Boosting Western supply of refined critical metals means de-risking investment. But how?: Russell
XLB•Western countries are seeking ways to build economically viable supply chains for refined critical metals, which China dominates. Proposed measures include price floors, guaranteed offtake and direct government investment, but the response remains fragmented.
1. China’s refining lead
China controls 99% of the world’s refined gallium, 74% of antimony, 81% of molybdenum, 91% of rare earths, 70% of lithium and 44% of copper, data from Visual Capitalist showed. The article says traditional mine-development and financing models may not deliver the supply Western economies need, particularly when refining costs are high.
2. Ways to de-risk projects
Three approaches discussed at the International Mining and Resources Conference in Sydney were setting a commodity price floor, guaranteeing offtake and directly investing in mines and processing. The United States has set a minimum price of $110 per kilogram for neodymium-praseodymium, a rare earth compound used to make magnets; its market price has risen above that floor.
3. Fragmented response
The article says government support may help make projects viable, with the best approach varying by project. It describes signs that the United States and European Union are competing rather than coordinating, raising the risk that the Western response remains fragmented.
