paper 02 - july 2019 critical raw materials: … · the institute has over 75 years’ experience...

Electric Arc Furnace at the Materials Processing Institute

CRITICAL RAW MATERIALS: DECARBONISATION,DEMOCRATISATION AND DECENTRALISATION OF SUPPLY CHAINS

WHITE PAPERINNOVATION SERIESPAPER 02 - JULY 2019

CRITICAL RAW MATERIALS: DECARBONISATION,DEMOCRATISATION AND DECENTRALISATIONOF SUPPLY CHAINS

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Critical Raw Materials: Decarbonisation, Democratisation and Decentralisation of Supply Chains

THE INNOVATION SERIES

The world has a long of history of conflict when it comesto valuable and scarce resources, be that theConquistador’s hunger for gold in South America, orEuropean powers seeking control of the Spice Islands inSouth East Asia. For most of our modern history theresource has been oil and the conflict has been in theMiddle East.

This is about to change. Access to rare earth materials isnow vital for future technologies and we can now see thepower play for resources such as cobalt and lithium aspotential conflicts of the future if we don’t act now.

Our global economy faces two major forces for change.The challenge is to decarbonise fast enough to preventcatastrophic global warming and the solution is in theemerging digital technologies of the 4th industrialrevolution.

These two unstoppable forces are driving the rapiddevelopment and commercialisation of technologiesthat will reduce oil dependency, but also move the riskof conflict and exploitation to impoverished and unstablecountries such as the Democratic Republic of Congo,where valuable resources are to be found.

To meet these challenges in a way that is bothsustainable and avoids making the mistakes of the past,we need to consider how we can realise the potential ofthese technologies and secure the resources through thedecarbonisation, democratisation and decentralisationof supply chains.

Decarbonisation

It can come as a surprise to learn that the technologieswhich will enable us to create the green industries of thefuture, are dependent on the highly resource and energyintensive industry of mining and yet everything has to bemade out of something. Consider electric vehiclebatteries, for example, where new technology reliessignificantly on the supply of materials such as copper,graphite, cobalt and lithium.

New technologies required to decarbonise our economydepend on a set of raw materials that are both critical andscarce. From platinum to palladium, niobium toneodymium, gallium to germanium, these elements areessential for fuel cells, photovoltaics and LEDs.

The manufacturing industries of the future depend onthese materials, classed as critical by the BritishGeological Survey. The challenge is that few nations holdsufficient resources in sufficient quantities.

Democratisation

Fundamental as they are to economic growth, access tothese materials is important for UK sovereign capabilityin industrial, defence, and foreign policy too. Just as thediscovery of Borrowdale graphite in the 16th centuryenabled the UK to dominate the global writinginstrument industry for almost 300 years, so Chinesedominance of the global graphite supply in the 21stcentury threatens ambitions for so-called ‘giga factories’in Europe.

In fact, with 40% of global rare earth reserves combinedwith a canny foreign policy initiative in the ‘Belt and Road’,China could dominate the green technologies of thefuture, such as smart phones, electric vehicles andrenewable energy.

Relying on primary sources of materials risks exploitationof both people and the natural world. It can place controlin the hands of unstable, or undemocratic regimes andincentivises global powers to keep things that way. Thismay seem a matter for geopolitics, but addressing thissupply chain vulnerability requires policy makers,technologies and manufacturers to recognise theirinterdependency and take a new approach.

For the EU to achieve its target level of electrification by2030 would deplete the known world reserves of lithiumwithin five years and cobalt within 12 months. It isgenerally assumed that industry would find morereserves, but even a trebling would present a hugechallenge. China already controls 80% of supply and isleading the world in the implementation of many greentechnologies at scale.

UK and European governments need to support industryin unleashing the forces of innovation, to understandhow these precious materials can be conserved, tracked,separated, reused and recycled. This can be an enablerfor a circular economy, with a ‘cradle-to-cradle’ approachto manufacturing that is more environmentallysustainable, efficient and profitable.

Materials Processing Institute


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Decentralisation

There are also new manufacturing techniques that canhelp, such as additive layer manufacturing, also knownas 3-D printing. This technology will render obsoletelarge swathes of the supply chain, from machining towelding and fabrication. Value in the supply chain iscollapsing to two areas, materials and design. There arecompanies well positioned to take advantage of this,including Liberty Powder Metals, which recentlyannounced a £10m investment at the campus of my ownresearch institute, for the development of new metalpowders.

The next challenge comes in upscaling thesetechnologies. This requires new processes that either usefewer materials, or increase efficiency. As this industrialrevolution takes hold, we will see the increasingimportance of materials and materials science, in bothdriving forward and capturing value from the supplychains of the future.

Response

The technologies to decarbonise our economies must becommercialised, but this is best done in a way whichallows both democratic control and decentralisation ofsupply chains. Legislators can help ensure that industrialpolicy takes a supply chain approach, whilst I have longargued that we industrialists and manufacturers need tobe more concerned with the ethical supply of ourmaterials and our environmental footprint.

We should not seek to pass off our global responsibilitiesto current and future generations so working conditions,sustainability and financial probity in the materialsindustry that makes up our smart phone is as critical asin the design and assembly.

Let us do more to realise the technologies that willenable a circular economy approach in rare earths andcritical materials to both improve sovereign capabilityand reduce environmental impact. This is a particulararea of interest for my own organisation, the MaterialsProcessing Institute, where the circular economy, alongwith advanced materials, digital technologies and lowcarbon energy, form our areas of research priority.

These twin responses will enable us to both drive upethical standards in primary extraction and reduce supplychain vulnerability.

Chris McDonald 14 July 2019Chief Executive Officer

This paper was published as an article in Manufacturing Today,

Europe. Issue 168 2019.




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Chris McDonald is the Chief Executive Officer of theMaterials Processing Institute. The Institute carries outindustrial research and innovation in advanced materials,low carbon energy and the circular economy. Chris’sbackground is in industrial research and manufacturing,where he has worked internationally. He led thedivestment and return to independent, not-for-profitownership of the Institute in 2014, the year theorganisation celebrated its 70th anniversary.

In addition to leading the Institute, Chris provides expertconsultancy support to companies, Governments andpublic bodies, in technology strategy and the technicaldue diligence aspects of mergers and acquisitions. He isprominent in the development of public policy, aroundinnovation, steel and SMEs, where he works to supportgrowth and inward investment. He is the policy chair forInnovation and Enterprise for the Federation of SmallBusinesses, a member of the CBI Regional Council for theNorth East and is the Innovation Lead for the UK MetalsCouncil. Chris is also a member of the Steel AdvisoryBoard for UK Steel (EEF).

A graduate of Cambridge University, Chris is a Fellow theInstitute of Chemical Engineers and of the Institute ofMaterials, Minerals and Mining. He sits on industrialadvisory boards at a number of universities, includingOxford and Sheffield.

He is often called to commentate in the media oninnovation leadership and the steel industry.

Chris McDonaldChief Executive OfficerMaterials Processing Institute

Chris provides expertconsultancy support tocompanies, Governmentsand public bodies inmaterials, technology andinnovation strategy

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The Materials Processing Institute is a research and innovation centre serving global steel and materialsorganisations, developing new technologies in advanced materials, low carbon energy, the circular economyand digital technologies.

Through collaboration with its customers, the institute provides a range of technology and R&D basedservices and consultancy. It also has pilot and demonstration facilities and an SME Technology Centre tosupport chain businesses with development of new technologies and products.


ADVANCEDMATERIALS

DIGITALTECHNOLOGIES

LOW CARBONENERGY

THE CIRCULARECONOMY

Working to reduce carbon emissionsthrough enhanced use of energy todevelop a low-carbon future globally.

Utilising digital technologies tooptimise industrial processes anddevelop advanced materials.

Research in advanced materials tounderstand how they can be usedmore efficiently and effectively anddevelop new and innovative materials.

Research to minimise resource usage,waste, emissions and energy leakagethrough improved design, maintenance,repair, reuse, remanufacturing,refurbishing, and recycling.

The Materials Processing Institute

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The Materials ProcessingInstitute is an independent,open access and not-for-profittechnology and innovationcentre working with industry,government and academiaworldwide. Support rangesfrom small scale, site basedinvestigations, through to longterm collaborative researchprogrammes.

The Materials Processing Institute has expertisein materials, materials processing and energy,specialising in challenging processes, particularlythose involving high specification materials, hightemperatures and difficult operating conditions.

The Institute has over 75 years’ experience as aleading UK technology provider. Extensivematerials processing knowledge is supported bystate-of-the-art facilities with a broad range ofequipment, from laboratories through todemonstration, scale-up and production plant.

Scientists and engineers work with industry andapply their expertise to develop and implementrobust solutions to research and developmentand improvements for products and processes.

Expertise is spread across a wide range ofdisciplines, including:

> Materials Characterisation, Research and Development

> Simulation and Design

> Monitoring, Measurement and Control in Hostile Environments

> Process Development and Upscaling

> Specialist Melting and Steel / Alloy Production

> Engineering / Asset Management

> Materials Handling

> Minerals and Ores

Research and project management teamsdeliver support across a wide range ofindustrial and manufacturing sectorsincluding:

> Metals and Metals Manufacture

> Chemicals and Process

> Nuclear

> Oil & Gas

> Energy

> Aerospace and Defence

> Mining and Quarrying



paper 02 - july 2019 critical raw materials: … · the institute has over 75 years’ experience...

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