Exploring critical raw material trade ahead of G20 Summit
The shift from fossil fuels to clean energy relies heavily on critical raw materials, including copper, lithium, nickel, and cobalt. As securing renewable supply chains has become urgent with the global surge in demand, G20 countries, which account for 76% of their total imports, play an amplified role.
Ahead of the 18th G20 Summit on “One Earth, One Family, One Future” on 9 and 10 September 2023 in New Delhi, India, ITC’s latest Trade Briefs are featuring “Key Products for the Global Energy Transition” and “G20's Trade in Critical Raw Materials”.
The energy transition has accelerated the demand for critical raw materials
Geopolitical interests in critical raw materials have never been higher due to their essential role in producing energy transition products such as e-bikes and rechargeable batteries.
Among the most essential inputs is lithium, used in rechargeable batteries for electric cars, grid storage and solar and wind power. G20 imports of lithium surged by 885% between Q4 2019 and Q1 2021, an exceptional increase compared to world trade in all products, which increased by 24% only.
Supplies are concentrated for 23 critical raw materials supplies
With few countries sitting on the largest reserves, the supplies are concentrated for 23 critical raw materials. This pattern has caused concerns over supply disruptions and price surges, especially for materials vital to the global energy transition.
For instance, Chile and China together account for more than three-quarters of world lithium exports.
Concerns about dependencies call – where possible – for a diversification of supply. Germany, the world’s largest rechargeable battery market, tries to become more self-sufficient by exploring new extraction methods, such as recycling or geothermal drilling. Malaysia, on the other hand, has recently doubled its rechargeable battery exports but sources almost all of its lithium from the Republic of Korea. Should exports continue to develop dynamically, Malaysia could unlock additional imports from big players Chile and China.
Learn more about export and import patterns for critical raw materials as well as about their role in products relevant for the global energy transition.
About Trade Briefs
The ITC's Monthly Briefs on the Global State of Trade analyse data to identify monthly variations in trade across countries, regions, and sectors. Each edition features trade-related topics of global relevance such as the current series on ‘Key Products for the Energy Transition’ and the spotlight section on ‘G20’s Trade in Critical Raw Materials’.
