The EU exhausted its €250 billion Green Deal months

sanzida963

Fast forward to 2031.  ago; The US Inflation Reduction Act is also closing and things are not going well. Sales of electric vehicles have been hampered by global shortages and price increases in lithium and other minerals. Without enough minerals to supply assembly lines, workers across the US 'battery belt' are laid off, with similar supply problems plaguing Europe. Talks with the new cartel of critical minerals producers have broken down, in part because China, which has acquired large stakes in member countries' mines, is directing supplies to its own battery makers. It doesn't have to be like this. Industry analysts are all flashing the same warning lights: Achieving the energy transition will demand far more lithium and other minerals by 2030 than the world is on track to produce.

Responsibly promoting global production is essential. Avoiding critical mineral shortages will require about 330 new mines over the next decade, according to Benchmark Minerals, even assuming maximum Job Function Email Database progress in recycling. This includes 59 new lithium mines; the world currently has a couple dozen. This is not a problem that any country can solve alone. The magnitude of supply needed to defend against looming deficits is greater than any nation could conceivably extract. The United States and its partners can and should cooperate to boost production abroad. Nor is it a problem that the market can easily handle on its own. There are several reasons to doubt the old saying, “the cure for high prices is high prices.” After all, lithium prices have risen 800% in the past three years, and yet mining companies, wary of price volatility, are not investing anywhere near the rates needed. Recent U.S. critical minerals deals with Japan, and soon Europe, offer a promising opening.



Avoid global shortages, policymakers must go much further. For starters, they will need to bring exporters to the table, not just buyers, by uniting Washington's bilateral agreements with Japan and the EU into a new critical minerals pact with major net importing and exporting countries. In the absence of this type of expansion, the world could read the US agreements with Tokyo and Brussels as an attempted 'buyers club', which risks fueling calls by some exporters to form a cartel similar to OPEC for critical minerals. For a new minerals club to work, purchasing countries would need to offer incentives to expand production responsibly. This starts with treating battery minerals as commodities and adapting policy accordingly. As with agriculture and oil, tailored measures such as price insurance – essentially a contract that gives the seller the option to sell a certain quantity of minerals at a certain price and time – will be important to encourage investment. amid high price volatility.