Critical minerals are of high economic importance for countries all over the globe, while also being vulnerable to supply disruptions. Critical and transition materials are confronted with a growing global demand, driven by the decarbonization of economies and the push for green energy.
Various countries and regions have now identified the minerals deemed essential to their short-term and long-term green energy futures, and have taken measures to secure key supply chains.
Nations are continually revising their critical minerals rules and regulations to adapt to growing themes of de-globalization, and to stay ahead when creating better, bigger, and greener technologies.
This piece takes a look as some of the more recent critical minerals regulations imposed across the globe.
China
China is first in the list of major critical minerals regulations to impact the rest of the world, as in July 2023, the mega-country-imposed export restrictions on gallium and germanium, two semiconductor minerals that the United States (US) does not produce domestically.
Then, China announced further stringent export restrictions on “dual use” technologies for both civilian and military use, specifically targeted, once again, at the US.
These new restrictions intensify the growing trade war between China and the US, marking the first time Chinese export restrictions on critical minerals have specifically targeted the US rather than all countries, and the first time such restrictions have been a direct response to limitations on advanced technologies.
Since then, China has added antimony to its increasingly stringent list of US exports in response to President-elect Donald Trump’s threats to sharply raise tariffs on imports from China and other countries, potentially intensifying simmering tensions over trade and technology.
Europe
Next up, The European Critical Raw Materials Act. As part of the European Green Deal, the European Commission (EC) has introduced new legislation called the Critical Raw Materials Act (CRMA) to enhance the production, processing, and recycling of strategic raw materials in Europe and to diversify supply chains. This legislation, agreed upon by the European Council and European Parliament in April 2024, came into effect in May 2024.
This development is significant for advocates of mineral exploration, mining, and projects involving the re-processing, refining, and recycling of critical raw materials worldwide.
The first round of applications for projects to be designated as ‘strategic’ closed in August 2024, with the initial projects being defined this month.
THE CMRA has a strong mandate with ambitions to reduce reliance on dominant suppliers of strategic raw materials that put the burden on EU member states to rapidly scale-up efforts to secure a stable, long-term supply of materials for strategic purposes from within the EU and partner nations.
Australia
Australia implemented one of its most significant minerals regulations in years with its “Critical Minerals Strategy 2023-2030”. The strategy also, unsurprisingly, aims to reduce the country’s dependence on China.
It also emphasizes increasing the value of Australian critical minerals by processing them domestically rather than just exporting raw materials, and it includes plans to attract investment and build international collaborations to secure these ever-important critical mineral supply chains.
The Australian Government website states that China currently accounts for over 60% of REE mining, over 80% of rare earth refinement and processing, and more than 90% of rare earth magnet production. Additionally, China has major critical mineral reserves, supported by substantial state financing and loose environmental regulations. As a result, it dominates much of the critical mineral refinement and processing market.
Australia is already a strong contender in the lithium mineral market; however, its rare earth industry is less developed. Nevertheless, Australia’s mineral wealth presents a strong opportunity to diversify mineral supply chains outside of China.
The Australia Government states, “Australia has what it takes to compete with China, but government financing, regulatory support, and international cooperation will be essential.”
Canada
Moving on over to Canada, with its Strategic Innovation Fund (SIF) that is part of its whopping C$2.8B Critical Minerals Strategy.
Canada currently has a list of 31 minerals it considers to be “critical.” The fund provides major investments in innovative projects that will help grow Canada’s economy. SIF reviews the potential for each project to benefit the Canadian economy and Canadians at large when assessing the “statement of interest.”
SIF is an integral part of Canada’s larger critical mineral strategy, which sets out a course for the country to become a global supplier of choice for critical minerals and the clean digital technologies they enable.
The SIF has funded over 100 direct-to-business projects and ten network agreements, representing a total of over C$8.2B in SIF contributions, with the potential to generate C$72B in private sector investments across various sectors.
Brazil
Brazil is well-positioned to become a driving force in the global energy transformation. The country is home to some of the world’s largest deposits of critical minerals necessary for the shift away from fossil fuels.
While Brazil already exports some of these minerals, it aims to develop domestic value chains for critical minerals, capitalizing on its leadership in renewable energy.
In February 2024, Brazil announced a US$200M fund to support exploration and improvements in ESG practices. The fund was created in partnership with the Brazilian Development Bank (BNDES) and the Ministry of Mines and Energy, and it aims to increase local production of materials for Electric Vehicle (EV) batteries and promote ESG practices in invested companies.
The fund’s goals are to support projects considered strategic to the energy transition, decarbonization, and sustainable food production.
The money can be used by small and medium sized companies to invest in facilities and projects eligible under the fund’s criteria but restricts the funds form being used by larger companies who already have access to capital.
