A critical or strategic material is a commodity whose lack of availability during a national emergency would seriously affect the economic, industrial, and defensive capability of a country.
The French Bureau de Recherches Géologiques et Minières rates high tech metals as critical, or not, based on three criteria:
- Possibility (or not) of substitution
- Irreplaceable functionality
- Potential supply risks
Demand is increasing for critical metals due to:
- Economic growth of developing countries
- Emergence of new technologies and products
Access to raw materials at competitive prices has become essential to the functioning of all industrialized economies. As we move forward developing and developed countries will, with their:
- Massive population booms
- Infrastructure build out and urbanization plans
- Modernization programs for existing, tired and worn out infrastructure
Continue to place extraordinary demands on our ability to access and distribute the planets natural resources.
Threats to access and distribution of these commodities could include:
- Political instability of supplier countries
- The manipulation of supplies
- The competition over supplies
- Attacks on supply infrastructure
- Accidents and natural disasters
- Climate change
Accessing a sustainable, and secure, supply of raw materials is going to become the number one priority for all countries. Increasingly we are going to see countries ensuring their own industries have first rights of access to internally produced commodities and they will look for such privileged access from other countries.
Numerous countries are taking steps to safeguard their own supply by:
- Stopping or slowing the export of natural resources
- Shutting down traditional supply markets
- Buying companies for their deposits
- Project finance tied to off take agreements
In this article I am going to take a look at three reports covering what the US and Europe consider critical or strategic minerals and materials.
In its first Critical Materials Strategy, the U.S. Department of Energy (DOE) focused on materials used in four clean energy technologies:
- wind turbines – permanent magnets
- electric vehicles – permanent magnets & advanced batteries
- solar cells – thin film semi conductors
- energy efficient lighting – phosphors
The DOE says they selected these particular components for two reasons:
- Deployment of the clean energy technologies that use them is projected to increase, perhaps significantly, in the short, medium and long term
- Each uses significant quantities of rare earth metals or other key materials
In its report the DOE provided data for nine rare earth elements: yttrium, lanthanum, cerium, praseodymium, neodymium, samarium, europium, terbium and dysprosium as well as indium, gallium, tellurium, cobalt and lithium.
Five of the rare earth metals – dysprosium, neodymium, terbium, europium and yttrium – as well as indium, were assessed as most critical in the short term. The DOE defines “criticality” as a measure that combines importance to the clean energy economy and risk of supply disruption.
In a follow up to its earlier report the U.S. Department of Energy, Dec. 2011 – Critical Materials Strategy, examined the role that rare earth metals and other key materials play in clean energy technologies such as wind turbines, electric vehicles, solar cells and energy-efficient lighting.
For the rest of this article, please go to A Head of the Herd.com website: http://aheadoftheherd.com/Newsletter/2012/Critical-Raw-Materials-Revisited.htm