1 / 11

Material Chain Management and Open Trade: The Cases of Coltan and PGM

Material Chain Management and Open Trade: The Cases of Coltan and PGM. Prof. Dr. Raimund Bleischwitz Transatlantic Academy Fellow & Wuppertal Institute, Germany. Presentation at the Conference: Governing Trade in Critical Raw Materials, GMF Washington DC Dec 8, 2011. Outline.

Download Presentation

Material Chain Management and Open Trade: The Cases of Coltan and PGM

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.


Presentation Transcript

  1. Material Chain Management and Open Trade: The Cases of Coltan and PGM Prof. Dr. Raimund Bleischwitz Transatlantic Academy Fellow & Wuppertal Institute, Germany Presentation at the Conference:Governing Trade in Critical Raw Materials, GMF Washington DCDec 8, 2011

  2. Outline

  3. The Issue: challenges for material value chain management • Transparency and certification could strengthen material chain management. • Material value chains are complex and often involve dozens of actors across many companies and jurisdictions. • Small-scale mining and early stages of trading and processing offer many ways of by-passing any proper management. • Some countries involved (e.g. China) may have strategic interests. • Traded products (and semi-products) inhibit materials as hidden flows. Material leakages are significant. => Transparency and certification require resilient institutions with support from companies and key countries.

  4. The case ofColtan • Coltan (tantalum) is used in mobile phones, other ICT products, medicine, optics, cutter technologies, etc. • Largest Mine (Australia)has abandoned its operations in 2008 • Central Africa (incl. Mozambique) now serves as largest supplier, followed by Brazil and Australia • Small-scale mining, civil war, lootability and profitability give incentives for illicit trade: ca. 20 % of worldwide coltan market (2009/10) • China deeply involved.

  5. Coltan: Risks and threats Intersection and cumulativeness of risks Affected Industries Resource Nationalism Global & transat-lantic scale Low Growth Low standards, enhanced climate change Civil war Failing states Piratery, Organized crime Regional scale Migra- tion Decrea- sing Re- venues Decrea- sing agri- culture Local scale Small- Scale Mining Illicit trade Increa- sed bush- meat hun- ting Defo- restation Source: own compilation after Folke et al. 2011

  6. The case of Platinum (PGM) • Important for car catalysts and electronics as well as for fuel cells & electric vehicles. • Projected future demand for these applications in 2030 likely to be 1.5 times higher than total production today. • Mining environmentally intensive (large amounts of water and energy, sulphurdioxide etc.): for the production of one single ounce a volume of 7 – 12 tons of ore have to be processed. • Main producers and South Africa and Russia. Source: Saurat/Bringezu 2008.

  7. PGM flows in Europe • PGMs in glass industry: • organized in closed loop • secondary PGM input represent ~ 43 % of European secondary input • primary input representonly 0.5 % of European primary input • PGMs in car catalysts: • lowrecycling rate (~30 %), mainly due to exports • expanding car fleet, growingaveragecylindercapacity, stricteremissions standards • => The automotiveindustryrepresents 76 % of PGM primary input to Europe PGM flows in EU 25 + Norway + Switzerland in 2004 Sources: Saurat/Bringezu 2008/9; Wilts 2011

  8. PGM: Losses, Risks and Threats • High material leakage • For car catalysts: In Germany e.g., only 15 % of registered cars are dismantled and recycled domestically. Most used cars are being exported to West Africa and Central Asia. • For mobile phones: 243 kg PGM inputs compared to 16,5 kg outputs to recycling (2009, Germany). • For discarded screens: 355 kg PGM inputs compared to 35-70 kg outputs to recycling (2009, Germany). • Shady business, grey markets, illegal shipping, organized crime (money laundry etc.). • Health and environmental risks • „Responsibility gap“ for post consumer waste abroad

  9. Proposal: An International Metal Covenant • Rationale: poor performance, material leakages internationally, low recycling standards in many countries. • Covenant to include industry (recycling, automotive) and target countries. • To set long-term goals to increase the resource productivity by high quality recycling of old cars • To define the responsibilities of different actors in terms of operation, implementation, and evaluation. • Establishes material stewardship internationally. • States shall guarantee stable and supportive regulatory framework conditions • Going beyond compliance! Recycling industry Automotive industry Exporting countries Importing countries Source: Wilts / Bleischwitz 2010:

  10. Conclusions • Sustainable sourcing and recycling improve material chain management • Spillovers and secondary benefits create further contributions to green and inclusive growth • Policies: to focus on life-cycle aspects and material leakages Opportunities Global Challenges • Critical metal markets put companies, high-tech industries and regions at risk • Transparency and certification encounters challenges from open markets and Chinese involvement • Material chain management (incl. mining, recycling and waste) at an international scale • New alliances beyond transparency and certification: an international metals covenant • ….export restrictions should not be an option! Response options • Material chain management and material stewardship raise collective action problems • Data base not yet fully established • Commodities have a collective goods dimension (externalities, property rights, dissociated markets, knowledge management) • Policies for mining countries (taxation issues, diversification, etc.) to be aligned with international resource politics Rethinking Trade

More Related