What is Critical Raw Materials (CRMs):

Critical Raw Materials (CRMs) stand at the forefront of sustaining and propelling the European economy into the future. These materials play a pivotal role in various industries, ranging from electronics and automotive to renewable energy and defence. However, the availability and secure supply of CRMs have become increasingly challenging, posing potential risks to economic stability and technological innovation.

CRMs are not necessarily scarce but are labelled 'critical' because of their economic importance to key sectors, high supply risk, and the lack of viable substitutes. The European economy relies on these materials for its quality of life, technological advancements, and environmental sustainability.

Significance of Critical Raw Materials (CRMs):

CRMs are integral to mega-sectors such as defence, automotive, metals, medical devices, consumer electronics, and green technology. The European Commission's 2020 list of CRMs includes essential elements like cobalt, lithium, and titanium, crucial for applications ranging from batteries to space exploration.

Critical Raw Materials in Key Sectors:

• Defence:

  • Cobalt, tantalum, and titanium are crucial for aerospace technologies.
  • Rare piles of earth and niobium are essential for defence applications.

• Automotive:

  • Lithium and cobalt for electric vehicle batteries.
  • Rare piles of earth in automotive sensors and catalytic converters.

• Metals:

  • Antimony, bismuth, and tungsten are vital for alloy production.
  • Strategic use of gallium and hafnium in metallurgical processes.

• Medical Devices:

  • Indium, niobium, and platinum group metals in medical equipment.
  • Natural rubber and titanium for prosthetics and medical implants.

• Consumer Electronics:

  • Indium, lithium, and rare earths critical for electronic components.
  • Silicon metal and germanium are used in semiconductor manufacturing.

• Green Technology:

  • Phosphorus, lithium, and rare earths in renewable energy technologies.
  • Borates and gallium are essential for the production of solar panels.

Essential Critical Raw Materials Shaping Europe's Future:

CRM-PeriodicTable.jpg

  • Antimony
  • Baryte
  • Bauxite
  • Beryllium
  • Bismuth
  • Borates
  • Cobalt
  • Coking coal
  • Fluorspar
  • Gallium
  • Germanium
  • Hafnium
  • HREEs (Heavy Rare Earth Elements)
  • Indium
  • Lithium
  • LREEs (Light Rare Earth Elements)
  • Magnesium
  • Natural graphite
  • Natural rubber
  • Niobium
  • PGMs (Platinum Group Metals)
  • Phosphate rock
  • Phosphorus
  • Scandium
  • Silicon metal
  • Strontium
  • Tantalum
  • Titanium
  • Tungsten
  • Vanadium

Challenges and Solutions:

To meet climate and digital objectives, securing a sustainable supply of CRMs within Europe is imperative. The European Critical Raw Materials Act serves as the foundation for achieving this goal by strengthening domestic supply chains, fostering international partnerships, setting priorities, building capacities, improving resilience, and investing in research and innovation.

Key Pillars of the European Critical Raw Materials Act:

Key Pillars of the European Critical Raw Materials Act.jpg

• Setting Clear Priorities for Action:

  • Identifying critical raw materials crucial for the green and digital transition, defence, and space.
  • Establishing benchmarks for domestic capacities by 2030.

• Diversification of Supply Sources:

  • The EU aims to reduce dependency on a single country or a limited number of countries for the supply of critical raw materials.
  • Diversifying sources helps mitigate geopolitical risks and ensures a more stable supply chain.

• Building European Capacities:

  • Strengthening the entire raw materials value chain, from mining to recycling.
  • Developing national exploration and streamlining permitting procedures.

• Improving Resilience:

  • Conducting stress tests to enhance monitoring capacity.
  • Coordinating efforts for strategic stockpiles and fostering sustainable investment.

• Investing in Research, Innovation, and Skills:

  • Uptake and deployment of breakthrough technologies in critical raw materials.
  • Establishing a Raw Materials Academy and a skills partnership to promote workforce expertise.

International Engagement

Given the global distribution of CRMs, the EU recognizes the importance of international trade and cooperation. The EU seeks mutually beneficial partnerships with emerging markets, establishes a Critical Raw Materials Club, and engages in trade actions to ensure diversified and secure supply chains.

Dependency Statistics: Unveiling the EU's Vulnerability in Critical Raw Materials

• Cobalt:

  1. Dependency: 63% of the world's cobalt, crucial for batteries, is extracted in the Democratic Republic of Congo.
  2. Implications: High reliance on a single source poses a risk to the EU's supply chain resilience.

• Magnesium:

  1. Dependency: 97% of the EU's magnesium supply is sourced from China.
  2. Challenges: Overreliance on a specific country for magnesium raises concerns about potential disruptions and market volatility.

• Rare Earths:

  1. Dependency: 100% of the rare earths used for permanent magnets are refined in China.
  2. Concerns: The exclusivity of Chinese refining puts the EU at risk of supply chain disruptions in critical sectors like electronics and green technology.

• Borate:

  1. Dependency: 98% of the EU's supply of borate is provided by Türkiye.
  2. Risks: Concentrated dependency on a single country for borate exposes the EU to geopolitical and economic uncertainties.

Conclusion:

As the EU strives for a sustainable and resilient future, addressing the challenges associated with Critical Raw Materials is paramount. The European Critical Raw Materials Act, with its strategic pillars and international engagement, paves the way for a secure and sustainable supply of these materials, ensuring the continued prosperity of the European economy.

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