Critical Minerals Technology Race to Determine National Security!
Critical minerals are fueling the current transformation from the 17th Century Coal-Age period of the First Industrial Revolution to the Technology Age of the Third Industrial Revolution. Whoever wins the critical minerals technology race, particularly ensuring a guaranteed supply chain of supplies, can only hope to consolidate and advance technology-cum economy security that are vital elements of national security.
The Indian Ministry of Mines has identified a total of 69 elements/minerals as critical in 2022. India as per CSEP 2020, has 30 elements/minerals out of 69 available in limited quantities only. There are 12 Minerals considered strategic and critical to include: Boron, Cobalt, Lithium, Molybdenum, Rhenium, Nickel, Niobium-Tantalum, Platinum Group of Elements; Rare Earth Elements (REEs), Titanium, Tungsten, Vanadium, Zirconium-Hafnium.
Availability of 12 minerals in India includes: Cobalt (Ore 45 Mn Ton; Res 0); Molybdenum (Ore27203398 Ton; Res 0); PGE (2092 tons metal; Res 0); RRE (459727 tons; Res 0); Titanium (41110526 ton; Res 15998625 ton); Tungsten (Ore 89432485,Metal 14465007; Res 0); Vanadium (Ore 24638855; Res 0); Zirconium (1674435; Res 669466); Bauxite (3240 Million Tons; Res 656 Million Tons); and Boron (74203 Tons Res 0). And, other include: Zinc (Metal 25732.32; Res Metal 7438.05); Copper (Ore 1496979 K.T & Metal 1003552 KT; Res Ore 163891 KT & Metal216157 KT); Nickel (189 million ton)
Next, the list of 17 REEs include: Yttrium; Cerium; Lanthanum; Erbium; Terbium; Ytterbium; Holmium; Scandium; Samarium; Thulium; Praseodymium; Neodymium; Dysprosium; Europium; Gadolinium; Lutetium; and Promethium. Of the 17 REE’s, the most important ones include: Yttrium, Cerium, Lanthanum, Terbium, Samarium, Praseodymium, Neodymium, Dysprosium, Europium and Gadolinium.
Mankind is transiting the “Technology Age”. Minerals such as REEs, lithium, graphite, cobalt and titanium, which are essential for the advancement of high-tech electronics, defense, clean energy technologies to meet the “Net Zero” commitments, and telecommunications and transport, will determine the winners in the Technology Race. The production of semiconductors, which are present in all types of electronics, including smart phones, computers, automotives, energy storage, medical devices, lighting, and military and aerospace applications, depends on them.
The four most used critical minerals are “Silicon, Gallium, Germanium, and Palladium.” Silicon is used for chip wafers, where additional metals such as arsenic, iridium, and phosphorus are introduced to slightly alter the wafers’ conductivity. Other materials used include: Fluorine for etching and purifying; Copper and Cobalt for the wires connecting these billions of transistors together into one integrated circuit; and Titanium for advanced packaging; and Arsenic needed for gallium arsenide (GaAs) chips, which are increasingly being substituted with higher-performance gallium nitride (GaN) compounds.
India is endowed with sufficiently large reserves of Silica minerals: estimated total reserves of silica minerals of 1,350 million tones. India is a major player in the world's silicon alloy production. The growth of the Indian silicon alloy market is driven by the growing need for steel in industries like construction, shipbuilding, and automotive. In 2023, India's ferrosilicon production was estimated to be 60,000 metric tons, making it the 11th largest producer of silicon in the world. It is projected to reach $79.6 billion by 2028. In 2022, India exported $161k in Silicon, that was over 99.99% pure, making it the 35th largest exporter of Silicon, >99.99% pure in the world. The main destinations of Silicon, >99.99% pure exports from India are: UAE ($51.6k), Nepal ($28.8k), Mozambique ($23k), Senegal ($19.9k), and Togo ($18.1k). At the same time, in 2022, India imported $308,000 worth of silicon that was over 99.99% pure, making it the 43rd largest importer in the world. The main sources of India's silicon imports were the United States, Chinese Taipei, China, Austria, and Canada.
Top 10 Silicon manufacturing companies in India include: Vedanta Limited; Tata Elxsi Limited; Dixon Technologies India Limited; MosChip Technologies Limited; ASM Technologies Limited; Reliance Industries Limited; RIR Power Electronics Limited; HCL Technologies Limited; MIC Electronics Limited; and Samsung India Electronics Private Limited.
Next, China is known as the King of REEs. Gallium does not occur as a free element in nature. It usually occurs as a trace component in zinc & bauxite ores. It can also be extracted from poly metallic ores by leaching and also from coal ash and coal. Gallium is also recycled from scrap generated from industries in Canada, China, Japan, Slovakia, and the United States. China accounts for 89 percent (estimated 1,100,000 kilograms per year) of the world’s “Refined Gallium.” The remaining primary low-purity Gallium producers outside of China included Japan, the Republic of Korea, and Russia.
World high-purity refined Gallium production capacity is an estimated 340,000 kilograms per year, and secondary high-purity Gallium production capacity is an estimated 280,000 kilograms per year. Germany, Hungary, Kazakhstan and Ukraine ceased primary production in 2016, 2015, 2013 and 2023 respectively. Now, they are considering restarting domestic primary gallium production to include the USA.
Also, China is a leading global exporter of Germanium with 68 percent of the world’s Germanium production. Germanium is a key material for high-speed transistors due to its high electron mobility. Fiber-optic cable manufacturing accounts for one-third of germanium demand. Germanium wafers are high performing and can be found in computer processors, infrared detectors, communication systems, and radar systems. No alternatives to germanium exist without significant performance losses.
Germanium does not occur as a natural metal. It is sourced as a byproduct of the processing of zinc ores. The mineral is one of the rarest metals on the periodic table. Countries with the greatest zinc reserves, aside from China (60 percent global supply), include Australia, Peru, and Mexico. Germanium needs significant refining to become suitable material for semiconductors, particularly expensive, as the metal needs to reach purity levels of over 99.999 percent. The process is not only costly, but technically challenging and energy intensive. Since imposing export restrictions by China in 2023, germanium prices have climbed over 70 percent, to $2,280 per kilogram. Nearly all exports from China go to Russia, Germany, Hong Kong, Belgium, Japan, and the United States, in descending order of quantity.
Russia holds the world’s largest Palladium reserves and the leading producer with 92 metric tons produced in 2023. Russia palladium exports in 2022 accounted for 18.1% of the total value. South Africa holds the world’s second-largest reserves of Palladium. Canada, USA and Zimbabwe follow them way behind. India has platinum group of elements (PGE) deposits, including the Baula-Nausahi belt, which is estimated to contain 14.2 million tonnes of deposits. The total cash cost for mining one ounce of palladium varies: $590, compared to just $402 at Norilsk in Russia; and in Montana, USA in 2024 operating costs of $1,032 per ounce, greater than the current selling price of palladium.
Most important is to know the true state of the REEs in India. 1% of global output is only produced in India. To meet most of its requirements, 92% of REE metal imports by value and 97% by quantity were sourced from China. However, there are 7 million tons of REE’s reserves accounting for more than 6 percent of global REE reserves, fifth largest in the world, available in India.
Monazite is the principal source of REE’s and thorium. The resource estimates of monazite in the beach and inland placer deposits have been enhanced from 11.935 million tons in 2012 to 12.47 million tons in 2016 which corresponds to about 1 million tons of thorium oxide.
Other REEs available in India include: Lanthanum, Cerium, Neodymium, Praseodymium and Samarium, etc. India produces Limonite, Rutile, Zircon, Garnet, and Sillimanite, Lanthanum carbonate, Cerium (III) carbonate, Ndpr Oxalate, Thorium (IV) nitrate, Disodium phosphate and Rare Earth Chloride. Others such as Dysprosium, Terbium, and Europium, which are classified as HREEs, are not available in Indian deposits in extractable quantities.
The Indian Rare Earths Limited (IREL) is the lead agency in the strategic and niche sector. IREL commissioned its largest division called Orissa Sand Complex (OSCOM) at Chhatrapur, Odisha. It produces/sells six heavy minerals namely Limonite, Rutile, Zircon, Monazite, Sillimanite, and Garnet. From 1 May 2015 it started commercial operation of Monazite Processing Plant at Orissa to process 10000tpa monazite to produce 11220tpa of rare earth chloride, 13500 tri-sodium phosphates, 26tpa NGADU etc. Similarly High Pure Rare Earth facility also commenced operation to refine pure rare earth compounds. The Rare Earth Permanent Magnet (REPM) in Vizag and Rare Earth and Titanium Theme Park (RETTP) in Bhopal have kick started with the funding assistance of Government of India.
However, India remains largely import-dependent for lithium, nickel, cobalt, copper and graphite and their compounds. For minerals like lithium oxide and nickel oxide, overall imports largely come from Russia and China, both countries with potential trade risks. India is also highly import-dependent for copper cathodes and nickel sulphates from just two countries - Japan and Belgium. Also, India depends heavily on China for synthetic graphite and natural graphite.
Analyses of Silicon, Gallium, Germanium and Palladium chains conclusively highlight both the dominance of China and others in the production of these critical raw materials. China has labeled rare earth mining and refining as state secrets. In 2023, China imposed export controls on two chemical elements: Gallium and Germanium. China’s recent moves to take charge of the supply chain include other obscure chemical elements. On Sept. 15, 2024, China's Ministry of Commerce restricted exports of antimony, a material used in semiconductors, military explosives and other weaponry.
Undeniably, India faces global and domestic challenges in ensuring reliable supply chains for critical minerals. India objective is to achieve 500 gigawatts (GW) of non-fossil fuel-based electricity installed capacity by 2030. As per other experts, India needs to install around 7,000 GW of renewable energy capacity to achieve net-zero emissions by 2070. If so, the demand for critical minerals may more than double by 2030. By 2070, the requirements may multiply. Internationally, there are major risks to consider include: Russia-Ukraine War: Russia is a major producer of nickel, palladium, titanium sponge metal, and the REE scandium. Ukraine is a significant producer of titanium and has reserves of lithium, cobalt, graphite, and rare earth elements; and Impact of China-Russia Partnership and Disparity in International Initiatives.
There are opportunities to exploit. India is endowed with bauxite and zinc ores. So also, there are large reserves of silica minerals, estimated to be around 1,350 million tones. The auctions of mines by the Ministry of Mines and the “Critical Minerals Mission” are intended to improve domestic production of critical minerals. However, domestic mining operations may meet only part of renewable energy goals.
In the past, small quantities of Gallium were extracted by the Hindalco Industries Ltd in Renukoot, Uttar Pradesh and National Aluminium Co. Ltd in Damanjodi, Odisha. Nalco has plans to set up a 10 tpy gallium extraction plant at its Alumina Refinery in Damanjodi (Odisha). NALCO has targets to produce Gallium metal with a purity of 99.99%. Also, an MoU was signed with Bhabha Atomic Research Centre (BARC), Mumbai in May 2016 for various R & D works like extraction of Gallium and other REEs from Bayer Process liquor and Alumina waste. Furthermore, developing local Germanium and Lithium refining capabilities and exploring alternative trade partners are crucial steps forward.
For the critical mineral strategy to be successful, India needs to develop the entire value chain from exploration to recycling. So, the strategy must include: capacity building at each stage of the value chain namely geosciences and exploration; Ban exports, besides eliminating illegal mining practices; mineral extraction; intermediate processing; advanced manufacturing; and recycling. Incentives and subsidies in downstream manufacturing to private parties is an imperative. Also, support to develop mining and refining capabilities in allied countries like Australia, Chile, Ghana, South Africa, Mozambique, Madagascar, Brazil and Tanzania.
To address supply chain vulnerabilities, policymakers must develop an import strategy, partnerships with mineral-rich nations, and balancing international relationships to secure these essential minerals is critical. The strategy should prioritize: (1) incentivize private investments by creating an investment tax credit for processing and refining projects; (2) opening national laboratories focused on semiconductor mineral research and development; (3) expanding eligibility for grants; (4) offering direct subsidies to encourage off take agreements with other country’s companies; and (5) offer dedicated funding for production of upstream gallium, germanium, palladium, or silicon for military-grade GaN.
To sum up, inadequate quantities of critical minerals and their reserves, particularly REEs, is real. Unless India formulates and implements a credible strategy for managing the uninterrupted supply chain of critical minerals, it cannot catch up to the lead players in the “Technology Age Race”. India’s rise to global power status may remain a mirage.
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