Tag Archives: strategic rare metals

When Others Do our Dirty Work: the Costs of Overdependence

China is tightening its grip on the global supply of processed manganese, rattling a range of companies world-wide that depend on the versatile metal—including the planet’s biggest electric-vehicle makers.

China produces more than 90% of the world’s manganese products, ranging from steel-strengthening additives to battery-grade compounds. Since October 2020, dozens of Chinese manganese processors accounting for most of global capacity have joined a state-backed campaign to establish a “manganese innovation alliance,” led by Ningxia Tianyuan Manganese Industry Group, setting out in planning documents goals and moves that others in the industry say are akin to a production cartel. They include centralizing control over supply of key products, coordinating prices, stockpiling and networks for mutual financial assistance.

The squeeze sent prices soaring in metal markets world-wide, snagging steelmakers and sharpening concern among car makers. China’s metal industries already dominate the global processing of most raw materials for rechargeable batteries, including cobalt and nickel. Three-quarters of the world’s lithium-ion batteries and half of its electric vehicles are made in China.  High-purity forms of manganese have increasingly become crucial for battery-powered automobiles, touted by Volkswagen AG and Tesla Inc. in recent months as a viable replacement for other, more-expensive battery ingredients….

While manganese ore is relatively abundant around the world, it is almost solely refined in China. Battery-grade manganese is traded mostly privately, and pricing can be opaque. Miners say a metric ton of the purified metal could cost up to $4,000—barely a 10th of the cost of cobalt, a widely used battery metal. By replacing cobalt, manganese could help auto makers produce 30% more cars with the same amount of nickel, analysts say.

Rival manganese projects outside China view the cartel-like activities as an opportunity to gain momentum for their own battery-grade developments…Still, analysts say such projects outside China might take years to start and heavy cost investments to develop. Viable bases of manganese ore are often located in remote regions, which require expensive infrastructure to ferry and process extracted ores.

Excerpt from Chuin-Wei Yap, China Hones Control Over Manganese, a Rising Star in Battery Metals, WSH, May 21, 2021

The Hunger for Rare Metals

Indium, part of an iPhone’s screen, is an “invisible link…between the phone and your finger”. Just a pinch of niobium, a soft, granite-grey metal mined mostly in Brazil, greatly strengthens a tonne of steel used in bridges and pipelines. Lithium is so light that it has become essential for rechargeable car-batteries. Dysprosium, as well as making an electric toothbrush whirr, helps power wind turbines. Military technology depends on numerous rare metals. Tungsten, for instance, is crucial for armour-piercing bullets. America’s forthcoming F-35 fighter planes are “flying periodic tables”, Mr Abraham writes….[T]he “long tailpipe” of pollution left in the wake of mining and refining, rare metals..

Supplies are also a worry. In 2010 a Chinese trawler rammed Japanese coastguard vessels in waters near islands called the Senkakus in Japanese and the Diaoyu in Chinese (their ownership is disputed by both countries). After the Chinese captain was detained, supplies of rare metals from the mainland to Japan suspiciously dried up. Though China never acknowledged an export ban, the incident caused rare-metal prices to spike, and unsettled manufacturers around the world. …

[The business of rare metals] generates $4 billion of revenues a year and also plays a critical role in systems worth about $4 trillion. China, which develops more rare metals than any other country, understands the calculus. The West, his book suggests, does not.

Excerpts from Rare metals: Unobtainiums, Economist, Jan. 16,  2016 (Book Review of ‘The Elements of Power by  D. Abraham]