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The entire global supply chain is facing an unprecedented change. From material and machine shortages to talent shortages and the push toward renewable and clean energy solutions - the industry is experiencing changes, the scale of which we haven't seen since the likes of the industrial revolution.
world leaders scramble to attain their net-zero targets, demand for raw
materials is set to soar. According to a BBC Future’s article, today’s society
is much more dependent on mined substances than ever before.
Indeed, the transition into clean energy presents new challenges for mining corporations, who must establish a clear strategy to achieve their growth plans. The 2021 United Nations Climate Change Conference (COP26) made stark and clear recommendations, with a particular focus on net-zero targets. As a result, several countries have already turned to renewable alternatives such as electric vehicles (EVs), solar or photovoltaic energy and wind turbine power generation to facilitate their targets.
However, this rapid demand for renewable technology is causing a domino effect on supply chains, with several experts concluding that net-zero ambitions are quickly outpacing the formation of supply chains, market mechanisms, financing models, and more. As a result, prices are set to increase whilst resource bottlenecks will be unavoidable as demand will undoubtedly outstrip supply.
For example, in the case of copper. According to the Bank of America, the world is at high risk of “running out of copper” due to supply chain problems and greater demand. As a result, prices may reach $20,000 per metric ton by 2025. Moreover, demand for copper is being heightened by investment in electrification as part of wider emission reduction strategies. Industry expert David Neuhauser commented, “I think copper is the new oil”.
The Future of Rare Earth Materials:
renewable technology is hailed as the just-in-time solution, almost all new
developments need rare earth elements (REEs), requiring companies to dig up
rare earth elements. For example:
Contrary to what the name suggests, we have a great supply of REEs within the earth’s crust. However, they come in low mineral concentrations and are difficult to separate from other elements, making them “rare.” In her Harvard Review article, Jaya Nayar suggested, "perhaps these elements also get their name from being rarely discussed, even though everything from the iPhone to the Tesla electric engine to LED lights”.
demand for REEs is projected to skyrocket in the coming years as governments,
organizations, and individuals increasingly invest in renewable energy.
Jon Taylor is a Principal Consultant at CSG Talent within the Mining Recruitment Team. His specialist area of recruitment is Exploration, Geology and Technical and he recently attended the PDAC Mining event in Canada. “Sitting in on many of the insightful talks during PDAC brought about many projections surrounding the importance of the key materials that are, and will continue to support global electrification, namely lithium & rare earths.
In short, demand for rare earths is rising fast. In the 20 years leading up to today, the demand for rare earth elements doubled to 125,000 metric tonnes and this will only continue as we near the year 2030.
This has been supported by many analysts and news outlets that state that the western world is still going to lean heavily on China for the refining of rare earths, but as new mines become operational in other parts of the world this could lessen. This is especially the case if proposed assets in Australia, the US, and parts of Africa progress.”
According to a Harvard Review report, demand for REEs are predicted to increase six-fold by 2040. Meanwhile, lithium and cobalt demand could increase 10-26 times by 2050 due to the move towards electric cars. Unsurprisingly, the demand for dysprosium and neodymium is estimated to increase seven to twenty-six times over the next 25 years as a result of electric vehicles and wind turbines.
So, why can’t we just mine more materials?
Using REEs within ‘renewable’ solutions is extremely problematic. The way that companies extract REEs creates widespread damage to communities and the surrounding areas. Figures show that for every ton of rare earth mined, 2,000 tons of toxic waste are produced.
Can we not recycle previously captured rare earth elements?
In a lot of cases, mining new materials continues to be more cost-effective than recycling these elements. However, there are companies we work with at CSG Talent who recycle rare earth elements as well as Lithium (another major market we operate within), but this simply cannot match demand so there is always a need for mining of them.
Junaid Hussain, Specialist Mining Recruiter within Battery Materials shares his own insights into recycling efforts within Mining. "With the importance of creating a sustainable solution paramount to meeting global demand and decarbonisation goals for critical minerals and rare earths, significant funding and research is being conducted to support recycling efforts. Typically, only 1% of rare earths are recycled from end-of-life products, which leaves considerable scope for an increase in supply and improvement of circular economy models to meet demands.
When coupled with projects to recycle mine waste tailings which are also under development, we should start to see a balance between continued mining and "re mining" which will prove vital for meeting both near and future global needs. It has been great to speak with clients operating in this space about both the successes and challenges they are facing and putting together plans to deliver their goals"
The Geography of Rare Earth Materials:
Currently, China dominates the REE market producing 85% of the world's REEs. Australia is the next largest producer producing 10% of elements.
China’s power over the rare earth market is so strong that they can use it as a weapon. In 2010, China blocked REE exports to Japan because of Japan’s detention of a Chinese captain. More recently, they came close to blocking exports to the US due to tariffs placed by President Donald Trump.
However, China holds only 35% of the world’s REE reserves, causing many to question what the future may look like for rare earth mining.
The Cape of Good Hope, Africa:
Africa may emerge as a global production region as the continent is home to numerous rare earth deposits, especially in eastern and southern nations. Despite this, there is only one extraction project currently active. However, several MEDC countries are looking to initiate projects here:
Source: The Scramble for Africa’s Rare Earths: China is not Alone | ISPI (ispionline.it)
Should We Be Looking for A Rare-er Alternative?
Without a doubt, the global shift away from traditional energy generation will cause a shake-up. The question is, how big a role should rare earth materials play? Should we be looking for better renewable alternatives that do not rely quite so heavily on pollutant mining? Several industry leaders are already creating solutions to help us do so. At CSG Talent, we continue to play our part by helping these businesses find the talent they need to create the next solution.
If you’re keen to explore the specific markets our mining recruitment team at CSG Talent operate, please click here. You’ll find information on our specialist areas, meet our expert team, and hear latest mining industry insights.