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Strategic Metals: Will future supply be able to meet future demand?


Multiple studies show that demand for strategic natural resources continues to increase (Alonso, Sherman, Wallington, Everson, Field, Roth, & Kirchain, 2012) (Roskill, 2012) (Hatch, 2012) (Onstad, 2012). New green, commercial, and military technologies, such as wind turbines, consumer electronics, and laser weapons systems use ever-increasing amounts of rare and strategic resources (Alonso et al., 2012). For example, over the past decade, there has been an increase in the use of highly efficient permanent magnets (especially in green energy production). This increased demand for efficient permanent magnets has directly led to increase in the demand for dysprosium and neodymium, strategic metals that are used in the production of permanent magnets (Alonso et al., 2012). On a similar note, the past two decades have seen increased regulation regarding harmful emissions from automotive vehicles. This increased regulation has resulted in greater use of autocatalysts to remove emissions from vehicle exhaust. Autocatalysts are made from platinum and other platinum group elements (PGEs); thus there has been an increase in demand for PGEs (Platinum Today, 2012).

As global population is expected to continues to grow, and countries continue to become more developed, there is no doubt that demand for strategic metals (and other strategic resources) will continue to grow grow as well. Global human population is predicted to exceed 9 billion by 2050. Much of the population growth will be coupled with strong economic growth and will occur in developing nations. As per-capita income increases in these countries, so does the demand for raw materials to be used in electronics, urban development, farming, and military. The effect of an emerging economy on demand for strategic metals can be seen in China's automotive sector. Of the estimated 35 million cars and trucks manufactured globally in 2010, 13.8 million were sold in China and between 2000 and 2010, car ownership in China increased twentyfold (Bloodworth & Gunn; 2012). It is therefore no surprise that demand for PGEs continues to increase. There are similar trends of large growth in many other sectors besides the automotive industry. In the developed world, green tech and green energy production has seen large growth due to the issue of global warming. This has resulted in a large increase in demand for many resources, including neodymium, dysprosium, cadmium, gallium, indium, hafnium, niobium, molybdenum, selenium, tellurium, vanadium, as well as more common materials such as copper, tin, silver, and nickel (Moss et al., 2011).

As has been explained above, there is increasing demand for strategic resources. However, future supply may not meet this increasing demand. Many strategic resources, due to their rarity, cannot easily increase production. For example, there are enough global reserves of rare earth elements (REEs) to last for more than a century; total reserves are 110,000,000 tonnes, whereas current total demand is around 110,000 tonnes (Alonso et al., 2012). However, even though there may a large amount of constituent REE ores, there are still several limitations on supply due to the rarity of mineable, high-concentration ores (Innovation Metals Corp, 2012). Besides rarity of mineable ores, factors such as political stability, environmental considerations, and economics also serve as limiting factors in increasing supply (these other factors are discussed in more detail in the supply & demand pages for each category of strategic resource). Thus demand for REEs and other strategic resources may rapidly outpace supply over the next 100 years.

The inequality between supply and demand of strategic resources will be a global problem. For a given resource, if demand is much greater than supply, then many countries will have limited access to that resource. Developing nations who aspire to use strategic resources in development of their own technologies will face an especially noticeable deficit. Resources are unevenly and inequitably distributed. As the most industrialized countries tend to drive global demand, resources that they do not control are exploited. Thus developing nations, while often containing deposits of a given resource, cannot access the resource due to economic pressures from industrialized nations to export. Inadequate supply of strategic resources will also result in increase in prices for both the resources as well as the final products they are used in. Large price increase (i.e. high inflation) can have negative effects on economic growth. Finally, inadequate supply of strategic resources can cause humanitarian and environmental problems. If demand is much greater than supply, then there is great monetary motivation to increase production, regardless of concern for worker safety or environment protection. Future supply-demand inequality for strategic resources will cause a variety of global problems including inaccessibility, price increases, instability, and environmental and humanitarian disregard. This is a pressing issue as supply for many strategic resources is expected to fall behind demand within the next 100 years. A global solution ensuring future supply meets future demand is therefore a necessity.

As explained in the categorization section, each strategic resource has its current set of uses and production methods. However, for each resource, supply and demand will vary with price and whether new uses are discovered or alternatives developed (Alonso et al., 2012). Mission 2016 developed a categorization of resources that have similar properties in order to facilitate/organize analysis. Using this categorization scheme, case studies are made within each category to better understand future supply and demand for that category. By examining general trends in demand, providing predictions for future demands, discussing what limits supply for each of the groups, and making predictions for how supply can be increased Mission 2016 hopes to greater outline the supply-demand problem for strategic resources and gain insight as to how it can be resolved. It is important to point out that a scenario-based approach is often used when predicting future demand and supply. In such an approach, the growth of different sectors is estimated based on expert insight or historic information. The effect on demand is then calculated using the assumptions of the scenario. This approach gives a range of probable growth rates for total consumption of a given strategic metal (Alonso et al., 2012) (Moss, Tzimas,Kara, Willis, & Kooroshy, 2011) (Department of Energy, 2011).

Alonso, E., Sherman, A. M., Wallington, T. J., Everson, M. P., Field, F. R., Roth, R., & Kirchain, R. E. (2012). Evaluating rare earth element availability: A case with revolutionary demand from clean technologies. Environmental science and technology, 46, 3406-3414. Retrieved from

Bloodworth, Andrew, and Gus Gunn. "The future of the global minerals and metals sector: issues and challenges out to 2050." Geosciences: BRGM's journal for a sustainable Earth 15 (2012): 90-97.

Hatch, G. P. (2012, October). Dynamics in the global market for rare earths. Elements, 8, Retrieved from

Moss, R. L., Tzimas, E., Kara, H., Willis, P., & Kooroshy, J. (2011). Critical metals in strategic energy technologies. JRC scientific and technical reports, doi: JRC 65592. Retrieved from

Onstad, E. (2012, September 19). Analysis: Rare earth prices to erode on fresh supply, china . Reuters. Retrieved from

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U.S. Department of Energy, (2011). Critical materials strategy (DOE/PI-0009). Retrieved from website: