Strategic mineralsScarce minerals, metals threaten manufacturing
The growing scarcity of certain minerals and metals is leading to explosive prices and delivery delays; since the relationships among these resources are strong, both the causes of and the solutions to scarcity are complex; for a manufacturing organization with a global supply chain, this can spell trouble
With a growing population, increasing GDP levels, and improving lifestyles, we are consuming more and more. Renewable and non-renewable resources — energy, water, land, minerals —are in ever-higher demand. Since the relationships between these resources are strong, both the causes of and the solutions to scarcity are complex. For a manufacturing organization with a global supply chain, this can spell trouble.
In a recent report, titled “Minerals and Metals Scarcity in Manufacturing: The Ticking Time Bomb,” PWC explores the impact that minerals and metals scarcity is likely to have on seven manufacturing industries. PWC found that the supply of many minerals and metals is struggling to keep up with rapid increases in consumption, resulting in price hikes and delivery delays. For example, dysprosium, an essential component of super magnets, and tantalum, an important component in aircraft and medical equipment, automotive electronics, mobile phones and LCD screens, have both experienced explosive price increases in recent years.
Resource scarcity is becoming a central issue on the policy agenda for many governing bodies:
- The European Union is pushing for resource efficiency and trade policies that favor international open markets.
- In the United States, the Dodd–Frank Act is forcing companies to become transparent with how they use so-called “conflict minerals.”
- Producing countries are starting to protect their interests with export taxes and trade restrictions — for example, China has imposed trade barriers for some metals to protect its domestic industries.
- Scarcity of resources is also likely to be a central issue at the Rio+20 UN Conference on Sustainable Development in June 2012.
For a large majority of the companies PWC interviewed, efficiency and collaboration throughout the supply chain are seen as essential to responding to the risk. While the effects of scarcity can cause stress at any link of the supply chain, it is especially evident as you move down the supply chain.
Data information, recycling technology, substitution technology, and regulation are all considered required elements of any response to the issue of minerals and metals scarcity.
— Read more in “Minerals and Metals Scarcity in Manufacturing: The Ticking Timebomb: Sustainable Materials Management”
