In order to reduce dependence on China (CCP), a European Union-funded organization has stated that Europe needs a system to independently price the key minerals necessary for energy transition.
According to a report by Reuters on July 15, Bernd Schaefer, CEO of EIT RawMaterials, said last week, “Europe should have a key materials platform with a pricing mechanism that reflects the supply and demand conditions in Europe.”
Some companies have indicated that materials such as lithium, cobalt, and rare earths are oversupplied and prices are weak, inhibiting cash flow for Western startups and making it difficult for them to compete with Chinese companies.
During an interview at the World Materials Forum in Paris, Schaefer mentioned, “Sometimes, a single administrative decision by China (CCP) can reverse the pricing direction, undermining all assumptions for some investors in raw materials. This situation needs to change.”
According to an EU analysis, China produces more than half of the world’s lithium, cobalt, and manganese battery metals. As for rare earth element dysprosium, Chinese companies are responsible for 84% of the mineral supply and 100% of the refining production.
EIT RawMaterials leads an alliance of over 300 companies, academia, and other stakeholders in the industry to implement a plan that aims to provide the necessary raw materials to achieve the EU’s 2050 net-zero emissions target.
The newly effective EU Critical Raw Materials Regulation, enacted in May, sets targets for the EU bloc to mine, recycle, and process minerals including lithium and copper by 2030 to ensure a secure and sustainable supply of key raw materials for the EU.
Schaefer emphasized that as a neutral, apolitical institution, the EIT RawMaterials division can play a crucial role in driving the necessary reforms.
Last month, Rare Earths Norway announced the discovery of the largest confirmed high-value rare earth element deposit in Europe. This discovery holds significant importance for reducing Europe’s reliance on China for key minerals.
During a press conference on June 6, the company revealed that the Fen Carbonatite Complex in southern Norway contains the largest rare earth element deposit in Europe, with an estimated total of 8.8 million tons of rare earth oxides and promising economic prospects for extraction. Among them, an estimated 1.5 million tons of rare earths related to magnets can be used for electric cars and wind turbines. When considering supply chain risks, the EU views these metals as the most critical raw materials.
One of the goals of the EU Critical Raw Materials Regulation is to meet at least 10% of the EU’s annual rare earth demand by 2030. Rare Earths Norway expressed their willingness to contribute to this goal.
Schaefer also called for the establishment of an exploration fund to promote the mining of key minerals in Europe.
“This should not be just a few million euros; it should be in the billions, it must be a large figure.”