Critical

MineralsMarket

Review

2023INTERNATIONAL

ENERGY

AGENCYThe

IEA

examines

the

full

spectrum

of

energyissues

including

oil,

gas

and

coal

supply

anddemand,

renewable

energy

technologies,electricity

markets,

energy

efficiency,

access

toenergy,

demand

side

management

and

muchmore.

Through

its

work,

the

IEA

advocatespolicies

that

willenhance

the

reliability,affordability

and

sustainability

of

energy

inits

31member

countries,

11

association

countries

andbeyond.IEA

member

countries:AustraliaAustriaBelgiumCanadaCzech

RepublicDenmarkEstoniaFinlandFranceSpainSwedenSwitzerlandRepublicof

TürkiyeUnited

KingdomUnited

StatesTheEuropeanCommissionalsoparticipatesintheworkoftheIEAGermanyGreeceHungaryIrelandItalyThispublicationandanymapincludedherein

arewithoutprejudicetothestatusoforsovereigntyoveranyterritory,tothedelimitationofinternationalfrontiersandboundariesandtothenameofanyterritory,cityorarea.IEA

association

countries:ArgentinaBrazilChinaEgyptJapanKoreaIndiaIndonesiaKenyaLithuaniaLuxembourgMexicoNetherlandsNew

ZealandNorwayPolandPortugalSlovak

RepublicMoroccoSenegalSingaporeSouthAfricaThailandUkraineSource:

IEA.International

Energy

AgencyWebsite:

CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023AbstractThe

inaugural

edition

of

the

Critical

Minerals

Market

Review

provides

amajor

update

on

the

investment,

market,

technology

and

policy

trends

ofthe

critical

minerals

sector

in

2022

and

an

an

initial

reading

of

theemerging

picture

for

2023.

Through

in-depth

analyses

of

clean

energyand

mineral

market

trends,

this

report

assesses

the

progress

made

bycountries

and

businesses

in

scaling

up

future

supplies,

diversifyingsources

of

supply,

and

improving

sustainable

and

responsible

practices.Italso

examines

major

trends

for

individual

minerals

and

discusseskeypolicy

implications.The

report

will

be

followed

by

a

forthcoming

analysis

that

will

featurecomprehensive

demand

and

supply

projections

for

key

materials

and

anumber

of

deep-dives

on

key

issues.

It

also

makes

available

an

onlinetool,

the

Critical

Minerals

Data

Explorer,

which

allow

users

to

exploreinteractivelythelatest

IEAprojections.PAGE|

2CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023Table

of

contentIntroduction4Executive

summary5Key

market

developments9Developments

of

the

battery

sector35Key

trends

by

individual

commodity50Implications62Annex75PAGE|

3CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023IntroductionCritical

minerals,

essential

for

a

range

of

clean

energy

technologies,have

risen

up

the

policy

and

business

agenda

in

recent

years.

Rapidgrowth

in

demand

is

providing

new

opportunities

for

the

industry,

but

acombination

of

volatile

price

movements,

supply

chain

bottlenecks

andgeopolitical

concerns

has

created

a

potent

mix

of

risks

for

secure

andrapid

energy

transitions.

This

has

triggered

an

array

of

new

policyactionsindifferentjurisdictions

to

enhance

thediversity

and

reliabilityofcriticalmineralsupplies.CriticalmineralshavebeenfullyintegratedintotheIEA’sGlobal

Energyand

Climate

Model,

which

means

that

the

projections

for

critical

mineralsdemand

and

supply

are

regularly

updated

in

line

with

latest

policy

andtechnology

trends

in

the

IEA

energy

scenarios,

notably

in

the

WorldEnergy

Outlook

and

the

Global

EV

Outlook.

The

updated

projections

areavailable

throughtheIEA

Critical

Minerals

Data

Explorer,

an

onlinetoolthat

intends

to

allowusers

to

easilyaccess

and

navigate

the

latest

data.This

is

part

of

the

efforts

to

enhance

market

transparency

throughmakingmore

datapublicly

available.SincetheInternationalEnergyAgency’s(IEA)landmarkanalysison

theRole

of

Critical

Minerals

in

Clean

Energy

Transitions

and

the

newministerial

mandates

inMarch2022,theAgency

has

expandeditsworkon

critical

minerals

to

help

policymakers

address

these

emergingchallenges

and

ensure

reliable

and

sustainable

supplies

of

criticalminerals.

These

efforts

include

a

commitment

to

regular

marketmonitoring,

which

aims

to

provide

a

clear

understanding

of

today’sdemandand

supplydynamicsandwhatthey

meanfor

the

future.

In

thisinaugural

piece

of

analysis,

we

review

the

latest

price,

investment

andproduction

trends

in

the

critical

minerals

sector.

The

first

chapterprovides

a

snapshot

of

industry

developments

in

2022

and

early

2023.The

second

chapter

reviews

key

trends

in

the

battery

sector

given

itsimportance

in

driving

demand

growth

for

critical

minerals.

The

thirdchapter

presents

a

concise

review

of

key

trends

for

each

individualcommodity.

In

the

final

chapter,

we

present

implications

for

policy

andindustrystakeholders.Our

report

considers

a

wide

range

of

minerals

used

in

clean

energytechnologies,

as

indicated

in

the

Annex

of

the

special

report.

Forenergytransition

minerals,

we

focus

on

copper,

major

battery

metals

(lithium,nickel,

cobalt

and

graphite)

and

rare

earth

elements.

We

also

discusstrends

for

other

important

minerals

and

metals

such

as

aluminium,manganese,platinumgroupmetalsanduraniumasrelevant.This

report

focuses

on

today’s

state

of

play.

It

will

be

complemented

bya

forthcoming

pieceof

analysis

that

will

providefull

demand

andsupplyprojections

for

key

materials

and

a

number

of

deep-dives

on

key

issues.This

will

respond

directly

to

the

request

in

the

G7

Five-Point

Plan

forcritical

minerals

security,

where

the

Group

ofSevenministers

asked

theIEA

to

produce

medium-

and

long-term

outlooks

for

critical

mineralsdemandandsupplytohelp

informdecisionmaking.PAGE|

4CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023Executive

summaryRecord

deployment

ofclean

energy

technologies

such

as

solar

PVand

batteries

is

propelling

unprecedented

growth

in

the

criticalminerals

markets.

Electric

car

sales

increased

by

60%

in

2022,exceeding

10million

units.

Energy

storage

systems

experienced

evenmore

rapid

growth,

with

capacity

additions

doubling

in

2022.

Solar

PVinstallationscontinueto

shatter

previousrecords,andwindpoweris

setto

resume

its

upward

march

after

two

subdued

years.

This

has

led

to

asignificant

increase

in

demand

for

critical

minerals.

From

2017

to

2022,demand

from

the

energy

sector

was

the

main

factor

behind

a

tripling

inoverall

demand

for

lithium,

a

70%

jump

in

demand

for

cobalt,

and

a

40%rise

in

demand

for

nickel.

In

2022,

the

share

of

clean

energy

applicationsin

total

demand

reached

56%

for

lithium,

40%

for

cobalt

and

16%

fornickel,

up

from

30%

for

lithium,

17%

for

cobalt

and

6%

for

nickel

fiveyearsago.critical

minerals

experienced

broad-based

price

increases

in

2021

andearly

2022,

accompanied

by

strong

volatility,

particularly

for

lithium

andnickel.

Most

prices

began

to

moderatein

the

latter

half

of

2022

andinto2023

but

remain

well

above

historical

averages.

Higher

or

volatilemineral

prices

during

2021

and

2022

highlighted

the

importance

ofmaterial

prices

in

the

costs

of

transforming

our

energy

systems.According

to

the

IEA’s

clean

energy

equipment

price

index,

clean

energytechnology

costs

continued

to

decline

until

the

end

of

2020

due

totechnology

innovation

and

economies

of

scale,

but

high

material

pricesthen

reversed

this

decade-long

trend.

Despite

these

recent

setbacks,

itis

noteworthy

that

the

prices

of

all

clean

energy

technologies

today

aresignificantlylowerthanadecadeago.Countries

are

seeking

to

diversify

mineral

supplies

with

a

wave

ofnew

policies.

Thereis

growing

recognitionthat

policy

interventions

areneeded

to

ensure

adequate

and

sustainable

mineral

supplies

and

theproliferation

of

such

initiatives

includes

the

European

Union’s

CriticalRaw

Materials

(CRM)

Act,

the

UnitedStates’

Inflation

Reduction

Act,Australia’s

Critical

Minerals

Strategy

and

Canada’s

Critical

MineralsStrategy,

among

others.

The

IEA

Critical

Minerals

Policy

Trackeridentified

nearly

200policies

and

regulations

across

the

globe,

with

over100oftheseenactedinthepastfew

years.Many

oftheseinterventionshave

implications

for

trade

and

investment,

and

some

have

includedrestrictions

on

import

or

export.

Among

resource-rich

countries,Indonesia,

Namibia

and

Zimbabwe

have

introduced

measures

to

banDriven

by

rising

demand

and

high

prices,

the

market

size

of

keyenergy

transition

minerals

doubled

over

the

past

five

years,reaching

USD

320

billion

in

2022.

This

contrasts

with

the

modestgrowth

of

bulk

materialslikezincand

lead.

As

a

result,

energy

transitionminerals,

which

used

to

be

a

small

segment

of

the

market,

are

nowmoving

to

centre

stage

in

the

mining

and

metals

industry.

This

bringsnew

revenue

opportunities

for

the

industry,

creates

jobsfor

the

society,andin

somecases

helpsdiversifycoal-dependenteconomies.The

affordability

and

speed

of

energy

transitions

will

be

heavilyinfluenced

by

the

availability

of

critical

mineral

supplies.

ManyPAGE|

5CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023the

export

of

unprocessed

mineral

ore.

Globally,

export

restrictions

oncriticalrawmaterialshave

seenafivefold

increase

since2009.all

venture

capital

(VC)

funding

for

clean

energy.

The

first

quarter

of

2023hasbeenstrong

forcriticalminerals,

despite

aseveredownturnin

otherVC

segments,

such

as

digital

start-ups.

Battery

recycling

was

the

largestrecipient

of

VC

funding,

followed

by

lithium

extraction

and

refiningtechnologies.

Companies

based

in

theUnited

States

raisedmost

ofthefunds,

at

45%

of

the

total

between

2018

and

2022.

Canadian

andChinese

start-ups

are

notably

active

in

battery

recycling

and

lithiumrefining.

European

start-ups

have

been

successful

at

raising

money

forrareearthelements,

batteryreuseandbatterymaterialsupply.Investment

in

critical

minerals

development

recorded

anothersharp

uptick

by

30%

in2022,

following

a

20%

increase

in

2021.

Ourdetailed

analysis

of

the

investment

levels

of

20large

mining

companieswith

a

significant

presence

in

developing

energy

transition

mineralsshows

a

strong

rise

in

capital

expenditure

on

critical

minerals,

spurredby

the

robust

momentum

behind

clean

energy

deployment.

Companiesspecialising

in

lithium

development

recorded

a

50%

increase

inspending,

followed

by

those

focusing

on

copper

and

nickel.

Companiesbased

in

the

People’s

Republic

of

China

(hereafter,

“China”)

nearlydoubledtheir

investmentspendingin

2022.The

battery

sector

is

undergoing

transformative

changes

with

theemergence

of

new

technology

options.

Global

battery

demand

forclean

energy

applications

increased

by

two-thirds

in

2022,

with

energystorage

becoming

a

growing

part

of

the

total

demand.

Demand

forbatteries

in

vehicles

outpaced

the

growth

rate

of

electric

car

sales

as

theaverage

battery

size

for

electric

cars

continued

to

rise

in

nearly

everymajor

market.

The

trend

of

favouring

larger

vehicles

seen

inconventional

car

markets

is

being

replicated

in

the

EV

market,

posingadditional

pressure

on

critical

mineral

supply

chains.

Sodium-ionbatteries

witnessed

a

leap

forward

in

early

2023,

with

plans

forproduction

capacity

exceeding

100

gigawatt-hours,

primarilyconcentrated

in

China.

Initially,

companies

are

targeting

less

demandingapplications

such

as

stationary

storage

or

micromobility

for

thistechnology,and

itremainsto

be

seenifitwillbeableto

meet

theneedsfor

EV

range

and

charging

time.

Today,

the

vast

majority

of

recyclingcapacity

is

located

in

China,

but

new

facilities

are

being

developed

inEurope

and

the

UnitedStates.

Scrap

from

manufacturing

processes

isExploration

spending

also

rose

by

20%

in

2022,

driven

by

recordgrowth

in

lithium

exploration.

Canada

and

Australia

led

the

way

withover

40%

growth

year-on-year,

notably

in

hard-rock

lithium

plays.Exploration

activities

are

also

expanding

in

Africa

and

Brazil.

Lithiumstood

out

as

a

clear

leader

in

exploration

activities,

with

spendingincreasing

by

90%.

Uranium

also

experienced

a

significant

surge

inspending

by

60%

due

to

renewed

interest

in

nuclear

power

amidconcerns

overRussian

supplies.

Nickel

was

a

close

follower

with

a

45%growth

rate

for

exploration,

led

by

Canada,

where

high-grade

sulfideresources,

proximity

to

existing

infrastructure

and

access

to

low-emissionselectricitycreateattractiveinvestmentopportunities.Despite

headwinds

in

the

wider

venture

capital

sector,

criticalminerals

start-ups

raised

a

record

USD

1.6

billion

in

2022.

This160%year-on-yearincreasetookthecritical

minerals

categoryto

4%

ofPAGE|

6CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023dominatingtoday’srecycling

pool,

but

this

is

set

to

changefrom

around2030asused

EVbatteries

reachtheendoftheir

firstlife.Three

layers

of

supply-side

challenges

need

to

be

addressed

toensure

rapid

and

secure

energy

transitions.

They

are

i)

whetherfuture

supplies

can

keep

up

with

the

rapid

pace

of

demand

growth

inclimate-driven

scenarios;

ii)

whether

those

supplies

can

come

fromdiversified

sources;

and

iii)

whether

those

volumes

can

be

supplied

fromcleanandresponsiblesources.In

a

bid

to

secure

mineral

supplies,

automakers,

battery

cell

makersand

equipment

manufacturers

are

increasingly

getting

involved

inthe

critical

minerals

value

chain.

Long-term

offtake

agreements

havebecome

the

norm

in

the

industry’s

procurement

strategies,

butcompanies

are

taking

extra

steps

to

invest

directly

in

the

critical

mineralsvalue

chain

such

as

mining,

refining

and

precursor

materials.

Since2021,

there

has

been

a

notable

increase

in

direct

investment

activities.Contemporary

Amperex

Technology

Co.

Limited,

the

world’s

largestbattery

cell

maker,

has

made

the

acquisition

of

critical

mineral

assets

acentralelement

of

itsstrategy.Other

examples

include

GeneralMotors’USD650million

investment

in

Lithium

Americas

and

Tesla’s

plan

tobuildanew

lithium

refinery

intheUnitedStates,

amongothers.A

host

of

newly

announced

projects

indicate

that

supply

iscatching

up

with

countries’

clean

energy

ambitions,

but

theadequacy

offuturesupplyisfarfrom

assured.In

some

cases,

newlyannounced

projects

suggest

that

anticipated

supplies

in

2030

areapproaching

the

requirements

of

the

APS

although

deployment

levels

inthe

NZE

Scenario

require

further

projects

to

be

realised.

Whileencouraging,

practicalchallenges

persist.

Risksofscheduledelaysandcost

overruns,

which

have

been

prevalent

in

the

past,

cannot

be

ignored.There

is

also

an

important

distinction

between

technology-gradeproducts

and

battery-grade

products,

with

the

latter

generally

requiringhigher-quality

inputs.

This

means

that

even

with

an

overall

balance

ofsupply

and

demand,

the

supply

of

battery-grade

products

may

still

beconstrained.

Moreover,

new

mining

plays

often

come

with

higherproductioncosts,whichcouldpushupmarginalcostsandprices.Demand

forcriticalmineralsforclean

energytechnologies

is

set

toincrease

rapidly

in

all

IEA

scenarios.

Since

its

landmark

special

reportin

2021,

the

IEA

has

been

updating

its

projections

for

future

mineraldemand

based

on

the

latest

policy

and

technology

developments.

In

theAnnounced

Pledges

Scenario

(APS),

demand

more

than

doubles

by2030.

In

the

Net

Zero

Emissions

by

2050

(NZE)

Scenario,

demand

forcritical

minerals

grows

by

three

and

a

half

times

to

2030,

reaching

over30million

tonnes.

EVs

and

battery

storage

are

the

main

drivers

ofdemand

growth,

but

there

are

also

major

contributions

from

low-emissions

power

generation

and

electricity

networks.

These

results

areavailable

throughthe

IEA

Critical

Minerals

Data

Explorer,

an

interactiveonline

tool

that

allows

users

to

easily

access

the

IEA's

projection

dataunder

differentscenariosandtechnologytrends.Limited

progress

has

been

made

in

terms

of

diversifying

supplysources

in

recent

years;

the

situation

has

even

worsened

in

somecases.Compared

with

the

situation

three

years

ago,

the

share

of

the

topthree

producers

in

2022

either

remains

unchanged

or

has

increasedfurther,

especially

for

nickel

and

cobalt.

Our

analysis

of

project

pipelinesindicates

a

somewhat

improved

picture

for

mining,

but

not

for

refiningoperations

where

today’s

geographical

concentration

is

greater.

ThePAGE|

7CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023majority

of

planned

projects

are

developed

in

incumbent

regions,

withChina

holding

half

of

planned

lithium

chemical

plants

and

Indonesiarepresenting

nearly

90%

of

planned

nickel

refining

facilities.

Manyresource-holding

nations

are

seeking

positions

further

up

the

value

chainwhile

many

consuming

countries

want

to

diversify

their

source

of

refinedmetal

supplies.

However,

the

world

has

not

yet

successfully

connectedthedotstobuilddiversified

midstream

supplychains.rawmaterialsupplyportfolio.

Thecountryhasbeen

activelyinvestinginmining

assets

in

Africa

and

Latin

America,

and

started

investing

inoverseas

refining

and

downstream

facilities,

with

an

aim

to

securestrategic

access

to

raw

materials.

Between

2018

and

the

first

half

of2021,

Chinese

companies

invested

USD

4.3

billion

to

acquire

lithiumassets,

twice

the

amount

invested

by

companies

from

the

UnitedStates,AustraliaandCanadacombinedduringthesame

period.There

has

been

mixed

progress

towards

improving

sustainable

andresponsible

practices.

Some

companies

are

stepping

up

actions

toreduce

environmental

and

social

harms

associated

with

their

activities.Ourassessmentof

the

environmentalandsocialperformanceof

20keycompanies

shows

that

companies

are

making

headway

in

communityinvestment,

worker

safety

and

gender

balance.

However,

environmentalindicators

are

not

improving

at

the

same

rate.

Greenhouse

gasemissions

remain

high,

with

roughly

the

same

amount

being

emitted

pertonne

of

mineral

output

every

year.

Water

withdrawals

almost

doubledfrom

2018

to

2021.

There

is

also

a

question

mark

regarding

the

extentto

which

sustainability

is

being

seriously

considered

by

consumers.Despite

the

availability

of

cleaner

production

pathways,

there

are

fewsigns

that

end

users

are

prioritising

them

in

their

sourcing

andinvestment

decisions,

although

some

downstream

companies

havestartedtogivepreferenceto

mineralswithalower

climateimpact.An

approach

to

critical

mineralsecurity

needs

to

cast

its

net

widelyto

encompass

niche

minerals.

While

the

focus

has

understandablybeen

on

battery

metals

and

copper,

recent

events

such

as

the

exportcurbs

on

Chinese

gallium

and

germanium

in

July

2023

havehighlightedthe

significance

of

a

lesser-known

group

of

critical

minerals,

oftencharacterised

by

small

volumes,

buthigh

levels

ofsupply

concentration.These

illustrate

how

relatively

niche

minerals

such

as

magnesium,

high-purity

manganese,

high-purity

phosphorus

and

silicon

may

disruptsupplychainsdueto

highrelianceonasmallgroupofsuppliers.A

broad

and

bold

strategy

is

needed

that

brings

togetherinvestment,

innovation,

recycling,

rigorous

sustainabilitystandards

and

well-designed

safety

nets.

To

bolster

globalprogress,

the

IEA

will

host

the

first-ever

international

summit

on

criticalminerals

on

28September

2023,

bringing

together

ministers

frommineral-producing

and

-consuming

economies

as

well

as

industry,investors

and

civil

society

to

discuss

measures

for

collectively

promotingasecureandsustainablesupplyof

criticalminerals.Critical

minerals

supply

is

also

a

concern

for

China.

As

the

world’slargest

metal

refining

hub,

China

heavily

relies

on

imports

for

largevolumes

of

raw

materials,

often

from

a

small

number

of

sources.

Forexample,

Chinareliesalmostentirelyon

the

Democratic

Republicof

theCongo

for

mined

cobalt.China

is

therefore

seeking

ways

to

diversify

itsPAGE|

8CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023Key

market

developmentsPAGE|

9CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023Clean

energy

technology

deployment

continued

its

upward

march

in

2022,

with

momentumexpected

to

continue

through

2023

and

beyondAnnualcapacity

additionsforsolarPV

andwind

andelectriccarsalesSolar

PVWindElectricCars40032024016080150120901512930%70%30%60%35%20%6063032019

2020

2021

2022

2023e2019

2020

2021

2022

2023e2019

2020

2021

2022

2023eIEA.

CC

BY

4.0.Source:

IEA

(2023),Renewable

Energy

Market

Update

–

June

2023,forsolarPVandwind

capacityadditions;IEA

(2023),Global

EV

Outlook

2023

–

April

2023,forelectriccarsales.PAGE|

10CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023The

rapid

rise

of

clean

energy

has

underpinned

significant

growth

in

mineral

demandDemandforkey

materialsandshareof

cleanenergyin

totaldemandLithiumNickelCobaltNeodymium150120904000320024001600800200160120801008060604056%30402040%16%202230%17%201710%6%20177%20172017202220222022CleanenergyOtherusesIEA.

CC

BY

4.0.PAGE|

11CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023Thanks

to

heightened

demand

and

rising

prices,

the

market

size

for

energy

transition

mineralsdoubled

over

the

past

five

years,

reaching

USD

320

billion

in

2022Marketsizeforkeyenergytransitionminerals400300200100100753.1x1.5x506.7x251.9x2.5x2017

2022Copper2017

2022Lithium2017

2022Nickel2017

2022Cobalt2017

2022Rareearth

elementsIEA.

CC

BY

4.0.Note:ThemarketsizefornickelincludesbothClass1(batterygrade)andClass2nickel.Source:

IEA

analysisbasedon

S&PGlobal.PAGE|

12CriticalMineralsMarketReview2023CriticalMineralsMarket

Review2023As

clean

energy

deployment

hits

new

records,

energy

transition

minerals

are

becoming

a

majorfocus

for

the

mining

and

metals

marketsDeployment

of

clean

energy

technologies

had

another

record

year

in2022.

Electric

car

markets

witnessed

unprecedented

growth

as

salesexceeded

10

millionunits

in

2022,

with

a

total

of

14%

of

all

new

cars

sol