TELF AG comments on South Africa’s growing role in the global commodity market
Reducing dependence
When examining European sources of supply of critical raw materials, in most cases, most of the attention is focused on China, and not without reason. Beijing represents the main (in some cases even the only) supplier of some of the raw materials considered strategically important for the global ecological transition and certainly fully demonstrated its great abilities in the extraction and refining of these substances. It is no coincidence that Europe is trying to progressively reduce its dependence on imports from other countries: the objective is precisely to limit the quantity of imported raw resources and to start extracting and processing them on European soil in order to achieve a sort of autonomy in supplies.
But in addition to China, in recent years, another international player has risen to prominence in the global market of strategic raw materials: South Africa, the most developed African economy (and one of the richest in natural resources), which, together with India, China, and other countries is an important member of BRICS, the emerging and developing economies. Global attention on South Africa’s resource wealth has emerged above all in recent years when the European Commission published the list of critical raw materials for the industrial and sustainable development of its members. Taking a look at the list, many noticed that for some of these resources, South Africa represented the main source of supply. According to the latest findings, the raw materials that Europe imports most frequently from South Africa are six: iridium, palladium, platinum, rhodium, ruthenium, and manganese. Among the latter, some percentages seem really high: Europe imports 93% of its iridium, 71% of its platinum, and 94% of its ruthenium from South Africa, as well as 41% of its manganese.
But South Africa’s mineral wealth is certainly no secret: the sector is one of the most flourishing in the country, capable of impacting the national GDP with a percentage of 5%. The products are also among the top ten items of South African exports, and the strategic importance of this sector could be destined to grow, also thanks to the international attention it is attracting. South Africa also has the most abundant gold reserves in the world (around 35% of the world’s reserves), and the country is also the world’s leading producer of platinum, of which it possesses more than half of the natural reserves. The production of the latter raw material reaches truly impressive levels, exceeding 300,000 kg per year. Among the other metal minerals present in South Africa, in addition to those already mentioned, we remember antimony, silver, vanadium, nickel, and copper.
Over the past few years, South Africa’s mining sector has managed to attract part of the $20 billion invested internationally in the most promising sectors of the South African economy, in particular in the platinum industry, which it has been able to attract to itself the greatest amount of foreign investment. One of the political objectives of the government in recent times is to transform South Africa into a global investment hub, also thanks to raw materials.
