As the electrification drive continues globally in the search for lower fossil fuel emissions, the producers and refiners of the metals needed for this "revolution" are finding themselves at the intersection of the world's supply chains and geopolitics.
The FT takes on the subject in this latest piece.
The new commodity superpowers
"We're not satisfied. None of these contracts create value for us," says Guy Robert Lukama, head of the DRC's state-owned mining company Gécamines. He would like to see more jobs, revenue and higher-value mineral activities captured by the DRC.
Lukama also advocates government intervention to keep cobalt prices high: "Excess of supply needs to be organised properly. Some export quotas will be useful," he says.
The DRC is far from alone. As the world moves from an energy system built on fossil fuels to one powered by electricity and renewables, global demand for materials such as copper, cobalt, nickel and lithium is transforming the fortunes of the countries that produce them.
The mining of certain metals is highly concentrated among just a few countries:
For cobalt, the DRC accounts for 70 per cent of global mining.
In nickel, the top three producers (Indonesia, the Philippines and Russia) account for two-thirds of the market.
For lithium, the top three producers (Australia, Chile and China) account for more than 90 per cent.
In critical minerals, China dominates refining, while mining is led by Indonesia, Chile and the DRC
Share of total (%, latest data available as of 2023)
DRC leads cobalt mining market with 70%, Indonesia tops nickel market with 48%, Australia tops the lithium market with 47% and Chile tops the copper market with 23%.
China dominates the refining market with 70% of cobalt market, 42% of copper market and 58% of lithium market.
Sources: Irena, USGS, US Department of the Interior
The supply chains for some of these metals are becoming entangled in the rising tensions between the west and China, which dominates processing capacity for lithium, cobalt and rare earths and is considering restricting exports of some materials. Governments from Washington to Brussels to Tokyo are assessing where they can reliably source critical minerals without going through Beijing's orbit.
The supply chains for some of these metals are becoming entangled in the rising tensions between the west and China, which dominates processing capacity for lithium, cobalt and rare earths and is considering restricting exports of some materials. Governments from Washington to Brussels to Tokyo are assessing where they can reliably source critical minerals without going through Beijing's orbit.
This shift is also transforming some smaller and historically under-developed countries into commodity superpowers. And their governments are now intent on rewriting the rules of mineral extraction.
Many are trying to capture more of the value of their minerals, by doing more processing and value-added manufacturing domestically. Some are also attempting to control the supply, by nationalising mineral resources, introducing export controls, and even proposing cartels.
See the whole piece on the Financial Times here: https://on.ft.com/47p42Jm
___________________
No comments:
Post a Comment
Commented on MasterMetals