the national bureau of asian researchnbr special report #102|

december 2022

Geopolitics of Critical Minerals
Yu-Hsuan Wu and Phung Quoc Huy

YU-HSUAN WU is a Researcher at the Asia Pacific Energy Research Centre (APERC).
He is responsible for Chinese Taipei’s energy outlook and overview and is involved
in several energy security projects. He can be reached at <yuhsuan.wu@aperc.or.jp>.
PHUNG QUOC HUY is a Senior Researcher at the Asia Pacific Energy Research Centre(APERC). He is interested in the coal market; clean coal technologies; energy
policies; carbon capture, utilization, and storage; critical minerals; renewable energy
certificates; and low-carbon towns. He can be reached at <huy.phung@aperc.or.jp>.

1

EXECUTIVE SUMMARY
This essay finds that the supply chains of critical minerals are highly concentrated by afew countries, creating geopolitical issues amid global clean energy transitions.

MAIN ARGUMENT
Several minerals are indispensable to the production of clean energy equipment, such as
solar photovoltaic modules, wind turbines, and batteries, and demand for these minerals is
expected to increase substantially in the next few decades as many economies deploy clean
energy technologies. A review of supply chains (mining, processing, manufacturing, andend use) of six critical minerals (cobalt, copper, lithium, nickel, rare earth elements, andsilicon) suggests that the supply chains of critical minerals are highly concentrated, which
creates potential economic, energy, and national security risks. Highly concentrated supply
chains will also shape the related downstream industries and the future energy mix of many
countries. Technological innovation could reduce this concentration and the associatedrisks, but game-changing innovation is likely several decades away from commercialization.
Given the technological uncertainties, increased investment in diverse supply chains isrequired to ensure an adequate supply of critical minerals in the coming decades.
POLICY IMPLICATIONS• The demand for critical minerals is expected to increase drastically in the next few
decades to achieve the energy transition and the net-zero emission targets that many
countries have already proposed. Under this projection, the highly concentrated criticalmineral supply chains will increase the potential economic and security risks that should
not be ignored.
• Historical events have shown that an economy with substantial market power in criticalmineral supply chains has the potential and ability to shape downstream industries anduse them as a political and economic weapon.
• Innovative technologies in the supply chains for critical minerals could mitigate
the concentration and the associated risks. However, considering the uncertainty ofinnovation, investment in diverse supply chains is still indispensable to ensure adequate
and affordable critical minerals.

As of June 2022, 137 countries have committed to achieving net zero or carbon neutrality
by the middle of this century. The transitional period requires switching from fossil
fuel to cleaner energy, in which renewable energy plays a crucial role. The International
Energy Agency (IEA) estimates that the share of renewable energy is expected to accountfor two-thirds of the total energy supply by 2050 in its “net-zero emissions by 2050” scenario.1 The
Asia-Pacific Economic Cooperation (APEC) shows a similar trajectory out to 2050 in its “carbon
neutrality” scenario.2 To facilitate this transition to more sustainable energy systems, there is acorrespondingly important role for clean energy technology and critical minerals.
This essay selects critical minerals based on three key criteria: demand growth, supplierconcentration, and importance to clean energy technology.3 Using these criteria, six criticalminerals are selected for study: cobalt, copper, lithium, nickel, rare earth elements (REEs), andsilicon. Clean energy technologies in this study include solar photovoltaic (PV) panels, windturbines, electric vehicles (EVs), and electrical grids.4
Geographically, in each of the mining, processing, and manufacturing phases, there are three
countries responsible for at least around half the global production of each critical material.
Although the countries are not the same in each phase, there are notable similarities in the top
three, which emphasizes supply limitations. Technologically, China is the global leader in mining
REEs and silicon as well as in the processing, manufacturing, and end uses of all six criticalminerals. While the Democratic Republic of Congo (DRC) dominates global cobalt ore production,
Australia is the largest lithium ore producer in the world. Indonesia has the largest share of global
nickel raw materials, and Chile is the largest copper ore producer worldwide. Thus, in the current
context, heavy geographic concentration and know-how led by a small number of countries raise
serious concerns about supply instability, pricing volatility, and geopolitical risks in the global
critical mineral market. This should cause alarm for nations that rely on critical mineral imports
or the final products.
This essay begins with an overview of critical minerals and supply chains, followed by adiscussion of geopolitical issues. It concludes with an analysis of new technologies that may
mitigate some of the geopolitical concerns.

Overview of Critical Minerals and Supply Chains
According to the IEA’s “sustainable development” scenario, the consumption of lithium,nickel, and cobalt is expected to drastically rise by 42, 33, and 21 times, respectively, by 2040
compared to 2020, while REEs, copper, and silicon will have relatively less growth of 7, 3, and 2
times, respectively.5 Based on various sources, shortages and higher prices are expected in almost
1

IEA, World Energy Outlook 2021 (Paris: IEA, 2021), https://www.iea.org/reports/world-energy-outlook-2021.

2

Asia Pacific Energy Research Centre (APERC), APEC Energy Demand and Supply Outlook, 8th ed. (Tokyo: APERC, 2022), https://www.
apec.org/publications/2022/09/apec-energy-demand-and-supply-outlook-%288th-edition%29---volume-i.

3

The authors are aware that the supply chain of “clean energy” may not be as clean as its name suggests. This is especially true in the mining,processing, and manufacturing stages, which can be energy-consuming processes. However, there seems to be no well-accepted term toreplace “clean energy technology.” Hence, in this essay, we use “clean energy technology” to refer to solar, wind, EV and battery storage, andelectricity networks.

4

REEs are a family of seventeen elements (fifteen elements in the lanthanide group, along with scandium and yttrium). Neodymium is one of
the most important elements for the clean energy transition and is a key ingredient in producing the powerful permanent magnets used for
motors in EVs and wind turbines.

5

IEA, “The Role of Critical Minerals in Clean Energy Transitions,” May 2021, https://www.iea.org/reports/the-role-of-critical-minerals-inclean-energy-transitions.

GEOPOLITICS OF CRITICAL MINERALS u WU AND PHUNG

3

all critical mineral markets.6 In the following sections, the supply chain (mining, processing,
manufacturing, and end uses) for six selected critical minerals is discussed to provide broad
insights into the main countries with concentrated stakes in each phase.7

Mining
The top-three countries’ total share of global mining production for each critical mineral isbetween 47% and 88%, suggesting a concentrated mining market (see Figure 1).8 The DRC has an

figure 1

Top-three producers in the critical mineral mining market

Congo

Chile

Peru

RussiaChina

Australia

Indonesia

Philippines

Chile

China

RussiaUnited States

China

China

China

Myanmar

United States

TurkeyU.S. Geological Survey (USGS), Mineral Commodity Summaries 2022 (Reston: USGS, 2022),
https://pubs.usgs.gov/periodicals/mcs2022/mcs2022.pdf; IEA, “The Role of Critical Minerals in Clean Energy
Transitions,” May 2021, https://www.iea.org/reports/the-role-of-critical-minerals-inclean-energy-transitions.;
and “World—Silica Sands (Quartz Sands or Industrial Sands)—Market Analysis, Forecast, Size, Trends andInsights,” IndexBox, August 13, 2022, https://www.indexbox.io/store/world-silica-sands-quartz-sands-orindustrial-sands-market-analysis-forecast-size-trends-and-insights.
source4

6

Silicon may be the only exception. An excess of the mineral in the markets is forecast by 2030, owing to an overcapacity issue in China’s
silicon industry, according to some sources. The capacity in China alone is expected to be large enough to cover the global demand forsilicon metal. Although more studies are needed to understand this overcapacity issue, it may result from a shortage of energy and China’s
unique “market mechanism.” See U.S. International Trade Commission, “Silicon Metal from China,” May 2018, https://www.usitc.gov/
publications/701_731/pub4783.pdf; and Liesbet Gregoir et al., “Metals for Clean Energy: Pathways to Solving Europe’s Raw Materials
Challenge,” KU Leuven and Eurometaux, April 2022, https://eurometaux.eu/media/jmxf2qm0/metals-for-clean-energy.pdf.

7

Definitions for different stages of the supply chains are provided in the following sections. However, due to the limited availability of data,
the definitions for different critical minerals in the same stage may not be identical.

8

Mining is defined as the activity of extracting targeted raw ores (e.g., sulfide ore and oxide ore) from the Earth’s crust, and mining
production is defined as the production of the targeted raw ores. The production of silica is regarded as silicon mining production.

NBR SPECIAL REPORT u DECEMBER 2022

overwhelming share of cobalt extraction, accounting for approximately 70% of global production.
Chile is the largest copper mine producer (28%) and the second-largest lithium mine producer(23%), while Australia is the principal producer of lithium mine products (52%). Indonesia is thelargest nickel producer, accounting for 31% of the world’s nickel mining. China dominates REE(58%) and silicon (68%) mining production and ranks third in global mining production of cobalt(2%), copper (8%), and lithium (13%).

Processing
The processing markets for the six critical minerals are also concentrated.9 The total share of
the top-three producers exceeds 50% of global processing of the selected critical minerals (seeFigure 2). China owns the largest share of the processing of all selected critical minerals: cobalt

figure 2

Top-three producers in the critical mineral processing market
China

Finland

China

Chile

Japan

China

China

Chile

Indonesia

Belgium

Argentina

Japan
Malaysia

China

China

Estonia

RussiaBrazils o u r c e “Global Cobalt Supply Chain: Limited Number of Players, China and the DRC to Maintain Their

Dominance,” Fitch Solutions, September 22, 2021, https://www.fitchsolutions.com/mining/global-cobaltsupply-chain-limited-number-players-china-and-drc-maintain-their-dominance-22-09-2021; IEA, “The Roleof Critical Minerals in Clean Energy Transitions”; U.S. Department of Energy, Rare Earth Permanent Magnets:
Supply Chain Deep Dive Assessment (Washington, D.C., February 2022), https://www.energy.gov/sites/default/
files/2022-02/Neodymium%20Magnets%20Supply%20Chain%20Report%20-%20Final.pdf; and USGS, Mineral
Commodity Summaries 2022.

9

Processing is defined as the activity of the preliminary separating of the targeted minerals from the raw ores (e.g., pyrometallurgy andhydrometallurgy). Metallurgical-grade silicon production is regarded as silicon processing production.

GEOPOLITICS OF CRITICAL MINERALS u WU AND PHUNG

5

(66%), copper (41%), lithium (58%), nickel (35%), REEs (89%), and silicon (69%). Chile ranks
second in copper and lithium processing, accounting for 10% and 28%, respectively. Indonesia, thelargest nickel mining country, ranks second in the nickel processing market (15%). The rest of thecountries in the top-three processing markets are not listed in the mining market, which implies
that the processing stage does not depend on the origin of raw critical mineral resources.10

Manufacturing
The manufacturing markets for the six critical minerals also remain concentrated.11 The total
share of the top-three manufacturers accounts for over half the global manufacturing products(see Figure 3). China dominates all manufacturing markets, namely cobalt (67%), copper (41%),
lithium (55%), nickel (25%), REEs (92%), and silicon (76%). Chile ranks second in copper (10%)
and lithium (27%) manufacturing products. Chile seems to take advantage of mineral resources in
the copper and lithium markets to develop the upstream and midstream mineral industries. Japanis listed in the top-three processing and manufacturing countries for copper and nickel as well as
in the top-three cobalt and REE manufacturers. Finland ranks second in cobalt processing andmanufacturing markets, while Argentina ranks third in lithium processing and manufacturingmarkets. The market shares for these two countries are around 10% in both the processing andmanufacturing stages. Overall, the market shares and ranks suggest a close relationship between
the processing and manufacturing markets.12

End Uses
The end-use markets for the selected critical minerals are concentrated much like the previous
three steps in the supply chain.13 The total share of the top-three producers exceeds 70% of the
global end use of selected critical minerals (see Figure 4). There are, however, two caveats. First,
except for silicon and lithium, the top-three end users of other critical minerals are aggregatedpartly by regions instead of countries. The different aggregation makes the comparison ofconcentration between end-use markets and other markets problematic. Second, the end-use data
here refers to the shares of end-use products or the critical mineral consumption in the end-use
sectors. However, China’s dominance in all end-use markets is undisputed, with cobalt (32%),
copper (54%), lithium (39%), nickel (59%), REEs (68%), and silicon (70%). South Korea ranks
second in lithium (20%) and silicon (5%) end-use production, while Japan ranks third in lithium(18%) end-use production.

Summary
The market shares of various critical minerals in different stages of the supply chain
suggest that the supply chains are highly concentrated and shaped by many factors, including

6

10

The development of processing industries in countries without raw resources may result from their comparative advantages in separation or
refinery technology and the investment needed. The cooperation of China and Myanmar in REEs is one example: the former possessed theneeded capital and technological know-how, and the latter offered the raw materials.

11

Manufacturing is defined as the activity of further refining the targeted minerals from the processed products. Lithium chemical production,
Class 1 nickel production, sintered neodymium magnet production, and polysilicon production are regarded as manufacturing productions.

12

The relationships may result from the similar definitions we made for the stages and critical minerals. The close relationships between
processing and manufacturing may imply that economies with a comparative advantage in one stage can naturally have a comparativeadvantage in the other. However, further studies are needed to understand the relationships between these two stages.

13

End uses are defined as the amounts of critical minerals consumed to produce the final product. Solar PV module production is regarded asa silicon end-use product.

NBR SPECIAL REPORT u DECEMBER 2022

figure 3

Top-three producers in the critical mineral manufacturing market

China

Finland

China

Chile

China

China

Japan

Chile

RussiaJapan

Argentina

Japan
Japan
China

China

VietnamGermanySouth Korea

s o u r c e : “ ‘State of the Cobalt Market’ Report,” Cobalt Institute, May 17, 2021, https://www.cobaltinstitute.

org/wp-content/uploads/2021/05/CobaltInstitute_Market_Report_2020_1.pdf; International Copper Study
Group, The World Copper Factbook 2021 (Lisbon: International Copper Study Group, 2021), https://icsg.
org/wp-content/uploads/2021/11/ICSG-Factbook-2021.pdf; “Europe’s Lithium Challenge on the Road
to Electrification,” Rock Tech Lithium, June 4, 2021, available at https://elements.visualcapitalist.com/
europes-lithium-supply-challenge-on-the-road-to-electrification; Marcelo Azevedo, Nicolas Goffaux, and
Ken Hoffman, “How Clean Can the Nickel Industry Become?” McKinsey & Company, September 11, 2020,
https://www.mckinsey.com/industries/metals-and-mining/our-insights/how-clean-can-the-nickel-industrybecome; U.S. Department of Energy, Rare Earth Permanent Magnets; Johannes Bernreuter, “Background andRanking of the Top Ten Polysilicon Producers,” Bernreuter Research, June 29, 2020, https://www.bernreuter.
com/polysilicon/manufacturers; and Kelly Pickerel, “China’s Share of World’s Polysilicon Production Grows
from 30% to 80% in Just One Decade,” Solar Power World, April 27, 2022, https://www.solarpowerworldonline.
com/2022/04/chinas-share-of-worlds-polysilicon-production-grows-from-30-to-80-in-just-one-decade.

endowments (e.g., distribution of mineral reserve and labor cost), economic structure, energy
policy, technology, and environmental regulations of each country. An abundant mineralreserve alone does not necessarily imply dominance of the entire supply chain. The best exampleof this is in the world’s largest cobalt miner, the DRC, which does not play any significant role in
the processing, manufacturing, or end-use stage. In addition, China dominates the entire supply
chain of REEs and silicon and ranks first in the processing, manufacturing, and end use of theother critical minerals discussed in this section. China’s leadership might result from its early
and abundant investment in the critical mineral supply chain.
The following section discusses the geopolitical aspects of highly concentrated supply chains.
GEOPOLITICS OF CRITICAL MINERALS u WU AND PHUNG

7

figure 4

Top-three users (producers) in the critical mineral end-use market

China

European Union

North America

European Union

China

China

South Korea

China

Asia (excluding China)

Japan

Asia (excluding China)

European Union
Asia (excluding China)

China

United States
South Korea

China

Vietnams o u r c e “Global Cobalt Supply Chain”; IEA, “The Role of Critical Minerals in Clean Energy Transitions”;

U.S. Department of Energy, Rare Earth Permanent Magnets; and USGS, Mineral Commodity Summaries 2022.

Geopolitical Aspects
The critical mineral market is expected to be more complicated and volatile than the oil market
given its highly concentrated supply chains. Under the global energy transition trend, it will beessential to pay equal or even greater attention to supply chains. The concentrated supply chainsin critical minerals could be problematic or trigger disputes because intentional disruptions
could affect a country’s industrial competitiveness and provide economic and political leverage tosuppliers with market power.
For the industry’s competitiveness, a country that dominates upstream production may
enjoy ease of access to the feedstock. For example, China dominates the entire supply chainof solar PV modules. Its cost advantage is generally recognized as the result of cheap labor, aneconomy of scale, and ease of access to the feedstocks. It is also worth noting that economies
of scale in solar PV module production further reinforce the profitability of those with market
power in upstream production. China’s solar PV supply chain dominance has raised concerns
in several countries, including the United States. According to the U.S. Department of Energy,
it would be risky for the United States to continue to rely on China’s silicon production, and it
would be beneficial for the U.S. economy to develop and secure its own solar PV supply chain.14
14

8

U.S. Department of Energy, “Rare Earth Permanent Magnets: Supply Chain Deep Dive Assessment,” February 2022, https://www.energy.
gov/sites/default/files/2022-02/Neodymium%20Magnets%20Supply%20Chain%20Report%20-%20Final.pdf.

NBR SPECIAL REPORT u DECEMBER 2022

Consequently, the United States has implemented several policies to encourage domestic solar
PV and the upstream industries and imposed restrictions on specific solar PV products orfeedstocks from China.
Some countries with abundant critical mineral resources have imposed restrictions on theexport of raw materials to stimulate domestic investment and production of higher value-added
products. Indonesia, the world’s largest nickel miner and second-largest nickel processor, started
restricting raw nickel exports in 2014. According to the Indonesian government, the restriction
stimulated investment in nickel refineries and nickel-based products.15 This case shows a country’s
attempt to develop an entire supply chain, increase economic profits, and improve economic
structures. Not surprisingly, the restrictions on exports resulted in complaints from othereconomies. The European Union, for example, claimed that the restrictions were illegal andharmful to its stainless steel producers.16
The security risks involved with critical mineral supply disruption are more disquieting. A
supply disruption can be caused by natural disasters, political turmoil, international conflicts, oranything that can affect the production and export of critical minerals. One well-known example
is the export restrictions on REEs that China imposed on Japan in 2010 after Japan seized a trawler
it said was fishing illegally in its waters. The effectiveness of these restrictions was demonstrated
by the speed with which Japan released the boat captain without receiving any concessions. This
example highlights how market power in the supply chains of critical materials can be used asboth a political and an economic weapon.17
A more recent example of a critical mineral supply disruption occurred in Myanmar. In 2021,
REE exports from Myanmar to China were affected by the military coup and the border closure tolimit the spread of Covid-19. Although China is the world’s leading REE producer and consumer,
it relies on the (heavy) REE feedstock from Myanmar. The disruption is believed to be one of
the reasons that the price of REEs rose significantly in 2021.18 This example shows that domestic
political turmoil or a natural disaster can cause a global supply issue if it happens in a country that
dominates, or partially dominates, certain critical minerals.
These economic and security aspects of geopolitical issues suggest that participants in a supply
chain should pay attention to the movements of major suppliers of critical minerals because of theirpotential ability to reshape the related industries. The following section discusses the potential ofinnovative technologies along with their uncertainties.

Innovative Technologies
The foregoing analysis of the geographic concentration of critical minerals and the resulting
geopolitical issues has revealed the fragility of global supply chains. This situation underscores

15

Krisna Gupta, “Indonesia’s Claim That Banning Nickel Exports Spurs Downstreaming Is Questionable,” Conversation, March 30, 2022,
https://theconversation.com/indonesias-claim-that-banning-nickel-exports-spurs-downstreaming-is-questionable-180229.

16“Indonesia Says ‘Ready to Fight’ EU at WTO over Nickel Export Curbs,” Reuters, February 26, 2021, https://www.reuters.com/article/us-euindonesia-trade-idUSKBN2AQ0GO.

17

Under China’s REE export restrictions in 2010, Japan used its REE stockpile to fill the gap, sought different REE sources, and invested inrelated technologies (e.g., seabed mining and recycling). There were short-term shocks resulting from China’s restrictions on Japan, but the
restrictions did not tremendously harm the Japanese economy. Instead, the restrictions raised Japan’s awareness of its import dependency on
critical minerals.

18

The strong demand for wind power and electric vehicles is another reason for the increasing price of REEs.

GEOPOLITICS OF CRITICAL MINERALS u WU AND PHUNG

9the need for innovative technologies at all stages in the supply chain to provide more stable andaffordable mineral sources for future clean energy development.
In mining, deep-seabed mineral extraction is one potentially innovative technology thatseveral countries are interested in exploring—particularly countries located in the Pacific Ocean’s
Ring of Fire. Japan, for example, plans to create mining technology and select a mining locationin its exclusive economic zone by the end of 2028.19 In Europe, Norway plans to start seabedmining exploration on its continental shelf as early as 2023. However, deep-seabed mining still
carries uncertainties due to technological and marine environmental hurdles. First, a pilot project
on deep-sea mining was conducted by the Japan Oil, Gas and Metals National Corporation in2017, but it still needs further technical investigations to become commercially feasible. Second,
impacts on ecosystems and biodiversity remain poorly understood, despite several rigorousstudies. The International Seabed Authority, a UN body, is drawing up regulatory frameworks forthe international seabed—areas outside any national jurisdiction—aiming to promote deep-sea
mining while minimizing damage to the marine environment.20
In processing, various research projects have been conducted in the United States, including
several pilot-scale tests and demonstrations. The West Virginia University Research Corporation
has implemented a project called “Development and Testing of an Integrated Acid Mine Drainage(AMD) Treatment and Rare Earth/Critical Mineral Plant.” If successful, the plant will generatearound one thousand tons per year of REE and critical material oxides from coal and other ore
bodies, with an estimated contained value of $237 per kilogram.21 Additionally, the United States
is conducting a feasibility study to assess the potential of REE recovery from coal, coal byproducts,
and waste materials to support the U.S. domestic supply of REEs for clean energy. The target is to
produce one to three tons of REEs per day by 2026.
In manufacturing and end use, innovative technologies in efficiency and design are vital toreduce material intensity. In the case of wind turbines, a larger size contributes to higher capacity,
leading to a reduction in the material intensity of minerals. For instance, on a kilogram per
megawatt (MW) basis, a 3.45 MW turbine contains around 50% less copper than a 2 MW turbine.22
Although innovative technologies are being developed at various stages of critical mineral
supply chains to reduce dependency on primary supply, these innovations reveal uncertainties
due to technological and environmental obstacles. Therefore, investment in mineralproduction is imperative to ensure a supply of critical minerals for clean energy technologies
in the coming decades. 23

10

19“JOGMEC Conducts World’s First Successful Excavation of Cobalt-Rich Seabed in the Deep Ocean; Excavation Test Seeks to Identify Best
Practices to Access Essential Green Technology Ingredients While Minimizing Environmental Impact,” Japan Oil, Gas and Metals National
Corporation, August 21, 2020, https://www.jogmec.go.jp/english/news/release/news_01_000033.html; “Japan to Commercialize Mining ofRare Metals on Seabed,” Eleven Media Group, January 19, 2021, https://elevenmyanmar.com/news/japan-to-commercialize-mining-of-raremetals-on-seabed; and IEA, “The Role of Critical Minerals in Clean Energy Transitions.”20“G-7 Countries Say Strict Environmental Rules Needed for Deep-sea Mining,” Reuters, May 27, 2022, https://www.reuters.com/world/g7countries-say-strict-environmental-rules-needed-deep-sea-mining-2022-05-27.

21

U.S. National Energy Technology Laboratory, “2020–2021 Critical Minerals Sustainability Program Project Portfolio,” May 2021, 18, https://www.netl.doe.gov/sites/default/files/2021-05/2020-2021-REE-Portfolio.pdf.

22

Alessia Elia et al., “Wind Turbine Cost Reduction: A Detailed Bottom-Up Analysis of Innovation Drivers,” Energy Policy, no. 147 (2020).

23

IEA, “The Role of Critical Minerals in Clean Energy Transitions.”

NBR SPECIAL REPORT u DECEMBER 2022

Conclusion
Demand for critical minerals is expected to rise rapidly in the coming decades, given theirsignificant role in the manufacture of clean energy equipment. The geopolitics of critical mineral
supply chains have become an issue for many governments, particularly in import-dependent
countries. The following are the main takeaways from this study:• The demand for six materials critical to the manufacture of clean energy equipment is
expected to triple by 2030 and quadruple by 2040 as the world transitions toward clean energy
technologies. By 2040, lithium has the highest expected growth in demand relative to 2020
levels (42-fold), followed by nickel (33-fold) and cobalt (21-fold), while demand for REEs,
copper, and silicon will grow at a slower pace.
• Processing and manufacturing are mostly concentrated in the top-three countries, accounting
for over half of the global production of each critical mineral (although the top three aredifferent for different materials). China is the global leader in mining REEs and silicon andcurrently dominates the processing to end-use segments for all six critical minerals.
• Critical mineral supply chains are much more concentrated than the oil and gas supply chainson which the world currently relies. Geopolitical issues suggest that participants should
pay attention to the potential economic, energy, and national security risks associated withcritical mineral supply chains to ensure affordable and available critical minerals for economic
development and decarbonization.
• In the long term, technological innovations, such as deep-seabed mining, provide potential
solutions to reduce dependency on concentrated supplies and secure material supply inseveral countries. However, various uncertainties exist due to technological constraints andenvironmental impacts. As a result, increased investment in diverse supply chains is required
to ensure an adequate supply of critical minerals in the coming decades.

GEOPOLITICS OF CRITICAL MINERALS u WU AND PHUNG

11