1. Falling prices and increased demand characterize critical minerals in the energy transition.
2. Global supply has outpaced demand, resulting in a drop in prices.
3. Concentration of supply is high and may increase, posing challenges for ensuring resilient and diversified supply for clean energy technologies.
The International Energy Agency (IEA) reports that falling prices, increased demand, and a concentration of supply are key aspects of the critical minerals landscape as energy transitions progress. These critical minerals, including lithium, copper, cobalt, and graphite, are essential for batteries, electric vehicles, solar panels, and other clean technologies.
The drop in prices is primarily due to a significant increase in global supply, surpassing the growing demand. This has resulted in a decline in prices, particularly in batteries. Despite a continuing increase in investment, the pace has slowed down compared to previous years.
While the market is currently well supplied, the IEA predicts that demand will continue to rise significantly in the future. The analysis shows that announced projects may not meet the full demand for minerals like copper and lithium by 2035.
Furthermore, a high concentration of supply, especially from a few top producers, is expected to persist or even increase. The IEA emphasizes the importance of reliable and diverse supplies of critical minerals to support clean energy transitions.
Key minerals like copper, lithium, nickel, cobalt, and graphite are crucial for clean energy technologies. Demand for these minerals is expected to grow rapidly, requiring a balance between supply and recycling efforts to meet future needs. The IEA warns that challenges in ensuring a reliable supply of critical minerals remain as energy transitions accelerate.