Strategic Metals Supply Chain: Which Countries are in the Lead?
Importance of Critical Minerals in the Energy Transition
As the world continues to shift towards renewable energy, the importance of securing reserves and supply chains of critical minerals cannot be overstated. To provide a visual representation of this, Visual Capitalist collaborated with Appian Capital Advisory. The analysis used data from the United States Geological Survey (USGS) and the International Energy Agency (IEA) to focus on four minerals: lithium, cobalt, natural graphite, and rare earths.
Which Countries Have the Most Reserves of Critical Minerals?
South America is at the forefront when it comes to lithium reserves, with Chile and Argentina holding nearly half of the world's known reserves. Australia also holds a significant portion of global lithium reserves. The Democratic Republic of Congo stands out for its cobalt reserves, holding the highest share globally. Australia also has a significant source of this metal. Natural graphite reserves are more geographically dispersed, with China and Brazil holding comparable amounts. In terms of rare earth minerals, Asia leads the way, with China and Vietnam possessing the largest reserves.
Production and Processing of Critical Minerals
China dominates the processing of critical minerals globally. The country is responsible for processing a significant portion of the world's lithium, cobalt, natural graphite, and rare earths. Mine production is also concentrated in a few countries, which could pose a risk to the stability of the supply chain. For instance, Australia is the top producer of lithium, while the Democratic Republic of Congo leads in cobalt production. China leads in the production of both natural graphite and rare earths.
Securing the Future Supply of Critical Minerals
To ensure a steady supply of minerals crucial for the transition to clean energy, investment in new mining projects is necessary. This is particularly true for countries with high reserves but low production and processing rates.
Bottom Line
The transition to renewable energy is dependent on the availability and supply of critical minerals. As it stands, a few countries dominate the reserves, production, and processing of these minerals. This concentration could pose a risk to the stability of the global supply chain. Therefore, investment in mining projects, especially in countries with high reserves but low production, is crucial. What are your thoughts on this? Do share this article with your friends and let's discuss. Don't forget to sign up for the Daily Briefing, available every day at 6pm.
