“What we haven’t seen is the corresponding tariffs. So we’ve only been developing a race against China’s [subsidies]. And that’s a race that the US as well as any free-market economy is destined to lose,” Fannon told delegates.

He explained the current strategy using President Reagan’s principle: “If you want more of something, subsidize it… if you want less of it, tax it.” 

During Trump’s first term, the introduction of a 25% tariff on Chinese gallium imports in 2019 led to initial stockpiling, which ultimately helped buffer later supply shocks when China implemented export controls.

Chinese content rules shake-up 

A second Trump administration would likely tighten restrictions on Chinese content in products receiving US government incentives, particularly in the electric vehicle supply chain, Fannon said in the fireside chat titled “What comes next? Insights into future US mining policy under a Second Trump Administration.”

“In the context of electric vehicle credits… if it comes from China, then it should not benefit from US taxpayer subsides,” he said, adding that the Biden administration’s allowance of “up to 25% Chinese content” would likely be scrapped as it “sends a mixed signal to the investment community.”

In September 2024, under President Biden, the US Trade Representative announced its final determination on Section 301 tariffs for Chinese critical minerals imports. The changes include a 25% tariff on indium, tantalum and chromium imports effective September 27, 2024, with additional tariff increases on other materials to be implemented in stages through 2026.

Fastmarkets assessed indium 99.99%, in-whs Rotterdam at $340-380 per kg on Wednesday December 4, unchanged since November 20, following a slight downward trend since October 23 but remaining largely stable.

The potential policy shift comes amid fresh concerns about Chinese control of critical mineral supply chains, highlighted by China’s expanded export controls on gallium and germanium implemented August 1, 2023, followed by restrictions on antimony exports from September 15, 2024, with new measures announced December 3 requiring stricter licensing and end-user reviews for exports to US entities.

Investment climate shift

The emphasis under a second Trump administration would shift from international forums to tangible development outcomes, according to Fannon.

“More convenience and more conferences don’t move tons… there’s going to be a very clear [key performance indicator]… Moving the tons of and the investment is the outcome,” he said.

The private sector’s role would be central to this approach.

“In our system, the government can establish parameters for action, but it doesn’t actually do anything… it’s the private sector that actually is the instrument,” Fannon said.

However, he warned that frequent policy changes between administrations create challenges for investors: “The pendulum swings we’re seeing [are] unhelpful for capital formation and creating a confidence to actually invest in certain jurisdictions, including the United States.”

Permitting reform potential

While permitting reform was initiated during Trump’s first term, the effort was disrupted by Covid-19, Fannon said. He indicated this would be revisited, as “you need to be able to build stuff.”

“How that’s tackled… I think that’s a bipartisan issue… How does one tackle it, how do we address it? What does reform look like, and how it can be for years is a very short point of time to address these long-term challenges,” he said.

Fannon pointed to state-level differences, citing Tesla’s move from California to Texas as an example: “Texas represented a place where you can build things. Capital is welcome.” 

He noted that most of America’s “battery belt” is in Republican-led states, despite federal funding being available nationwide.

“Permitting takes 10-15 years to [start up] a mine, with timelines of 20 years. That’s the biggest bottleneck to the business cases,” Rolf Kuby, director general of Euromines, told Fastmarkets in an exclusive interview at Resourcing Tomorrow.

International cooperation restructure

While existing international frameworks like the Minerals Security Partnership may continue, they would likely be restructured to focus more on concrete outcomes under a second Trump presidency, Fannon said. 

The Minerals Security Partnership (MSP) is a collaboration of 14 countries and the EU to catalyze public and private investment in responsible critical minerals supply chains. MSP partners include Australia, Canada, Estonia, Finland, France, Germany, India, Italy, Japan, Norway, South Korea, Sweden, the UK the US and the EU.

“It’s very difficult to create multi-national fora and agreements… it is painstaking work and takes far too long,” Fannon said, drawing from his own government experience. While acknowledging these forums create an important foundation, he emphasized that “having the meeting is not the outcome.”

Instead, future cooperation would likely prioritize capital deployment.

“You’re going to see a bit of a different approach… which will have the convenience of government… But there’s going to be a focus on action and deployment of capital,” he said.

The shift back to security as the “north star” of US policy would necessitate continued international investment.

Fannon said: “There’s a clear recognition… that the US – even though we have an amazing minerals endowment – it’s the time horizon that’s necessary to develop them… and that means investment overseas and partnerships overseas.”

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The assessment evaluated 82 raw materials – compared with 26 in 2021 – and identified 34 critical minerals in total, including 17 new additions.

Several minor metals maintained their critical status from the 2021 assessment, including bismuth, gallium, indium, magnesium, silicon and tellurium. The designation of these metals as critical aligns with similar assessments by other major economies.

Gallium, germanium, bismuth and magnesium were identified as critical by the UK, EU, US, Canada and Australia, accentuating the global competition to secure supplies of these materials.

Silicon was deemed critical by the UK, EU and Australia in their 2024 assessments, while tellurium was classified as critical by the UK, US, Canada and Australia, but not by the EU in its 2024 review.

Fastmarkets’ assessed weekly price for silicon grade 4-4-1 99% Si min, in-whs Rotterdam was €2,030-2,240 ($2,146-2,368) per tonne on November 29, marking three consecutive weeks of decline since November 8, when it was assessed at €2,100-2,300 per tonne.

Meanwhile, the assessed price for silicon grade 5-5-3 98.5% Si min, in-whs Rotterdam was €1,930-2,150 per tonne on November 29, down by 2.39% from €1,980-2,200 per tonne on November 22.

“Overcapacity, particularly in China, and elevated exports from that source continue to weigh on the market,” Emre Uzun, Fastmarkets ferro alloys and steel analyst, said. “Downside potential appears to be limited amid higher production with the onset of the dry season in China and an increase in European energy costs.”

Notably, while chromium has been designated as critical by the US, Canada and Australia since 2022, it remains non-critical in both the UK and EU assessments.

Fastmarkets assessed chromium alumino-thermic 99% min, in-whs Rotterdam at $9,100-11,500 per tonne on November 29, unchanged since November 8.

Supply chain challenges

The critical minerals assessment highlights significant supply chain vulnerabilities for the UK. According to the CMIC, the country has no domestic production of gallium, germanium, indium, silicon metal or tellurium, making it entirely reliant on imports. This dependency is particularly concerning given China’s dominant position in refining these materials.

Trade regulations, such as China’s export controls on gallium and germanium, have demonstrated the potential for supply chain disruption.

The recently published Dual-Use Items Export Control List of the People’s Republic of China, effective December 1, consolidates controlled items like gallium and germanium under a unified system, but does not expand the scope of controls. The process for exporting these materials remains lengthy, sometimes taking up to six months, further underscoring the risks of dependency.

While these measures have stimulated innovation and efforts to develop alternative sources, they have also highlighted the UK’s vulnerability to supply restrictions.

Export restrictions create uncertainty

China’s export restrictions on gallium and germanium, implemented in August 2023, have significantly impacted global supply chains, with prices for both metals showing substantial increases since the regulations were announced.

Fastmarkets assessed gallium 99.99% Ga min, in-whs Rotterdam at $470-550 per kg on November 29, unchanged since November 8. Prior to China’s export licensing requirements, gallium was assessed 43-47% lower at $250-265 per kg on June 30, 2023.

The assessed price for germanium 99.999% Ge, in-whs Rotterdam was $2,850-3,000 per kg on November 29, flat since November 15. This represents a sharp increase of 111-114% from pre-restriction levels of $1,350-1,400 per kg in July 2023.

The regulations have created uncertainty in both markets, with participants reporting unusual market conditions for the time of year.

“Strange… normally this time of year the germanium metal market is very active, but doesn’t seem so,” a Chinese producer told Fastmarkets.

Market participants reported mixed signals in the gallium market.

“A lot of market insiders think the price is still on a downward trajectory… It’s still severely oversupplied and very difficult to generate buying interests,” a second Chinese producer said.

“Seems to me that bears and bulls are currently fighting in these markets,” a European trader said. “All are preparing for end of year… I have seen it in gallium specifically.”

The supply situation remains particularly concentrated, with China controlling 94.9% of refined gallium production and 92.2% of refined germanium production globally.

UK policy prioritizes supply security

The UK government’s industrial strategy, currently under consultation, has identified eight key sectors for growth, including advanced manufacturing, clean energy industries, defence and digital technologies – all of which rely heavily on critical minerals.

According to the critical minerals assessment, the country’s commitment to achieving net-zero greenhouse gas emissions by 2050 is driving increased demand for these materials.

Recent initiatives include £200 million ($254.54 million) invested in decarbonizing freight vehicles and a target for 80% of car sales to be electric by 2030.

Strategic applications drive critical status

The designation of these metals as critical reflects their role in strategic technologies and industries.

Germanium is crucial for infrared optics, optical fibers and satellite solar cells, while also being used in solid-state electronics and semiconductors.

Gallium plays a vital role in integrated circuits, optoelectronics and sensors, particularly in the manufacture of semiconductors and fiber optic systems.

Other critical metals serve equally important functions, with magnesium finding applications in transportation, packaging and construction, particularly in products requiring lightweight properties.

Silicon remains fundamental to digital technologies and semiconductors, while tellurium is essential for solar power and electronic components.

The critical minerals assessment recommends regular reassessment of critical minerals’ status, with a comprehensive update suggested for 2027.

The report also calls for further research into midstream and manufacturing sectors, particularly recycling, and advocates for building international trade partnerships to reduce the risks associated with trade barriers.

Want to find out more about our critical minerals price data, forecasts and market insights? Visit our dedicated critical minerals market hub here.

The post UK names germanium, gallium among top 10 critical minerals for 2024 appeared first on Fastmarkets.

“This could include geographic location data, human rights practices, environmental practices (including greenhouse gas emissions, environmental harms, respect for no-go areas, tailings management approaches), social practices (including on gender, labor rights, Indigenous Peoples, and the obtainment of their Free, Prior and Informed Consent), and governance practices (including on corruption risks, fraud, illicit mining, illicit financial flows, money laundering, transparency gaps, fair deals and equitable benefit-sharing),” the panel said.

“It’s good to hammer these principles, but we need to think about enforceability,” Myriam El Kara, founder and chief executive officer of Singapore-based critical raw materials advisory services firm Sterling Acumen told Fastmarkets. “What’s the sanction for non-compliance, and who’s deciding on that sanction? Which body? Without monetary incentive, the market won’t take care of it.”

In a UN panel report released September 11, 2024, titled “Resourcing the Energy Transition,” the United Nations proposed a new global tracking framework for critical energy transition minerals.

The panel was created in 2023 to address the challenges and opportunities associated with the increasing demand for minerals essential for renewable energy technologies.

The report’s principles and recommendations will be discussed at the upcoming COP29 from November 11-22, in Baku, Azerbaijan.

COP29, or the 29th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC), is the world’s biggest and most important climate summit aimed at advancing international climate action. Last year, it had over 85,000 participants and 150 heads of state.

This year’s conference emphasizes the need for creative solutions to mobilize climate finance; the agenda includes discussions on carbon markets and adaptation strategies.

China’s dominance raises stakes for mineral oversight

The UN’s proposal came after governments at COP28 agreed to triple renewable energy capacity and double energy efficiency by 2030. This transition is expected to drive critical mineral demand – set to quadruple by 2040, according to International Energy Agency forecasts.

“The proposal represents an ambitious yet challenging task,” Jawad Sardar, director at Richmond Global, a consultancy working to create sustainable supply chains for critical minerals, told Fastmarkets.

“Production of many critical energy transition minerals is concentrated on a few major actors,” Sardar said. “China controls 35% of nickel, 40% of copper, and 50-70% of lithium and cobalt processing.”

The CETM market remains in its early stages of development, with many key battery raw materials still lacking mature price discovery mechanisms.

“Until nickel and other battery metals compounds reach sufficient maturity and liquidity in new markets, they’re going to be very much tied to the Chinese market,” said El Kara. “No energy transition can happen without Chinese and Indian demand.”

As a result, the panel has recommended the establishment of a framework outlining seven Guiding Principles and five Actionable Recommendations aimed at embedding equity and justice in the race to net-zero emissions.

The framework would require comprehensive environmental and human rights due diligence, transparency in revenue and payments, and independent third-party verification of performance standards for market access.

The proposals cover minerals essential for renewable energy technologies, including copper, cobalt, nickel, lithium, graphite, rare earth elements and aluminum needed for electric vehicles and batteries – as well as silicon, cadmium, tellurium and selenium for solar panels.

El Kara warned that the framework’s voluntary nature could limit its effectiveness. “It’s soft law. There is no consequence for not complying,” she told Fastmarkets.

“[Its] success, like other globally adopted principles and standards, will largely depend on the buy-in from key market players,” Sardar said.

Additionally, the proposal throws up issues around data security, which would need to be addressed.

“Traceability and transparency are crucial questions, but we need to think about the security and ownership of the data,” El Kara said. “How are we [resolving the issue of] cyber security? Where are we saving the data, which servers? Who owns the data? These were raised when [I was] working on traceability solutions in supply chains.”

El Kara previously worked in procurement roles at companies like Verkor, a lithium-ion EV battery startup manufacturer.

“A one-size-fits-all approach to traceability won’t be straightforward given the vast differences in operational capabilities, technological readiness, and regulatory frameworks across these markets,” Sardar said.

But he conceded that “the proposal’s emphasis on transparency and accountability is much needed” notwithstanding “the practical mechanics of implementing such a system across diverse operating environments.”

New market oversight mechanisms

The UN Panel has also recommended a global mining legacy fund to address derelict or abandoned mines and strengthen financial assurance for mine closure and rehabilitation, as well as a high-level expert advisory group to accelerate greater benefit-sharing, value addition and economic diversification in mineral-producing countries.

The panel emphasized that mining has too often operated as an “enclave” with little value accruing to host countries.

Developing countries have faced significant hurdles implementing industrial policies to transform their economies – a position that could worsen if existing trade rules hindering structural transformation remain static.

New mining rules require upfront financial guarantees and indigenous consent before development can begin. The framework demands environmental protection measures, local processing requirements and transparent revenue sharing with affected communities. It also includes provisions for artisanal mining operations (ASM).

“Artisanal and small-scale mining… contribute significantly to global mineral supply,” said Sardar. “About 20% of global cobalt comes from ASM operations in the Democratic Republic of Congo alone.”

“Organizing artisanal mining and bringing the basics of health and safety and organizing work for people to get a better livelihood out of it is very important,” El Kara said. “These issues – the traceability, the artisanal mining, and the dangers of that – are not new topics. We should ask miners how they’ve tackled these issues on the ground because they have been dealing with them for a long time.”

El Kara emphasized that addressing these challenges requires an inclusive, multi-stakeholder approach. “We need to bring together civil society, international organizations, local governments, and industry players to develop fit-for-purpose solutions,” she said. “The most successful initiatives have always been those that draw on existing experience while fostering accountability across all stakeholders.”

Forming the UN Critical Minerals Panel

The UN Secretary-General established the Panel on Critical Energy Transition Minerals in April 2024, bringing together governments, international organizations, industry and civil society representatives. It completed intensive consultations including stakeholder dialogues with civil society, finance sector, industry and artisanal mining representatives before submitting recommendations.

After its launch, the panel – working to transform resource governance – conducted 13 virtual meetings and two in-person meetings in Copenhagen and Nairobi during July and August. The group of members, selected for geographic and gender balance, received over 100 stakeholder submissions during consultations before completing their work on September 3.

The recommendations build on existing UN declarations, conventions and agreements, with technical expert advice from 17 UN agencies. The panel followed a two-phase approach, first identifying priorities through workstreams before drafting the principles and recommendations.

Specific initiatives include establishing an International Council on Artisanal and Small-scale Mining to help these miners become “agents of transformation” in sustainable development. The panel also recommended new approaches to material efficiency and circularity, along with strengthened requirements for environmental bonds and financial assurance.

The panel’s proposals align with existing UN frameworks including the UN Framework Classification for Resources (UNFC) and UN Resource Management System (UNRMS).

The EU’s Critical Raw Materials Act (CRMA) already mandates UNFC standards to promote global cooperation and resource efficiency.

Fastmarkets provides comprehensive price assessments for critical minerals such as silicon, cadmium, tellurium and selenium. For more information on Fastmarkets’ minor metals prices and market coverage, visit fastmarkets.com/metals-and-mining/minor-metals.

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At a seminar on critical minerals, hosted by the UK Department for Business & Trade and the Embassy of Brazil in London on October 3, Goodenough emphasized that Brazil’s progress in this area could inform the UK’s policies.

“It seems to be widely perceived that we no longer engage in mining in the UK [and] that the UK’s mining history is over,” Goodenough said. “Instead, we [should] focus on finance and perhaps train some individuals who then go overseas.”

In recent years, Brazil has been emphasizing mining as a vital part of its economy, creating job opportunities and making substantial progress, according to speakers at the seminar.

“The UK still has a mining heritage,” Goodenough said, pointing to the need for updated assessments to identify potential untapped resources in the country.

“Although we train people – perhaps fewer than we used to – we still don’t adequately discuss the importance of mining and mineral resources in this country,” she said. “While it’s important to have international partnerships with various countries that are producing critical minerals, we should also focus more on our own resources.”

What is the UK’s critical minerals strategy?

The UK possesses some capabilities in the critical minerals sector across the mining lifecycle, including low-carbon solutions. London already serves as a global mining finance and trading hub, and is home to the London Metal Exchange, the world center for industrial metals trading.

Last year, the UK government unveiled its first-ever Critical Minerals Strategy, outlining a comprehensive approach to securing the UK’s supply of critical minerals.

The strategy will adopt a three-pronged “ACE” approach:

• Accelerate the UK’s domestic capabilities
• Collaborate with international partners
• Enhance international markets.

Under the “Accelerate” pillar, the UK intends to maximize domestic production where economically viable and environmentally sustainable. The strategy also emphasizes rebuilding skills in mining and minerals, proposing investments in research and development to solve challenges in critical minerals supply chains.

The country’s mining heritage is evident in Cornwall, in the south-west of England, which hosts a growing mining cluster of more than 110 companies. Two of these, Cornish Lithium and British Lithium, were already developing projects to produce lithium salts in the region.

Meanwhile, Pensana was developing a rare earth processing facility at the Humber Freeport, and Peak Resources was planning a similar facility at the Teesside Freeport, both in north-east England.

These projects aligned with the UK government’s broader investment in green industries. In 2020, it committed £12 billion ($15.7 billion) as part of its Ten Point Plan to support green jobs and transition to net-zero carbon emissions by 2050.

The recent £25 million investment by UK Research & Innovation (UKRI) in green industry centers, including £4.5 million for the University of Exeter to accelerate critical minerals mining, further demonstrated the UK’s commitment to developing its domestic capabilities.

Brazil’s critical minerals headway

Brazil has long been recognized for its significant mineral resources, particularly in critical minerals. “For instance,” Goodenough said, “Brazil is the world’s leading producer of niobium, which dominates that sector.”

According to Goodenough, Brazil has various other elements with considerable potential. “When discussing battery raw materials, Brazil stands out as a producer of nickel and graphite, being one of the largest producers globally,” she said.

Brazil has a diverse portfolio of resources essential for the global energy transition. The country dominates the niobium market and is rapidly expanding its presence in the production of lithium, graphite and rare earth elements (REE).

According to Olivier Masson, Fastmarkets’ nickel analyst, Brazil produced only 2% of global refined production in 2023. But that supply was equivalent to 18% of global ferronickel supply, excluding nickel pig iron.

Ferronickel, it should be noted, is primarily used in the stainless-steel sector and is not suitable for battery production.

Brazil is currently the fourth-largest producer of natural graphite in the world, accounting for approximately 3% of global production. But its output of 30,000 tonnes in 2023 was significantly lower than those of China (800,000 tonnes), Mozambique (100,000 tonnes) and Madagascar (79,000 tonnes), limiting its role in international graphite markets.

According to the Geological Survey of Brazil, Brazil’s graphite production still needs to be improved, and there is room for growth in the industry. The Brazilian government has shown interest in developing the country’s graphite production, and investment in the sector was expected to increase in the coming years.

At present, around 50% of Brazil’s graphite production is consumed in the domestic market, primarily by traditional sectors such as the steel industry, lubricants, and others.

The country has limited exposure to the rapidly growing lithium-ion battery sector.

Fastmarkets data analyst Georgi Georgiev expected Brazil to play a more significant role in battery raw materials supply chains for graphite in the Americas in the coming years. He added that the shift would be driven by two key factors.

First is the Inflation Reduction Act (IRA) regulations in the US, which will incentivize the sourcing of critical minerals, including graphite, from countries with free trade agreements with the US.

While Brazil currently does not have an FTA with the US, discussions were being held about potential trade agreements that could benefit Brazil’s graphite industry in the future.

The second key factor is new graphite projects coming online in Brazil, such as the Santa Cruz mine. This project, being developed by South Star Battery Metals, was expected to produce 12,000 tonnes per year of graphite when it reaches full capacity, which should be this year.

Given these developments, Fastmarkets’ data analysts project that Brazil’s graphite production could exceed 56,000 tpy by 2028, potentially raising its global market share to 2.7%. This growth could position Brazil as a key supplier of graphite for the expanding electric vehicle (EV) battery market in both North and South America, especially if trade agreements with the US are established.

Fastmarkets launched a monthly price assessment for graphite flake, 94% C, -100 mesh, cif US ports, on October 3 this year, reflecting the growing interest in US graphite pricing.

Lessons from ESG, tech advancements

Another panelist at the London seminar, Rafael Bittar, vice-president at iron ore and nickel producer Vale, discussed the Brazilian multinational’s efforts to implement new technologies.

Bittar mentioned Vale’s recent technology investments, including the use of robotics to eliminate upstream tailings facilities, and the use of artificial intelligence (AI) to improve production efficiency and reduce resource consumption.

“We need to have roadmaps for zero-residue, carbon neutrality, and circularity in mining operations,” Bittar said.

The panel discussion highlighted that successful mineral resource development must go beyond extraction. It will require a comprehensive approach encompassing sustainable practices, community engagement and technological innovation.

Ligia Pinto from Sigma Lithium pointed to that company’s commitment to sustainable operations in Brazil.

“We operate with zero toxic chemicals use, zero carbon emissions, and zero tailings dams,” Pinto said, emphasizing the importance of long-term sustainability over short-term profits.

Pinto also detailed Sigma’s micro-credit program for women in local communities, which has already reached 2,000 women and was hoped to support 10,000 within two years.

But it was worth noting that, for some critical minerals such as rare earth elements, Brazil’s current production was still relatively low despite its significant reserves. This indicated that the country had yet to fully capitalize on its potential in this sector.

Last year, Brazilian mining association IBRAM signed a cooperation agreement with the British government mission in Brazil and with Mining Hub, a local industry innovation initiative. The intention was to finish a new inventory of sectoral greenhouse gas (GHG) emissions and to develop a decarbonization roadmap.

Stay informed, make confident decisions and navigate the dynamic rare earths market with Fastmarkets. Learn more.

The post UK-Brazil critical minerals seminar sparks call for British mining revival appeared first on Fastmarkets.

MB-MAG-0018 – Magnesia, dead burned, 95% MgO, fob Europe, $/tonne
MB-MAG-0013 – Magnesite, Greek, raw, max 3.5% SiO2, fob East Mediterranean, €/tonne
MB-MAG-0012 – Magnesia, European calcined, agricultural, cif Europe, €/tonne
MB-MAG-0019 – Magnesia, fused, 97% MgO, cif Europe, $/tonne

These prices are a part of the Fastmarkets industrial minerals package.

For more information or to provide feedback on the delayed publication of this price or if you would like to provide price information by becoming a data submitter to these prices, please contact Julienne C. Raboca by email at: pricing@fastmarkets.com. Please add the subject heading “FAO: Julienne C. Raboca, re: European magnesia prices.”

Please indicate if comments are confidential. Fastmarkets will consider all comments received and will make comments not marked as confidential available upon request.

To see all Fastmarkets pricing methodology and specification documents, go to https://www.fastmarkets.com/methodology.

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Among these is Brazil’s first fund to support critical minerals, backed by Vale and Brazil’s development bank BNDES, announced this month. A consortium formed by JGP Asset Management, BB Asset and Ore Investments was selected to manage the 1 billion Reais ($184 million) private equity fund supporting research and exploration of strategic minerals needed for the energy transition.

China’s export crackdown

Last year, China’s Ministry of Commerce imposed restrictions on gallium, germanium and graphite. These moves reflect growing geopolitical tensions over critical minerals essential for the defense, technology and energy sectors.

With recent restrictions imposed by China on critical minerals, Brazil has the potential to take on a more significant role, according to panelists at a seminar on critical minerals hosted by the UK Department for Business & Trade and the Embassy of Brazil in London on Thursday October 3.

“If you look at where China is dominant, Brazil produces various elements,” Kathryn Goodenough, Principal Geologist & International Lead at the British Geological Survey, said. “Graphite is produced in Brazil… there are many opportunities for the development of supply chains that do not go through China.” 

China’s export controls have disturbed supply for the critical materials, and Fastmarkets has assessed a significant price disparity for gallium and germanium in the Chinese versus European markets.

Fastmarkets’ price assessment for gallium 99.99% Ga min, in-whs Rotterdam was $500-550 per kg on Friday October 4, unchanged from September 27. This compares with the assessment for gallium 99.99% Ga min, in-whs China at 2,650-2,750 yuan ($379-393) per kg on September 27, showing a substantial premium for material in Europe.

And Fastmarkets’ price assessment for germanium 99.999% Ge, in-whs Rotterdam was $2,700-3,100 per kg on October 4, also unchanged from September 27. This contrasts with the assessment for germanium 99.999% Ge min, in-whs China at 18,000-18,500 yuan ($2,573-2,644) per kg on September 27.

The restrained exports from China since the controls were implemented have kept supplies tight in Europe, supporting higher prices there.

Brazil’s critical minerals landscape

Brazil has rapidly increased its production of battery raw materials. This year Serra Verde started commercial production of mixed rare earth concentrate (MREC) in Brazil. In May 2023, Brazil launched the Lithium Valley Initiative, aimed at attracting investments and streamlining development in the lithium mining and processing industries. This collaborative effort between the government and the private sector is designed to increase production of environmentally sustainable “Green Lithium” while advancing social development goals in the Vale do Jequitinhonha region.

Caption: Felipe V. Sperandio, Partner at Clyde & Co, moderates a panel discussion with Kathryn Goodenough, Principal Geologist & International Lead at the British Geological Survey; Ligia Pinto from Sigma Lithium and Paulo Castellari, CEO at Appian Capital

The US has also recognized Brazil’s potential as a critical minerals partner. A potential critical minerals agreement (CMA) between the US and Brazil could support US critical mineral needs, while also countering Chinese influence in the region.

Such an agreement could leverage Brazil’s significant reserves of graphite, nickel and manganese, which align well with US requirements. But to make such an agreement feasible, Brazil would need to address environmental concerns and streamline its licensing approval process for mining projects.

According to Goodenough, Brazil is one of the few countries with the potential to produce all key battery raw materials, naming nickel, graphite, lithium, manganese and cobalt.

“Brazil is also one of the world’s largest producers of graphite and has significant resources of manganese,” she said. “It is also rapidly increasing its lithium production and has substantial manganese resources.”

But, she said, in recent years “entering this market has been challenging due to its dominance by a single country.” 

Graphite prices in China and the West diverged in the final months of 2023, owing both to China’s export control on graphite, introduced in December, and rising freight rates to Europe. 

Fastmarkets’ assessed price for graphite flake 94% C, -100 mesh, cif Europe was $600-700 per tonne on October 3, flat from the session before but 4% higher than the $600-650 per tonne that was assessed in the final session of 2023, on December 28. 

Prices in Europe peaked at $650-750 per tonne from June 13 to September 5, but have since softened on low demand and declining freight rates. 

And the most recently assessed graphite flake 94% C, -100 mesh, fob China was $450-469 per tonne on September 26, down 3.16% from $460-489 per tonne a week earlier, on September 19. 

The price spread between the regions has been credited to rising freight rates, falling Chinese prices, and limited export flows from China. The ex-China graphite supply chain has been boosted by the export control, despite China’s overcapacity. 

And Fastmarkets’ newly launched graphite flake, 94%, -100 mesh, cif US ports price assessment showed a further premium to the Chinese price in its first assessment on October 3 at $700-850 per tonne.

Looking for more graphite news, price and analysis of the innovative world of synthetic and natural graphite? Discover graphite prices, news and forecasts all in one space. Click here to find out more.

The post China’s export restrictions create unexpected opportunity for Brazil’s critical minerals sector appeared first on Fastmarkets.

In the panel “Critical Minerals & the Future of the Battery”, Geoff Streeton, chief development officer at French non-ferrous miner Eramet, highlighted this trend.

“The Chinese engineering and project delivery ecosystem is able to deliver [large capital-intensive projects] with a step change in cost and speed relative to the traditional project delivery models,” Streeton said.

Eramet, a significant producer of nickel, already has several partnerships with Chinese firms across their global operations.

These include a partnership with Chinese firm Tsingshan, the world’s largest stainless steel producer, for nickel mining and refining in Weda Bay, Indonesia. The two companies also have a joint venture agreement for the operation of the Centenario direct lithium extraction plant in Argentina.

Ivan Vella, managing director and chief executive officer of Australian miner IGO, discussed their partnership with Tianqi Lithium in Australia.

He emphasized the importance of these collaborations, saying: “I think it’s fundamental. The strength of the broader battery and EV (electric vehicle) industry in China, with companies like Ganfeng and Tianqi, is formidable. Being partnered with Tianqi gives us a lot of insight and strength.”

Indonesia perhaps provides one of the best examples of this speed and cost competitive scaling of projects. Chinese firms within the country have been able to develop, build and operate nickel refining assets at considerably lower cost than many other nickel producers, a trend which has ultimately shifted the global supply-demand balance of the market.

Streeton also highlighted the complementary skills that Western companies bring to these partnerships.

“You have to bring also to the table the skills that they lack… which is around how you manage workforce, how you manage ESG (environmental, social, and governance) issues, and how you ensure that community development can be done properly,” Streeton said.

Europe’s EV supply chain should work more closely with its Chinese counterparts to technologically catch up, according to experts at Fastmarkets’ European Battery Raw Material conference in Amsterdam on September 16-18. Several speakers emphasized the importance of forming partnerships with Chinese technology companies for immediate transfer of technology to help Europe develop knowledge and drive down costs in its battery supply chain.

Low prices threaten future critical mineral supply

Though partnerships with Chinese firms can provide benefits to Western producers of critical raw materials, the current price environment for battery metals like lithium and nickel are providing a barrier to investments in new projects and exploration.

Hanna Schweitz, director of battery materials and asset development at WMC Energy, said, “It’s of course a very high risk that at these prices you see less investments, less companies can spend money on actually investing in finding the best deposits.”

In the lithium market, it is typically said that the incentive price for investment in expansions or new projects sits around $20-25 per kg on a lithium carbonate equivalent (LCE) basis, depending on the resource and region.

At present, lithium prices sit well below this level.

Fastmarkets’ daily assessment of the lithium carbonate 99.5% Li2CO3 min, battery grade, spot prices cif China, Japan & Korea was $10.70-11.30 per kg on Tuesday October 1. 

Nickel is a more complicated market to evaluate in terms of incentive prices, because it depends on the type of nickel being produced and the technology being used. But typically, non-Indonesian producers of nickel have sat on the higher side of the cost curve.

The benchmark price for nickel remains the London Metal Exchange nickel cash price. The LME nickel cash official price closed at $17,002 per tonne on September 30, up from $16,652 per tonne on September 27.

The LME nickel cash price is down by close to 12% since June 1.

IRA and the battery metal regulatory landscape

Panelists at the FT’s Mining Summit also discussed how the Inflation Reduction Act (IRA) in the US might influence battery metal sourcing.

“No OEM (original equipment manufacturer) wants to take the risk of having some non-compliant material in their supply chain with the risk of losing the money if they are not adherent to the rules,” said Schweitz.

Streeton commented on the IRA’s potential impact, saying, “You’ve got to factor in that these are policy interventions. They’re not structural interventions that are permanent potentially.”

Vella expressed scepticism about the IRA’s impact on raw material suppliers, stating, “I don’t know of anyone who can reference the point where that EV subsidy actually flows all the way back to the raw material supplier… and even if it did, how material would it be?”

Our expert editorial team, analysts and price reporters working across metals, battery raw materials and rare earths bring you the latest price trends, market insights and forecasts for the critical minerals market. Track critical minerals markets with our price data and market coverage today.

The post Critical minerals sector eyes Chinese partnerships to cut costs, boost technology: LME Week appeared first on Fastmarkets.

“Just as an example, to do these projects, we need more than 400 permits to be able to get moving,” Arriagada said, referring to the company’s plans to expand copper production to 900,000 tonnes per year in the next three or four years, from 700,000 tpy.

A scarcity of copper concentrate supply from mines has forced down the treatment costs that smelters charge miners for material. Fastmarkets’ copper concentrate TC/RC index began to fall in November 2023 and has hovered near all-time lows so far in 2024.

Fastmarkets calculated the weekly copper concentrates TC index, cif Asia Pacific, at $2 per tonne on September 27, up from $(1.90) per tonne a week earlier.

Market dynamics were exerting a significant effect on negotiations for long-term agreements.

Nicholas Snowdon, head of metals and mining research at Mercuria, pointed out that the appearance of negative treatment and refining charges (TC/RCs) in the concentrate markets was “historically unprecedented,” indicating the strains on supply.

He added that this was “creating dislocations and volatility in both the physical market and the paper market,” making it necessary for “further risk mitigators to come in and support that function for market participants.”

New copper regions emerging

The copper supply landscape was evolving, with different regions presenting unique advantages and challenges.

Snowdon noted that the Democratic Republic of Congo (DRC) and Zambia “have gone from being the fourth- or fifth-biggest area of copper production, if you go back to the end of the last decade, to now [being] essentially just behind [the leading supplier] Chile.”

Snowdon added that this success story “does look to have momentum [that will continue] over the next couple of years.”

Arriagada highlighted the comparative advantages of different regions. “In the case of the DRC, grade is obviously a key element,” he said. “If you look at places such as Chile or Peru, grades are lower, but the deposits tend to be larger… They sit in places that have different political contexts.”

He also noted that Chile was a member country of the Organization for Economic Co-operation & Development (OECD), where “logistics are much simpler.”

“We spend less than 10 cents per lb on logistics,” Arriagada said. “In some places in the DRC, you [need to] spend ten times more.”

Argentina was also attracting attention as a potential region for new copper supply. “Some of the changes are very positive,” Arriagada said. “What’s been happening in Argentina, and what we’re seeing in terms of signals – we wait to see how those consolidate over time.”

What to understand more about what’s ahead in the copper industry? As copper prices reach record highs and analysts warn of ‘unsustainable deficits’, we explore the key trends shaping the copper market. Read more here.

Environmental paradox

Metals such as copper were needed to fight climate change, but their mining operations were a major contributor to greenhouse gas emissions.

Publicly listed mining companies, such as Antofagasta, were coming under increasing pressure from shareholders to minimize their carbon footprint, but implementing green mining technologies would add further to the costs of production, delegates heard.

Antofagasta’s operations were now “running fully on renewable energy,” Arriagada said, with 90% of water use expected to come from desalination by 2026. The company has also begun to use autonomous fleets and water recovery technologies.

Tora Leifland, head of public affairs at Volvo Construction Equipment, said that significant productivity gains could be derived from electrically powered equipment. For volume production of machinery, for example, she said, it was necessary to bring the cost down.

The mining market has seen a number of significant acquisition attempts recently, the largest being BHP’s attempted takeover of Anglo American.

“We look at [mergers and acquisitions] from the point of view of the extent to which it will allow production actually to increase, or reach the market in shorter timeframes,” Arriagada said. “Therefore, [such activity is] based on synergies – which is, I think, the key element that one would look at.”

Kenta Saito, general manager of the base metals division at Mitsui & Co, suggested that while M&A could be one approach to increasing supply, “the ultimate objective is really to increase every tonne of copper or whatever that is being produced.”

The panel at the event emphasized the need for increased dialogue between industry and governments on critical minerals supply.

Leifland called for supportive policies such as carbon pricing. “If you get the incentives right on a global level,” she said, “ideally, a lot of positive things will follow.”

Find out about our market-reflective copper price data spanning the copper supply chain, from copper concentrates and copper wire to copper scrap. Learn more.

The post New critical mineral frontiers battle red tape and green costs: LME Week appeared first on Fastmarkets.

At the FT Mining Summit‘s panel on “Supply, demand and decarbonization” in London on September 26, industry leaders grappled with the challenge of balancing sustainability investments against rising inflation and the question of who will pay for operational costs.

Balancing sustainability investments amid rising inflation

Tomas Kuta, Head of Public Affairs at Volvo Construction Equipment, highlighted the industry’s dilemma: “Cost is a barrier to change, not only in the mining industry, but in all customer segments. So new technologies are more expensive initially.”

According to Kuta, while some “front-runner customers” with science-based targets are willing to invest, “not all customers are able to pay that green premium.”

To address this challenge, producers are seeking new business models to share ‘green premium’ risks.

There are also concerns that price-sensitive consumers are not prepared to pay a “green premium,” despite what original equipment manufacturers (OEMs) and others on the supply chain had expected, according one mining source. This raises the question of who will pay the additional cost if lower-priced alternatives are available.

Kuta revealed that Volvo is “looking into how we can share more and more of that risk through new business models, like equipment as a service, where the machines remain on Volvo’s balance sheet.”

Technology and policy support needed to drive down costs of sustainable mining

The mining sector is seeking a collaborative approach to verify sustainability claims.

Kenta Saito, general manager of base metals division at Mitsui & Co, emphasized the importance of joint efforts: “There needs to be a joint effort throughout the industry to find those new technologies and to actually have them become more popular and prevail and be implemented in every part of the world.”

Kuta called for “CO2 pricing, green public procurement and things that can bring the cost down and help this transformation to happen,” rather than “massive subsidies.”

Volvo’s executive reiterated that cost remains a barrier to sustainable mining technologies.

“New technologies are more expensive initially, and volumes of serialization machinery, for example, you get those volumes up to bring the cost,” Kuta said.

Iván Arriagada, chief executive officer of Antofagasta, said technology is driving rapid sustainability gains in mining.

“If I look back five years from now, in the case of some of our sites, we’re running fully on renewable energy… By 2026, 90% of the water that we use will be water from the sea,” Arriagada said. “We are recovering extra water as well in our processes… We’ve got an autonomous fleet.”

Panelists at both days of the summit highlighted the role of technology in bringing down costs over time. Digitalization, automation and artificial intelligence were cited as key tools to optimize operations and manage higher electricity requirements.

Alex Richards from Schneider Electric cited opportunities to increase efficiency and reduce over-engineering in new and retrofit projects.

Growing pains

Nicholas Snowdon, head of metals and mining research at Mercuria, highlighted the growing opportunity in the metals market due to the energy transition.

“In the first four years of this decade, we’ve seen the copper market increase by the same degree that we saw in the entire 2010s,” Snowdon said. “And we think that… 2028 will have nearly matched the entire growth of the market from the 2000s and 2010s.”

However, a disconnect persists between the industry’s sustainability efforts and market valuations.

“If you look at renewable energy companies or electric car companies… they trade at very high multiples, as opposed to mining that produces a lot of cash, but trade at lower multiples, even though those metals are needed for those companies to actually deliver on the growth promises,” Arriagada said.

Energy access key to green production

On the second day of the FT Mining Summit, another panel provided additional perspectives on the challenges of satisfying demand for low-carbon metals and overcoming the price premium.

Luisa Orre, chief procurement officer at Stegra, highlighted the critical role of access to abundant, low-cost renewable energy in scaling up production of low-carbon metals.

Orre noted that Stegra’s green steel plant requires 2,000 megawatts of power, which they can access for just €30 ($33.47) per megawatt hour in their chosen location.

However, Richards said that many existing producers in Europe face much higher energy costs, potentially limiting their ability to transition to greener production methods.

Carbon pricing meets premiums

The panel noted that green premiums for low-carbon metals currently range from 20-30%.

While this poses affordability challenges, Orre said that green premiums provide an important incentive for decarbonization investments. She suggested that the combination of carbon pricing on high-emission production and premiums for green products will help drive the green transition.

Richards predicted an interesting dynamic as both supply and demand for green materials increase, with construction potentially joining automotive as a major source of demand. This could maintain healthy green premiums while expanding the market.

As LME Week approaches, the industry faces the challenge of bridging this gap between green demands and market valuations.

Arriagada suggested a potential solution: “The bit that we need to get probably better at is engaging those that actually benefit from mining, or that are impacted by mining. [We should] talk about the industry more than ourselves in a more consistent way.”

Low-carbon premiums: market reality check

A number of price reporting agencies, including Fastmarkets, have launched low-carbon premiums to assess if consumers are paying more for “green metal.”

Fastmarkets launched its first low-carbon aluminium price in March 2021. On September 6, the aluminium low-carbon differential P1020A was assessed at $0-30 per tonne.

The low level indicates that spot market buyers aren’t paying a significant premium for low-carbon aluminium in Europe.

In response to the perceived lack of premium, Fastmarkets recently consulted the market about a proposed low-carbon differential that would capture liquidity over a longer timeframe.

On May 1, Fastmarkets launched a low-carbon nickel price. Fastmarkets assessed the nickel briquette low-carbon premium, CIF global at $200-660 per tonne on September 2, narrowing downward from $200-815 per tonne a week earlier

So far there is little evidence of consumers paying a premium for low-carbon nickel.

“Premiums for low-carbon nickel don’t exist,” Eramet Indonesia’s president director Jerome Baudelet said at Fastmarkets’ International Critical Minerals and Metals Summit in Bali, Indonesia, on September 5.

“If you talk to a stainless steel mill or an OEM and ask them to pay a premium for green nickel, they won’t pay a dollar more… It’s clear that the world needs the miners and processors of nickel to be greener, but a low-carbon premium isn’t being paid at the moment.”

A global supply glut in nickel has pushed down nickel prices this year.

“The nickel price has remained weak,” Fastmarkets analyst Olivier Masson said. “Because the market has remained oversupplied. Less so than last year, but still an oversupply.”

The disconnect between sustainability efforts and market valuations presents both challenges and opportunities for the mining industry. How this gap narrows — or widens — is believed to affect the future of sustainable metal production.

The post Will consumers pay more for sustainably sourced metals?: LME Week appeared first on Fastmarkets.

This influx of sovereign capital comes as the mining industry faces challenges in attracting traditional investment.

Institutional shareholders have reduced their exposure to the sector due to concerns over environmental, social and governance (ESG) risks, geopolitical volatility and the cyclical nature of commodity markets, according to speakers on the panel titled “Finance and investment – Where is the capital?”

Alex Pickard, executive vice president of corporate development and investor relations at Ivanhoe Mines, highlighted the lack of investment in early-stage projects.

“Capital is very selective. It wants to go into things at the end of the pipe, where the outcome is very certain,” he said. “Not enough capital is going into the exploration stage and the development stage to actually fill out this project pipeline.”

Olivia Markham, managing director and portfolio manager at BlackRock, pointed out that government involvement extends beyond sovereign wealth funds: “We’re seeing governments providing more capital. You know, you see from the United States, Canada, Australia, they’ve all got funding schemes linked to critical minerals or infrastructure, etc. So that’s an encouraging thing to see.”

The panel also discussed the growing importance of royalty and streaming companies in mining finance. Marc Bishop Lafleche, chief executive officer of Ecora, said: “If you look at the market capitalization of our sector, comparing five years ago to 20 years ago, it has grown by orders of magnitude.”

Geopolitical tensions are reshaping investment patterns in the sector.

“This government leverage that sovereign wealth funds may carry is going to be hugely valuable for a lot of investors,” Morsy said. “Whether it’s major mining companies or even smaller mining companies… there is no doubt you’ve heard the theme over the last two hours on the panels. The permitting issues are real.”

The discussion also touched on the potential for downstream consumers to invest in upstream mining projects, though this trend has not materialized as expected.

“It’s harder than you think for an [original equipment manufacturer] or a company with no experience to come into the sector and try and pick the winners,” Pickard said.

Addressing the industry’s historical underperformance, Morsy said: “If you look at the last thirty years, not just the last five, the internal rate of return has been quite low for many companies. Some reports and analysis suggest about 4%. So, if you’re an investor, would you go in for the long term for a return that low?”

The panel debated the future of diversified miners versus pure-play companies in the context of the energy transition.

“I think the real benefit to the diversified miners today is, if you want to describe it, the ‘old economy’ commodities,” Markham said. “So the bulk commodities are providing the funding to invest in the green metals that are all linked to the energy transition.”

Bulk commodities are high-volume, low-value unprocessed commodities including grain, iron ore and coal.

As the mining industry continues to tackle these capital challenges, the role of sovereign wealth funds and government investments were cited by industry players as potential sources of financing to bridge the gap between current investment levels and the capital needed to meet future mineral demand driven by the energy transition.

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