The struggle for critical raw materials continues and European companies, including those in the appliances industry, are struggling to increase their stocks, waiting to meet market demands, while recent research warns that the gap between EU, Chinese and US manufacturers is widening.
The European Parliament has recently approved a final draft of the Critical Raw Materials Act, thanks to which authorities are planning to support manufacturers in reducing their dependency on foreign sources. Especially backed by Italy, France, and Germany, the agreement introduces further incentives, whose goal is to promote and facilitate mining and recycling activities across the EU; and to speed up and simplify the authorisation procedures needed. The deal addresses small-medium businesses and start-ups in the first place, aiming to help them strengthen their operations and involvement, looking forward to fulfilling the CRM’s and 2030 Agenda’s requirements. The plan is ambitious, given the fact that the demand for lithium and cobalt, for instance, is foreseen to rocket by 2050: +3.500 and +330% respectively, according to a 2022 Eurometaux report. This is one of the reasons why the EU Council has suggested increasing the share of refining and mining – up to 50 and 20% within 2030 – for those commodities that are destined to be consumed inside the continent.
Initiatives underway, but there is still a long way to go
Lithium, cobalt, and rare earths are part of the list of the so-called critical raw materials, which includes 34 minerals whose importance, in the European economic framework, is considered extremely high, also due to possible risks of a shortage and turbulences on the supply side. 17 materials are dubbed strategic since the request from several different industrial segments is poised to grow significantly over the next few years. The deal encourages recycling activities and partnership agreements with supplying countries, and the aforementioned Eurometaux estimated that there are at least 50 ongoing initiatives that could prove useful for reaching the forecasted targets. Still, there’s a long way to go for EU manufacturers, according to a study by the Brussels-based campaign group Transport & Environment (T&E).
| FACTS AND FIGURES 16% of the quantity of raw materials that EU manufacturers have secured, to meet their 2030 targets +3500% the demand for lithium, by 2050 +330% the demand for cobalt, in 2050 400,000 tons the possible lithium shortfall, in 2030 5 million tons amount of copper and aluminium shortfall, in 2030 |
The Kazaki candidate
If on the one hand analysts at Benchmark Mineral Intelligence predicted that the demand for lithium should quadruple over the next six years – triggering a nearly 400,000 tons shortage – a shortfall of nickel and cobalt is also to be taken into consideration, on the other. The European Union is striving to solve the problem by looking for new partners and Kazakhstan emerged recently as a promising one. That happened during the 8th Raw Materials Week that took place last November in Brussels and hosted the EU-Kazakhstan Business Forum. The Central Asian nation already plays a precious role in the trade balance of countries like Italy and the Netherlands, for which it represents an important counterpart, in terms of exports. It also stands for its capacity to attract foreign investments, for a total amount of 78 billion dollars, 19 of which were provided by France. But the most meaningful and interesting of the complicated raw materials scenario is the fact that the land is rich in at least 20 crucial commodities, including lithium, tungsten, and rare earth minerals.
C for China, C for circularity
Talks and memoranda between the EU (and its industrial players) and Kazakhstan date back to the mid-Nineties and have been consolidating throughout the decades. Of course, today they could become tighter and advantageous for both, but the question is whether they will be enough, for the Union, to keep up with China. According to Indian sources, the People’s Republic is now working hard to enhance its capabilities in the field of recycling. It could achieve a circular economy in lithium for batteries as early as 2059. Europe and North America would lag, once again, because according to the German University of Münster, they have few chances to reach this same target before 2070. Quoted by The Deccan Herald, the German study reports that China could become fully circular around 2045, with regards to cobalt; and 2046 for nickel, whereas the EU and the US would only hit these targets in 2052, 2056, 2058, and 2064, respectively.
