Africa: key to commodity diversification

Africa: key to commodity diversification

Unpredictable geopolitical events in the last two years have shown the need for global commodity diversification. Decreasing the total dependency on historic dominant supply countries, will limit the impact and provide more stock security in sensitive industries.

By Dr Nicolaas C Steenkamp

China is the main supplier of Rare Earth Elements (REE) to the global market. In 2021, the country introduced sudden restrictions on the export of REE and hardened their production limits in-country.

This led to a scramble in the rest of the world to secure sufficient reserves of REE that is used in all major electronic devices and sensitive military equipment. The result was a sharp increase in investment in securing domestic supply in countries such as the United States, Canada, Australia and within the European Union.

Funding was made available to construct processing plants and measures were implemented to fast track the development of metallurgical methods to separate and recycle REE from common household devices.

There was also a drive to establish recycling collection points. The slow rate of development of REE projects in developing countries, specifically in African countries like South African, Zimbabwe, Burundi, and Malawi, saw an urgency to develop production capability to supply mainly hard rock ore to the market.

Fears of uranium supply

The recent destabilisation of Kazakhstan has sparked concerns about the supply of uranium oxide to the global market. As a result, a couple of smaller, dormant uranium mining operations indicated that they could restart production if the situation continued for an extended period. Africa has several uranium deposits that could supply the global market, most notably in Namibia, but also in countries like Niger and the Central African Republic (CAR).

Bulk commodities and base metal supply (copper especially) has also been threatened, mainly due to community unrest in the major producing countries like Chile, Peru, and Zambia. Copper is critical for the development of renewable energy. Offshore wind turbines, for example, contain more than 50kg of copper per meter of cable.

Lithium development critical

Other critical elements in the Electric Vehicle (EV) industry, such as lithium, is also controlled to a large extent by the Andean Mountain countries, placing the global supply at risk. Therefore, the development of hard rock deposits, in countries like Zimbabwe, is critical.

It is therefore considered important to develop and focus on the African deposits to not only secure domestic supply to Africa, but to become and remain significant suppliers to the global market. This will require the African countries that host these deposits to establish the necessary infrastructure to export in-country beneficiated products, rather than just raw ore.

About the author: Dr Nicolaas C Steenkamp is an independent consultant, specialising in geological, geotechnical and geometallurgical projects and mining project management. He has over two decades of industry experience with global exposure. ncs.contract@gmail.com

WhyAfrica provides you with business intelligence that matters. WhyAfrica specialises in African affairs and natural resources. Africa is our business, and we want it to be yours too. To subscribe to WhyAfrica’s free newsletter or digital magazine, and for more news on Africa, visit the website at www.whyafrica.co.za or send a direct message. WhyAfrica launched its first ever digital magazine in November. If you are interested in contributing or advertising in future issues, please contact me at leon@whyafrica.co.za. We have a wide range of different packages and combo deals to give your company the greatest exposure to a rapidly growing, African readership.       

 

Leave a Reply

Your email address will not be published.

five × 5 =