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COVID-19 has highlighted the US dependency for minerals in foreign countries, solutions proposed during Senate hearing

Construction continues at Section F of the new Tesla Gigafactory during a media tour Tuesday,...
Construction continues at Section F of the new Tesla Gigafactory during a media tour Tuesday, July 26, 2016, in Sparks, Nev. It’s Tesla Motors’ biggest bet yet: A massive, $5 billion factory in the Nevada desert that could almost double the world’s production of lithium-ion batteries by 2018. (AP Photo/Rich Pedroncelli) (KTUU)
Published: Jun. 24, 2020 at 9:09 AM AKDT
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The coronavirus pandemic has not only placed some speed bumps in the way we go about our daily lives, but it has raised a concern on how the U.S imports and comes about crucial and critical minerals.

Wednesday, the Senate Energy and Natural Resources Committee held a hearing “to examine the impact of COVID-19 on mineral supply chains, the role of those supply chains in economic and national security, and challenges and opportunities to rebuild America’s supply chains,” said a description of the hearing in a release.

Witnesses included:

  • Dr. Nedal Nassar, Chief, Materials Flow Analysis Section, National Minerals Information Center, U.S. Geological Survey, U.S. Department of the Interior
  • Joe Bryan, Senior Fellow, Atlantic Council Global Energy Center
  • Mark Caffarey, President, Umicore USA, Inc.
  • Dr. Thomas J. Duesterberg, Senior Fellow, Hudson Institute
  • Simon Moores, Managing Director, Benchmark Mineral Intelligence

A main chunk of the hearing focused on the U.S’ reliance on foreign counties, namely China, for critical minerals such as Lithium-ion.

“The U.S. Geological Survey tells us that we imported at least 50% of our supply of at least 46 different minerals, including 100% of 17 of them, in 2019. Beyond the numbers, that means we are placing our fate on others’ ability and willingness to sell to us. And we are forcing American manufacturers to develop complex global supply chains that sometimes prompt them to realize it would be cheaper and easier to locate somewhere else,” said Sen. Lisa Murkowski in her opening remarks.

Simon Moores, Managing Director, Benchmark Mineral Intelligence, like other witnesses in Wednesday’s hearing touched a lot on the issue of China’s some could say dominance on lithium-ion battery production.

Moores highlighted that Lithium-ion batteries are a core platform technology for the 21st century.

“A new global lithium-ion economy is being created. Yet, any U.S. ambitions to be a leader in this lithium-ion economy continue to only creep forward and be outstripped by China and Europe. In more stark terms: China is building the equivalent of one battery mega factory a week, the USA one every four months,” said Moores.

Joe Bryan, Senior Fellow, Atlantic Council Global Energy Center, touched upon the topic of lithium-ion but from the perspective of national defense.

“While China is the dominant player, we are also quickly losing ground to our European allies as well. This is a problem.”

Bryan says our supply chain weakness not only effects the U.S economically but also impacts national security.

“From communications gear that keeps troops connected on the battlefield, to unmanned aerial and sub-surface platforms, to tactical ground vehicles transitioning away from lead-acid, lithium-ion batteries are everywhere.”

Like Moores, Bryan highlighted how the future is dependent on lithium-ion and how the U.S is lacking when it comes to the current supply chain. Bryan noted how COVID-19 impacted the production of key minerals.

“For example, COVID-19 severely impacted the supply of cobalt, a key mineral in the production of lithium-ion batteries. The cause of the disruption this time was a pandemic but it could have been a material shortage, a trade dispute, or in the worst-case military conflict that caught off access to key materials.”

The hearing did produce some positive outlooks on what is being done currently to combat a possible shortage and build up the U.S supply of crucial materials. Both Moores and Bryan highlighted the steps being taken in the U.S to foster domestic production.

“In the USA, progress is far too slow on building out a domestic lithium-ion economy, but the opportunities that remain are vast and pioneers have emerged. Tesla has continued to lead the industry and build on its Nevada gigafactory by announcing super-sized battery plants in Germany and China and is widely expected to announce the fourth plant in Texas. Ohio, with bipartisan support and of organizations like JobsOhio, has recognized the scale of this opportunity and successfully attracted the $2.3B General Motors /LG Chem joint venture,” Moores said in his opening statement.

Bryan also touched upon the development in Ohio.

“The State of Ohio recently landed a $2.3B investment from General Motors and South Korea’s LG Chem to build a battery plant in Lordstown, Ohio," Bryan said. "That facility will bring more than 1000 jobs to the Mahoning Valley. We can’t change geology and create resources where they don’t exist. But we can change direction and compete for supply chain jobs in minerals processing, anode, cathode, and cell production.”

During the Q&A portion of the hearing, talk emerged on what the U.S can do to get ahead or decrease its dependency on foreign countries.

Potential solutions include:

  • Taking a closure look at mining protocols and procedures. For example, making changes to the permitting process to get mines up and running faster to foster the materials we need.
  • Working with our allies and not just China.
  • Mark Caffarey, President, Umicore USA, Inc. wrote,” the economic growth benefits of a domestic commitment to the recycling of critical materials could be enormous.” Other witnesses including Dr. Thomas J. Duesterberg, Senior Fellow, Hudson Institute, highlighted this option. Duesterberg also touched upon the mining solution.
  • Pushing educational systems to invest in technical degrees. What was highlighted in the talks about this solution was the need for more women in STEM programs.
  • There was talks about stockpiling minerals we need.
  • Another solution was to invest in domestic manufacturing. “It’s scary the United States has gotten to this point, especially since we have many of these resources in the backyard of the United States, we don’t need to be so dependent on foreign for these critical minerals,” said Senator Steve Daines.

Another solution that was proposed was from Murkowski in her opening statement.

“We need to do more, and of course we’ve got an answer here on this committee," Murkowski said. "We can start by passing my American Mineral Security Act, which provides the framework for a sustainable domestic mineral supply chain. It recognizes the expertise at agencies like USGS for surveying and forecasting. It directs DOE to conduct research and development into alternatives and recycling while facilitating modest permitting reforms and helping to ensure a skilled workforce.”

This is a brief write up of Wednesday’s hearing, for the full hearing where you can hear more about the current state of the mineral supply chains and what needs to be done,

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