shoring”, meaning moving manufacturing away from authoritarian and unfriendly states to allies. For friend-shoring to be effective, the allied or friendly countries must have enough resources to trade among themselves. In reality, unfriendly or hostile regimes or countries not included in the MSP control various aspects of the supply chain for many critical minerals. Although friend-shoring may help alleviate supply chain vulnerabilities for Western nations, the success of the MSP depends on striking a balance between reducing reliance on China and managing the economic costs of alternative initiatives that support national and geopolitical security, all while upholding environmental, social and governance (ESG) standards. Critics argue that the potentially harmful effects of friend-shoring far outnumber its benefits. Friend-shoring risks creating an elitist and exclusionary club in world trade, and may lead to supply chain bottlenecks, higher prices and lower economic growth. Friend-shoring has been described as a new symbolism of protectionism.

-16. De-coupling and de-risking:

China occupies a dominant position in the global supply chain for critical minerals. In the production of graphite and rare earth elements, China not only produces 70 per cent of the world’s supply but also dominates almost the entire supply chain. China also holds substantial influence in the processing and manufacturing of lithium batteries. Meanwhile, amid escalating geopolitical tensions, China’s dominant position in critical minerals has raised widespread concerns about supply chain security. The United States and its allies have begun exploring strategies for decoupling from China.

Decoupling, a term that has gained currency in geopolitical dialogues, suggests a severing of economic and technological ties in pursuit of national security and economic independence. However, this narrative overlooks the interdependent nature of modern economies, where the integration of supply chains and the free flow of knowledge and innovation are not just beneficial but essential for global progress on green energy transition. China’s role, therefore, should transcend national boundaries, influencing global markets and innovation ecosystems. The discourse should shift from a binary choice between decoupling and dependency to a nuanced strategy of engagement that recognises the mutual benefits of cooperation.

In response to rising concerns over China’s dominance of critical links in global supply chains, a new term has come into vogue: “de-risking.” First coined by European Commission president Ursula von der Leyen in 2023 and seen as an effort to soften the prior U.S. position of “decoupling” from China, de-risking has gained a host of adherents who see the policy as offering practical guidance for countries and companies to minimize their exposure to Beijing’s economic coercion.

De-risking is especially important in the realm of critical minerals and metals. While the United States has enjoyed success crafting a strategy to de-risk certain critical industries such as semiconductor manufacturing with the CHIPS and Science Act, a similar de-risking strategy has not been adopted by Latin American and Caribbean (LAC) countries, who still rely on China as the primary buyer of their raw materials.

-17. AI to alleviate the critical minerals crunch:

Like other industries looking to move faster, the critical minerals mining sector has been increasingly artificial intelligence-curious. AI could, in theory, aid the industry in finding both new deposits of the most sought-after minerals, and entirely new materials. That’s a potential that has kept money flowing to early-stage AI solutions throughout 2023, despite a tight investment market. AI-based mineral asset generator VerAI raised $12 million for a Series A. GeologicAI raised $20 million for its “core scanning robot,” also a Series A. Berkeley-based KoBold Metals raised $195 million, in a round whose investors included T. Rowe Price, Andreessen Horowitz, and Breakthrough Energy Ventures.

Recently Google joined the lineup of players betting AI can speed up operations far up in the minerals supply chain, introducing the DeepMind Graph Networks for Materials Exploration, a deep learning tool for predicting the stability of new materials. Of the 2.2 million predictions made by GNoME, Google said 380,000 are particularly promising for experimental synthesis. “Among these candidates are materials that have the potential to develop future transformative technologies ranging from superconductors, powering supercomputers, and next-generation batteries to boost the efficiency of electric vehicles,” the company said.

AI’s potential role in mineral exploration is broad, and the current offerings each take a slightly different approach. GNoME, for example, is a graph neural network model trained with data on the structure and chemical stability of crystals. It identifies new minerals that have similar structures to known materials, and could therefore replace highly in-demand minerals like, say, lithium relatively easily.

Meanwhile, investor KoBold uses machine learning and geological data to model the sub-surface and predict where mineral deposits are likely to be found. Founded in 2018, the company has scaled quickly, in part because its business model doesn’t stop at software. Instead, it makes strategic investments on land claims, and then sells licenses to mine operators. To date, KoBold says it has more than 60 mining projects globally.

Other startups use machine learning to search through geologic data to identify promising mineral deposits, or even develop robots capable of scanning and analyzing rock samples themselves.

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Will critical minerals run out?

We’re moving towards a low-carbon future. But one common worry is that this future relies on critical minerals and that supply won’t keep up with demand, or may well run out. This is sometimes used as an argument against green technologies. It’s worth pointing out that these materials are already used in many other technologies and industries as well such as transport, electronics and medicine. But it’s a concern that requires serious consideration.

Sustainability By Numbers has done the research and (like other organisations, including the International Energy Agency) concluded we needn’t worry about long-term supply. Supply of materials like iron (for steel) and graphite is well above demand. And while demand for minerals like lithium, copper, cobalt and nickel is above or nearly at current reserves, enough materials do exist. As Sustainability by Numbers explains, the challenge is to “make more of these economically viable [to extract] or find new deposits that are easily accessible”. This means bottlenecks in the short and medium term are more of an issue for a greener future. Discovering, exploring and extracting new mineral deposits is a slow process that can take well over a decade.

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Section-10

Mining critical minerals:

The primary source materials for CMs are different minerals/ores that occur in diverse rock types/ore deposits on earth. These primary sources – ore deposits, hosted by the magmatic, sedimentary and metamorphic–metasomatic rocks, all affected by diverse mineralization processes that include hydrothermal activity, syn-/dia-/epi-genetic affects, remobilization–recrystallization, weathering, transportation (as in placers), etc. are mined conventionally after (i) comprehensive mineral exploration by the geological–geophysical–geochemical and related laboratory-based studies, and (ii) establishment of a cost effectively exploitable resource-base in a deposit. CMs are usually recovered from such ores as by-/co-products and occasionally as major products by mineral processing, which comprises pre-concentration, beneficiation and extractive metallurgy like hydro-/pyro-metallurgy, followed by smelting and purification. The mineral industry usually focuses on the extraction of the main product(s) of ores, with little importance to their potential byproducts like many CMs. For example, in the diverse types of U-deposits in India, the emphasis is more on the extraction of U and less on its possible high-value CMs like Au, Ag, Mo, Co, V, etc. To extract the main product(s) and co-/by-products, like some valuable CMs from different ore deposits as well as from their waste generated during mining and ore-processing, it is better to synergize the mineral-, chemical- and nano-technology, after comprehensive characterization of different ores by state of-the-art analytical techniques like electron micro-probe analysis, to identify both qualitatively and quantitatively different constituent metals in different ore minerals.

Copper, nickel, cobalt, lithium, and rare earth elements are particularly in demand for batteries and high-performance magnets used in low-carbon technologies. Copper, predominantly sourced from porphyry deposits, is critical for electricity generation, storage, and distribution. Nickel, which comes from laterite and magmatic sulfide deposits, and cobalt, often a by-product of nickel or copper mining, are core components of batteries that power electric vehicles. Lithium, sourced from pegmatite deposits and continental brines, is another key battery component. Rare earth elements, primarily obtained from carbonatite- and regolith-hosted ion-adsorption deposits, have unique magnetic properties that are key for motor efficiency.

Over the next few decades, the role that copper and critical minerals play in achieving the energy transition, spurring economic development, and strengthening national security will continue to grow. The world is slowly shifting its energy mix to one that is greener, but this transition will require significant mining resources. This may seem counterintuitive, but many low-carbon technology components consist of key minerals and metals. According to the International Energy Agency, within 20 years, the energy sector’s demand for minerals may increase by as much as six times, and demand from the low-carbon energy generation sector will triple. One estimate by S&P Global suggests that more copper will need to be mined in the next few decades than has been extracted in the past several thousand years of human history. Mining and the processing of minerals are also crucial in maintaining the military’s technological edge, securing manufacturing supply chains, and pursuing sustainable development practices. Mining will also become increasingly important for economic development. The top 40 mining companies had a combined revenue of $711 billion in 2022. The global mining market had a compound annual growth rate of 6.1 percent between 2022 and 2023, reaching $2.15 trillion, and is expected to grow to $2.78 trillion by 2027. In the United States alone, mining accounted for 1.9 percent of GDP and employed over half a million people. In this regard, the Western Hemisphere is emerging as a key source of some of these minerals. With their considerable reserves of copper and other critical minerals such as lithium and nickel, countries in the Western Hemisphere have attracted significant investment in mining projects. Latin America, for example, currently supplies 40 percent of the world’s copper and 35 percent of the world’s lithium. Mining offers an opportunity for economic development, but the region needs to adjust policies to better steward these resources in order for the sector to continue to play a development role.

The mining industry is at a crossroads with the growing demand for exploration and exploitation of critical minerals for the energy transition to reverse the debilitating impacts of global warming such as heat waves, droughts, floods, hurricanes, and biodiversity loss. For every job in metals mining, an estimated 2.3 additional jobs are generated, and for every nonmetals mining job, an additional 1.6 jobs are created. The industry has a significant role of supplying the critical minerals and metals required for the energy transition. Yet, it is faced with numerous risks which may hinder the uninterrupted supply of essential materials for the transition. New critical minerals mining projects can take up to 20 years to be developed as project timelines are routinely beset by delays.

Figure below shows Global average lead times from discovery to production, 2010-2019

If the average time to production does not reduce to between 5 and 10 years, there is a risk that a critical minerals shortage before 2030 could cause the global 2050 net zero emissions target to be missed. ERM analysis of more than 100 global critical minerals projects—mining primarily cobalt, copper, graphite, lithium, manganese, nickel, rare earths, lanthanides or zinc— shows that between 2017 and 2023 almost 60% of projects reported pre-production delays ranging from a few months to several years. The three biggest causes of delay to critical mineral mine development are permitting issues (39%), technical challenges (36%), and commercial issues (26%). Sustainability issues, particularly environmental concerns (24%) and stakeholder opposition (17%), were found to have contributed significantly to these top three delays. The financial implications of these delays are significant. ERM research shows that a mining project with capital expenditure of between US$3–5bn will suffer roughly US$20m per week in terms of net present value from delayed production.

Mining and Extraction of Critical Minerals:

Mining and extraction of critical minerals is a sophisticated process that involves various methods and technologies to gather these essential resources from the earth. As global demand for these minerals increases, understanding these processes becomes vital.

Methods of Extraction:

Different methods are employed based on the type and location of the mineral deposit. Some common techniques include:

Open-pit Mining: Used for minerals located near the Earth’s surface. Involves removing large amounts of surface material.
Underground Mining: Employed for deep deposits. It involves creating tunnels and shafts.
In-situ Leaching: Involves dissolving minerals in place and pumping them to the surface. Used for minerals like uranium.

Each method presents unique challenges and environmental considerations.

In-situ Leaching is a mining process where the desired minerals are dissolved with solutions and then extracted through pumping. For instance, lithium extraction often uses evaporative methods in salt flats, which are particularly effective in areas like the Lithium Triangle in South America, due to the high concentration of lithium-rich brine.

The deepest mine in the world is the Mponeng gold mine in South Africa, which extends 2.5 miles below the Earth’s surface! It takes 6,000 tons of ice a day to keep Mponeng’s deepest levels at a bearable 83 °F degrees.

Rare earth mining:

Rare earth mining can be open pit, underground or leached in-situ. The metals are found in hard-rock deposits, ionic clay deposits and mineral sands. Some minerals that are mined for rare earths are bastnäsite, monazite, loparite and xenotime. In China, the rare earth elements are recovered as a by-product of iron mining. The world’s largest light rare earth deposit is Bayon Obo located in Baotou, China, containing 48 million tonnes of rare earths reserves in the form of bastnasite ore.

The open-pit mining process for rare earths is similar to that of other minerals: hard rock is mined, ore is separated from tailings and then it is refined. For a typical open pit mine, the approach is very similar to other mining operations which involve removal of overburden, mining, milling, crushing and grinding, separation or concentration. The product of the enriched concentrate after separation may contain around 30%–70% of rare earth bearing ore. The process requires higher amount of water and energy usage (e.g., compared with other common metals, i.e., 0.2 to 1 GJ energy/t REO, 0.3 to 1.8 ML water/t REO) as well as production of waste streams (i.e., with other metals due very low grade) such as tailings and wastewater.

If the deposit type is hard rock based then conventional open-cut or underground truck shovel mining system is used. On the other hand, if it is mineral sand-based monazite type deposit then wet-dredging or dry mining method is used. If a wet mining operation, a floating dredge cuts the ore under the surface of a pond and pumps the ore slurry to a floating wet concentrator. Dry mining can be similar to conventional truck and shovel system.

In in-situ leaching, which is also a common method of mining uranium, miners pump a chemical solution into an orebody. The solution dissolves the targeted materials into a brine that is then pumped back out of the ore and into collection pools.

Mining operations extract ore-bearing rock from their open pit or underground operations. This material being ferried around in big mining trucks, or on railed mine carts, is often referred to as run-of-mine (ROM). The ROM needs further processing to separate the minerals of interest from the host rocks. There are many factors involved in this process, and in fact this area is an engineering subject in its own right, and has various names, including mineral processing, minerals engineering and metallurgy.

Refining involves separation of an element from its ore through the removal of impurities. So as to decrease the cost of transportation of the huge quantity of ore needed to refine, refining is often done at the mine itself. Refinement occurs through physical separation of the REEs by various chemical techniques, sometimes involving thousands of steps. Unfortunately, all REEs and their respective ores are different and require different chemical techniques for refining (depending on melting point and vapor pressure, as well as other physical properties of the element). Typical techniques for refinement include milling, where ore is ground down to fine particles and then separated in a variety of ways, followed by cracking, where the it undergo a series of chemical treatments. Due to the large number of steps the REEs must go through to be purified requiring many different chemicals and reagents for these processes, there is a huge amount of toxic and radioactive waste generated from byproducts, which must be handled either through recycling, or by pumping it to a holding tank. The waste presents various health and environmental issues that must be dealt with at the mining site. In addition, the amount of processing that goes into purifying REEs incurs a huge cost, and raises the price of the element significantly.

Beneficiation and refining are both processes in mineral processing, but they differ in their primary goals. Beneficiation focuses on separating and concentrating valuable minerals from their ores, essentially upgrading the ore’s grade, while refining aims to purify the extracted metal to a higher degree of purity.

To extract rare earths, plenty of processing/extraction and refining are required but they are beyond the scope of this article.

All mines have a finite life with many historical giants already exhausted. Therefore, without a revolution in metal recycling and mine waste reprocessing, successful global greenfield exploration is of key importance. Greenfield exploration is when new mine sites are located in unexplored or currently undeveloped areas while Brownfield exploration involves searching known or currently mined sites for additional deposits. Because the sites have already been surveyed, this process is usually very straightforward. If you think of mines as having a life cycle, in the early to mid-life phase, brownfield exploration is preferable because it is the fastest and most cost effective way to access more ore. In the long term, however, as the mine’s output slows, it is essential that greenfield exploration is occurring to find new, prospective sites. Given the extended time it takes to find, establish and develop a new mine, greenfield exploration needs to occur in advance of the brownfield-sourced mines becoming depleted.

Why is it difficult to mine rare earth metals?

Rare earth minerals can be recovered as byproducts during the mining and processing of base metals like lead, zinc, copper, and tin. Although rare earths aren’t as rare as you might assume from the name, finding economic deposits is very difficult. This is even more so the case for the heavy rare earths, as orebodies containing them are less abundant versus light rare earths.

Another road bump for rare earths is the separation process. Because the rare earth elements all have similar chemical behavior to each other, they are very tough to separate, making the process difficult and expensive. The most common separation method is solvent extraction, but it is lengthy and can take hundreds to thousands of cycles to achieve high purity levels.

Lastly, the environmental risks associated with rare earths mining mean even more care needs to be taken to minimize damage to the environment and to the people near the mine.

Environmental Impacts of Mining:

Mining can significantly impact the environment. It’s essential to consider these effects when planning extraction processes.

Habitat Destruction: Clearing areas for mining leads to loss of forests and wildlife habitats.
Pollution: Mining operations can contribute to air and water pollution through dust and chemicals.
Soil Degradation: Removal of soil layers can lead to erosion and loss of fertile land.
Radioactive waste: A major issue with mining rare earths is that the ore they are extracted from also often contains thorium and uranium, which are both radioactive. This means the separation of rare earths from this ore must be handled carefully, as the waste produced will be radioactive as well. Unfortunately, it is common for this radioactive waste to make its way into groundwater and streams, which is incredibly damaging to the environment and to nearby communities that rely on this water.

Mitigating these impacts involves employing sustainable practices and technologies to minimize environmental damage.

A fascinating aspect of modern mining is the shift towards ‘green mining’ technologies. These innovations aim to reduce waste and energy consumption. Methods include bio-mining, which uses bacteria to extract metals, and the use of more efficient machinery to cut down on energy usage and emissions. While still in development, these technologies promise to revolutionize the way minerals are extracted, making the process more sustainable and less damaging to the environment.

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In order to increase the pace and scale of critical minerals mine development, following challenges need to be addressed:

-1. Building stakeholder trust in the mining industry

Despite the emergence of more than 20 mining sustainability standards over the past two decades, alongside state, federal and regional jurisdictional requirements designed to improve environmental and social performance, stakeholder trust in the sector remains low. According to a 2022 poll commissioned by the International Council on Metals and Mining (ICMM), the mining sector has the lowest level of public trust compared to any other industry, below oil and gas.

About 62% of the projects were delayed by permitting issues due to stakeholder opposition or concerns around the project’s environmental impacts (with the remainder largely the result of regulatory constraints). In many cases, stakeholder concerns around the mine’s impact on the environment were not factored into the project’s design, with companies instead focused on proving the resource in isolation of ESG factors or stakeholder engagement. This has the potential to hold up public consultations and, in some cases, require a re-design of the project, resulting in further delays and costs for the operator.

Building stakeholder trust is a complex and long-term undertaking that also requires a commitment to greater transparency. It will be important for mining companies to share candidly the lessons learned from previous experience and demonstrate how mining has improved its effectiveness in managing environmental and social impacts. Recognizing where performance fell short and sparked remedial action can help build better stakeholder relationships. If this is sustained over the long term, trust may start to be repaired.

-2. Avoiding delays early in the project’s development

ERM research shows that over 40% of delays to critical minerals mining projects occur early on, at the feasibility stage, with the rate of delay then falling as the project develops. Crucially it is at the feasibility stage that stakeholders outside of the industry (and those most likely to voice opposition) become aware of the project’s existence and investors begin to commit capital to studies assessing the project’s viability and to secure key approvals.

Most stakeholder interest and/or opposition tends to be driven by a debate around the environmental and social impacts of a mining project, though discussions around revenue sharing (beyond direct employment or ‘hand outs’) are increasingly common. This is a crucial point at which companies need to create a shared value proposition in collaboration with stakeholders, providing clarity and transparency, listening to concerns and dispelling misinformation and misperception. The tone in any debate of this nature is often set early on and can influence stakeholder perceptions well into the production stage of a project.

-3. Understanding local social, political, environmental and regulatory risks

Reflecting the scope and range of global geopolitical, regulatory, social and environmental dynamics across geographies, ERM research shows that the location of critical minerals projects can also heavily influence the risk of delays, stakeholder challenges and higher costs.

For example, mining projects located in environmentally sensitive jurisdictions come with additional expectations for mining companies to manage their environmental impacts and tackle stakeholder challenges. According to research by S&P Global Sustainable, 1,200 mining sites worldwide are in key biodiversity areas (with 29% of these projects involving critical minerals).

In Latin America, delays were driven markedly by difficulties in obtaining the necessary permits (67% of delayed projects in the region). ERM’s experience of working with mining projects across this region has shown significant capacity constraints in many regulatory agencies handling permitting.

National politics also impact permitting delays. In Mexico, hundreds of mining projects have been suspended as the government looks to take a tougher line on environmental permitting and take a greater stake in the lithium sector.

In Africa, 44% of the projects delayed were related to government efforts to renegotiate mining licenses. Contract renegotiations and fiscal disputes in Tanzania and the DRC were central drivers of this.

-4. The Social Compact

The U.S. mining industry is recognized internationally for its technical capacities, skilled workforce, and technological prowess, but in recent years, its social compact has begun to erode domestically. As public opposition to natural resource development continues to grow, an increasingly important question will be how the industry can strengthen its social compact with stakeholders at all levels.

The first step will be to reward, support, and highlight the mining companies that are being responsible corporate citizens. Part of the problem arises from the few “bad apples” that receive media attention and diminish the reputations of companies that are genuinely investing in a more sustainable future.

There are a number of services dedicated to evaluating the practices of mining, including the Responsible Mining Foundation, which publishes an annual index that profiles 800 mine sites around the world and rates them on five categories. Unfortunately, the index does not yet include any mine sites in the United States. Further resources will need to be dedicated to such initiatives in the future if there is to be truly global comparisons and accountability.

Another issue is the quality of safety standards against which mines can be judged. The best standard is generally considered to be the International Labour Organization’s (ILO) Convention 176, which the United States has adopted. This is an important step. However, organizations like the ILO do not have enforcement capabilities and rely on local institutions to step in. Furthermore, every serious incident or accident erodes confidence in these standards and practices, while cases of continued safe operation attract little attention.

-5. Labor Conditions

There is broad agreement among stakeholders that the top concern in any mine should be safety. Across the board, a great deal of progress has been made to make mines safer workplaces, and the voice of the labor community has done much to advance this cause, as well as to improve the environmental conditions in mining. Despite all this progress, each additional fatality puts another stain on the industry and can prevent further progress. It should be remembered that there is no single mining industry but instead a heterogeneous mix of companies and practices, most engaging with the transition to a low-carbon future in different ways.

The optimal approach to responsible mining suggests that most mining companies can, and indeed should, meet industry best practices, aiming well above and beyond regulations wherever possible. This is not to say regulations should not continue improving by adopting new and evolving industry best practices and societal expectations. For example, it is estimated that over a million children are forcibly put to work in mines around the world. While this practice has long since been outlawed in the United States, there remains little accountability for purchasers of commodities mined by children or through other methods of labor exploitation.

Labor unions have played an important role in demanding better working conditions and environmental performance in mines and are a critical constituency to engage in order to assess current shortcomings and drive future strategies for change. For example, unions have consistently noted that existing responsible mining codes, for the most part, do not include strong language on worker safety or other conditions of work. There needs to be an assessment of labor conditions in the mining industry and, where such assessments exist, they should be better highlighted, promoted, and implemented.

-6. Uncertainty

The mining industry has always been characterized by uncertainty and risk. For example, one potential challenge is the lengthy time period required to get a mine up and running, which runs contrary to the need to respond to rapidly evolving commodity markets. Another uncertainty is how many jobs will remain unchanged or be created in a future mining sector based on critical minerals. These uncertainties can be partially addressed through government-backed geological surveys and development strategies that highlight economic and labor force impacts.

-7. Continuous funding for mine development:

Mining activities are often capital-intensive, requiring up to a decade of development before operations begin. During this period, the project managing entity requires massive funds for development and expansion. China extended sustenance funds through consecutive loans from state-owned creditors, ensuring that raw materials moved directly to Chinese refineries — units that process 73 per cent of the world’s cobalt and 59 per cent of lithium. China has provided 66 per cent of loans to 14 mining operations across eight countries: the Toromocho, Las Bambas, and Marcona mines in Peru; the Tenke Fungurume, Kamoa-Kakula, Sicomines, Kolwezi, and Kinsenda mines in the DRC; the Bor mine in Serbia; the Aktogay mine in Kazakhstan; the Phu Kham mine in Laos; the Mirador mine in Ecuador; the Bisha mine in Eritrea; and the Ramu mine in Papua New Guinea.

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Artisanal and Small-Scale Mining (ASM) of Critical Minerals:

Mapping of ASM activity with the CRMs:

CRM Reported ASM activity

Antimony Morocco, Nigeria and India

Bauxite India

Beryllium Rwanda, Uganda, Zimbabwe

Bismuth Madagascar and Uganda

Cobalt DRC

Coking Coal China, India and Pakistan,

Fluorspar Mongolia

Lithium Zimbabwe

Niobium DRC

PGMs Ethiopia

Phosphate Rock Tanzania

REE China and Madagascar

Tantalum 60% of total global supply from ASM, Brazil, Burundi, Colombia, DRC,

Ethiopia, Nigeria, Rwanda, Venezuela

Titanium Tanzania

Tungsten 6% of total global supply from ASM, Bolivia, China, DRC, Indonesia, Rwanda

ASM is an overlooked source of many critical minerals, despite being a significant contributor to the global supply of critical minerals and several other minerals. Although not all critical minerals can be easily sourced through ASM, there is a potential for a greater role for ASM in sourcing them as seen in figure below.

Figure above shows Critical minerals, their associated technologies, and the potential for sourcing through ASM. Although not all critical minerals are easily minable through ASM, as illustrated in figure above, some of them have the potential to be extracted by ASM operations. New and reliable supplies of critical minerals are needed if growing (current and anticipated) demand in all areas of energy transition technologies, digital transition technologies, and society are to be met. ASM can be an important contributor to the future global needs of critical minerals.

According to the World Bank (2020), ASM occurs in nearly 80 countries worldwide, being the main livelihood of approximately 40 million artisanal miners. It is widespread in developing countries in Africa, Asia, Oceania and Central and South America. The ASM sector has emerged as perhaps the most important non-farm rural source of employment in sub-Saharan Africa in recent years (Hilson et al., 2021). The sector has grown in response to push factors out of other sectors (such as agriculture) and pull factors from growth in the demand of specific minerals sourced from ASM. The sector has become a key supplier of a grouping of materials, including gold, cobalt and the ‘3Ts’ — tin, tantalum and tungsten. It is also a niche supplier of a wide set of other minerals, ranging from gemstones, nickel, zinc, and industrial minerals. Currently, ASM contributes significantly to the global supply of these commodities, accounting for approximately 8% of cobalt, 40% of tin, and 60% of tantalum production worldwide (Cobalt Institute, 2022; International Tin Association, n.d.; Schütte & Näher, 2020).

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Section-11

Secondary sources of critical minerals:

Fossil fuels, with their geologic origins as organic materials, are consumed when burned to generate usable energy. As such, they are destroyed and not available for use later. Such is not the case for nonfuel minerals, which in principle can be recycled after initial use. Thus, minerals and mineral products are available as primary resources (extracted from Earth’s crust) and also as secondary resources (recovered from scrap). In addition, for a country or region—as opposed to the planet as a whole—the importation of metals or metal-containing products serves as an additional (“tertiary”) resource.

Bridging the gap between demand and supply has brought attention to the prospect of recycling critical minerals from secondary sources. While the clean energy transition will undoubtedly require greater mining, recycling will play a role in sustaining future mineral supply. Like fossil fuels, minerals are inherently finite, so finding innovative ways to reduce reliance on mining raw minerals will be critical to meeting the future demands of clean energy.

Two secondary sources of minerals hold the most promise: recycling from end-of-life products and recycling from mine waste tailings.

-1. End-of-Life Product Recycling:

The most widely discussed application for mineral recycling from end-of-life products is EVs batteries. By 2030, an “influx” of spent batteries from EV will create the need for a robust recycling industry to manage them. Building effective EV recycling programs must overcome significant barriers, however. Existing EV batteries run on a 10- to 20-year cycle, so it could take several decades until there are enough to create a sufficient supply for the recycling industry. Additionally, the variability in design and composition of batteries, the lack of existing collection and manufacturing infrastructure, and the lack of data regarding the quality of reused batteries all make it difficult to scale up recycling processes.

The process of battery recycling is also very much still in the development phase. Extracting minerals from used lithium-ion batteries often occurs through hydrometallurgy—which involves placing the battery’s cathode in a solution to separate the minerals out, or pyrometallurgy—the use of high temperatures to achieve the same end. The relative complexity and demands of these processes mean that, at present, it is still more cost effective to mine new minerals than to recycle them. Tipping this scale would require broad industrialization of the recycling process and major policy incentives. Additionally, while cobalt and nickel can be continually reused, it is still uncertain if recycling will diminish the quality of other critical minerals.

Yet even overcoming extraction barriers, the IEA predicts that, “by 2040, recycled quantities of copper, lithium, nickel and cobalt from spent batteries could reduce combined primary supply requirement for these minerals by about 10 percent.”

These barriers may prove even more challenging in other areas of consumer technology where end-of-life recycling has been underdeveloped, such as headphones, smartphones, TVs, and the neodymium magnets used in wind turbines. There is wide variability in the quantity and quality of these secondary sources of minerals. And, like EV batteries, these technologies are not designed to be recycled, making extraction difficult. Despite the barriers, consumer technology has the potential to be a large secondary source of rare earth minerals (REEs) as well as other critical minerals.

Currently, global REE and lithium recycling sit at about 0.2 percent and 0.5 percent, respectively, which is well below other minerals. These numbers will grow as end-of-life recycling gains traction and as technology and manufacturing progress, but policy incentives will be crucial for overcoming these initial barriers to growing end-of-life recycling.

-2. Recycling the Byproducts of the Mining Process:

While end-of-life mineral recycling has received the greatest attention, there is growing research around recycling minerals from mine tailings—a fine-grained material produced as a byproduct of mining. Uses for mine tailings in areas such as construction and cement production, agriculture, and other purposes have emerged, including the potential for recovering critical minerals from tailings.

The tailings from coal, iron, uranium, and bauxite mines have been found to contain concentrations of critical minerals extracted as byproducts of the mining process. The primary motivation for seeking minerals from these mine tailings is that the cost of reprocessing them is much lower than raw extraction, and the overall process to do so is much quicker.

There is promising research that advances the identification of these secondary deposits. In the abandoned iron mines of New York’s Adirondack Mountains, scientists analyzed both tailings and ore, finding REE concentrations up to 2.2 percent for the tailings and 4.8 percent for the ore. Considering the waste-to-extraction ratio is large for rare earths, these percentages are not insignificant. Additionally, research on recycling mine waste tailings is also underway in South Africa, Australia, and Sweden. Estimates vary, but the value of minerals in tailing storage facilities worldwide is close to $3.4 trillion.

Yet several concerns arise when it comes to sourcing REEs from mine tailings. First, the critical minerals found in tailings are often low-grade and vary in quantity. Second, extraction methods such as bio- and hydrometallurgy, while successful thus far, have yet to be applied broadly. Third, there is no applicable system for sourcing minerals from mine tailings, which inhibits the practice from becoming commercialized. If mine tailings are to be an effective secondary source of critical minerals, significant research and development are needed to understand their economic viability.

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Recycling critical minerals from scrap:

Supply and demand mismatch:

What do silver, silicon and gallium have in common? These raw materials are essential components of our various solar energy technologies. What about neodymium, praseodymium and dysprosium? These rare earth metals are used to build the powerful magnets in wind turbines.

Keeping our planet liveable requires accelerated clean energy transitions by governments — global carbon emissions must halve by 2030 and achieve net-zero by 2050. But a more ambitious clean energy transition requires more of the metals and minerals used to build clean energy technologies. As the global energy sector shifts from fossil fuels to clean energy, the demand of precious metals — known as critical minerals — is increasing. A striking example is lithium, a metal used in electric vehicle batteries. Between 2018 and 2022, the demand for lithium increased by 25 per cent per year. Under a net-zero scenario, lithium demand by 2040 could be over 40 times what it was in 2020.

The current challenge lies in a supply and demand mismatch. The projected demand for critical minerals exceeds the available supply. Basic principles of economics dictate higher prices for these minerals. In addition, critical minerals have a geographically concentrated supply. These metals are only extracted from a handful of countries and are overwhelmingly processed in China.

A graph below shows that the demand for important metals is outpacing supply:

The current production rates of critical metals are likely to be inadequate to satisfy future demand.

The most obvious way to restore the balance between supply and demand — more mining — leads to the extraction of more ore. However, ore extraction is also becoming more difficult, particularly as the industrial sector tries to achieve carbon neutrality by 2050. Given these challenges, recycling metals is becoming an important and practical alternative to extraction. Recycling could not only help meet the rapidly increasing demand for metals, it could also help reduce emissions and minimize other environmental impacts such as waste. Mining is environmentally destructive and damages ecosystems and communities. Plans for opening new mines in France, Serbia and Portugal have seen massive social opposition, leaving their future uncertain. Opening a new mine can take more than 15 years on average, so projects started today might arrive too late. While some capacity can be built quicker by reopening old mines, and some projects are already underway, supply imbalances are expected to be inevitable by 2030.

Beyond mining, two alternative practical approaches exist.

The first is to reduce the demand for critical minerals by clean energy technologies. With innovation and research and development, clean energy products can be redesigned to use less material in each generation. The silver content in solar cells dropped by 80 per cent in one decade. Likewise, the cathodes in new electric vehicle batteries contain up to six times less cobalt than older models.

The second alternative is to increase the supply of critical minerals by recovering them from older and used clean technology products via advanced recycling. Decommissioned solar panels might no longer produce energy but can be a valuable source of silver or silicon. There are reasons to be hopeful that recycling can bolster critical mineral supplies. Most metals have the potential to be recycled “without the quality being affected”. This means that once there is a high volume of material in the system, and recycling technologies and facilities are sufficiently developed, the world should be getting supplies also from recycling.

The primary focus areas for recycling critical materials include:

Electric Vehicle (EV) Batteries: Recycling lithium, cobalt, nickel, and other materials from spent EV batteries and production scrap is a major focus due to the growing demand for electric vehicles.
Consumer Electronics: Recovering rare earth elements, gold, and other valuable metals from discarded electronics.
Renewable Energy Technologies: Recycling materials from decommissioned wind turbines, solar panels, and other renewable energy infrastructure.

Recycling efforts from mine tailings are also gaining traction as a way to recover critical minerals and reduce environmental impact in addition to providing the economic benefits by selling the recovered materials.

Why is recycling critical minerals important?

Reduces the need for new mines
Enhances supply security for countries importing minerals
Mitigates the environmental and social impacts related to mining and refining
Prevents waste from end-use technologies ending up in landfills
Strengthens domestic supply chains

Recycling critical minerals can help address supply challenges and reduce the environmental impact of mining. By 2040, recycled copper, lithium, nickel, and cobalt from spent batteries alone could provide for 10% of the demand for these minerals. The EU’s new Critical Raw Materials Act has mandated that at least 15% of the EU’s annual consumption of critical minerals must come from recycling by 2030. Finding innovative ways to reduce reliance on mining raw minerals will be critical to meeting the future demands of clean energy.

According to the International Energy Agency, recycling metals and minerals from end-of-life equipment and scrap – also known as electronic waste (e-waste) – could help satisfy primary supply reduction requirements in its Net Zero Emissions by 2050 Scenario. However, there is a significant disparity in recycling rates and opportunities among different materials.

Copper, for example, has one of the highest recycling rates compared to other metals. Copper is 100% Recyclable. Copper is one of the few materials that can be recycled repeatedly without any loss of performance. Between 2009 and 2018, global copper consumption averaged 26.7 million tonnes annually, with 32% (8.7 million tonnes per year) of this coming from recycled sources. Even when excluding defective products recycled during production, the recycling rate remains around 56% of copper produced globally. Still, this means nearly half of the copper produced is discarded rather than recycled. Increasing the recycling rate could satisfy a significant portion of the rising demand for copper from growing industries like artificial intelligence (AI), data centres, clean energy technology and electric vehicles. Such demand is expected to increase by 50% by 2040 under the IEA’s Net Zero Emissions Scenario.

Scaling up recycling could reduce critical mineral mining needs as seen in figure below:

The growth in new mining supply for critical minerals could be brought down by between 25% and 40% by mid-century by scaling up recycling. In a scenario in which countries around the world deliver on all announced national pledges on energy and climate, recycling reduces new mine development needs by 40% for copper and cobalt, and by 25% for lithium and nickel by 2050.

Recycling metals eliminates waste generated during the production process. Additionally, carbon dioxide emitted during production of copper could be reduced by up to 85% through recycling. Unfortunately, recycling processes are difficult to manage and monitor, however. Approximately 64 million tons of electronic products containing a high amount of copper were produced worldwide in 2022, but only 14 million tons – or 22% – were recycled.

If not properly recycled, useful resources such as silver, nickel, cobalt and lithium could be discarded, leading to environmental pollution and resource wastage by electric vehicle and solar panel manufacturers – the very industries that are trying to promote more environmentally friendly technologies.

Infographic below shows how global e-waste was managed in 2022, with the bulk happening outside of formal metal recycling schemes.

Most e-waste is managed outside formal collection and recycling schemes.

Advances in recycling technology have made the extraction of rare earths from E-waste less expensive. Recycling plants operate in Japan, where an estimated 300,000 tons of rare earths are found in unused electronics. In France, the Rhodia group is setting up two factories, in La Rochelle and Saint-Fons, that will produce 200 tons of rare earths a year from used fluorescent lamps, magnets, and batteries. Noveon Magnetics—formerly Urban Mining—extracts critical materials from discarded commercial magnets (from motors or medical devices, for example, or from storage drives used by data centers) or those withdrawn from the supply chain because of manufacturing defects or obsolescence. From these materials, Noveon manufactures new sintered neodymium boron magnets, critical components of generators in wind turbines and motors in electric vehicles. The company produces a new type of high-performance magnet, which it calls “EcoFlux,” using less material than conventional versions. While it’s hard for recycled magnets to perform as well as nonrecycled products, Noveon has managed the feat by combining a proprietary technology that improves the composition and properties of magnetic materials with its patented Magnet-to-Magnet technology that can recycle up to 99.5% of input materials.

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How recycling works:

Recycling is the process of transforming materials containing recoverable metals into a usable product with varying levels of processing. One category of feedstock includes scrap produced during the manufacturing process; for example, when there are products or metals and alloys that did not meet the required quality standards for use (often referred to as “manufacturing scrap”). The other category is products that reached their end of life (referred to as “end-of-life scrap”). In the energy sector, these include batteries found in electric vehicles (EVs), solar panels, wind turbines and the permanent magnets within them, among others. The broader economy can also be seen as holding feedstock for recycling – this concept, referred to as “urban mining”, views all human-made materials as potential sources of recoverable metals, including electronics, industrial parts, electrical wires, buildings and more.

Recovering metals from materials requires as a first step significant efforts to collect and transport the feedstock for recycling. This stage is often the most challenging, as collection rates for many end-of-life products have historically been low, and there can be safety and regulatory issues with transporting the materials. Once materials have been collected, they typically go through a pretreatment and material recovery stage to recover the metals and minerals. These stages differ depending on the type of feedstock, but generally requires some level of sorting, separation and processing. The “material recovery” stage also differs depending on the feedstock, with processing for battery recycling, for example, happening through pyrometallurgy or hydrometallurgy. The material recovery stage can produce various products depending on the level of processing adopted, transforming the materials into a product suitable for use as secondary supply, either to be used in the same product it came from (closed-loop recycling) or in a different product (open-loop recycling). In some cases, scrap does not go through the processing stage and instead is used directly by fabricators (referred to as “direct-use scrap”).

Metals, apart from some specialty alloys, can be repeatedly recycled without loss of quality, with the specific metal available at the end of the recycling process depending on the feedstock. For EV batteries, the chemistry impacts the material available, with nickel, cobalt, manganese and lithium typically recoverable from lithium nickel manganese cobalt oxide (NMC) batteries for example. Solar panels, on the other hand, contain copper, aluminium, silver and silicon. Wind turbines include base metals such as nickel, aluminium and copper, and also contain rare earth elements from the permanent magnets. Currently, copper is more commonly recycled from industrial applications or buildings, but end-of-life batteries are emerging as a growing source of secondary copper supply.

There are also fewer conventional sources of recoverable minerals being explored in the context of the energy transition. These include re-mining and processing of waste (or tailings) from the primary production process. While this is not categorised as secondary supply in a strict sense, it provides a way to extract value from the waste stream. The mineral recovered in this process depends greatly on the initial mined commodity, the presence and volume of by-products, and the quality of those resources. In some cases, processing waste could lead to recovering more of the initial commodity. Additionally, there may be non-recovered metals within the waste that were not initially valuable but have gained value in the context of the energy transition. For example, historical tailings from copper mines could be rich in lower-grade copper ore – compared with the initially mined copper – which was not originally economically or technologically feasible to extract, or they may contain by-products of copper, such as cobalt.

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Battery recycling technologies:

Whilst some recycling techniques are well-established, such as those for lead-acid batteries, many critical mineral recycling methods are still in development. Batteries are designed and manufactured in a variety of ways to suit their different requirements. For example:

Nickel-cadmium batteries are generally used for portable electronic devices and power tools. The Cadmium is extracted using high temperature thermal vacuum vapourisation techniques.
Alkaline/zinc-carbon batteries are often seen in low drain devices such as remote controls and torches. To extract the zinc, the batteries are shredded and processed in a rotary kiln to convert the magnesium oxide into zinc oxide.
Nickel-metal hydride batteries usually found in laptops, digital cameras and other electronic devices. Steel can be realised from these batteries’ recycling for use in stainless steel or building materials.
Lithium-ion batteries, used most commonly in electric vehicles and electronic devices are most commonly recycled using the techniques shown in Figure below.

Recycling processes for batteries is advancing but not yet fully optimised as it is not a straightforward process: batteries are not manufactured in a standardised way, so variations in their design and composition, and in the quality of the product which is left at the end of their useable life, makes recycling processes more complex. The intellectual property (IP) rights connected with battery designs also cause difficulties in understanding and standardising the recycling processes for batteries generally.

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Recycling rare earth elements from permanent magnets:

Some elements of the rare earth group, particularly neodymium (Nd), praseodymium (Pr), dysprosium (Dy) and terbium (Tb), can be alloyed with iron and boron to make permanent magnets, then used as key components of several clean energy technologies, particularly EV motors and wind turbines (hereafter referred to as “magnet rare earths”). Other rare earth elements, such as cerium and lanthanum, are used in applications such as consumer batteries, fluorescent lamps and polishing powders. There are existing capacities to recycle these rare earth elements, notably from fluorescent lamps, but the recycling of magnet rare earths from end-of-life products has historically been limited. However, the energy transition is making magnet rare earths recycling more feasible than before, due to their rising use in larger applications such as wind turbines compared with previous uses.

In the STEPS (Supply Chain Transformation and Environmental Protection Strategy), secondary supply has the potential to reduce primary supply requirements for magnet rare earths by over 25% in 2035, and over 30% in 2050. In the APS (Announced Pledges Scenario) and NZE (Net Zero Emissions) Scenario, these figures are higher due to greater collection efforts and efficiency, reaching 35% and 40% in 2050, respectively.

From the perspective of end-of-life collection, EV motors and wind turbines are likely to be among the most accessible sources of end-of-life magnet rare earths. An EV motor typically contains about 1 kg of magnets, and wind turbines can contain up to 2 tonnes, when a magnet in an electronic speaker can be as light as a few milligrams. Another secondary supply source for magnet rare earths could be those found in medical imaging machines. However, rare earth elements are mostly used in low-field machines (from 0.25 tesla to 0.5 tesla), while higher field machines (1.5 tesla or 3 tesla) use superconductors that do not contain rare earth elements.

There is also potential to recycle permanent magnets from electric or electronic waste, where they are often used to produce sound or haptic feedback, in robotic and drone motors, and historically in hard drives. However, sourcing rare earth elements from electronic waste faces significant challenges: the magnets are generally small and embedded in complex objects. Automation and artificial intelligence-based technologies are, however, well positioned to facilitate sorting, presenting new opportunities.

Technological pathway: “Short loop” versus “long loop”

Rare earth recycling has historically focused on the latter: production of rare earth oxides from waste, or “long loop”. This approach requires similar processing capacities to those required to refine mine concentrate into oxides, allowing for higher flexibility with regard to input composition and possible impurities. Manufacturing scrap – swarf – is often contaminated during the cutting process and can be oxidised, making it a candidate for long loop reprocessing into oxides.

Recycling of permanent magnets into reusable alloys is sometimes referred to as “short loop” or “magnet to magnet” recycling, enabled by new technologies, such as hydrogen-based processing of magnet scrap. Depending on the type of recycling, the ability to track the composition of magnets and enhance sorting capacities can lead to increased efficiency. Short loop recycling also requires monitoring the grades and chemical compositions of the magnets.

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IEA calls for greater support for critical minerals recycling in 2024 report:

In the report, Recycling of Critical Minerals: strategies to scale up recycling and urban mining, the IEA projects that growth in critical minerals mining supply could be reduced by between 25-40% by 2050 through an expanded recycling effort.

Under a scenario where countries deliver on their net zero climate pledges, the IEA estimates that recycling could reduce new mining capacity needs by 40% for copper and cobalt, and by 25% for lithium and nickel by 2050.

While the use of recycled materials has so far failed to keep pace with rising material consumption, the IEA suggests that there is “vast potential” for critical minerals recycling as electric vehicles reach their end-of-life the availability of discarded batteries increases significantly post-2030.

Expanding recycling can have positive knock-on effects for energy security by reducing reliance on imports and building up reserves to mitigate against future supply shocks and price volatility, the report states.

On average, recycled critical minerals incur 80% less greenhouse gas emissions than primary materials and help reduce landfill waste, it said.

Critical minerals recycling has also attracted the interest of policymakers with 30 new policy measures on recycling being introduced in recent years, according to the IEA’s critical minerals policy tracker. These policies include financial incentives and industry specific targets for material recovery, collection rates and minimum recycled content, the report says. The IEA states that many of these strategies are not comprehensive and need to be expanded to other sectors.

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Miners diversifying into metals and minerals recycling:

From technology development to company acquisitions, mining majors are making moves in the mineral and metals recycling sector. South African-based mining company Sibanye-Stillwater is one of the world’s largest primary producers of platinum, palladium and rhodium, as well as a top-tier gold producer. Perhaps surprisingly, it is also a large recycler, processing 310,000oz of platinum group metals in 2023 – representing 13.3% of the company’s revenue. Sibanye-Stillwater was an early mover in what is now a growing trend of miners diversifying into the recycling sector. Whether it is through acquiring equity stakes in recycling companies, establishing joint ventures or funding the development of proprietary technologies, several global miners are tentatively dipping their toes into the metals and minerals recycling industry.

Why are miners diversifying into metals and minerals recycling?

-1. Miners look beyond mines for metals

Companies are starting to look at where the metals are, and not just where the mines are.

-2. New headwinds drive diversification

Industry experts say this trend is being driven by a perfect storm of rising demand for critical minerals, increasing lead times for new mining projects – which have risen from an average of 12.7 to 17.9 years, according to recent data – changing policy and increasing sustainability requirements. Combining mining investments with recycling initiatives not only accelerates material availability but also ensures a more sustainable supply chain and a strategic move to establish a presence across the entire value chain, from primary extraction to secondary resource recovery. This is a win-win business model.

-3. US and EU policies incentivise metals recycling

These investments, which can provide crucial financial support to recycling companies, are also often supported by favourable policies. For example, the US Department of Energy has committed $16bn in investments to bolster recycling technologies and infrastructure. What is more, the Inflation Reduction Act offers EV tax credits for batteries containing North American recycled critical minerals. Similarly, the EU’s Critical Raw Materials Act and the European Raw Materials Alliance require that at least 15% of the EU’s annual consumption comes from domestic recycling – this is as demand for materials such as aluminium, silicon, copper and nickel are projected to rise.

-4. The ESG factor driving recycling

Added to this is the ESG factor. Recycling can reduce mining activity, which is getting harder with lower grades and the focus of more public resistance. It can also boost a company’s sustainability credentials, something that is increasingly important to end buyers. To say you are investing in recycling technologies is a great marketing tool.

-5. Innovation

Metals recycling is notoriously challenging technology-wise and requires a wave of innovation. For example, zinc can be easily recycled but it is often mixed with plastics and other metals that must be hand-removed before processing, a time-consuming task. Similarly, put recycled material that is mixed with another material into a blast furnace worth a million-odd dollars and it can potentially destroy the machine. Investment from mining companies can help the industry innovate and overcome some of these challenges.

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The multiple benefits of scaling up efforts for recycling include:

-1. Creating a secondary source of supply that reduces the burden on primary supply from new mines.

Ramping up recycling will neither offset completely the growth in demand for energy transition minerals nor eliminate the need for continued investments in mining and refining (and the significant associated revenues that accrue to resource-rich countries). However, it will relieve some of the burden on the extraction of virgin minerals. Without scaling up secondary supplies (from recycling and reuse), investments required in mining to reach net zero emissions by 2050 globally would be USD 240 billion or around 30% higher over the period to 2040.

-2. Providing enhanced security for countries and regions with high clean energy technology deployment but limited mineral resource endowment.

Lessons learned from several decades of energy security demonstrate the need for importing countries to diversify their supply sources and enhance their resilience to disruptions triggered by geopolitical events. Recycling can provide a secure and diversified source of supply. Domestic infrastructure and investments in like-minded countries for recycling of critical minerals can also assist in building reserves to protect against the worst impacts of future supply disruptions.

-3. Lowering the environmental footprint of clean energy technologies.

Recycling has emerged as a potential pathway to alleviate some of the environmental impacts associated with the primary production of energy transition minerals. On average, recycled minerals emit 80% less greenhouse gas (GHG) emissions than their primary counterparts. This is, in part, because recycling processes often use less energy than the mining and processing of virgin minerals. The production of recycled materials also consumes less water than primary minerals. A strong example of the environmental benefits comes from the aluminium industry, where recycling of post-consumer scrap has been shown to reduce emissions by 90% compared with primary aluminium. Furthermore, recent studies show that total GHG emissions for manufacturing a nickel-rich lithium-ion battery cell can be around 28% lower if made from recycled materials rather than virgin minerals. It is worth noting that the gap between the implied emissions of virgin versus recycled materials varies strongly depending on the energy mix of the region where these are mined and processed and the region where they are recycled.

-4. Reducing the amount of waste generated from end-use technologies, mining and manufacturing.

The massive amounts of waste generated through the accumulation of end-of-life products such as consumer electronics, information technology equipment, household appliances, and clean energy technologies such as solar panels, wind turbines, EVs and storage batteries would pose challenges for global ecosystems. In the absence of adequate recycling efforts and stronger collaboration between manufacturers and recyclers, this waste might end up in landfills, polluting land and water resources and putting the health and safety of local populations at risk. Furthermore, recycling is not just limited to the management of end-of-life products; it must also include the volumes of waste generated in the form of manufacturing scrap as well as mine waste. Using scrap from manufacturing processes and recovering minerals from mine waste, also known as tailings reprocessing, can help reduce the amount of waste generated.

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Recycling not enough: more mining needed:

The industry is struggling to build mines fast enough to meet expected demand. So, demand is turning to other sources of critical minerals, one of the most important of which is recycling — which can also often be more sustainable than mining. Governments across the world are incentivizing recycling projects with tax rebates and other financial support to encourage investment. But there’s one big problem: there are not enough secondary stock of metals currently in circulation that can be recycled to meet such an increase in demand. Not only are there not enough minerals, but it can also take up to 10-20 years before an electric battery being put out into the market today to reach the end-of-life and be ready for recycling. Recycling will be no panacea to critical minerals concerns. The main reason for this is that there will not be enough secondary feedstock to meet a significant share of material demand.

For example, the EU’s new Critical Raw Materials Act has mandated that at least 15% of the EU’s annual consumption of critical minerals must come from recycling by 2030. The European Recycling Industries Confederation (EuRIC), although welcoming the act, warns that pragmatic targets are needed. “Recycling targets can drive sustainability but they’re not a silver bullet… You need to have a market, basically” — said Emmanuel Katrakis, secretary general of EuRIC, the European Recycling Industries Confederation. Eurometaux, a trade association representing non-ferrous metals producers and recyclers in Europe, suggests precious metals in electric batteries won’t be widely available until 2035-2040. “Basically, what we’re doing now is adding materials into our urban mine that will be there in 15 years’ time to capitalise on”. And different countries will have different speeds at which they will be able to bring a sustainable recycling industry online. China and South Korea are ramping up their recycling policies to gain an industrial advantage, including taking scrap from other markets.

The World Bank has modelled the share of metals that can come from recycling by 2050 if there was to be 100% end-of-life recycling. Aluminium, copper, and nickel would still only see secondary supplies reach 60% of demand.

And recycling is not always as cost-efficient as mining.

Although technology is making significant advances to increase recycling rates, it is still both cheaper and easier to mine some metals due to the need to use hazardous chemicals and significant heat sometimes needed to “unblend” minerals in magnets, batteries and touchscreens. This is particularly so with rare earths and lithium.

At present, the challenges of recycled battery raw materials seem insurmountable… Firstly, the cathode, which contains critical metals in the EV pack, is overpackaged with pack materials such as casings, interconnects, cooling channels and others. The result is a tedious recycling process with little value. There are also some serious technological hurdles to boosting the recycling rates of certain metals. The 15 elements that make up the rare earth metals group, for example, collectively have only around a 1% global recycling rate. These metals are often blended together with other minerals to make things like magnets and touchscreens, and separating them has traditionally involved hazardous chemicals such as hydrochloric acid and a lot of heat. This means more mining, a lot more mining, and quickly. Recycling is not going to eliminate the need for a new primary supply of metals as demand booms during the energy transition, but if rates are improved for more easily recycled metals, and technology improves for harder-to-recycle materials, then it will prove to be a useful asset.

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Reprocessing mining and refining waste to recover critical minerals:

One man’s trash (mine waste) is another man’s treasure (critical minerals):

Note:

“Remining” refers to the practice of mining previously mined areas or extracting resources from existing mine waste. It essentially involves re-entering abandoned mines or reprocessing waste materials to extract additional valuable resources or to remediate environmental issues caused by prior mining.

In metal mining, in most cases only a minor percentage of the extracted materials are the valuable target elements (e.g. Fe or Al ores 20–70%, Zn 2–15%, Pb 1–10%, Cu 0.2–6%, REE 0.1–0.5%, Au 0.5–20 g/t). Thus, the vast majority of the extracted material is defined as waste, which is deposited in disposal facilities like tailings impoundments, lakes or the sea and in waste-rock dumps, or is backfilled into open pits or underground mines. These mine wastes are the source of environmental pollution, for example via Acid Mine Drainage formation, and fatal risks like during tailings dam failures. To minimize the risk from mine waste, mine waste has to be eliminated, in order to gain back the social license to operate. This applies for both, fresh mine waste and historical mine waste. Mine waste can still contain important metal contents (specifically the overlooked critical metals like REE, PGE, and battery metals like Co, Ni, Li, Mn), and have therefore a high potential for successful reprocessing.

In mining, tailings refer to the waste material remaining after valuable minerals have been extracted from ore. They are a byproduct of the mining process, typically a slurry of fine mineral particles and water. Mine tailings are increasingly mass produced as a result of increased demand for metals and minerals as well as the advancement in technology that allows for the exploitation of lower-grade ores. Lower grades can increase the volume of tailings that may contain new gangue minerals that should be evaluated for the presence of critical minerals and other valuable metals. The practice of reprocessing, while relatively new, is crucial to reducing environmental damages, obtaining valuable critical minerals from waste, and contributing to more sustainable repurposing and disposal methods. With the increase in tailings dam failures in recent years, there is a large motivating factor in remining and removing the potential hazard to benefit the safety of potentially impacted communities.

The technological pathways to recover minerals from mine waste depend on the type and characteristics of the mine waste and the specific mineral recovered. The mineral extraction process is similar to the original value chain – crushing, milling classification, separation (including flotation, gravity separation and magnetic separation), leaching or solvent extraction, metal extraction, and metal recovery. However, there are some additional challenges when recovering minerals from mine waste.

These include the secondary minerals created during the weathering and disposal process, uneven size and texture of waste particles and mineral oxidation. This last aspect could require adaptations to the primary production process or the development of entirely new technologies. The minerals that can be recovered from mine waste depend on the geology and extraction or processing used when the waste was originally generated. Commonly found minerals within gold and iron tailings could include copper, zinc and some rare earth elements.

For copper tailings specifically, metals such as cobalt, zinc and rare earth elements may be found. Rare earth elements are also found in the tailings of tin, phosphate, bauxite, coal, titanium and uranium. Varying levels of the originally targeted commodity may also be found, depending on the ore grade and recovery efficiency of the original process.

Quantity of mine waste:

The International Energy Agency (IEA), in their World Energy Outlook Special Report Recycling of Critical Minerals: Strategies to scale up recycling and urban mining, specifies that mining generates large amounts of waste. The estimate is that around 3500 large-scale mining operations globally produce more than 100 billion tonnes of solid waste yearly. The report highlights an additional estimated 5.75 billion cubic metres of waste in active, inactive and closed tailings in 2020 for just over 100 of the world’s largest mining companies, mainly located in the Americas. As new mines and associated tailings facilities open, the volume of active facilities is expected to grow by 1.7 billion cubic metres by 2025, increasing the amount of tailings worldwide by about 35% since the beginning of this decade. If current growth continues, this would mean that the waste quantity generated would reach almost 8.5 billion cubic metres by 2030, 87% higher than the 2020 levels. This does not include tailings from abandoned sites, where there are an estimated 500000 abandoned mining sites in the United States alone, as well as those from artisanal mine sites, says the IEA.

The paper, Recycling and Reuse of Mine Tailings: A Review of Advancements and Their Implications, published in open access journal Geosciences in 2022, indicates that mining generated 7 billion tonnes of mine tailings annually worldwide, suggesting that 19 billion solid tailings will be accumulated by 2025. It enumerates 10000 abandoned mines in Canada, 50000 in Australia and 6000 in South Africa, creating a particularly worrying legacy of environmental damage, along with the 9500 coal mines in China, which might reach 15000 by 2050.

Companies using mine waste to recover minerals:

The IEA’s Recycling of Critical Minerals points out companies are actively recovering minerals from mine waste. They specify US Strategic Metals, which has been recovering cobalt from tailings at a former Superfund site since 2019. However, large-scale production from mines is not usual. Companies are, however, starting to actively evaluate the potential of recovering minerals from mine waste. Rio Tinto invested $2 million in regeneration to focus on re-mining and processing waste from legacy mine sites. They aim to extract minerals from water, tailings and waste rock. Barrick Gold is also exploring the possibility of recovery at Nevada Gold mines. They target scandium, nickel, zinc and cobalt using an ion-exchange recovery system to extract material from heap leach copper solutions. In Europe, Euro Manganese is investigating how to recover and refine battery-grade manganese from tailings at a decommissioned pyrite mine site. This is the only known source of manganese suitable for the battery industry in the EU. Otherwise, it is imported from China.

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Wheel of Metals Companionality:

Production of minerals from natural resources has always focused on the primary mineral of value. However, in some mineral deposits, several valuable minerals may be present that can be recovered as byproducts, allowing multiple products to be marketed. Fluctuating commodity prices will influence the economics of producing both the primary and byproduct minerals at any given time. For example, in a porphyry copper deposit, copper is the primary metal produced and all efforts are invested in optimizing copper recovery and production. Some copper deposits contain precious metals that pay a bonus at the smelter. Molybdenum may also occur and is separated at the milling operation into its own concentrate. In essence, copper pays the bills and the other metals contribute to the mines’ profits.

Recent characterizations of tailings and waste rocks at some mines have revealed that these materials contain low concentrations of one or more critical minerals. In all likelihood, their presence was known but determined to be too low in concentration to recover when the ore was originally processed. However, they are now in high demand as the raw materials needed to manufacture and construct renewable energy infrastructure and technologies making reprocessing tailings and other mine wastes potentially lucrative. Recently enacted policies support recovering critical minerals from previously mined materials. For example, the Infrastructure Investment and Jobs Act of 2021, also known as the Bipartisan Infrastructure Bill1, provides funding for the recovery of rare earth elements from acid mine drainage and mine waste, states that “many critical minerals are only economic to recover when combined with the production of a host mineral,” and defines critical minerals and metals as “any host mineral of a critical mineral.”

Many critical minerals mainly occur in deposits of other more common minerals. A 2015 study from the Center for Industrial Ecology at Yale University discusses the occurrence of by-product minerals in primary mineral deposits and illustrates these occurrences in the “Wheel of Metals Companionality” shown on Figure below. Many of the by-product minerals are included in the U.S. Geological Survey’s (USGS’) critical minerals list.

Figure above shows Wheel of Metals Companionality.

As described in the 2015 study, the principal host metals form the inner, darkest blue circle. Companion elements appear in the outer circles at distances proportional to the percentage of their primary production (from 100 to 0 percent) of the host metal indicated. The companion elements in the white region of the outer circle are elements for which the percentage of their production from the host metal indicated has not been determined.

The Wheel of Metals Companionality illustrates there are many primary metal deposits that have significant potential to produce important critical minerals as by-products or co-products. For example, antimony (Sb), is shown in association with primary (host) mineral deposits of gold (Au), and lead (Pb). Copper (Cu) deposits are a host metal for several critical minerals including tellurium (Te), rhenium (Re), tin (Sn), cobalt (Co), bismuth (Bi), uranium (U), indium (In), barite (Ba), and arsenic (As).

Opportunities to Produce Critical Minerals from Host Mineral Deposits:

There are several opportunities to produce critical minerals as by-products or co-products from mineral deposits:

-1. Recovering critical minerals from mines that are currently producing primary minerals where the host mineral deposit may contain some or all of the by-product or co-product minerals shown in Figure above;

-2. Reprocessing mine wastes at active mines, (e.g., tailings, waste rock, or both) that may contain some of the critical mineral by-products and co-products shown in Figure above;

-3. Reprocessing tailings and/or waste rocks at inactive and potentially abandoned mines where these wastes may contain valuable deposits of the primary host mineral as well as critical minerals by-products and co-products.

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Mining and processing waste:

Mining and processing wastes are defined as solid and liquid by-products of mining, mineral processing, and metallurgical extraction processes (Hudson-Edwards et al., 2011). Globally, over 100 billion tons of mining wastes are generated per year (Rankin, 2015), and this is likely to grow as lower grade resources are increasingly utilised due to depletion of high-grade resources. There are three main types of mining and refinery wastes: (i) mining wastes, (ii) processing wastes, and (iii) metallurgical wastes as seen in figure below.

Figure above shows Schematic illustrating mine waste generation from a metal commodity.

Mine wastes are generated during open pit and underground mining activities and include waste rock, overburden, and mining waters. Mineral processing wastes are generated during the concentration of economical metals and minerals, and include tailings, sludges, and mill water. Tailings, which are a mixture of non-economical crushed rock and processing fluids generated from a mill, washery or concentrator during mineral processing, are the main waste stream. Metallurgical wastes are generated during the extraction and recovery of metals from mineral concentrates and include slags, roasted ores, flue dust, ashes, leached ores, and process water.

Mining and processing waste have variable chemical and physical properties that can make recovery of critical metals challenging. Mining and processing wastes can contain: (i) primary ore in subeconomic concentrations, (ii) gangue minerals, (iii) secondary minerals formed during weathering, and (iv) compounds formed during mineral processing or waste disposal (Lottermoser, 2010; Jamieson, 2011). Mining and processing waste particles can be poorly liberated, and the distribution of particle sizes within these wastes can vary significantly by type. For example, waste rock generated during mining activities varies from sand sized (0.0625–2 mm) to boulders (>256 mm) whereas tailings contain smaller particle sizes and significant concentrations of fines (Vriens et al., 2020; Collins and Miller, 1979). Mining wastes also have a range of textures and crystal structures (Piatak, 2018). Furthermore, the prolonged weathering and exposure to air and water causes significant oxidation of mineral surfaces, causing them to become less amenable to treatment by flotation (Newell et al., 2007). To overcome these challenges, processing technologies for critical metal extraction need to be developed or adapted for mining wastes.

Types of mining and processing waste:

-1. Fly ash is extracted from various tailings, overburden dumps and other mining/processing waste.

-2. Red mud, also known as bauxite residue, is a byproduct produced during the Bayer process (the principal method for refining bauxite into alumina). For every tonne of alumina produced, approximately 1–1.5 tonnes of red mud are generated. Red mud is primarily composed of iron (Fe). Additionally, it contains critical minerals such as titanium, along with trace amounts of vanadium and REEs.

-3. Mine overburden dumps are a byproduct of mineral extraction, consisting of waste rock, soil and low-grade ore removed during mining operations. These dumps present environmental and land-use challenges but also contain valuable secondary resources. Critical minerals and rare earths are often concentrated in the coal seams and surrounding rocks, including mine overburden. Rare earth elements are typically found in coal-bearing strata as minerals such as monazite, xenotime and bastnaesite.

-4. Mine tailings are waste by-products left over after extracting valuable metals and minerals from ore deposits. Tailings are often stored in large, man-made dams. These dams, also known as tailings dams, are designed to contain the slurry of fine particles and water that make up tailings. An estimated 16 billion tonnes of tailings are generated globally each year, contributing to a total worldwide stockpile of approximately 282 billion tonnes. Many tailings, especially from older mining operations, contain significant amounts of critical materials such as copper, cobalt, nickel, lithium and REE, presenting an opportunity to tap into these materials as a secondary resource.

Significant quantities of rare-earth oxides are found in tailings accumulated from 50 years of uranium ore, shale, and loparite mining at Sillamäe, Estonia. Due to the rising prices of rare earths, extraction of these oxides has become economically viable. The country currently exports around 3,000 metric tons per year, representing around 2% of world production.

Phoenix Tailings is a Massachusetts-based startup extracting rare earth elements from mining sites. Two of Phoenix’s founders, who grew up in communities affected by mining, say they are motivated by personal experience in addition to the growing demand for rare earth elements. Besides the four rare earths used most commonly in magnets (neodymium, praseodymium, dysprosium, and terbium), Phoenix recovers battery metals, platinum group metals, low-carbon irons, and other materials in what it calls a “portfolio approach” that improves economic viability. Phoenix repurposes residual materials into concrete and other aggregates. This provides long-term storage for carbonaceous materials, reducing environmental impact by trapping them and preventing them from ending up in the water supply.

-5. Metal slag, a byproduct of metallurgical processes, is generated during the refining of metals such as copper, zinc and lead. While traditionally considered waste, metal slag contains iron, nickel, cobalt and REEs, making it a potential source for metal recovery.

Figure below shows recovery of critical minerals from mining and processing wastes:

Mine waste, including tailings and waste rock, holds significant potential for the recovery of critical minerals such as copper, cobalt, nickel and REEs. Advancements in processing technologies, such as specialised sorbents and membranes, now enable the selective extraction of these valuable minerals. With traditional sources depleting and new deposits becoming increasingly difficult to access, attention is turning to the vast untapped potential in mine waste and tailings. Reprocessing mine tailings offers a sustainable alternative for sourcing critical minerals while addressing environmental concerns, optimising land use and mitigating resistance to new mining projects.

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Table below summarizes the advantages and challenges associated with the recovery of renewable energy metals from mine waste sources. The advantages for all remined sources include an increased domestic supply, especially of REEs; generally lower energy and water use; potential for the cleanup of abandoned mine lands and mine-affected waters; and increased local employment. Some common challenges include a lack of comprehensive sampling and characterization information, the evaluations that are needed to provide increasing circularity by creating products from the post-remining wastes, and the evaluation of potential positive and adverse environmental outcomes.

Advantages and challenges for the recovery of renewable energy metals from remined sources.

Remined Source	Primary Targeted Metals	Advantages	Challenges
Tailings	Ag, Cd, Co, Cu, Ga, Li, Mn, Ni, (Au), REEs	Already crushed/ground; lower energy use and GHG emissions compared to virgin extraction; can often be reprocessed on or near mine sites using existing infrastructure; amenable to bioleaching, which uses few toxic chemicals.	If regrinding is needed, this will produce slimes that present management challenges and limit floatability; detailed characterization to estimate economic value and environmental effects generally lacking; tailings dam failures have resulted from remining, and careful evaluation is needed to lower failure risks.
Waste rock	Cu, Li, Zn	Can have higher metal concentrations than tailings due to varying ore cut-off grades over time.	Generally not in contained impoundments; highly variable chemistry and particle sizes; access issues if co-disposed with tailings.
Bauxite residue/red mud	Al, Cr, Ga, REEs	Potential for removing enormous waste piles that pose environmental and human health and safety risks; increased domestic supply.	Reasonable management and circularity options for remaining wastes not examined; remining of wet tailings could result in tailings dam failures if not carefully conducted.
Acid Mine Drainage (AMD) discharge and sludge	Co, Mn, REEs	Direct extraction from AMD eliminates the need for dissolving the sludge and results in lower reagent and processing costs and more sustainable waste disposal practices; domestic REE source; remediation of abandoned mine lands/affected waters.	Processing facilities will need to be built nearby and will likely require the collection and transport of AMD and associated sludges.
Secondary recovery from ore production byproducts	Li, Te	Work so far by mining companies has shown potential for two metals in low supply relative to demand; domestic sources of Li and Te.	More work needed by mining companies on potential for secondary recovery in terms of available waste quantities and metal content.
Coal ash	Co, Mn, REEs	Potential for removing and/or making use of waste in large impoundments that pose environmental/human safety risks; domestic supply.	Transport likely needed; strong chemicals generally needed for reprocessing; full circularity (using remaining wastes) not evaluated.

Based on the pros and cons outlined in Table above, at this point it appears that tailings hold the most promise for remining because of the relatively large number of metal extraction studies conducted on tailings, the large amount of tailings worldwide, and the fact that they are already extracted and pre-processed, which reduces energy and potentially water use. One of the greatest threats from remining, however, stems from the rehandling of wet tailings in dammed impoundments. With more waste characterization and pilot projects, the potential for the recovery of renewable energy metals from all remined sources can be better evaluated. Of the processing approaches examined for recovery from tailings, bioleaching appears to offer the most benefits with the fewest potential downsides.

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Reprocessing mine waste for critical minerals can help reduce environmental impact, create a secondary supply of minerals, and support local economies.

Benefits:

Environmental impact: Reduces water contamination, soil pollution, and safety risks
Supply security: Creates a secondary supply of minerals, reducing reliance on new mines
Economic impact: Supports local economies by creating jobs in the mining industry
Environmental remediation: Can help clean up abandoned mine sites

Challenges:

Requires large-scale industrial installations and specialized technologies
Requires addressing liability barriers related to abandoned mine sites

There are technical, economic and environmental challenges associated with the recovery of critical minerals from tailings where they are mostly generated as by-products or companion products of host metals such as Zn, Pb, Cu, Au, Ni, Fe and Sn. One key challenge relates to the form of the CMs in the tailings is their concentration, grain size, liberation, and association with other gangue constituents, and moreover the influence or impact of these characteristics on the reprocessing method and efficiency. Therefore, detail characterization, chemical and mineralogical, of tailings with technoeconomic assessment is necessary, which needs more research.

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A Circular Economy Approach to Critical Mineral Sustainability:

We need a clean energy revolution, and we need it now. But this transition from fossil fuels to renewables will need large supplies of critical metals such as cobalt, lithium, nickel, to name a few. Shortages of these critical minerals could raise the costs of clean energy technologies.

One obvious route is to mine more virgin material, but this comes with its own costs and potentially unintended consequences. Another solution commonly discussed is to recycle more and use the metals already in circulation. The complication is that we do not currently have enough metals in circulation, and even with recycling taken into consideration, mineral production is still forecasted to increase by nearly 500%. So how should we proceed?

A fully circular economy is much more than recycling; it is keeping materials at their highest value. Circular economy (CE) and green economy (GE) are the most used concepts for sustainability issues in mining sector (D’Amato et al., 2019; Kinnunen and Kaksonen, 2019). Many definitions are currently published, and some also linked into human rights, social impact, pollution, corruption, among other sectors (Korhonen et al., 2018). These concepts focus especially on the raw material sector on the 3-R approach: Reduce (minimum use of raw material), Reuse (Maximum reuse of products and components), Recycle (high quality reuse of raw material). The goal is to minimize the waste material along a value chain and maintain the material as long as possible in the cycle of a system, with the use of renewable energy sources. As a result, several initiatives were built to address a more responsible or sustainable mining industry, like Initiative for Responsible Mining Assurance (IRMA), Responsible Mining Index (RMI), among many others.

It is important that we invest in purpose-built facilities and new efficient techniques to recycle critical minerals. For example, with 300 smart phones able to provide enough cobalt for one EV battery, recycling the unused 21 million tech items in UK homes could help supply critical minerals for UK gigafactories. Recycling EV battery waste could also supply enough cathode material to supply 60 GWh of new EV batteries by 2040.

However, the circular economy hierarchy suggests that recycling should be the last resort. The priority should be to keep materials in use for longer by sharing, leasing, repairing, reusing, remanufacturing and, finally, recycling the assets in which they exist.

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Section-12

Adverse impacts of critical minerals production:

The growth of minerals supply not only plays a vital role in enabling clean energy transitions, but also holds great promise to lift some of the world’s poorest people out of poverty. Mineral wealth can, if exploited responsibly, contribute to public revenue and provide economic livelihoods for many. However, if poorly managed, mineral development can lead to a myriad of negative consequences.

Significant greenhouse gas (GHG) emissions arising from energy-intensive mining and processing activities.
Environmental impacts, including biodiversity loss and social disruption due to land use change, water depletion and pollution, waste related contamination, and air pollution.
Social impacts stemming from corruption and misuse of government resources, fatalities and injuries to workers and members of the public, human rights abuses including child labour and unequal impacts on women and girls.
Rare earth minerals are processed primarily from ores and minerals that also naturally contain uranium and thorium resulting in radioactive waste.

The extraction and processing of critical minerals generate significant global impacts, accounting for 10 % of GHG emissions in 2018 – a proportion expected to rise due to increasing demand and dwindling ore quality (Azadi et al., 2020). In addition, the localized repercussions of these extraction activities are equally concerning. Among the local environmental impacts, chemical pollution, including water and soil contamination, poses significant environmental challenges (Balaram, 2019; Jiang et al., 2020; Marx et al., 2018). On the social front, mining activities present a complex picture. On the positive side, they can catalyze job creation and economic growth, offering an escape from poverty (Mancini and Sala, 2018; Sovacool, 2019). Mining contributes to community development, enhances social and cultural identity (Sovacool, 2019), and promotes infrastructure improvements, including in telecommunications and utilities (Azapagic, 2004; Franks, 2012; Hajkowicz et al., 2011). However, particularly in developing countries, the industry is plagued by significant drawbacks such as corruption, child and forced labor, poor working conditions, low wages, and health risks, often in violation of the International Labour Organization (ILO) conventions (Azapagic, 2004; Environmental Law Alliance Worldwide (ELAW), 2010; Franks, 2012; Hajkowicz et al., 2011; Mwaura, 2019; Sovacool, 2019; Spohr, 2016; Starke, 2016).

Critical minerals are primarily extracted from a select few countries (IEA, 2021a), thereby concentrating the localized impacts within these regions. Furthermore, these extraction activities often serve as the starting points for extensive global supply chains. The result is localized impacts that are often geographically distant from where the minerals are finally utilized. This spatial disconnection creates a “decarbonization divide” (Sovacool et al., 2020), whereby developed countries reap the benefits of cleaner technologies while developing and least-developed countries often bear the environmental and social burdens. This divide not only complicates future decarbonization initiatives in those developing countries but also exacerbates existing inequalities (Sovacool et al., 2020).

Some risks are more likely to hinder supply:

While it is important to address all the potential negative impacts of mineral production, certain risks are especially likely to create issues for security of supply by disrupting short-term supply or acting as a barrier to new developments.

-1. Water scarcity can lead to disputes with local communities or shortages of water, which is needed in large quantities for mining activities.

-2. Greenhouse gas emissions from mining and processing can undermine the case for new developments and contribute to regulatory and financial risks.

-3. Impacts on biodiversity may pose growing regulatory and financial risk as criteria concerning biodiversity impacts are introduced.

-4. Human rights violations can pose major reputational and legal risks for companies that do not do enough to ensure their supply chains do not contribute or are linked to abuses.

-5. Failure to meaningfully engage with communities – including respect for the rights of Indigenous Peoples – can engender local opposition and lead to protests or blockades that stop production or make it difficult to obtain permits or begin operations even with the required permits.

-6. Instances of corruption can lead to protracted delays in new projects, and perceived risks may deter new investment in certain regions.

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Greenhouse gas emissions:

GHG emissions from critical mineral production can occur at multiple places along the supply chain. The industry relies on heavy equipment and industrial processes that can be relatively energy-intensive and have historically been powered by fossil fuels. In 2021, the average GHG emissions for the production of critical minerals produced ranges from 4.6 t of carbon dioxide equivalent (CO2-eq) per tonne of refined copper to 75.8 t CO2-eq per tonne of neodymium oxide. These emissions will vary greatly depending on the type of processes, the energy efficiency and whether the power is sourced renewably. As of today, emissions from the critical minerals industry are relatively small compared with other sectors, largely due to low production volumes. However, these emissions could grow alongside projected growth in demand, including indirect emissions from purchased energy.

Clean energy technologies have lower levels of GHG emissions compared with other technologies even when considering the full life-cycle emissions. Total lifecycle greenhouse gas emissions of electric vehicles are around half those of internal combustion engine cars on average, with the potential for a further 25% reduction with low-carbon electricity. However, lowering mining’s GHG emissions will be crucial in the production of critical minerals to ensure there is a sustainable, responsible and reliable supply. Energy-intensive mining for critical minerals could undermine efforts to reduce emissions. Fortunately, mining companies have the resources to invest in renewables, like green hydrogen as they develop, and in more efficient technologies to reduce overall emissions of mining operations.

High GHG emissions along the critical mineral supply chain may eventually serve as a prohibitive barrier in developing new operations in areas where cost efficient renewable sources of energy or GHG abatement technologies and methods are unavailable. This is particularly relevant for minerals that require energy-intensive processes and for developing resources in regions that are not grid-connected or grid-powered by sufficient levels of renewables. According to analysis for a Nuclear Energy Agency report, 15.8% of critical mineral deposits are remote. As new reserves and resources of critical minerals are developed to meet demand from the clean energy transition, mining supply chains will need to invest in technological improvements to bring down emissions.

By contributing to GHG emissions, mining could also be reinforcing supply risks in other areas and increasing its own risk of being exposed to the impacts of climate change, which can stop production or create delays. Climate change is known to exacerbate extreme weather conditions and fundamentally alter global precipitation, temperature and hydrological conditions, all of which could potentially severely disrupt the entire length of mineral supply chains, both upstream and downstream. Changing weather patterns, especially altered flood levels and increased water stress, could disturb individual mine sites’ infrastructure and operations.

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Critical Minerals Mining could strain Water Supplies in Stressed Regions:

Using global data from the U.S. Geological Survey (USGS) and WRI’s Aqueduct tool, it was found that at least 16% of the world’s land-based critical mineral mines, deposits and districts are located in areas already facing high or extremely high levels of water stress as seen in the figure below. These are areas where agriculture, industry and households regularly use up much or most of the available water supply. Without proper management, critical minerals mining can be extremely water intensive and polluting, further straining limited freshwater supplies.

An analysis of data from USGS and WRI’s Aqueduct Water Risk Atlas reveals that at least 16% of the global critical mineral mines, deposits and districts located on land are in areas facing high or extremely high baseline water stress. In these locations, at least 40% of the water supply is required each year to meet existing demand, meaning that there is high competition for water among agricultural, industrial and domestic users and sometimes not enough water left over to sustain important freshwater ecosystems. A further 8% of global critical mineral locations are in arid and low-water-use areas, where available water supplies and total water demand are very low. Rapid increases in mining activity in these regions could easily increase demand for water and push these locations with already-scarce freshwater supplies into high or extremely high levels of water stress. Arid, low-water use and/or highly water-stressed countries with the most critical minerals sites include the United States, Australia, South Africa, India, China, Mongolia, Russia, Mexico, Chile and Namibia. Under a business-as-usual scenario, the percentage of today’s critical mineral locations that would be located in areas of high or extremely high water stress would increase to 20% by 2050.

Most methods used to mine critical minerals today require significant amounts of water for separating minerals, cooling machinery and controlling dust. Waste from mining and processing, including residual minerals and chemicals, can also contaminate water in nearby communities.

Current processes for extracting lithium — a critical mineral used in both electric vehicle (EV) batteries and solar panels — are particularly water-intensive. Take the “lithium triangle” in South America. This area spanning parts of Chile, Argentina and Bolivia contains over half the global lithium supply, found in brine pools underneath the region’s vast salt flats. Miners pump this brine into large pools on the surface of the flats, where the water evaporates out and leaves behind lithium carbonate, used for producing clean energy technologies. This evaporation method uses up to half a million gallons of brine water to extract one ton of lithium. While the brine water itself is unfit for drinking or agricultural use, some reports show that withdrawing such large quantities can cause fresh water to flow into brine aquifers and mix with salt water. This can result in salinization of fresh water and deplete nearby surface and groundwater supplies.

In Chile’s Salar de Atacama, one of the country’s key mining regions, lithium and copper extraction have reportedly consumed over 65% of the local water supply, depleting available water for Indigenous farming communities in an already water-scarce region. Indigenous communities in Chile and Argentina have also reported contamination of fresh water used for drinking, livestock and agriculture with toxic waste from lithium operations. Impacts to fresh water are not unique to Chile nor to the lithium industry; they are occurring across global mining and processing locations for a variety of critical minerals. Similar concerns about water use and contamination have already been reported for cobalt in the Democratic Republic of Congo (DRC) and graphite in China, among others.

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Environmental impacts of production of critical minerals versus coal/gas/oil:

Critical materials are fundamentally different to fossil fuels as seen in figure below:

The environmental impact of critical minerals mining can be significant, including greenhouse gas emissions, biodiversity loss, water pollution, and soil contamination. Mining, whether for fossil fuels or metals used in clean energy technologies, has serious environmental impacts, and it’s hard to make apples-to-apples comparisons—except in terms of their impact on climate change, where clean energy mining is clearly better. Building clean energy technologies, like wind turbines and electric vehicles (EV), is generally more mineral intensive than using fossil fuels. An EV requires six times more minerals than a conventional car (not counting steel and aluminum), while building a wind plant uses nine times more minerals than a gas-fired plant. Certain materials are particularly critical for the clean energy transition. These include lithium used in the batteries that run EVs, rare earth minerals in the magnets that allow wind turbines to make electricity, and copper, which is used for electricity transmission.

The argument could be made that, with the clean energy transition, we’re exchanging a fossil fuel-based energy system with a metals-based energy system. As the clean energy transition moves forward, the demand for these materials will grow. Projections from the International Energy Agency (IEA) suggest that by 2040 the demand for copper could more than double, while the demand for lithium could grow over 40 times—if, that is, the world builds enough clean energy to meet the international climate goals set by the 2015 Paris Agreement. This growing demand will mean more and larger mines, which come with real risks to communities and to biodiversity. So is the direct impact of all this mining for clean energy greater or smaller than the impact of mining for fossil fuels?

That answer, unfortunately, isn’t straightforward as making an apples-to-apples comparison is challenging, because methods for extracting and processing oil and coal are different than those for metal mining. Even mining two different metals—or two different deposits of the same metal—can call for different techniques. We shouldn’t discount the amount of resource extraction we already do to power our current, climate-warming energy system. The volume of fossil fuels we mine today dwarfs the amount of clean energy minerals the world will need in the future. In 2021, over 7.5 billion tons of coal were extracted from the ground, while the IEA projects that the total amount of critical minerals needed for clean energy technology by 2040 will be under 30 million tons. This figure includes minerals like copper, silicon, silver, zinc, manganese, and more, which are crucial for solar panels, wind energy, electric vehicles, and other clean energy technologies. However, this amount doesn’t include the total ore extracted or rock moved to obtain these minerals. Yet even this becomes complicated when one factors in the percentage of material extracted from a mine that is actually the usable resource we want. For coal, this number can range from less than 40 to as high as 90 percent. In contrast, this number for a copper deposit may be less than one percent, meaning that much more material needs to be extracted and processed for the same volume of output.

But there is one area where clean energy definitely wins out: climate-warming carbon dioxide (CO2) emissions. The emissions created by extracting minerals from the ground are tiny compared to those created by burning fossil fuels: a 2020 report from the IEA found that for every gigawatt of a clean energy technology that’s installed, millions of tons of CO2 emissions can be avoided. Given the urgent threat of climate change, the clean energy transition is necessary. However, we must be aware of the environmental and social impacts of mining for clean energy materials. Electric vehicles are only as “clean” as the electricity grid that feeds them. They are only as “green” as their component parts. The batteries require nickel, which could well have come from a mine in the Philippines that legally dumps its tailings (toxic waste) in oceans. Meanwhile, the vital cobalt can’t be separated from the human miseries of mining in the Democratic Republic of the Congo — a mining industry referred to as “a new form of slavery, a subterranean slavery.” When considering the implications of minerals shortages, it may be tempting to justify critical minerals mining at all costs, however, this is a dangerous fallacy. The social and environmental impacts of poorly mined critical minerals are dire. These range from lithium’s water intensity in the fragile landscapes of the Chilean Atacama desert to the toxic processes inherent in the processing of the rare earth elements whose use is ubiquitous in smart technology and wind turbines. Diminishing ore grades mean ever bigger tailings dams, and climate change makes them more prone to accidents.

For Indigenous communities, critical minerals hold both promise and peril. Studies have shown that critical minerals are often heavily concentrated on Indigenous lands. For them, the question arises whether this will open the door to Indigenous economic development or if it will constitute yet another instance of displacement and ecological destruction on their doorstep. The importance of independent standards authorities such as the Initiative for Responsible Mining Assurance (IRMA) cannot be overemphasized. In contrast to industry standards such as Towards Sustainable Mining, IRMA represents multiple stakeholder views. These include communities, employees, investors and mines.

Mining is by its very nature a highly energy intensive process. While it is expensive and technically complex to retrofit existing mines for electrification purposes, new mines should be designed with carbon neutrality in mind. Of course, this can be particularly difficult in places that are experiencing infrastructure challenges, such as limited renewable or low carbon energy options. Greenfield mining is not the sole solution to the critical minerals conundrum. Urban mining (extraction from electronic waste) can play an important role. It’s also important to design products manufactured from critical minerals with recycling and repurposing in mind. By investing in research and development, we can find substitutes to the most problematic minerals, whether the underlying issues are geopolitical constraints, toxicity or human rights abuses.

Mitigating the environmental impact:

Sustainable mining practices:

Implementing practices like water recycling, improved waste management, and minimizing land disturbance.

Recycling and reuse:

Increasing recycling of critical minerals from end-of-life products to reduce the need for primary mining.

Strict regulations and oversight:

Implementing robust environmental regulations to monitor and control mining activities.

Research and development:

Investing in new technologies to develop more environmentally friendly extraction and processing methods

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Section-13

The Geopolitics of Critical Minerals Supply Chains:

Geopolitics is the study of how a country’s geography (location, terrain, land size, climate, soil and raw materials) affect its foreign, economic, military policy and strategy. The word geopolitics comes from the words “geography” and “politics”. The mining and processing landscape of critical materials is geographically concentrated, with a select group of countries playing a dominant role.

The curse of geography:

The distribution of critical raw materials (CRMs) represents a multilayered and complex phenomenon that has received considerable attention in recent years, especially in global supply chains and sustainability. Mining and processing of critical raw materials are concentrated in specific localities, allowing a few countries to dominate the entire sector. Australia leads in iron ore and lithium production, essential for steel manufacturing and battery technologies, while Chile is the world leader in producing copper. China is a superpower when it comes to graphite and rare earths, which are critical for modern technology. The Democratic Republic of the Congo (DRC) is a key cobalt producer while platinum and iridium are mainly mined in South Africa. Indonesia dominates nickel with almost half of global production.

The processing phase is even more pronounced, with China now accounting for 100 percent of refined natural graphite and dysprosium (a rare earth element), 70 percent of cobalt, and nearly 60 percent of lithium and manganese. Besides the specific uneven geographic distribution of critical raw materials that pose considerable supply security risks, geopolitical tensions and an unstable environment in producer regions actually compound these risks. For instance, 70 percent of cobalt mined worldwide comes from the Democratic Republic of the Congo, a country limping under political instability. The high probability of disruptions in the supply chains could lead to price fluctuations with ripple effects across various sectors reliant on these materials. The concept of ‘criticality’ in reference to raw materials has grown into a crucial framework for understanding the risks associated with supply interruptions such as geographic concentration of production, economic dependencies, and political (in)stability.

There is a common agreement among scientists to take action against the accelerating calamities of climate change, which necessitate the introduction of technologies that phase out fossil fuels as the predominant source of CO2 emissions contributing to temperature increases. The introduction of ‘green’ energy sources will depend on getting numerous minerals and metals into the industrial scene. The European Commission has considered 34 CRMs by using a specific methodology to determine criticality (economic importance and supply risk). The phasing out of coal mines and oil fields, at the same time, is met with plans for establishing over 300 new mines for these critical minerals. Worldwide demand for CRMs is forecasted to double from current levels by 2030 and quadruple by 2040. Global demand for raw battery materials (lithium, graphite, and nickel) is projected to increase by 14, 19, and 20 times in 2040 compared to 2020. By 2030, cobalt demand is expected to grow to four times its 2020 levels. The US Department of Defence has marked cobalt as a material that ‘has critical applications in high-capacity batteries for military and commercial electric vehicles’. While the quantities of minerals that the rest of the world bought were relatively modest, this was not a big problem, but as the demand began to grow drastically, all the shortcomings of such a situation became apparent. Therefore, the fight against global warming currently depends entirely on the ability to get CRMs from a few countries that have a monopoly on their production, with China leading the way.

Critical minerals and oil have notably different demand factors. For oil, the global economy has little ability to temper demand quickly in response to shortages or manipulations in supply. Some big oil suppliers are responsive to state interests when they make investment and production decisions, which at times helps them manipulate supplies. By contrast, most critical minerals are used only when new projects are built. With the right policies in place, demand can be highly responsive. Suppliers, knowing this, are less likely and able to corner the market. Moreover, most mineral suppliers respond principally to market conditions, rather than state interest. The risks to the global economy that the clean energy transition will create geopolitical tensions over critical minerals – as has happened thus far with oil – are not as great as feared so long as the market forces that govern supply and demand are properly harnessed. Innovation can also help temper demand, as has happened with cobalt where worries about dependence on slave labour have led innovators to find alternatives to the mineral and to identify new sources of supply.

The distribution of critical mineral resources can have significant geopolitical implications. Some countries have abundant reserves of these minerals, giving them a strategic advantage. This can influence international relations. Moreover, the reliance on foreign sources for these minerals can create supply vulnerabilities. This can lead to geopolitical tensions and trade disputes. It underscores the need for international cooperation in the management of these resources. Therefore, critical minerals are not just commodities. They are strategic assets that can shape the geopolitical landscape of the 21st century. The U.S. is 100% reliant on foreign countries for 17 critical and strategic minerals.

The geographical concentration of minerals creates a major strategic issue: a high global demand versus limited local supply. Since minerals originate from a limited number of mining sites and nations, they are highly vulnerable to supply restrictions. In this respect, the supply risk is always a key factor to determine the criticality in countries that have a high dependency on imported minerals. As a result, there is a potential insecurity in how markets are responding and what roles governments should play to secure the supply chains. An example of critical minerals supply for the European Union is shown in figure below.

Figure above shows global location of critical minerals with specified major supplier countries to the European Union, e.g., China provides 98% of rare earth elements (REE), Turkey provides 98% of borates and South Africa provides 71% of the platinum (2020).

Minerals criticality is commonly evaluated from a regional and geopolitical perspective. In practice, the extraction, refining and use of various materials used in modern transportation vehicles involve complex interactions through associated mining and global trade companies, governments and industrial chains, flowing up to supply chains of then manufactured components for use by vehicle manufacturers. Therefore, the security of supply issues of some minerals is seen through a geographical and political perspective rather than reflecting the actual lack of supply of the mineral in question. Based on resources available, countries can be divided into resource-poor and resource-rich. The resource-poor countries recognized critical mineral supply as a strategic issue, made investments designed to diversify supplies, develop substitutes, improve reuse and recycling, use less by improving efficiency and covered them by government policies. In practice, no country is fully self-sufficient in meeting all its mineral resource needs. There are countries, however, where some of the strategic minerals are not subject to a shortage of supply, at least until the near future. In this case, the exploration of critical materials is protected and secured as “strategic” to hold a domestic resource advantage. Having an abundance of critical minerals, a country will act as a powerhouse in supplying the global market. Thus, individual countries have their own lists of critical minerals and the lists of critical minerals specified by individual countries are quite similar with common overlaps.

The Chinese Dominance of the Global Critical Minerals Supply Chains:

China has become a dominant stakeholder in the global supply chains for critical minerals and clean energy goods. In solar PV manufacturing (which broadly consists of the manufacturing of polysilicon, ingots, wafers, cells, and modules), China is home to over 90 percent of the world’s wafer manufacturing capacity, and Chinese companies—regardless of factory location—own two-thirds of the global polysilicon manufacturing capacity and 72 percent of the global module manufacturing capacity. In lithium-ion battery manufacturing, China has a majority of processing capacity for key components (such as cathodes, anodes, separators, and electrolytes), as well as almost 80 percent of global battery cell manufacturing capacity. Although less dominant, China still has a strong presence in the wind turbine value chain: it is home to about half of total manufacturing plants for nacelles, blades, wind towers, turbine generators, and gearboxes. China’s emergence as a major force along the clean energy technology value chain is partly the result of their resource wealth, as China is home to roughly one-third of global rare-earth reserves. However, this emergence also represents the culmination of long-term industrial policy, China’s capacity to execute it, and advantages derived from a lag in extractive industry regulations. Where it lacks access to resources, China has invested in mining projects abroad. For example, since nearly 60 percent of cobalt ore comes from the DRC, Chinese enterprises invest in cobalt mines and participate in cobalt smelting projects there to secure stable access to cobalt resources. China has come to account for 72 percent of the global cobalt refining capacity. China is only one of five countries that produce lithium (another key mineral for lithium-ion battery production), it accounts for roughly 60 percent of global lithium refining capacity. China also leads the rest of the world in its capacity to process these refined materials into components, mainly cathodes (producing 52 percent of the global cathode supply), anodes (78 percent), separators (66 percent), and electrolytes (62 percent).

Figure below shows Clean Energy Mineral Supply Chains and Top Global Suppliers for Batteries, Wind, and Solar PV.

China’s development of midstream and downstream capacities has turned it from a supplier of raw minerals and materials to a key consumer of them. China’s commanding position along critical minerals supply chains is a key factor that shapes other economies’ strategic responses.

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Geopolitical Vulnerability:

The extractive landscape for energy minerals is shaped by the combination of their geographic distribution and the economic and political priorities of resource-rich countries. Top upstream producers of different minerals are globally distributed. In 2021, Australia accounted for about 50 percent of global lithium mining, the Democratic Republic of Congo (DRC) for 70 percent of cobalt, and Indonesia for almost 40 percent of nickel. Yet, equity concerns between a supplier country and an importer country, as well as between resource-holding local communities and their national government, could still fuel uncertainties over supply access. Sixty-eight percent of metals market participants polled by the law firm White & Case concluded that resource nationalism is on the rise, creating market uncertainty for traders and project developers.

Geopolitical competition and geographic concentration have increased concerns in many countries about critical mineral supply chains. Export bans and limitations are being used by countries attempting to capture the higher-value processing and manufacturing segments of mineral supply chains. For example, Zimbabwe has extended its 2022 ban on the exports of raw lithium to all raw mineral ores. The ban would force new projects to process minerals locally. Indonesia, one of the world’s biggest producers of nickel, banned exports in 2020. Under the ban, foreign buyers must invest in smelters in Indonesia to process materials locally before export. A similar ban was announced for the country’s bauxite exports in June 2023. In April 2023, Chile announced plans to nationalize the country’s lithium reserves, and its government passed a bill for new royalties on copper and lithium sales a month later. Export limitations can increase uncertainty for private mining and processing companies seeking to develop their activities abroad as well as increase costs for downstream consumers.

Critical minerals are processed almost entirely in China, including 60 to 70 percent of lithium and cobalt, close to 60 percent of nickel, and 90 percent of REEs. For many of those minerals, China requires upstream inputs from around the world, though China does control 60 percent of REE production. In contrast, the global supply chain for lithium is less concentrated, with meaningful extractive activities in several countries, including Australia, Chile, China, Argentina, and Brazil. In the processing and separation stages, Central and South America account for nearly 40 percent of the global capacity, while China accounts for about 60 percent. Mineral supply chains are concentrated in China at the processing stage, meaning that Chinese firms have significant market power as buyers of upstream ores and the Chinese state can exert geopolitical influence through exports controls on downstream materials.

Trade dependencies of critical minerals:

Figure below shows the top bilateral trade flows by value for five critical materials in 2022: copper, lithium, manganese, nickel and platinum. It shows how copper is the most valuable material by trade value. The graph also demonstrates the geographic diversity of mining countries, but also how important mining is to several, relatively small economies such as Chile and Peru. Finally, the data indicates that China is among the top importers, even though it is commonly perceived as dominating critical material supply chains. It is the world’s largest importer of raw or unprocessed nickel, copper, lithium, cobalt and rare earths. As such, the country relies on imports for inputs but dominates large portions of the midstream and downstream capacity for many critical materials.

Figure above shows Bilateral trade flows by value for select materials in 2022.

Notes: All data refer to unprocessed ores and concentrates, except for lithium, where we have to rely on data for lithium carbonates and lithium oxide and hydroxide. Import data was used and only individual EU countries were included.

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Reorienting supply chains is possible, but processing is a challenge:

Critical mineral supply chains are complex, and reorientation in specific areas will require significant investments of time, expertise, and resources, but it is possible in many domains. In some ways, it has already begun. On the upstream supply side, there is no danger of the world running out of critical minerals soon. Every year, the USGS releases summaries of mineral commodities, including data on known, economically extractable reserves. These numbers vary, depending on a variety of factors. When ore is extracted, known reserves are depleted. But when new deposits are discovered and the full extent of known deposits is explored, reserve numbers increase. While the total fluctuates, a trend is clear: From 2013 to 2022, the USGS summaries reveal that, on net, the world’s known reserves of cobalt, lithium, and nickel are increasing, as are known reserves of other critical minerals.

The data also show that no country has a monopoly on critical minerals reserves. Ten years ago, 50% of all known REE deposits were in China. Today, that figure is down to 34%. There have also been significant new discoveries in countries as diverse as Indonesia, Argentina, Australia, and Vietnam. Recently Sweden discovered Europe’s largest deposits of REEs, and there was recently a find of an estimated 20 to 40 million tons of lithium in a volcanic crater along the Nevada-Oregon border, making it potentially the world’s largest deposit. By the end of the next decade, there’s every reason to expect additional discoveries that will deepen our understanding of the diverse potential sources of supply.

Even though new discoveries of critical mineral reserves around the world continue to be made, China is still the top producer of 30 of the 50 critical minerals, in part because it mines at greater rates than other countries. China also has a significant share of the reserves of many materials identified by the US Department of Energy as both important for energy purposes and whose supply is at risk, including graphite (16% of global reserves) and gallium (86% of global reserves), as well as REEs like dysprosium, neodymium, and terbium (China holds 34% of global rare earth reserves).

Despite the current state of play, the data show there is a reasonable roadmap to building an ex-China supply chain for mining and extracting many critical minerals and REEs. A decade ago, China accounted for over 97% of both REE supply and refined output, shares that have fallen to 63% and below 90% respectively, according to Wood Mackenzie, which also expects China’s share of global REE supply may fall to around half by 2050. In the United States alone, REE mine production increased from 6% of global output in 2013 to 14% in 2022, and Australia, Vietnam, and Japan increased their shares significantly as well.

But additional critical mineral mining capacity outside of China is only part of what would be required to build an ex-China supply chain that would serve global consumers and countries’ needs. As it stands, even when those minerals are mined outside of China, based on the distribution of global capacity, they are almost always sent to China for processing and manufacturing. This asymmetric capacity represents a meaningful bottleneck that can only be addressed if other countries move quickly to develop their own downstream processing and manufacturing capacities.

That task is easier said than done. Building new processing facilities is less expensive and time consuming than constructing new mines, but it comes with its own costs and difficulties. Processing facilities require expertise and advanced machinery. They create environmental and social concerns, including over water usage, carbon emissions, and radioactive waste produced by REE magnet manufacturing. Despite the significant attention given to critical minerals and REEs in recent years, there are currently only five ex-China REE refineries in operation, under construction, or being recommissioned. According to Goldman Sachs Research, these refineries are in Nevada, Malaysia, France, Estonia, and Western Australia.

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Putting Profits over People:

Tens of trillions of dollars in green energy supply and infrastructure investment will be required over the next few decades just to mitigate climate change. Overlapping demand for critical minerals for the foreseeable future will also come from the renewed global arms race and the AI revolution. If the history of oil is anything to go by, mineral-rich but institutionally weak nations await serious governance challenges that will come from a tidal wave of demand for their resources. Nowhere else is this more apparent than in Africa. Absent a controversial ramp-up of deep-sea mining, the global green transition is doomed to fail without accessing the continent’s vast mineral stores. Calculations by the Washington-based Center for Strategic and International Studies estimate this includes 85 percent of the world’s manganese, 80 percent of its platinum and chromium, around half of global deposits of cobalt and a fifth of graphite.

The European Union, South Korea, the United States and others are already scrambling to sign infrastructure and mining agreements across Africa to compete with China’s entrenched presence there. Over the past two decades, China has issued at least $170 billion in debt across more than 1,200 loans to African governments and their state-owned enterprises. Mining has been the third-most targeted sector, behind transportation and energy. The head of the Zimbabwe Investment and Development Agency said that six months after the country instituted its ban on unprocessed lithium, his agency had received at least 160 lithium investment applications from investors based in China — in stark contrast to just five from the United States.

The pillage of the DRC’s mineral resources:

The critical minerals gold rush presents a once-in-a-generation opportunity for African governments to properly capitalize on their natural resources for the benefit of their people. However, the dangers of getting it wrong are immense — the most extreme example being the Democratic Republic of the Congo (DRC). For the past 20 years, political instability, opaque supply chains, foreign interference and endemic corruption have kept the nation of 102 million trapped in a brutal twenty-first-century version of the resource curse. About the size of Western Europe, the DRC contains an estimated US$24 trillion in untapped mineral resources and produces around 70 percent of the world’s cobalt, along with large amounts of copper, coltan, tin, tungsten, tantalum and more. Much of this stock originates from the country’s restive eastern provinces — arguably the world’s most complex conflict zone. The territory, barely governed, is a chaotic battleground between government and regional forces, international peacekeepers and some 120 different armed groups residing there. Criminal enterprises, corrupt local officials, erstwhile revolutionaries, ethnic militias and roaming jihadist affiliates of the Islamic State each vie for a greater share of a booming illicit trade in gold, diamonds, lumber and critical minerals. Domestic authorities have been accused of overlooking child labour; artisanal miners operating on the fringes of large corporate mining sites have suffered abusive crackdowns. Overall, the consequences for the local population have been devastating, including the inability to fully take part in elections due to the lack of secure polling sites. Most proceeds from the DRC’s mineral wealth are still concentrated in the hands of domestic political elites and foreign interests. Burundi, Rwanda and Uganda have each profited off the insecurity of their larger neighbour by offering weapons, money, training, intelligence and logistical support at various points to rebel groups in the DRC in exchange for natural resources being smuggled across their borders and laundered into global supply chains.

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Rare earths bankroll North Korea:

Those who travel to North Korea regularly might have noticed that recent years have brought significant improvement in the country’s economic situation. Newly built high-rise apartments, modern cars on the roads and improved infrastructure come as a surprise to visitors. It begs the question, where does Pyongyang get the money from? The ambitious rocket and nuclear programs, which North Korea continues to pursue despite international condemnation, are expensive and harmful to its economy. International sanctions continue to bite the Democratic People’s Republic of Korea’s foreign trade and investment prospects. Regular floods and droughts, animal epidemics and other natural disasters hit the fragile economy even harder.

Where does the money come from?

North Korea is sitting on the goldmine. The northern side of the Korean peninsula is well known for its rocky terrain, with 85% of the country composed of mountains. It hosts sizeable deposits of more than 200 different minerals, of which deposits of coal, iron ore, magnesite, gold ore, zinc ore, copper ore, limestone, molybdenum, and graphite are the largest and have the potential for the development of large-scale mines. After China, North Korea’s magnesite reserves are the second-largest in the world, and its tungsten deposits are almost the world’s sixth-largest. Still the value of all these resources pales in comparison to prospects that promise the exploration and export of rare earth metals. South Korea estimates the total value of the North’s mineral deposits at more than US$6 trillion.

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Resource nationalism and blackmail:

Resource nationalism refers to the tendency of countries to assert control over their natural resources, often prioritizing domestic interests and national sovereignty over foreign investment and international trade. This can manifest in various ways, including nationalizing industries, increasing taxes, imposing local content requirements, and implementing export restrictions. A significant political trend – resource nationalism, has gained momentum among resource-rich nations as they seek to consolidate control over their natural resources. The motives behind resource nationalism often involve maximising revenue from one’s natural resources. Numerous military regimes within Africa’s ‘coup belt’ have endeavoured the renegotiation of mineral development agreements. When countries control natural resources, they have a more considerable stake in international relations and can exert influence over economic and political decisions. Moreover, the current energy transition has changed the character of geopolitical relations as countries seek to secure access to renewable energy and the materials necessary to harness them. Countries of the Global South, abundant with strategic raw materials, are becoming increasingly important players in the newly evolving geopolitics prone to leveraging natural resources. The implications of this shift unsettle traditional dynamics of power and economic relationships.

Some CRMs have extremely broad applications on the commercial and military fronts, beyond renewable energy. They come in with the full package, including mobile phones, computer hard disks, electric vehicle batteries, precision missile guidance, and high-tech ammunition. China is the world’s largest producer of lithium batteries for electric mobility, commanding a 60% stake in the global electric vehicles (EV) market. By strategically manipulating the supply chains for clean technology, through mining, metallurgy, and material sciences (often referred to as ‘three Ms’), China has largely kept other players out. The EU and the USA, on the contrary, are extremely dependent on the import of CRMs from abroad and thus on the international commodity markets and access to foreign mines. Accordingly, to date, commodities coming from China account for 98% of the rare earth elements (REEs) supply to the EU.

Figure below shows graphical presentation of Europe’s dependence on Chinese resources and the percentage of critical materials by China in 2024.

The potential for blackmail through resource control could lead to increased tensions and conflict as nations struggle for access to CRMs. Critical mineral security is intrinsically linked to the escalating trade war between the USA and China. China’s initiative to diminish or terminate the exportation of certain essential materials, including germanium and gallium, to the United States in the previous year has already manifested a significant effect on their bilateral trade dynamics, whereas a prospective augmentation of such prohibitions may function as leverage for Beijing in tariff negotiations with the Trump administration. China has effectively ceased exports of both wrought and unwrought antimony metal, a material of paramount importance to the military sector.

The EU has also found itself in a difficult position, currently lacking sufficient CRMs needed for new technologies on its territory. Imports are becoming increasingly problematic after the war in Ukraine closed the northern routes and instability in the Middle East made the Red Sea route very risky. The USA, the UK, and the European Union have developed strategic plans to minimise reliance on Chinese supplies. But in the case of CRM, this is very difficult due to the uneven geographical distribution. An ace up one’s sleeve may lead to a reduction in tensions between the warring parties. Otherwise, the Western technology industry is in serious trouble.

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The world’s costly and damaging fight for critical minerals:

Certain elements are crucial for the clean energy transition. Sustainability, equity and security are all at risk in the rush to break China’s dominance over their production.

It’s an all-too-familiar statement: in a zero-carbon world, certain chemical elements will be as important as oil and gas are to a fossil-fuel-powered world. These include the nickel, lithium and cobalt used in batteries, as well as rare-earth elements such as neodymium and samarium, which are essential to the magnets of wind turbines and electric motors.

The world is struggling to work out how to equitably meet demand for these elements. Recently in its inaugural Critical Minerals Market Review, the International Energy Agency counted nearly 200 national policies and strategies surrounding the ‘critical minerals’ needed to keep the lights on and the wheels turning in a low-carbon world. National strategies are necessary, but they should not exclude international cooperation and coordination — which need to happen fast.

An abundance of critical minerals is so far being mined in only a small number of countries. Most cobalt comes from the Democratic Republic of the Congo (DRC) and most nickel from Indonesia. China dominates in graphite and rare-earth elements. In this sense, the situation is not dissimilar to that of fossil fuels, for which a few countries have tended to dominate supply.

Graphic above shows the top three extractors and processors of various critical minerals by country in 2022.

But, unlike with fossil fuels, just one country — China — has become the world leader in refining and processing these crucial elements for use in finished products. The singular exception is Indonesia, which, along with China, dominates nickel processing.

China’s ascendancy is the result of forward thinking by the country’s leadership. But it would be unwise for the rest of the world to rely on just one country for the processing of critical minerals. And as other countries build their homegrown mining, refining and processing capacity, they need to think about putting cooperation front and centre.

China, Europe, the United States and others are all investing billions of dollars to acquire access to critical minerals in Africa and South America. This is potentially exploitative. The countries in which the minerals are being mined know it, and are sensibly refusing to be used solely to provide raw materials for other people’s batteries, insisting that the processing of minerals into higher-value products happens within their borders, too. Indonesia, for example, has banned the export of nickel ore.

China’s export restrictions on critical minerals like gallium and germanium reflect its geopolitical strategy, mirroring past actions with rare earths. These materials are crucial for semiconductors, electric batteries and defence technologies. In response to US semiconductor sanctions, China is flexing its dominance over global critical minerals supply chains, intensifying trade tensions. The broader trend of governments wielding export controls as geopolitical weapons adds further volatility to global trade. While firms adjust and innovate in the face of these changes, the intensifying rivalry between global powers risks threatening long-term trade stability. Export curbs applied to technology or critical raw materials are often justified by the need to promote downstream industries, the raising of revenue and environmental protection. But there are other motivations, including the desire to gain an upper hand on a geopolitical rival.

Groups of mineral-rich countries are discussing establishing cartels to allow them to exert more control over pricing. This includes Argentina, Bolivia and Chile, which are thought to hold half of the world’s known lithium reserves. Others are considering ‘friend-shoring’, whereby supply chains are created between friendly countries. This will inevitably lead to complications. Indonesia and the DRC, for example, are friends and trading partners with both China and the United States. From the perspective of economic security, it is not in the interests of any nation to partner with just one other country or group of countries.

Friend-shoring is also likely to fuel competition, inflate prices and send the many who cannot afford the going rate to the back of the queue. If anyone needs a lesson in the folly of this approach, they need look no further than to the immense damage caused by vaccine hoarding during the COVID-19 pandemic. Despite signing up to a global agreement to cooperate, richer countries outbid each other for vaccine supplies. By one estimate, more than one million lives had been lost by the end of 2021 because a few countries massively over-ordered vaccines, which meant there were not enough for everyone else when they were most needed (S. Moore et al. Nature Med. 28, 2416–2423; 2022). The authors of a Comment article in Nature recently present one component of a better approach to critical- mineral use (Y. Geng et al. Nature 619, 248–251; 2023). They lay out clearly what is needed for a ‘circular economy’ in rare-earth elements, with an emphasis on reusing and recycling materials, rather than fuelling an ever-increasing demand for raw materials. This makes sense. There’s no logic to saving the planet from environmentally polluting technologies by using methods to secure critical minerals that are themselves environmentally damaging.

Mining and international conflict:

Access to natural resources is a key aspect of strategic interest for many countries and is reflected in their foreign policy doctrines and actions. The pursuit of critical materials has been a major motive for states seeking territorial expansion. Now, the global demand for critical materials could lead to increased competition especially in deposit-rich areas, potentially sparking geopolitical tensions in the Arctic, outer space and the deep sea, as countries scramble to secure access to these resources (Fox, 2022).

The Arctic is known to have vast reserves of critical materials such as nickel, zinc and rare earths (Boyd et al., 2016). Mining is not a new activity in the region, which is home to several well-established mines, such as the Red Dog zinc mine in Alaska and the Polar Division nickel mines in Arctic Russia (Loginova et al., 2023). New deposits are being discovered. In January 2023, the Swedish mining company LKAB announced the discovery of the largest known rare earth elements deposit in Europe. The rapid melting of the Arctic sea ice, due to the region warming at twice the global average rate, has exposed previously inaccessible resources, triggering heightened competition among countries (IPCC, 2021; Paul Taylor, 2020). While the region has seen increased military presence, most scholars see a low likelihood of conflict over resources (Tunsjø, 2020). Nonetheless, the region’s mineral bounties contribute to its strategic importance.

Outer space is also becoming a new frontier in the race for critical materials. Asteroids and other celestial bodies are believed to be extremely rich in rare metals, including platinum and gold. This has spurred increased investment in space exploration and mining, with countries such as China, the Russian Federation and the United States vying for a foothold in this emerging industry. A rapid take-off of commercial space mining is, however, unlikely due to unresolved questions about its cost effectiveness, technical feasibility, legal governance, and environmental and safety implications.

The race for minerals could also trigger geopolitical conflicts over ocean sea-beds, which hold some of the largest estimated mineral deposits on the planet. Some countries have already initiated deep-sea exploration within their exclusive economic zones or extended continental shelves. Norway, for instance, is planning to open an area of ocean nearly the size of Germany to deep-sea mining (Bryan and Milne, 2023). However, these areas often overlap between neighbouring countries, triggering disputes over resource ownership and extraction rights. Deep-sea mining in waters beyond national jurisdiction is regulated by the International Seabed Authority, created by the United Nations Convention on the Law of the Sea. However, a regulatory framework remains incomplete, and member countries have opposing views on how to proceed. A growing number of countries and corporations are showing interest in deep-sea mining for critical materials, that is, extracting mineral resources from the ocean floor. To date, 22 state and private contractors hold 31 mining exploration contracts to search for polymetallic nodules, polymetallic sulphides and cobalt rich ferromanganese crusts (International Seabed Authority, 2023), which are extremely rich in valuable metals with high-grade ore, such as cobalt, copper and manganese.

Deep-sea mining raises concerns regarding environmental impacts, including marine habitat destruction and the release of toxic chemicals. Deep-sea ecosystems are crucial for global climate regulation and form an important part of oceanic food webs (Environment Justice Foundation, 2023). While some proponents of deep-sea mining argue that it is more eco-friendly than land-based mining, others argue that it is not sustainable and could cause irreversible environmental damage (Levin et al., 2020). This has prompted several calls for a moratorium on deep-sea mining. In September 2021, the International Union for Conservation of Nature’s World Conservation Congress adopted a motion calling for a moratorium on deep-sea mining (Resolution 122, IUCN, 2021). Several countries also have called for a moratorium or precautionary pause on deep-sea mining in international waters (Deep Sea Conservation Coalition, 2022). The European Commission wants deep sea mining to be prohibited until “scientific gaps are properly filled, no harmful effects arise from mining and the marine environment is effectively protected” (Directorate-General for Maritime Affairs and Fisheries, 2022).

Mining and local conflict:

The race for minerals can exacerbate or contribute to local armed conflict in multiple ways. In countries with weak governance and political instability, mineral extraction can be linked to local grievances, conflict and human rights abuse (Church and Crawford, 2018). This has been observed with certain other high-value resources, such as diamonds, gold and timber. In fact, the United Nations Environment Programme estimates that at least 40% of all intrastate conflicts in the past 60 years can be linked to natural resources (UNEP, 2009).

Mineral riches can contribute to conflict in several ways (UNEP, 2009). For example, mineral exploitation can stir conflict over the fair distribution of benefits and costs among the local population. Mining wealth can also be exploited to sustain local conflicts, and in areas with weak state authority, it can help armed groups fund their activities by exploiting green mineral deposits, leading to increased violence and instability. This is especially true in regions with a history of conflict or where ethnic or religious tensions exist.

In Colombia, for example, Revolutionary Armed Forces of Colombia (FARC) rebels, who have been fighting an insurgency since 1987, long financed part of their operations by producing tungsten from the depths of the Amazonian jungle. Similarly, in the Democratic Republic of Congo, rebel gangs are estimated to make millions from illegally producing tungsten, tin, tantalum and gold (also referred to as “3TG”). It is estimated that approximately 21% of the world’s tantalum supply in 2011 came from conflicted regions (Abraham, 2017).

Certain mineral resources are less likely to be involved in local conflicts than others. For example, minerals such as bauxite, lithium and graphite are profitable only when extracted on a large industrial scale. Also, bauxite and graphite have low value-to-weight ratios, making them less attractive to non-state armed groups, such as rebel armies and militias, which exploit valuable resources. Further, although artisanal miners mine a substantial portion of cobalt, the artisanal cobalt mines in the Democratic Republic of Congo have not yet been targets for armed actors, despite the prevalence of conflict around the artisanal gold and other conflict minerals in Eastern Congo (Hendrix, 2022).

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Section-14

China’s Role in Supplying Critical Minerals:

China’s rise in the critical minerals sector is not just a recent phenomenon; it has been a strategic focus for decades. The country has invested heavily in its mining and processing capabilities, aiming to secure a dominant position in the global market. This long-term strategy has paid off, as China now controls a significant portion of the world’s critical minerals.

The implications of China’s control over critical minerals are profound. China’s control over critical minerals has significant effects on global supply chains. This dominance creates vulnerabilities for many countries that rely on these resources for technology and energy. For instance, China controls about 60% of the world’s rare earth production, which is essential for various high-tech applications. This situation raises concerns about supply disruptions and economic dependencies. Countries like the United States and members of the European Union are increasingly aware of their dependency on Chinese supplies. This has led to efforts to diversify sources and reduce reliance on China.

The world faces major challenges in responsibly sourcing large quantities of minerals that are critical for the transition to low-carbon energy sources. Consumption of these critical minerals—most notably nickel, copper, lithium, and cobalt—is projected to rise, largely driven by their use in the renewable energy sector. Demand is expected to quadruple by 2040 under the International Energy Agency’s Sustainable Development Scenario, in which global action would limit the global temperature rise to well below 2°C, and it is projected to rise by six times under a net-zero scenario. Many governments, including the United States, European Union members, and China, seem to share the goal of increasing the supply and rate of production of the raw materials needed for the energy transition to address the challenge of global climate change. However, meeting this demand will be difficult—and producing these minerals in strict adherence to robust environmental, social, and governance criteria will be even more so.

Two major factors are likely to influence dynamics around responsible sourcing of critical minerals for the energy transition.

The first factor is China’s level of dominance across critical minerals supply chains. There is growing concern that a high level of dependence on China for these minerals and their derivative products may create energy security risks. Other governments, notably in the U.S. and Europe, have moved to build out their own critical minerals supply chains, creating uncertainty about whether China will maintain its dominant position.

The second factor is the level of enforcement of due diligence requirements in China’s mineral sector and midstream and downstream industries (e.g., refiners or original equipment manufacturers) to make these supply chains “cleaner” and “greener.” Comprehensive, globally aligned due diligence requirements are needed to ensure that the sourcing of minerals needed for the energy transition does not cause or contribute to adverse social and environmental impacts. These two factors will likely shape the future of critical minerals supply chains.

A best-case scenario would be characterized by geographic diversification of critical minerals supply chains, coupled with globally aligned statutory due diligence requirements to make these supply chains cleaner and greener. This would see the U.S. and Europe making considerable investments in and successfully building out their critical minerals supply chains, from mining to battery manufacturing. It would also entail China instituting mandatory due diligence requirements on critical minerals sourcing and global coordination among major players, including Beijing, Washington, and Brussels, to align these requirements. This would ensure a stable supply of cleaner and greener critical minerals for the energy transition and minimize the risk of the energy transition being disrupted due to price volatility, geopolitical tensions, or logistical issues in supply chains. As things stand, this best-case scenario looks unlikely. Considerable investment would be needed to build out critical minerals supply chains in the U.S. and Europe. A worst-case scenario would see continued reliance on China for critical minerals and their derivative products. This would expose the energy transition to major geopolitical risks, as well as increase the risk that sourcing of critical minerals will cause or contribute to serious social or environmental harms.

China has systematically extended its control over critical minerals essential for the global energy transition and net-zero emissions, using a network of at least 26 state-backed financial institutions over the past two decades. Beijing has leveraged an intricate web of financial mechanisms to dominate the global supply chain for critical minerals. These minerals — including copper, cobalt, nickel, lithium and rare earth elements — are vital for emerging technologies such as electric vehicle batteries and solar panels. Between 2000 and 2021, Chinese financial institutions provided nearly $57 billion in loans to 19 low- and middle-income countries. China has deployed its vast foreign exchange reserves to secure long-term control over strategic mineral deposits in resource-rich nations. Key examples include copper and cobalt from the Democratic Republic of Congo and Peru, nickel from Indonesia, and lithium from Argentina. Over 75% of these investments were structured to ensure Chinese ownership stakes, primarily through joint ventures (JVs) and special purpose vehicles (SPVs). These arrangements grant Chinese entities significant influence over the extraction and processing of these resources.

It is important to note that except for natural graphite, China does not have high shares for extraction of these critical minerals. However, China has made significant capital investments in critical mineral extraction companies in other countries, both existing facilities and those that are expected to begin production soon. Lipton and Searcey (2022) report that, as of 2020, Chinese-backed companies owned or had a financial stake in 15 of 19 cobalt-producing mines in the DRC. Figure below lists some examples of Chinese-owned lithium and cobalt facilities.

Mineral reserves are known physical quantities of minerals in the earth that can be extracted cost-effectively, given current market conditions and technologies. The quantities of critical mineral reserves in different countries provide insight on the potential extraction rates of the minerals by those countries over the medium term if prevailing market conditions continue or improve. Reserves of critical minerals are significantly less concentrated geographically than current extraction. The more diverse geographic distribution of reserves lessens concerns over potential fluctuations in availability or price volatility for extracted critical minerals.

Extracted critical minerals must undergo processing to become useful for electric vehicle battery production. Cobalt, lithium, and manganese processing are highly concentrated in China, whereas China’s share of nickel processing is relatively lower than other countries. However, in the wake of Indonesia’s various bans on exports of nickel ore between 2009 and 2020, Chinese companies have invested $14.2 billion to construct industrial parks in the country, including nickel smelters on two Indonesian islands that have some of the largest known nickel reserves in the world. Although data are not available for natural graphite processing, China is the major source of extracted natural graphite. Rattled by China, West scrambles to rejig critical minerals supply chains.

Gørild Heggelund, a research professor at the Fridtjof Nansen Institute, Oslo, Norway, said: “China’s dominance gives it a strategic advantage but also exposes vulnerabilities for other nations.” China controls more than sixty percent of rare earth production worldwide. However, it is very dependent on cobalt and lithium imports for batteries. Heggelund explained: “Almost all the cobalt used in China comes from the Democratic Republic of Congo. This makes their supply chains vulnerable.” However, China has maintained its dominance by focusing on the processing stage, where raw materials are transformed into products that we can use. Heggelund added: “China’s focus on processing has allowed it to maintain control without owning all the mines. But it has become reliant on imports for parts of its supply as domestic policies aim at restricting mining and processing to conserve resources and reduce environmental pollution.”

Bar graph below shows which countries produce rare earth elements in 2024.

China dominates the rare earth element market.

China’s long-term goals in mineral investments include:

-1. Securing supply chains for critical minerals.

-2. Reducing dependency on foreign sources.

-3. Enhancing its global economic influence through strategic partnerships.

China’s approach to securing mineral resources is not just about immediate needs; it’s about establishing a sustainable and reliable supply chain for the future. China’s investments in global mineral resources are a key part of its strategy to maintain its industrial growth and geopolitical power. The country is not only focusing on domestic production but is also expanding its reach internationally to ensure a steady supply of critical minerals.

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Chinese threat:

Factors leading to China’s dominance in critical minerals:

-1. Resource Base and Reserves: China has vast reserves of critical minerals like rare earth elements (REE), lithium, and graphite, ensuring a strong supply base.

-2. Processing Capabilities: Controls 87% of rare earth processing, 58% of lithium refining, and 68% of silicon processing, dominating global supply chains.

-3. Strategic Investments: Heavy investments in domestic and overseas mining projects to secure mineral assets globally.

-4. Vertical Integration: Developed end-to-end infrastructure from mining to refining, ensuring efficiency and cost-effectiveness in production.

China’s Strategic Approach to Critical Minerals:

China provides a clear example of a well-defined and executed strategy for securing critical minerals. Rather than allowing free markets to dictate outcomes, Beijing has:

Acquired upstream assets: Chinese firms control large stakes in mines across Africa, Latin America, and Indonesia.
Invested in refining and processing: Even when China doesn’t control mining operations, it dominates mineral processing, securing a stranglehold over supply chains.
Offered long-term offtake agreements: Unlike Western firms that rely on short-term market pricing, China provides guaranteed contracts, ensuring stable supplies.
Leveraged soft and hard power: Through infrastructure investments (Belt and Road Initiative) and diplomatic ties, China secures access to crucial resources.

As a result, Beijing has transformed once-critical materials like lithium, cobalt, nickel, and rare earths from potential vulnerabilities into strategic assets.

Economic Implications of China’s Mineral Policies:

The reliance on Chinese minerals creates vulnerabilities for many countries. Here are some key points to consider:

China is the largest producer of rare earth elements, which are essential for various technologies.
The prices of critical minerals can fluctuate dramatically based on China’s export policies.
Countries dependent on these minerals face economic risks if China decides to restrict exports.
China’s export controls can be seen as a tool for economic leverage.

In summary, China’s mineral policies have profound economic implications, affecting global markets, trade relations, and future trends in mineral supply. As countries respond to these challenges, the landscape of critical minerals will continue to evolve, highlighting the need for strategic planning and international cooperation.

The geopolitical landscape is shifting as countries recognize their dependencies on China for critical minerals. This dependency can lead to strategic vulnerabilities, such as:

-1. Economic coercion: China may restrict exports to exert pressure on other nations.

-2. Technological setbacks: Limited access to essential minerals can hinder technological advancements in the West.

-3. Increased competition: Nations may engage in aggressive strategies to secure mineral resources, leading to geopolitical tensions.

The global race for critical minerals is not just about resources; it’s about securing a nation’s future in technology and defense. In summary, China’s control over critical minerals poses significant geopolitical challenges, prompting responses from Western nations and highlighting vulnerabilities in global supply chains.

U.S.-China Trade War:

In response to Donald Trump’s escalating tariffs, China retaliated in part by placing export restrictions on a slew of rare earth elements. These powerful materials are crucial to the U.S., because they underpin the creation of weapons, computer chips, and electric cars. China produces a majority of these rare earth materials—and experts say that the U.S. is years away from building its own supply chain. As the U.S.–China trade war ramps up, rare earths are among the most important pieces of leverage that China controls. There are many reasons why China would not want to shut off U.S. access to rare earths completely, most notably that the country makes a lot of money from exporting them. But if China decides to further choke off its supply, the ripple effects could be extremely painful across many industries. The U.S. does not have the means to create the materials it needs to create the devices it survives on. REEs are crucial for a range of defense technologies, including F-35 fighter jets, Virginia- and Columbia-class submarines, Tomahawk missiles, radar systems, Predator unmanned aerial vehicles, and the Joint Direct Attack Munition series of smart bombs. For example, the F-35 fighter jet contains over 900 pounds of REEs. An Arleigh Burke-class DDG-51 destroyer requires approximately 5,200 pounds, while a Virginia-class submarine uses around 9,200 pounds. Almost all of these materials are mined and processed by China, which has spent decades aggressively building the infrastructure to do so. As a result, many companies, including Tesla and Apple, source their rare earths from China. China has not hesitated to wield this dominance as a geopolitical bargaining tool. In 2010, China halted rare-earth exports to Japan amidst rising tensions. Over the past two years, Beijing has imposed curbs on other critical minerals, such as gallium, germanium, and graphite.

Even with recent investments, the United States is a long way off from meeting the DOD’s goal for a mine-to-magnet REE supply chain independent of China, and it is even further from rivalling foreign adversaries in this strategic industry. U.S. capabilities are largely early-stage. For example, in January 2025, USA Rare Earths produced its first sample of dysprosium oxide purified to 99.1 percent. Produced using ore from the Round Top deposit in Texas and processed at a research facility in Wheat Ridge Colorado, the company has called the development a breakthrough for the domestic rare earths industry. However, significant work remains to turn production of samples in a laboratory into full scale commercial production capable of reducing reliance on China. Developing mining and processing capabilities requires a long-term effort, meaning the United States will be on the back foot for the foreseeable future.

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Counter Chinese Threat:

In response to China’s near dominance of the global production of rare earths, campaigns have been launched to mine rare earths in the most forbidding of frontiers: in ecologically sensitive indigenous lands in the Amazon, in war-torn Afghanistan, in protected areas of Greenland, in the depths of the world’s oceans, and even on the Moon. In the issue of One Earth, Vakulchuk and Overland assess the possibilities for the emergence of Central Asia as a region that could play a major role in the global supply of critical minerals. In reviewing the mineral resource base of Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan, the authors show that these Central Asian states have often been overlooked in global resource assessments of critical materials for clean energy technologies, even though they were key suppliers of metals and industrial minerals for the Soviet Union. They argue, however, that the global shift in resource extraction from fossil fuels to critical minerals is not only bringing new interest from industry to Central Asia: it is moving the region’s geopolitical importance into sharper focus. The authors also point out that the international attention now being given to the region’s geological resources demands greater understanding of the role that Central Asia plays in China’s strategic positioning and its policy of heavy investment in mineral resource extraction there.

However, China is a major player not just in the production of critical minerals. As Parag Khanna puts it, Beijing ‘‘views the world almost entirely through the lens of supply chains.’’ It is not, he argues, China’s intention to occupy countries militarily or to seek influence in domestic politics but to secure access to resources, enabling it greater influence in facilitating the smooth flow of global supplies. One of the main ways to do this is through its Belt and Road Initiative (BRI) with investments in roads, harbors, and maritime transport. A major element of China’s BRI is a Polar Silk Road, which was outlined in a white paper on Arctic policy in 2018 that envisions greater investment in northern development and Arctic infrastructure. But it is not only China that is looking to the world’s high latitudes. As with the four Central Asian states, there is growing global interest in the resources of the Arctic. In particular, international attention is being given to Greenland’s potential for supplying critical minerals.

Critical minerals are abundant throughout the Western world, particularly in Australia, Canada and the United States. The problem is that mining projects have long lead times and are notoriously difficult to execute because of capital requirements, regulatory burdens, environmental protections and bureaucratic inertia. In Canada, which possesses enormous mineral wealth, the federal government’s new Critical Minerals Strategy admits it can take five to 25 years for a mining project to become operational and generate revenue. Some don’t even materialize after years of effort and investment. Mineral refinement poses a further challenge, given the energy intensity and toxic by-products inherent in the process. What’s more, mining domestic deposits alone may be insufficient for Western countries to meet their needs. Filling the gap created by a serious pivot away from China will require governments and businesses from the industrialized world to engage their counterparts in emerging markets. And many of these nations are now embracing resource nationalism in an effort to dictate terms of trade to foreign clients.

According to AIDDATA research, China has strategically utilised the Belt and Road Initiative (BRI) to finance “mine acquisitions, the development and expansion of mineral extraction infrastructure, and the day-to-day operational needs of mine owners and operators,” granting it access to REEs in “165 low-income countries and middle-income countries.” The same research reveals that between 2000 and 2021, Chinese financial institutions provided a total of $57 billion to 19 core BRI countries in a concerted effort to gain control over their rare earth markets. This further highlights an urgent need for action if the West is to expand its global influence in the REE market.

Mongolia offers a compelling case in point. Despite its wealth of resources, the country currently exports the majority of its critical minerals to China, leaving it in a vulnerable geopolitical position. However, as a recent Henry Jackson Society (HJS) report argues, this situation is not set in stone, as Mongolia remains open to Western investment. Capitalising on these opportunities requires the West to forge stronger partnerships with resource-rich nations and outpace China in mineral extraction and processing.

The HJS report outlines four crucial steps the West must urgently take. First, it must strengthen alliances and prioritise REE trade with trusted partners. Second, it needs to expand domestic mining and refining capacity. Third, it should offer developing nations fairer and more advantageous investment deals to counter Chinese influence. Finally, Western liberal democracies must integrate REEs into broader security and trade strategies. Without a proactive approach, the West risks not only lagging behind but also falling further behind in a market that will shape the geopolitical landscape of the 21st century.

Policy Shifts in the United States and Europe:

In response to China’s growing influence in the critical minerals sector, the United States and Europe have begun to rethink their strategies. Both regions are focusing on reducing their reliance on China by investing in domestic production and forming new partnerships. This shift includes:

Increasing local mining operations.
Promoting recycling of critical minerals.
Establishing trade agreements with other mineral-rich countries.

Collaborative Efforts to Diversify Supply:

Countries are also working together to create a more resilient supply chain. For instance, India is reducing reliance on China for critical minerals through sustainable practices, recycling, and global partnerships to boost its clean energy initiatives. Collaborative efforts include:

Joint ventures in mining projects.
Sharing technology for mineral processing.
Coordinating policies to ensure stable supply chains.

Economic and Diplomatic Countermeasures:

As tensions rise, nations are implementing economic and diplomatic measures to counter China’s influence. These measures may include:

-1. Imposing tariffs on Chinese mineral imports.

-2. Strengthening alliances with countries that have abundant mineral resources.

-3. Engaging in diplomatic talks to address trade imbalances.

The global community is recognizing the need for a balanced approach to ensure that critical mineral supply chains are not overly dependent on any single country. This strategic shift reflects a growing awareness of the geopolitical implications of mineral control and the importance of securing access to these vital resources.

Will Chinese embargo work?

Throughout the 1990s and early 2000s, western firms shuttered solvent‑extraction plants for environmental reasons. Chinese provincial govts stepped in, backed by subsidised power and land. But this was not a triumph of unique chemistry. Solvent extraction was developed in the West in the 1950s and though China, after three decades of near‑total clustering inside the country, has indeed made refinements to the process, the underlying science remains well within reach of western labs. China has protected its monopoly with economics rather than technology. Whenever a Non‑Chinese refinery or processing plant threatened to scale up, Chinese exporters, subsidised by the govt, flooded the market with below‑cost REEs, driving new entrants into insolvency. Alternatively, Chinese firms bought out the international companies. However, a monopoly created by dumping can survive only as long as the monopolist keeps dumping. By restricting exports, as it has done now, Beijing loses the weapon that kept rivals at bay. China’s rare-earth export controls, intended as a strategic advantage, may backfire by incentivizing other nations to develop their own processing capabilities. Despite China’s dominance in rare-earth mining and refining, its restrictions are driving global diversification through material substitution, reuse & recycling advancements, reprocessing mine tailings, and efficiency improvements. This shift presents an opportunity for other countries to establish a critical mineral supply chain. By restricting shipments, Beijing is lifting prices worldwide and incentivising countries to set up processing elsewhere. Once the capital is sunk into new refining in the rest of the world, even a later U‑turn by China cannot quickly claw these customers back. The tactic also undermines China’s typical market‑flooding response. It can no longer depress prices globally without first loosening those very export controls. The result is a strategic dilemma — either keep curbs and accelerate diversification or scrap them and watch prices collapse. Well, material substitution, reuse & recycling advancements, reprocessing mine tailings, and efficiency improvements by the rest of world will be a minor solution of meeting increasing demand of critical minerals but major solution is increased mining and increased processing; and it will take decades to match Chinese mining and processing capabilities (native & overseas); so Chinese embargo will work on short term.

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Moral of the story:

-1. Minerals are solid, naturally occurring inorganic substances with a definite chemical composition and a crystalline structure (regular arrangement of atoms) that can be found in the earth’s crust. Minerals can contain a combination of metallic, non-metallic, and metalloid elements. A mineral’s composition refers to the kinds and proportions of elements making up the mineral. The way these elements are packed together determines the structure of the mineral. More than 3,500 different minerals have been identified. Remember, all the minerals are non-renewable because nature usually takes hundreds of thousands to millions of years to produce mineral deposits. We need minerals to make cars, computers, appliances, concrete roads, houses, tractors, fertilizer, electrical transmission lines, solar panels, wind turbines and jewellery. Without mineral resources, industry would collapse and living standards would plummet.

-2. Minerals are the building blocks of rocks and ores. Rocks are aggregates of one or more minerals. Thus, it can be stated that every rock is comprised by minerals. Ore is a rich mineral aggregate in a specific mineral or chemical element that is economically or technologically viable for extraction (mining). Copper, for instance, occurs naturally in some rock types, but it is only possible to become an ore when it concentrates in large quantities and it is possible to be extracted from nature.

-3. Many minerals contain metals as their primary or secondary constituents. Metals are elementary substances, such as gold, silver and copper, extracted from ores. They are crystalline when solid and naturally occur in minerals. They are often good conductors of electricity and heat, shiny and malleable. The metals we use day-to-day are converted from metallic ores to their final form by processing (refining) using various methods.

-4. The temporal evolution of the metallic mineral systems depends on cooling of a hot early Earth, its tectonic history, oxygen levels in the atmosphere, biogenic activity in the hydrosphere, and preservation conditions. Metallic mineral deposits are ∼10 to >10,000 times enriched in metal relative to crustal abundance and hence are rare, with mines exploiting mineral deposits occupying only about 0.02% of the Earth’s land surface. As each continent and country within it had its own tectonic history, the distribution of these rare metallic mineral deposits is incredibly heterogeneous. Countries or regions such as China, Russia, and Australia, and to a lesser extent western South America, Brazil, Canada, and South Africa, dominate global critical metal reserves and/or production.

-5. Metals that are considered geochemically abundant occur at crustal abundances of 0.1 percent (1000 ppm) or more (e.g. iron, aluminum, manganese, magnesium, titanium). Geochemically scarce critical metals (Ni, Cu, Zn, Pb, Co, Li, Ga) have crustal abundances between 10 and 100 ppm while vanadium occurs at an average crustal abundance of 138 ppm whereas indium’s abundance is 0.052 ppm. These metals rarely occur alone in any single mineral deposit of this group of metal systems. By contrast, they normally represent natural concentrations in multielement mineral systems that form in a wide range of tectonic settings. Mineralogically, critical metals either occur as structural components of minerals, as substitutions within other minerals and ores, or in some cases as native elements (e.g. rhenium, tellurium).

-6. Many critical minerals (CMs) mainly occur in deposits of other more common host minerals and many critical minerals are only economic to recover when combined with the production of a host mineral. So critical minerals are often by-products of other mined base (host) metals. For example, cobalt is typically a by-product of nickel and copper mining, nearly all indium is a byproduct of zinc mining and most rare earth elements are by-products of iron ore mining. Copper (Cu) deposits are a host metal for several critical minerals including tellurium (Te), rhenium (Re), tin (Sn), cobalt (Co), bismuth (Bi), uranium (U), indium (In), barite (Ba), and arsenic (As). The production of these minor metals is therefore strongly influenced by the production of the base metals, which often generate more revenues. For example, investments in new cobalt projects are often linked more to market dynamics for copper than cobalt. In other words, a higher cobalt price does not necessarily incentivise copper miners enough to produce more of it. We know that if the price of copper drops and less copper is mined, there will also be less cobalt, tellurium and rhenium available. Many critical minerals can’t be mined or refined economically on their own. This means that many of them are only produced because they happen to be a byproduct of producing more abundant minerals.

-7. There are several opportunities to produce critical minerals as by-products or co-products from host mineral deposits:

(1. Recovering critical minerals from mines that are currently producing primary minerals where the host mineral deposit may contain some or all of the by-product or co-product minerals.

(2. Reprocessing mine wastes at active mines, (e.g., tailings, waste rock, or both) that may contain some of the critical mineral by-products and co-products.

(3. Reprocessing tailings and/or waste rocks at inactive and potentially abandoned mines where these wastes may contain valuable deposits of the primary host mineral as well as critical minerals by-products and co-products.

-8. The total metric tons for each mineral for global production may not equal the total metric tons for each mineral for global refinement because production and refinement are different processes involving different materials and these steps potentially may occur in different years. Different authors have used different terminology; production means mining, and refinement means processing; although production also means mainly mining plus processing, but can include production from recycling scrap and reprocessing waste. Technically speaking, processing is the first step in separating the valuable mineral, while refining is the process of further purifying and refining the concentrate for specific applications.

-9. There are two forms of critical mineral production. The first is mine production. As the name suggests, this is what’s directly mined out of the ground. Minerals are obtained from the ground by a process known as ‘mining’. This is often impure and mixed with other minerals or rocks. It usually needs to be refined to get it into a usable or final form. That’s the second form of production. Refined production is the conversion and separation of the raw mineral into a pure or final form used in manufacturing. And the countries that do the mining are often different from those doing the processing and refining.

For critical minerals mining, Chile is the largest producing country for copper, Australia for lithium, Indonesia for nickel and Congo for cobalt. China dominates global critical mineral processing, holding a significant share of refining capacity for key materials like lithium, cobalt, nickel, and rare earths.

-10. What is a critical mineral:

It should be emphasized that the scarcity of a mineral in the Earth’s crust alone does not automatically make it critical. The earth’s crust has no shortage of the critical minerals but exploration of critical minerals (including discovering new ones) is very difficult and very expensive; and processing is highly geographically concentrated.

Modern economies rely on countless raw materials. Many minerals have important uses but, by dint of plentiful supply, functioning markets or an ability to substitute them, do not warrant the focus that others may at this stage. By necessity of focus, only some are defined as “critical”. Critical minerals refer to metals, non-metals, metalloids and mineral resources, both primary and processed, which are essential inputs in the production process of an economy & national security, and whose supplies are likely to be disrupted on account of non-availability or risks of unaffordable price spikes.

At present, in the USA and Canada the term “critical minerals” is used while “critical raw materials” (CRM) is used by the European Union. The other terminology includes “strategic minerals” or “advantageous minerals” used by China. The global Critical Minerals Market size was valued at USD 320.43 billion in 2022 and is projected to reach USD 494.23 billion by 2030, growing at a CAGR of 5.69% from 2023 to 2030.

The association of the term strategic mineral almost exclusively with national security and military needs or requirements is well understood but critical material has broader connotations than a strategic material, and its definition can be considered to include civilian, industrial, and military applications that could have measured effects on the nation’s economy should supply of the material under evaluation become restricted. In accordance with these definitions, a critical material may or may not be strategic, while a strategic mineral will always be critical.

Core mineral is one that you largely can leave to market forces to supply, relying on private mining companies to explore, develop and produce on commercial terms. However, a genuinely critical mineral is likely to require a different strategy to acquire, such as directly funding new mines, building strategic relationships with host countries and offering offtake agreements that aren’t dependent on market prices.

While some of these minerals are inputs for traditional industries like metallurgy and in the production of steel, ceramics, refractories, automobiles and jewellery; many are crucial for the high-tech products required for clean energy, national defence, informational technology, aviation, and space research. Many of these critical minerals are produced in comparatively small volumes or as companion metals (meaning they’re produced as by-products of other mining activities), are non-substitutable in their applications and have low recycling rates.

The “critical minerals’ cannot include fuel minerals such as oil, gas or coal. Water, ice, snow or common varieties of sand, gravel, stone, pumice, cinders and clay are also excluded from being critical minerals.

-11. Declaration of Critical Minerals is a dynamic process, and it can evolve over time as new technologies, market dynamics, and geopolitical considerations emerge. Different countries may have their own unique lists of critical minerals based on their specific circumstances and priorities. What is (or isn’t) deemed a critical mineral varies from country to country. Most governments maintain their own lists of the minerals they categorize as “critical,” which are usually put together by committees of scientists and engineers. These lists are not static, however, as they can be updated to reflect a country’s changing priorities. They are influenced by factors such as importance, supply, demand, reserves and geopolitical risks. Rare-earth elements (REE), the platinum-group metals (PGM), indium, tungsten, germanium, cobalt, niobium, tantalum, gallium, and antimony have been identified as critical by most countries. However, what started out as compilations to inform policy and sustain economic efficiency has in recent years morphed into lists that are central to geopolitical strategy.

-12. What are rare earth elements:

Rare earth elements (REEs) represent the group of 17 elements comprising 15 lanthanides, plus yttrium (Y) and scandium (Sc). Rare earth elements are critical to many industries—used in electric motors, medical imaging and diagnostics, oil and gas refining, and computer and phone screens.

Rare earth elements (REEs) are a subset of critical minerals and materials. Critical minerals encompass a broader range of elements crucial for various industries and national security, while rare earth elements (REEs) are a specific subset of critical minerals known for their unique magnetic, luminescent, and catalytic properties.

Unlike the name suggests, REEs are actually not rare. In fact, they are relatively abundant and quite commonly available in the Earth’s crust. Cerium is the most abundant REE, and is more common in the Earth’s crust than copper or lead. All of the REEs, except promethium, are more abundant on average in the Earth’s crust than silver, gold, or platinum.

The REEs are commonly found together in the Earth’s crust because they share a trivalent charge (+3) and similar ionic radii. In nature, REEs do not exist individually, like gold or copper often do, but instead occur in minerals as either minor or major constituents. Although rare earth elements are relatively abundant in the Earth’s crust, they are rarely concentrated into mineable ore deposits, so finding economic deposits is very difficult. What makes these materials rare is how difficult they are to extract and how complex it is to process them. Because the rare earth elements all have similar chemical behavior to each other, they are very tough to separate, making the process difficult and expensive.

-13. REE properties:

The REE’s distinctive properties are due to their atomic structure, especially the configuration of their electrons, which is unlike that of other elements. Most lanthanides possess an important set of electrons called the “f-electrons,” which dwell in a Goldilocks zone located near the valence electrons but slightly closer to the nucleus. It’s these f-electrons that are responsible for both the magnetic and luminescent properties of the rare earth elements. In atomic structure, “f electrons” refer to electrons occupying the f orbitals, which are a type of atomic orbital with a complex, multi-lobed shape and can hold a maximum of 14 electrons. The series of chemical elements comprises the 14 metallic chemical elements with atomic numbers 58–71, from cerium through Lutetium, fill the 4f orbitals. In the lanthanides, it is the 4f orbitals that are being filled, so the configuration of the valence electrons is similar in all the REEs, hence all exhibit similar chemical behavior. Although REEs have notable chemical similarities, the gradual filling of the f-orbitals makes them unique for many applications. The shielded nature of the f-orbitals leads to well-defined energy levels that are weakly perturbed by the environment and are accompanied by large spin-orbit coupling, which enable application of REs in optical and magnetic applications.

Rare earth metals radiate light when stimulated. The trick is to tickle their f-electrons. Using an energy source like a laser or lamp, scientists and engineers can jolt one of a rare earth’s f-electrons into an excited state and then let it fall back into lethargy, or its ground state. When the lanthanides come back to the ground state, they emit light. Each rare earth reliably emits precise wavelengths of light when excited. This dependable precision allows engineers to carefully tune electromagnetic radiation in many electronics resulting in emission of bright colors for electronic displays and sensors.

Rare earths have many orbitals of electrons, but the f-electrons inhabit a specific group of seven orbitals called the 4f-subshell. In any subshell, electrons try to spread themselves out among the orbitals within. Each orbital can house up to two electrons. But since the 4f-subshell contains seven orbitals, and most rare earths contain fewer than 14 f-electrons, the elements tend to have multiple orbitals with just one electron. Neodymium atoms, for instance, possess four of these loners, while dysprosium and samarium have five. Crucially, these unpaired electrons tend to point — or spin — in the same direction. That’s what creates the north and the south poles that we classically understand as magnetism. They make stronger and more lightweight magnets so that electronics can be more portable. Large wind turbines can each use up to 2 tonnes of high strength magnets which contain about 30% REE. Up to 20 kg of REE are used in the batteries, electric traction motors and regenerative braking systems of each hybrid vehicle.

-14. Reserves tell us how much known and assessed mineral deposits can be mined economically with current technologies and market conditions. These are not to be confused with “resources”, which describes the total amount of available minerals. Reserves are resources that are economically viable today. Both metrics — reserves and resources — can change over time as we find new deposits and known ones become more economical.

-15. Countries like Australia, Chile and DRC come to the forefront when we consider the deposits of these critical minerals, however the availability is one thing but the extraction and processing capabilities are a whole different ball game altogether. It’s the latter that has come to dominate the sensibilities of the nation states when it comes to critical minerals. The major producers of critical minerals globally are Chile, Indonesia, Congo, China, Australia and South Africa but only China dominates in terms of processing.

-16. China holds the world’s largest rare earth reserves, estimated at 44 million metric tons. It also leads in production, generating 270,000 metric tons in 2024. China currently dominates the rare earth supply chain, producing 70 percent of the world’s supply and handling 90 percent of global rare earth ore processing. This dominance of the discovery-to-production-to-export chain gives the country enormous control over rare earth prices globally.

-17. The Democratic Republic of Congo (DRC) is by far the largest global supplier of cobalt but locals in the capital of Kinshasa will be hesitant to celebrate due to widespread phenomenon in many commodity-rich developing countries known as the ‘resource curse’. This curse refers to a phenomenon where countries rich in natural resources, particularly minerals and commodities like oil, often experience economic and political challenges – typically caused by geo-economic exploitation by richer nations – that can hinder their development and overall well-being. Just ask Venezuelans how flush they currently feel from their vast oil reserves. Even if countries have realised the potential of their reserves, they might not have the money to exploit it. In many African countries right now, it is Chinese companies that are exploiting these resources, not the country itself. The critical minerals gold rush presents a once-in-a-generation opportunity for African governments to properly capitalize on their natural resources for the benefit of their people. However, the dangers of getting it wrong are immense — the most extreme example being the Democratic Republic of the Congo (DRC).

-18. Ukraine’s rare earth deposits are overstated, outdated, and largely inaccessible. The assessment of critical minerals is based on outdated geologic data. The significant number of mines are inactive due to the war, and many employ older, inefficient technology. More importantly, four areas with substantial deposits of rare earth ores are occupied by Russia. Ukraine’s rare earths – meant to replace China as a supplier – will be of little use without the ability to process it. It’s also not just about the mineral deposit reserves; it’s also about processing power.

-19. Primary raw materials are natural, unprocessed substances extracted directly from the Earth, while secondary raw materials are materials that have been recycled or recovered from waste and used in manufacturing processes instead of virgin materials. In general, primary material benefits from the technological knowledge gained from millennia of discovery and processing, but resource conflicts and other issues can make the utilization of these stocks problematic. In contrast, secondary materials possess fewer issues that are potentially problematic, but the collection and reprocessing technologies for those materials are not highly developed.

-20. Fossil fuels, with their geologic origins as organic materials, are consumed when burned to generate usable energy. As such, they are destroyed and not available for use later. Such is not the case for nonfuel minerals, which in principle can be recycled after initial use. Thus, minerals and mineral products are available as primary resources (extracted from Earth’s crust) and also as secondary resources (recovered from scrap and mine waste). In addition, for a country or region—as opposed to the planet as a whole—the importation of metals or metal-containing products serves as an additional (“tertiary”) resource.

-21. Critical minerals in energy transition:

The concept of critical minerals has gained popularity because the new technologies that are shaping the ongoing green and digital transitions (together known as the ‘twin transition’) utilise far higher amounts of minerals than more traditional technologies. An energy system powered by clean energy technologies differs profoundly from one fuelled by traditional hydrocarbon resources. With the clean energy transition, we’re exchanging a fossil fuel-based energy system with a metals-based energy system. While solar PV plants and wind farms do not require fuels to operate, they generally require more minerals than fossil fuel-based counterparts for construction. A typical electric car requires six times the mineral inputs of a conventional car and an onshore wind plant requires nine times more mineral resources than a gas-fired plant of the same capacity. Furthermore, the construction of wind farms and electric cars use seven different types of minerals, while a natural gas power plant and a conventional car use only two. Manufacturing a single electric car, for example, requires more than 200 kilograms of combined copper, lithium, nickel, manganese, cobalt, graphite and rare earth elements, compared to less than 35 kilograms of just copper and manganese for an internal combustion model. One megawatt of wind energy capacity requires 171 kg of rare earths. While previously the energy sector represented only a small portion of the total minerals demand, it is emerging as the major force in mineral markets and as a result of this transformation, minerals bring new challenges to the energy security.

Meeting the Paris climate agreement’s goal of keeping average global warming well below 2ºC above pre-industrial temperatures will result in a quadrupling of demand for critical minerals by 2040. Achieving net-zero emissions by 2050 would mean a sixfold increase. In total, between 2022 and 2050, the energy transition could require up to 6.5 billion tonnes of materials, cumulatively, of which 95% is accounted for by steel, copper and aluminium and the global demand could grow 40 times for lithium and between 20 and 25 times for nickel, cobalt, and graphite. One estimate by S&P Global suggests that more copper will need to be mined in the next few decades than has been extracted in the past several thousand years of human history.

-22. The types of mineral resources used vary by technology. Lithium, cobalt and nickel play a central role in giving batteries greater performance, longevity and higher energy density. Rare earth elements are used to make powerful magnets that are vital for wind turbines and EVs while solar PV cells contain aluminum, silicon, copper, silver, tin, and lead. Electricity networks need a huge amount of copper and aluminium. Hydrogen electrolysers and fuel cells require nickel or platinum group metals depending on the technology type. These characteristics of a clean energy system imply a significant increase in demand for minerals as more batteries, solar panels, wind turbines and networks are deployed. Limiting global warming to 1.5 degrees Celsius, to avert the worst impacts of climate change, will depend on the sufficient, reliable and affordable supply of critical energy transition minerals. The world is heading for a turbulent period of energy transition where constraints on the supply of critical materials are increasingly likely to slow the pace of change. The danger is that surging demand outpaces supply, resulting in a dramatic price increase, which would not only delay the energy transition but also make it much costlier. Between $3tn and $4tn of investments in mining, smelting and refining are needed to meet the shortfall in supply. There are enough resources and minerals in the world for the energy transition but the challenge is to make more of these economically viable [to extract] or find new deposits that are easily accessible.

-23. Critical mineral supply chain:

A generic supply chain—which includes extraction, processing, components, end-use technology, and recycling and reuse—provides a useful context to consider geologic, technical, environmental, political, and economic factors that impact supply risk. Supply risks may be (1) geologic—whether the resource exists in nature, (2) technical—whether the resource can be extracted and processed, (3) environmental and social—whether the resource can be extracted and processed in an environmentally and socially acceptable way, (4) political—whether governments influence resource availability through policies and actions, and (5) economic—whether the resource can be extracted and processed at a cost that users are willing to pay.

Two largely interrelated movements are fuelling the rush for critical minerals worldwide. The first is the transition toward low-carbon and decarbonized energy systems and second movement is the transition to the digital economy. These two major drivers occur while the demand for societal needs, industrialization, and development stays high. As demand grows, so do concerns about supply chain stability and environmental impacts.

On the upstream supply side, there is no danger of the world running out of critical minerals soon. When ore is extracted, known reserves are depleted. But when new deposits are discovered and the full extent of known deposits is explored, reserve numbers increase. While the total fluctuates, a trend is clear on net, the world’s known reserves of cobalt, lithium, and nickel are increasing. World resources of REE are enough to meet foreseeable demand and the only rare earth element estimated to have less than 1000 years resource is Europium at approximately 600 years. But the great difficulty is in tapping these reserves in a way that is profitable, sustainable, and responsible. Critical minerals are not evenly distributed across the globe. Specific regions and countries have abundant reserves, making them key players in the production and supply of these essential resources. As it stands, even when those minerals are mined outside of China, based on the distribution of global capacity, they are almost always sent to China for processing and manufacturing. This asymmetric capacity represents a meaningful bottleneck that can only be addressed if other countries move quickly to develop their own downstream processing and manufacturing capacities. The reliance on China for processing means that any disruption in Chinese production—whether due to geopolitical tensions, environmental regulations, or trade restrictions—could have far-reaching consequences for the global supply chain.

In contrast to the strong demand for these minerals, their supply is highly inelastic and fragile. Many deposits are in developing and highly underdeveloped countries, where mining has historically had challenges with corruption, pollution, human rights, and violence. Mineral extraction, therefore, often becomes a catalyst for negative community impacts. Additionally, the environmental toll of mining in these countries often goes unchecked, further complicating the ethical dimensions of the supply chain.

Minerals and metals supply chains have been disrupted with increasing frequency and intensity in recent years. The disruptions have included natural disasters such as earthquakes and climate change triggered crises such as wildfires, floods, and heat waves. More recently, supply chains were disrupted by a global pandemic and the war between Russia and Ukraine. Other supply chain risks include limited or concentrated supply sources, market immaturity, high production costs, political factors, social unrest, mine accidents, and technological difficulties in extraction and production processes. It has taken 16.5 years on average to move mining projects from discovery to first production. These long lead times raise questions about the ability of supply to ramp up output if demand were to pick up rapidly.

-24. Factors responsible for supply disruption of critical minerals include:

(1. Supply shortages due to increased demand

(2. External shocks

(3. Resource nationalism

(4. Export restrictions on critical materials

(5. Mineral cartels

(6. Political instability and social unrest

(7. Market volatility and manipulation

(8. Lack of investment

(9. Geopolitical risks, tensions and instability

(10. Regional water constraints and their impact on resource availability

-25. Price Volatility:

Unlike oil, most critical materials are not widely traded on exchanges, and this limits opportunities to hedge against price volatility. Further, insufficient data on consumption, production, and trade of minerals causes uncertainty, price volatility and delays in investments. In periods of especially strong economic growth, mineral use in general expands more quickly than production capacity, tending to drive up mineral prices, whereas in periods of slower growth or recession, mineral use tends to grow more slowly than production capacity and prices tend to fall.

Prices for minerals and metals experienced a widespread decline in 2023, with battery metals experiencing particularly sharp reductions. The main reason for price declines has been a strong increase in supply outpaced demand along with ample inventories of technologies made with critical minerals. However, today’s well-supplied market may not be a good guide for the future, as demand for critical minerals continues to rise.

-26. Critical mineral supply chains cannot be truly secure, reliable and resilient unless they are also sustainable and responsible. Growing demand for critical minerals will mean new mines, processing facilities and refineries, which can bring attendant risks of harm to the environment, workers, communities and societies. These harms, if not adequately prevented, mitigated or remedied, can disrupt supply and hinder the rapid scale-up of clean energy technologies. To address these challenges, processes, tools and mechanisms are needed to ensure and demonstrate responsible practices across the value chain. Traceability can play an important role in ensuring sustainable and responsible supply chains. Traceability in critical mineral supply chains refers to the ability to track and follow the path of a mineral from its extraction to its final use. This involves documenting the origin, movement, and ownership of the mineral throughout the supply chain. Traceability is crucial for ensuring responsible sourcing, complying with regulations, and mitigating risks associated with conflict minerals and other unethical practices.

-27. MSP:

The Minerals Security Partnership (MSP) is a collaboration between 14 countries and the EU to secure critical mineral supply. It aims to catalyse public and private investment in critical mineral supply chains globally. The basic premise of MSP is “friend-shoring”, meaning moving manufacturing away from authoritarian and unfriendly states to allies. Friend-shoring means supply chains are created between friendly countries.

If anyone needs a lesson in the folly of this approach, they need look no further than to the immense damage caused by vaccine hoarding during the COVID-19 pandemic. Despite signing up to a global agreement to cooperate, richer countries outbid each other for vaccine supplies. By one estimate, more than one million lives had been lost by the end of 2021 because a few countries massively over-ordered vaccines, which meant there were not enough for everyone else when they were most needed.

Although friend-shoring may help alleviate supply chain vulnerabilities for Western nations, the success of the MSP depends on striking a balance between reducing reliance on China and managing the economic costs of alternative initiatives that support national and geopolitical security, all while upholding environmental, social and governance (ESG) standards. Critics argue that the potentially harmful effects of friend-shoring far outnumber its benefits. Friend-shoring risks creating an elitist and exclusionary club in world trade, and may lead to supply chain bottlenecks, higher prices and lower economic growth. Friend-shoring has been described as a new symbolism of protectionism.

-28. The critical mineral resource-poor countries can make policies to diversify supplies, develop substitutes, improve reuse and recycling, reprocess mine tailings, and use less critical minerals by improving efficiency.

-29. Mining:

Minerals and metals are extracted and produced by large-scale mining, and artisanal and small-scale mining (ASM) operations. Large-scale mining projects can take 15-20 years, and there is lack of investment in exploration and production for key energy transition materials. The three biggest causes of delay to critical mineral mine development are permitting issues (39%), technical challenges (36%), and commercial issues (26%). Key solutions include accelerating permitting timescales, increasing output from existing mines, updating geological surveys, improving international data-sharing and increasing capital investments.

In order to increase the pace and scale of critical minerals mine development, building stakeholder trust in the mining industry is required. The mining sector has the lowest level of public trust compared to any other industry, below oil and gas. About 62% of the projects were delayed by permitting issues due to stakeholder opposition or concerns around the project’s environmental impacts. About 1,200 mining sites worldwide are in key biodiversity areas (with 29% of these projects involving critical minerals).

There is also deep-sea mining. Practically all of the mineral and energy resources found on land are present under the sea as well. Development, however, is limited by extraction costs that increase with depth of water, by the relative abundance of resources on land, and by political questions involving ownership of deep ocean resources.

-30. AI could, in theory, aid the critical mineral industry in finding both new deposits of the most sought-after minerals, and entirely new materials.

-31. ASM:

Artisanal and small-scale mining (ASM) is a global activity where individuals or small groups extract and process mineral resources using simple, labour-intensive methods. It’s a key livelihood for millions, particularly in developing countries, and contributes significantly to the global supply of minerals. ASM is an overlooked source of many critical minerals, despite being a significant contributor to the global supply of critical minerals and several other minerals. ASM occurs in nearly 80 countries worldwide, being the main livelihood of approximately 40 million artisanal miners. Currently, ASM contributes significantly to the global supply of approximately 8% of cobalt, 40% of tin, and 60% of tantalum production worldwide. Around 70%–80% of ASM operates within the informal sector, either illegally or in legal grey areas, and the inclusion of ASM in the formal sector presents one among many policy considerations.

-32. Recycling scrap:

The primary limitation of critical minerals recycling is economic—currently, a much larger volume of material can be obtained at a lower cost from mining than from recycling. However, if the environmental, social, and greenhouse gas emissions benefits of recycling are factored in, recycling becomes more cost competitive.

By recycling the critical materials into new technologies, it is possible to lower our reliance on mined materials, alleviate some of the environmental and social harms associated with mining, reduce greenhouse gas emissions, reduce environmental harms of e-waste and strengthen and diversify the supply chain. It is estimated that each year ~50 million metric tons of e-waste are disposed in landfills worldwide, and only 12.5% of e-waste is currently being recycled for all metals.

Most metals have the potential to be recycled “without the quality being affected”. This means that once there is a high volume of material in the system, and recycling technologies and facilities are sufficiently developed, the world should be getting supplies also from recycling. Metals, apart from some specialty alloys, can be repeatedly recycled without loss of quality, with the specific metal available at the end of the recycling process depending on the feedstock. During the last decade about 32 percent of annual copper use came from recycled sources. Currently, global REE and lithium recycling sit at about 0.2 percent and 0.5 percent, respectively, which is well below other minerals.

Recycling reduces new mine development needs by 40% for copper and cobalt, and by 25% for lithium and nickel by 2050. Recycling EV battery waste could supply enough cathode material to supply 60 GWh of new EV batteries by 2040. Recycling of 10,000 iPhones has the potential to yield 190kg of aluminum, 77kg of cobalt, 71kg of copper, 9.3kg of tungsten, 4.2kg of tin, 1.1kg of REE, 0.75kg of silver, 0.18kg of tantalum, 0.097kg of gold and 0.01kg of palladium.

On average, recycled critical minerals incur 80% less greenhouse gas emissions than primary materials and help reduce landfill waste. This is, in part, because recycling processes often use less energy than the mining and processing of virgin minerals. The production of recycled materials also consumes less water than primary minerals.

Mining companies are diversifying into metals and minerals recycling; and this trend is being driven by a perfect storm of rising demand for critical minerals, increasing lead times for new mining projects which have risen from an average of 12.7 to 17.9 years and increasing sustainability requirements. Combining mining investments with recycling initiatives not only accelerates material availability but also ensures a more sustainable supply chain and a strategic move to establish a presence across the entire value chain, from primary extraction to secondary resource recovery. This is a win-win business model.

But is recycling enough?

Recycling is not enough: more mining needed: The main reason for this is that there will not be enough secondary feedstock to meet a significant share of material demand. Even if there is 100% end-of-life recycling by 2050, aluminium, copper, and nickel would still only see secondary supplies reach 60% of demand.

-33. Reprocessing mine waste: Remining:

Globally, over 100 billion tons of mining wastes are generated per year, and this is likely to grow as lower grade resources are increasingly utilised due to depletion of high-grade resources. The practice of reprocessing mine waste is crucial to reducing environmental damages, obtaining valuable critical minerals from waste, and contributing to more sustainable repurposing and disposal methods. The minerals that can be recovered from mine waste depend on the geology and extraction or processing used when the waste was originally generated. Unfavourable economics, inefficient processing and mineralogical factors may also have resulted in critical metals reporting to mining wastes over time. Commonly found minerals within gold and iron tailings could include copper, zinc and some rare earth elements. For copper tailings specifically, metals such as cobalt, zinc and rare earth elements may be found. Rare earth elements are also found in the tailings of tin, phosphate, bauxite, coal, titanium and uranium. Mine waste, including tailings and waste rock, holds significant potential for the recovery of critical minerals such as copper, cobalt, nickel and REEs. The minimum of 24 kt of indium is present in mining wastes globally.

The advantages for all remined sources include an increased domestic supply, especially of REEs; generally lower energy and water use; potential for the cleanup of abandoned mine lands and mine-affected waters; and increased local employment.

Mine tailings (one type of mine waste) are waste byproducts left over after extracting valuable metals and minerals from ore deposits. An estimated 16 billion tonnes of tailings are generated globally each year, contributing to a total worldwide stockpile of approximately 282 billion tonnes. Tailings hold the most promise for remining because of the relatively large number of metal extraction studies conducted on tailings, the large amount of tailings worldwide, and the fact that they are already extracted and pre-processed, which reduces energy and water use. Many tailings, especially from older mining operations, contain significant amounts of critical materials such as copper, cobalt, nickel, lithium and REE, presenting an opportunity to tap into these materials as a secondary resource. The primary motivation for seeking minerals from these mine tailings is that the cost of reprocessing them is much lower than raw extraction, and the overall process to do so is much quicker. Estimates vary, but the value of minerals in tailing storage facilities worldwide is close to $3.4 trillion.

In the abandoned iron mines of New York’s Adirondack Mountains, scientists analyzed both tailings and ore, finding REE concentrations up to 2.2 percent for the tailings and 4.8 percent for the ore. Considering the waste-to-extraction ratio is large for rare earths, these percentages are not insignificant.

Phoenix Tailings is a Massachusetts-based startup extracting rare earth elements from mining sites. Besides the four rare earths used most commonly in magnets (neodymium, praseodymium, dysprosium, and terbium), Phoenix recovers battery metals, platinum group metals, low-carbon irons, and other materials in what it calls a “portfolio approach” that improves economic viability.

-34. Water and environment:

The environmental impact of critical minerals mining can be significant, including greenhouse gas emissions, biodiversity loss, water pollution, and soil contamination. Mining can cause what is known as dewatering. Just to take one example, it takes 2 million litres of water to extract a single tonne of lithium and some 50 per cent of global copper and lithium production are concentrated in areas with water scarcity.

Most methods used to mine critical minerals today require significant amounts of water for separating minerals, cooling machinery and controlling dust. At least 16% of the global critical mineral mines, deposits and districts located on land are in areas facing high or extremely high baseline water stress. Rapid increases in mining activity in these regions could easily increase demand for water and push these locations with already-scarce freshwater supplies into high or extremely high levels of water stress. Waste from mining and processing, including residual minerals and chemicals, can also contaminate water in nearby communities. In Chile’s Salar de Atacama, one of the country’s key mining regions, lithium and copper extraction have reportedly consumed over 65% of the local water supply, depleting available water for indigenous farming communities in an already water-scarce region. Indigenous communities in Chile and Argentina have also reported contamination of fresh water used for drinking, livestock and agriculture with toxic waste from lithium operations. Similar concerns about water use and contamination have already been reported for cobalt in the Democratic Republic of Congo (DRC) and graphite in China, among others.

-35. Critical minerals create a “decarbonization divide”, whereby developed countries reap the benefits of cleaner technologies while developing and least-developed countries often bear the environmental and social burdens.

-36. We cannot achieve the goals of the Paris Climate Agreement to reduce greenhouse gas emissions without the use of critical minerals and consequently without more mining. Energy-intensive mining for critical minerals could undermine efforts to reduce emissions. The extraction and processing of critical minerals generate significant global impacts, accounting for 10 % of GHG emissions in 2018 – a proportion expected to rise due to increasing demand and dwindling ore quality. However, the emissions created by extracting minerals from the ground are tiny compared to those created by burning fossil fuels. For every gigawatt of a clean energy technology that’s installed, millions of tons of CO2 emissions can be avoided.

-37. The global mining market had a compound annual growth rate of 6.1 percent between 2022 and 2023, reaching $2.15 trillion, and is expected to grow to $2.78 trillion by 2027. Mining is, and will continue to be, essential to the livelihood, development, and progress of billions of people around the globe. Mining has become increasingly important for economic development. The top 40 mining companies had a combined revenue of $711 billion in 2022. For every job in metals mining, an estimated 2.3 additional jobs are generated, and for every nonmetals mining job, an additional 1.6 jobs are created. However, particularly in developing countries, the industry is plagued by significant drawbacks such as corruption, child and forced labor, poor working conditions, low wages, and health risks.

-38. Export curbs applied to critical raw materials are often justified by the need to promote downstream industries, the raising of revenue and environmental protection. But there are other motivations, including the desire to gain an upper hand on a geopolitical rival.

-39. The race for minerals can exacerbate or contribute armed conflict in multiple ways. In countries with weak governance and political instability, mineral extraction can be linked to local grievances, conflict and human rights abuse. Mining wealth can also be exploited to sustain local conflicts, and in areas with weak state authority, it can help armed groups fund their activities by exploiting green mineral deposits, leading to increased violence and instability. This is especially true in regions with a history of conflict or where ethnic or religious tensions exist. The potential for blackmail through resource control could lead to increased tensions and conflict as nations struggle for access to critical minerals.

-40. China factor:

The geography of mining versus the processing of critical minerals is very telling. China completely dominates the processing of copper, nickel, cobalt, rare earths, graphite and lithium, but it only dominates in the mining of rare earths and graphite. The country controls 90 percent of the world’s rare earth refining capacity, around two-thirds of its lithium and cobalt refining capacity, and around a third of its nickel refining capacity. The country also invested in the upstream production of these minerals in other developing countries through its $1 trillion Belt and Road initiative, enabling it to achieve vertical integration through the supply chain for certain minerals. It is mind-boggling that China is the dominant producer in the world economy of offshore wind, onshore wind, solar, and electrical vehicles and has 40-45% global shares in the production of fuel cell trucks, heat pumps, and electrolysers.

China’s ascendancy is the result of forward thinking by the country’s leadership. Thanks to a decades-long strategy of investment and industrial policy, supported by cheaper labor, faster permitting, and looser environmental and labor regulations than in many other countries, China has developed these resources and achieved a dominant global position in many areas. China’s focus on processing has allowed it to maintain control on critical mineral supply chain without owning all the mines. But it would be unwise for the rest of the world to rely on just one country for the processing of critical minerals.

China has taken an aggressive, competitive posture to undermine potential rivals. China has in the past “strategically flooded the global market” with REEs at lower prices to decrease incentives for foreign companies to start new projects, or to put competing companies out of business.

-41. United States is being too heavily dependent on China for too many critical minerals. Between 2020 and 2023, the US relied on China for 70% of its imports of all rare earth compounds and metals. It’s common sense not to be overly reliant on one supplier, especially a top economic and geopolitical competitor, for any commodity or product. China is leveraging its powerful position by restricting mineral exports to the U.S., and the U.S. is trying to reduce reliance on its adversary. That’s why Trump has shown interest in annexing mineral-rich territories like Canada and Greenland. It’s also why the U.S. and Ukraine have negotiated a deal to have Ukraine give the U.S. access to its minerals.

-42. Minerals are foundational in warfighting. They are used in defense platforms like attack submarines, heavy bombers, and mobile missile launchers, and in munitions like submarine-launched torpedoes, air-launched standoff missiles, and ground-launched rockets and missiles. For example, a single U.S. F-35 fighter jet requires about 427 kg of rare earths, and a Virginia-class nuclear submarine uses nearly 4.2 tonnes. Today, the U.S. military is at a greater risk of severe mineral shortages if a U.S.-China war were to unfold: the United States has limited mineral stockpiles; low domestic mineral production; and heavy mineral import reliance, including from its great power rival, China. The United States would consume significant mineral volumes for increased defense production in a war, and it would face disrupted mineral imports from expanded export controls and contested shipping routes, posing mineral shortage risks. Critical minerals are a matter of national security not only for the U.S. but for all major world powers.

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Dr. Rajiv Desai. MD.

May 11, 2025

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Postscript:

As early as 1992, Chinese leader Deng Xiaoping was highlighting his country’s potential to lead the world in critical minerals, saying “The Middle East has oil. China has rare earths.”. Unlike fossil fuels, just one country — China — has become the world leader in refining and processing critical minerals for use in finished products. China’s ascendancy is the result of forward thinking by the country’s leadership.

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Critical Minerals

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