Are we really running out of critical minerals?

It isn’t just the extinction of critical minerals that concerns governments at the moment – it’s the sovereign risk of having to source them from and then process them in a vanishingly small number of countries around the world.

As countries around the world race to shore up their supply of a range of currently in-demand minerals, it’s worth asking the question – how critical is supply?

Is the planet in danger of running out of the elements we need – copper, nickel, lithium, graphite and tin spring to mind – to build the technologies needed to transition to a renewable and low-emissions future?

Some estimates say China’s supply of metals such as dysprosium, neodymium and lanthanum, used in missile guidance systems, laptops and many other products, could be exhausted within 20 years.

Single source poses sovereign risk

It isn’t just the extinction of critical minerals that concerns governments – it’s the sovereign risk of having to source them from and then process them in a vanishingly small number of countries around the world.

China owns 85% of the Earth's known rare earth element supply and is home to more than 90% of production.

With the breakdown of global supply chains, caused by war and geopolitical unrest, but also by pandemic(s) and natural disasters, it’s important to have secure domestic supply.

The scarcity of a critical mineral is determined by a range of factors, including domestic processing, import dependence, geological endowment and demand.

In 2022, critical minerals are inputs to a range of automotive, communications, electronics, defence, aerospace, power generation and medical technologies.

Low-emission technologies are greedy for the minerals that make components for batteries, electric motors and renewable energy generators.

Then there is the grid – the wires that supply all that renewable energy. Copper is an inalienable part of that, and this is why the price of copper is skyrocketing.

Recycling part of the solution

Enhanced recycling technologies will remain an important piece of the puzzle and progress on this front will alleviate the pressure on supply.

“We should be recycling all of our modern electronics to recover these materials,” said Vernon.

To this end, ASX-lister Reach Resources Ltd (ASX:RR1) recently announced it is considering acquiring REEcycle Inc, a US-based rare earth element (REE) separation and technology company, citing an interest in the need to create a renewable and secure source of rare earth elements, to reduce uncertainty for companies reliant on these materials.   

REEcycle has strategically concentrated on the recovery of neodymium and dysprosium, two REEs that are ranked highest in both supply risk and for their importance to clean energy.

In a recent presser, Reach Resources cited the Shanghai Metals Market, which forecasts that recycling of neodymium-based NdFeB magnets is likely to become the largest growth of neodymium and dysprosium supply from 2021 to 2025.