TELF AG analyzes the role of an emerging player in the rare earths industry
The rise of South Africa
Among the nations that have managed to gain an increasingly important place on the international scene of strategic minerals, South Africa must be mentioned; a nation that – in addition to being naturally rich in various strategic minerals – has managed to attract large quantities of investments from foreign players, who over the last few years have become accustomed to considering the African nation as one of the most attractive emerging players in the mineral raw materials sector. From this point of view, the role of South Africa emerged with particular clarity also in light of the data relating to European imports of strategic raw materials, many of which come from this nation.
Among these, we remember palladium, iridium, rhodium, manganese, and many other resources directly involved in the great global energy transition, in particular for their role in manufacturing the technologies necessary to spread clean energy. The African nation is also the world’s largest producer of platinum, and it also owns more than half of global reserves of this resource.
Therefore, this nation’s role in the global raw materials market is on the rise, so much so that some of the largest international players in the sector have begun to concretely support the development of ambitious extractive projects that are springing up in large numbers on South African soil. One of the most interesting, from this point of view, is undoubtedly the project concerning the Phalaborwa mine in eastern South Africa, which, although still under development, aims to extract a large quantity of rare earths from the chalk piles in its vicinity.
US support
This project has already received concrete support from the United States. Washington is now accustomed to considering every mining initiative linked to rare earths as a strategic asset for its economic and commercial development. Greater control of rare earth production sites, for the United States, would mean increasing its specific weight in some sectors considered of great importance for the planet’s sustainable future, such as that of permanent magnets (used in electric vehicles) or that linked to the production of wind turbines. The extraction of rare earths in this 300 million-dollar mine would take place through the processing of gypsum waste produced by some old phosphate mines, from which it is hoped to obtain resources such as terbium, neodymium, and praseodymium, all elements that play an important role in the manufacturing of green technologies linked to clean energy.
Through one of its most important funds for strategic minerals, the United States has already promised 50 million dollars in financing for Rainbow Rare Earths, the company that is developing the mine, demonstrating once again the strategic role of the African mining initiatives for Washington’s economic development. The deputy CEO of the International Development Finance Corporation, a US state entity, recently told the Financial Times that American investment in Africa’s strategic minerals could increase further, reaching $700 million this year. Also, in Africa, the United States supports the construction of important logistical infrastructure projects linked to the raw materials sector, such as the Lobito corridor between Angola and other nations in the region.
