This may not be the reality anyone wants to hear but despite important steps forward, the nation’s minerals problem – notably the mismatch between soaring demand, available supply, and our alarming overreliance on imports – is only getting worse. And while the Biden administration has done important work to elevate the challenge, it has yet to clearly embrace the most obvious solution: more domestic mining.
This doesn’t mean the Biden administration hasn’t worked to fill holes in the mineral supply chain. It has. The administration is working closely with allies and overseas mineral producers to ramp up supply and has backed incentives to encourage development of domestic supply chains with loans and grants going to processors, recyclers, and, in limited quantities, to miners. But for everything the administration has said about critical minerals, it’s what hasn’t been said and done that’s perhaps most notable: The Biden administration has yet to plainly say we need to ramp up domestic mining and, in fact, has yet to approve a single major mine.
How can the U.S. possibly hope to address the enormity of the minerals challenge if we don’t place using our vast domestic resources front and center of any effort to do so? The short answer is, we can’t. And if we don’t solve – or get on track to solve – the minerals challenge, much of the Biden administration agenda will go down with it.
This is an administration that wants to build, reshore, modernize our industrial base, rebuild our middle class, and compete with China’s industrial might and to accelerate the deployment of electric vehicles (EVs), solar panels, wind farms, and tens of thousands of miles of transmission lines. Every piece of that agenda is incumbent on de-risking mineral supply chains and ensuring that the material inputs that make semi-conductors and lithium-ion batteries possible are both available and affordable.
As the administration is so fond of saying, time is not on our side. Deployment of these energy and transportation technologies must accelerate to reach decarbonization goals. Yet, the current rate of deployment – and build out of manufacturing capacity – is already eclipsing the material supply chains needed to support it.
Consider the scale of the investment going into EV and battery manufacturing and the speed at which new capacity is coming online. New battery megafactories are going from blueprints to production in two years. Comparatively, the mines needed to supply those factories often take decades to reach production.
We simply don’t have the luxury not to energetically pursue domestic mining projects right now to build the massively expanded supply chains we need tomorrow. According to the International Energy Agency, global supply of key metals must expand many times over nearly overnight if we’re to keep up with mineral demand. For example, lithium demand is poised to jump 40-fold, and demand for nickel, cobalt, and graphite is set to soar 25 times by 2040. For copper, which provides the irreplaceable wiring for electrification, annual demand alone is projected by 2050 to reach a level equal to all the copper consumed in the world between 1900 and 2021.
The U.S. has the resources – from rare earths to lithium to copper – to meet much of the demand now at our doorstep. What is lacking is the policy commitment to make it happen. As mines wait for approvals, as delays accumulate or hundreds of thousands of acres of mineral-rich land are withdrawn from potential production, our competitors, namely China, are only tightening their chokehold on the supply chains we know we need.
China’s mineral strength is now appallingly mirrored by our weakness. We’re now import-reliant for more than 50 minerals, with China the leading supplier of 26. The White House has warned that mineral supply chains could be weaponized in the same way oil was in the 1970s and natural gas was in Europe in 2022 following Russia’s invasion of Ukraine. It’s not a matter of if but when it happens. China is already using its dominance of mineral markets to exert geopolitical leverage, announcing restrictions of exports of two rare metals just days before trade negotiations with U.S. Treasury Secretary Janet Yellen.
Secure, reliable, and responsible mineral supply chains need domestic mineral production under the world’s highest labor and environmental standards. The era of outsourcing essential industries, supply chains, and essential American jobs must end. And doing so means that made in America must also increasingly mean mined in America. The Biden administration’s minerals strategy can’t possibly succeed until it embraces domestic mining and we begin approving mines.
On mining, our time to act is now.
By Rich Nolan via Zerohedge.com
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