Critical and strategic metals
“Lithium and Rare Earths will soon be more important than oil and gas”
“Lithium and rare earths will soon be more important than oil and gas.”
Ursula von der Leyen, President of the European Commission
The transition away from fossil fuels towards carbon-neutral technologies, continuing digitalisation and the breakthrough of artificial intelligence have caused demand for lithium, nickel, cobalt and rare earths to rise sharply over the past two decades. These metals, some with exotic-sounding names, are essential for semiconductors, drones, batteries and many other key technologies.
China is by far the largest producer or refiner of many of these metals. Similar to the role of OPEC countries in oil, the country holds a powerful position in the market, especially for rare earths. Because this dominance is used as leverage and as a competitive instrument, the United States, the European Union and other countries are working to diversify their supply chains.
The United States, the EU, Japan, Canada, China and Russia regularly update lists of strategic and critical raw materials. These are materials that are important to their economies, may become scarce and face substantial supply risks.
Policies such as the EU Critical Raw Materials Act and the US Critical Minerals Action Plan are intended to improve security of supply.
