Supply chain solutions for critical minerals

3 minute read + PDF  10.08.2022 David Morfesi, Simon Scott

Critical minerals are in demand as countries transition to renewables. But with only one supply chain, the future supply of critical minerals could be at risk. Findings from a recent workshop series shed light on what the regional solution may look like.

Supply Chains for Critical Minerals – Workshop Series Report

During 2021, Austrade, the Australia India Chamber of Commerce (AICC), Monash University and MinterEllison conducted a workshop series, comprising four sessions. The objective was to bring together stakeholders from government, industry, corporate and research sectors across the regions, to work through the opportunities and the challenges involved in building an additional and diversified supply chain for critical minerals.

The four workshops covered:

  • Partnerships for Indo-Pacific supply chains and critical minerals
  • Battery minerals extraction, production and trade
  • Rare-earth elements: will we be too late to the Electric Vehicle (EV) revolution?
  • Principles of collaboration.

Our report explores the recommendations from the workshops.

What do you think? Please answer a few quick questions on a supply chain in the Indo Pacific

The Australian, Indian, Japanese and US governments are aware of the supply chain risk for critical minerals, and have highlighted their interest in long term solutions.

 

Determined cooperation in the field of critical minerals presents a historic opportunity for like-minded countries of the Indo-Pacific region and beyond to join hands in realising the great potential that exists in this strategic sector.”
His Excellency Manpreet Vohra, High Commissioner of India

 

Why are critical minerals and rare earth elements so important?

Critical minerals are metals and nonmetals that have a significant risk of supply disruption, and where such a disruption would have a material impact on industries, economies and/or sovereign security.

Rapid growth and innovation in electronics and low-carbon technologies means many critical minerals are used in the manufacturing of batteries, mobile phones, flat-screen monitors, wind turbines, electric cars and solar panels, and in a multitude of other applications. The metals that are important for transitioning to low-carbon economies are often referred to as ‘clean energy metals’, some of which are also critical minerals.

Report findings and recommendations

Exploration and technology

As a relatively immature industry that historically has been under-appreciated, there’s still a lot of work to do to determine the locations, quantities and qualities of critical minerals in Australia and India. Critical minerals are often more complex to mine and process, usually using waste streams from other mining processes. They also present novel environmental challenges that must be overcome to meet environmental protection standards.

The crucial first step is agreeing on the priority minerals and the projects that will support their production.

Markets and investment

Due to the immaturity of the industry, it’s harder to predict return on investment, particularly when many factors are unknown.

What we do know is that demand in this sector will increase, and without early investment, partnerships and identification of value chain gaps, it will be almost impossible to develop a sustainable and competitive supply chain in the Indo-Pacific region.

Government regulation

There have been many government announcements since 2021 indicating that Australia, India, Japan and the US see the need for better cross-border regulation to enable initiatives that support cross-regional partnerships and trade. However, legislative frameworks like royalties, intellectual property (IP) and other structures still need to be reviewed to manage minerals and REEs within these revised regulations. Governments from the Indo-Pacific region can help by supporting frameworks and resources that build the industry until it can sustain and stabilise itself, similar to other industries in the past.

Critical Minerals International Alliance

The recommendation of these workshops is to develop a Critical Minerals International Alliance (CMIA), with representatives from each participating region with an interest in a supply chain across the Indo-Pacific. Further details about the model and responsibilities are included in this report.

What do you think? Please answer a few quick questions on a supply chain in the Indo Pacific

Contact

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