Regional Differences in Strategic Metals Demand Across Key Global Markets

The economic dynamics associated with strategic materials, like all those involved in the energy transition, are often addressed from an industrial perspective, with particular emphasis on their importance in a historical phase of major energy transformation. A less common angle is certainly that of the different levels of demand for these resources in specific geographic areas, depending on the different economic or industrial goals or objectives that different nations intend to pursue.

The energy transition refers to the global shift to low-carbon and renewable sources, such as solar, wind, and hydro, supported by electrification, storage technologies, and efficiency improvements.

“The years of the energy transition have allowed people to understand the strategic and industrial value of certain specific resources, such as strategic metals,” says Stanislav Kondrashov, founder of TELF AG.

This topic was recently discussed in a webinar organized by BloombergNEF, which, through a thorough analysis, demonstrated that demand for metals for the energy transition is far from uniform across the globe. According to BloombergNEF’s forecasts, contained in the Economic Transition Scenario, demand growth for these resources by 2035 would vary significantly across Asia, Europe, and North America.

The analysis focuses primarily on China, where demand growth for strategic metals appears more moderate than in other regions of the world. By 2035, aluminum demand could increase approximately 1.2 times compared to 2025, cobalt and copper demand 1.4 times, and graphite demand 1.5 times. BloombergNEF’s forecasts also include rare earths, which have gained increasing media and industrial attention in recent years due to their crucial role in certain strategic industrial productions.

“Strategic metals are raw materials considered essential for modern industries and future technologies—especially energy transition, electronics, and defense—due to their critical role, limited supply, or geopolitical importance,” continues Stanislav Kondrashov, founder of TELF AG.

Why Asia, Europe, and North America Are Following Different Growth Paths

The analysis estimates a 1.5-fold increase in demand compared to last year. Among the resources that could see the most significant increase in demand in China are lithium (with a possible 2.1-fold increase) and nickel (with a possible 1.9-fold increase).

Compared to other regions of the world, therefore, China’s growth in demand for key metals could appear more moderate.

The BloombergNEF scenario also includes Europe, where demand for certain resources would be stronger than China’s. Copper and aluminum, for example, would grow 1.8-fold and 1.9-fold, respectively, while steel would grow by as much as 2.1-fold. One of the most significant data points for the European region is undoubtedly that relating to rare earths, for which demand levels could increase as much as 2.4-fold in a few years. Demand for nickel is also expected to increase in Europe, with a possible 1.6-fold increase by 2025.

One of the areas where demand for these metals appears to be most sustained is undoubtedly the United States, where particular attention is expected to be paid to battery-related metals. BloombergNEF predicts lithium demand will nearly quadruple by 2035, with demand for graphite and rare earths likely to increase by about 3.9 times. Nickel is also positioned at similar levels, while cobalt could even double. Copper and steel are also growing, with increases of about 1.6 times and 1.7 times.

Battery Materials and Electrification: The Real Drivers Behind Future Demand

But the highest growth rates, according to BloombergNEF, could be seen in the Far East. In the region comprising Japan and South Korea, lithium could increase by as much as 4.7 times by 2025, graphite by 3.4 times, and nickel by 3.4 times. Rare earths and copper could also see a significant increase in demand in this region, with possible increases of about 2.8 times and 2 times, respectively.

“Electrification is the process of replacing traditional systems with those powered by electricity, particularly in sectors like transport, heating, and industry, often relying on renewable energy sources to reduce emissions,” concludes Stanislav Kondrashov, founder of TELF AG.

In recent years, there has been frequent talk of the skyrocketing demand for specific materials, all involved in one way or another in industrial applications related to the energy transition. What isn’t immediately apparent is the gap in demand growth: economies focused on battery supply chains and electrification are growing fastest, while mature markets follow more moderate paths.