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Speaking at the summit of the European Raw Materials Alliance, European Commissioner for the Internal Market, Thierry Breton, expressed concern about the EU’s dependence on third countries for 99 products, primarily raw materials (supply of rare earths, 98% of which are delivered to Europe from China, both raw and refined), necessary for the ecosystem of energy-intensive industries.
It is not an enviable position to be in, but we are not alone: the US, Japan, the UK, Canada, Australia, India and others are rushing to address this vulnerability.
It’s a similar situation with rare earths and permanent magnets as we were a few years ago with batteries and lithium: total dependence on China, very limited EU production, no European regulation to encourage ethical sourcing of rare earths, create demand for recycled materials, or give European manufacturers a competitive advantage through carbon footprint requirements, and downstream industries benefiting from the current situation in terms of cost-effectiveness.
In this context, Breton reported that it is important for member states and regions to follow the guidance set forth in the EU Action Plan on Critical Raw Materials and work together to identify critical raw materials and rare earth mining, processing, and valorization projects that can be operational by 2025.
The former French economy minister pointed out that to work toward this goal, the EC established the European Raw Materials Alliance, ERMA, to address the value chain of rare earth magnets and motors as a priority.
“If these projects were implemented, 20 percent of Europe’s rare earth needs could come from the EU. From almost zero today. What is needed now is to find the funding, both public and private.
In his view, national recovery plans could provide funding for this, which would be helped by the Important Projects of Common European Interest, IPCEI.
Second, a dialogue will also be initiated with downstream market players, talking to rare earth and magnet producers, diversifying for the EU the entire supply chain from rare earths to magnet recycling. Now is the time to talk to downstream manufacturers in the automotive, wind energy, defense, and digital sectors that use these magnets, to understand what their concerns are and how they can contribute to resilient EU value chains.
As a third pillar of the strategy to reduce Europe’s dependence on China, the Internal Market Commissioner reported that, as part of the
the EU’s action plan, his office has promoted a number of partnerships with resource-rich countries to ensure a diversified supply of critical raw materials extracted sustainably away from a single source.
These partnerships focus on integrating raw material value chains between the EU and third countries, cooperation in research and innovation, and social and environmental criteria.
Breton highlighted a recent agreement signed with Canada, but that the goal is to also connect with some African countries, while partnerships on the ground are to be implemented by members of the European Raw Materials Alliance and the European Institute of Innovation and Technology.
For the commissioner, however, there are not enough partnerships to meet the continent’s growing demand for critical raw materials. Thus, he called on member states to start considering domestic sourcing.
This proposal refers not only to promoting circularity and recycling and increasing the use of secondary raw materials, but also to supporting mining projects.
Finally, “I believe that the reasons to explore sustainable mining in the EU are not only economic and geopolitical. We also have a moral obligation,” reported Commissioner. “If we don’t have an open debate on sustainable mining in Europe, without taboos, we will continue in a situation where we import raw materials from mines far from our homes and conveniently turn a blind eye to how they were obtained.”
