Breaking the minerals monopoly

In the 21st century, critical minerals and rare earths have taken centre stage, becoming crucial for elecdefence, aerospace, and medical devices.

- AJAY KUMAR

For instance, the International Renewable Energy Agency's pathway to restrict global temperature rise to 1.5°C posits that renewables will constitute 91 per cent of the energy mix by 2050, requiring massive quantities of minerals like silicon, silver, lithium, and rare earths such as neodymium and dysprosium. The surging demand and deepening reliance have classified these and other minerals like graphite, manganese, cobalt and nickel as "critical", highlighting their pivotal role in shaping future technologies and industries.

The global surge in demand has elevated critical minerals to the status of strategic assets and geopolitical tools. These minerals are concentrated in a few nations, with China being the dominant one possessing substantial reserves of dysprosium (50 per cent), neodymium (50 per cent), and graphite (65 per cent). China's mineral dominance is fortified by securing advantageous agreements across Africa, Latin America, Central Asia, and Australia, often through initiatives like the Belt and Road Initiative (BRI). For instance, China's $1.3 billion BRI investment in mineral exploration and processing in Ghana, Guinea, Niger, Sierra Leone, and Mali ensured privileged access to bauxite and lithium. In Ghana, the involvement of SinoHydro, a Chinese firm in aluminium processing from Ghanaian bauxite, grants China concessional terms over 20 years, while the Ghanaian entity repays the Chinese loan.

Additionally, China's monopoly is reinforced by being the mineral processing capital of the world. China controls substantial global shares graphite (80 per cent), dysprosium (100 per cent), manganese (93 per cent), and neodymium (88 per cent). This industrial prowess of China, driven by economies of scale, has reduced their processing costs and erected significant barriers to entry for other nations, solidifying China's control over mineral supply-chains.