A new report from the Task and Finish Group, convened by the government, yesterday (19 December) claimed that a lack of resilience in the supply of critical raw materials (CRMs) and minerals “is an increasing risk to UK industry”.
The group added that the country needs to build its midstream processing capabilities among other measures to remain competitive internationally.
Competition rising
The report states that rising demand for CRMs across the globe, largely driven by the net zero transition, further exposes the UK and its businesses to competition from abroad.
While rival firms in other countries, such as the US, EU, Australia and elsewhere, may benefit from the lower prices or greater accessibility of minerals yielded by the domestic reserves, the UK does not have the same advantages.
As a result, the authors say, the UK must adapt to “remain competitive and meet the growing demands of UK industry”.
Meeting the challenge
The report offers specific proposals for countering the problem. The authors argue:
“The UK should consider focusing attention on building capability in midstream processing, as well as building a circular economy to capture the value of materials already in the country.
“These are both high value-add areas where the UK could have a competitive edge though its access to technology and finance.”
The UK also needs a long-term plan for industrial resilience that focuses on CRMs, setting priorities for production and procurement so that industry can “focus resources to fill the infrastructure, skills and financing gaps in these supply chains building resilience into key industries”.
To achieve this resilience, the report contends, they will require “direction and support from government”.
Warning
The Task and Finish report is not the only one to highlight issues in the UK’s access to critical minerals this month.
A House of Commons Foreign Affairs Select Committee report highlighted on Friday last week (15 December) how “successive UK governments have failed to recognise the importance of critical minerals”.
The “aggressive capture of large parts of the market” by China over the last 30 years has left the UK vulnerable, the report says. The UK is also said to be “lagging behind allies in its response to the challenge”.
Alicia Kearns, chair of the Foreign Affairs Select Committee, commented on the publication to say:
“The government must be able to provide UK industry, as well as current and potential trading partners, with a coherent plan to build critical minerals resilience.
“We need to move beyond strategy documents and towards implementation, providing clear priorities and supporting industry to deliver. We are in a global competition for technological advantage which we cannot afford to lose.
“This is primarily about power, not trade. The supply of critical minerals is more a geopolitical issue than a geological one.”
EU too?
While the EU may have considerable mineral reserves, as highlighted in the Task and Finish report, it is having its own problems turning those into useable resources.
Reuters reported earlier this week (18 December) that a combination of rising energy costs and local opposition is making it difficult to mine and refine critical minerals, such as lithium and cobalt, that the bloc requires for its efforts to transition to net zero.
European non-ferrous metal association Eurometaux argues that, though the EU holds promise as a supplier of these materials, it needs lower energy costs and EU funding like that provided in the US, Canada and Japan to be competitive.
The EU last month passed its Critical Raw Materials Act (CRMA), which aims to ensure it mines 10%, recycles 25% and processes 40% of 17 of the main raw materials it uses by 2030.
The legislation will enter into force in 2024 and is partly a response to export restrictions on graphite imposed by China earlier this year, which highlighted the Asian nation’s grip on critical materials.