The demand for Critical Raw Materials (CRMs) is about to soar, as the green transition accelerates towards 2050. According to World Bank projections, as much as 500%. This, as the European Union is seeking to detangle itself from economic dependence on Russia – “a highly problematic trading partner as its war in Ukraine that the Kremlin grinds on.”
Fears of supply risk
And China. 19 of the 30 raw materials the European Commission has labelled ‘critical’ are primarily produced in China. Its dominance is leading to fears of supply risk and disruptions for the EU’s industrial sector.
Phillipe Varin, Chairman of the World Material Summit, encapsulates the scenario: “We are facing a very unusual transition because we have never seen such explosive growth rates of demand in such a short time frame. {…} We should not accept that we have more than 25% of raw materials coming from one geographic area, whatever this area is, as such a dependency implies huge supply risks.”
Strategic partnerships
As these perceived risks grow greater, a global scramble for Critical Raw Materials is emerging; understandably new alliances are, too. The European Union is looking to Norway – with its abundance of CRMs (vanadium, phosphate, and titanium). At the end of June, Norge Mining was privileged to participate in a roundtable where the Norwegian government and the EU leadership discussed how an industry partnership between Norway and the Union can be put into motion.
Shared ambition
Following this strategic meeting, Vice-President for Interinstitutional Relations and Foresight, Maroš Šefčovič, and Jan Christian Vestre, Norway’s Minister of Trade and Industry issued these words in a joint statement:
“Given the urgent need to tackle climate change, and secure supplies of sustainable energy, materials and technologies instrumental to decarbonisation and the competitiveness of their economies, while increasing resilience of strategic ecosystems, the EU and Norway share the ambition to strengthen and expand their cooperation in the area of the raw materials and battery value chains…{..}..This will help address strategic dependencies and create green long-term growth and high-quality jobs.”
It’s interesting to note that Maroš Šefčovič travelled to Oslo, rather than meeting in Brussels – the typical location for discussions of this kind. Norge Mining was the only upstream mining / commodity company present. The conversations went extremely well; we were able to outline all important points on how mining can be introduced in smoothest, most efficient way – that will in turn help drive the EU’s Critical Raw Material independence.
Across the Atlantic
The European Commission is also looking across the Atlantic in forging partnerships that bolster CRM supply chains and act as a counterforce to Russian/ China dominance. It recently joined the Minerals Security Partnership (MSP) with the US. Other countries who’ve signed up to the alliance include Canada, Australia, Finland, Germany, France, Japan, the Republic of Korea, Sweden and the UK.
Who’s not on the list
In the words of a Reuters’ journalist, ‘a metallic NATO’ is taking shape. The same journalist – Andy Home, Reuters Senior Metals Columnist, says: “It is defined as much as anything by who is not on the invite list – China and Russia. {..} The United States and Europe have realised that they can’t build out purely domestic supply chains quickly enough to meet demand from the electric vehicle transition. The answer is “friend-shoring”. If you can’t produce it yourself, find a friendly country that can.”
In fact, Norge Mining has also had a meeting with the US State Department just recently, due to the US regarding securing CRM supply as a matter of national security. During these discussions with the Director of Energy Transformation at the Department of State and MSP leader, it was indicated that Norway may too be welcomed into the MSP alliance. Watch this space…
