On March 25, local time, the European Commission released a list of 47 strategic projects for critical raw materials, aimed at enhancing the capacity of strategic raw materials within Europe.
According to information released by the European Commission, this list is one of the implementation measures of the Critical Raw Materials Act (CRMA), which came into effect on May 23, 2024, aiming to strengthen the local raw material supply chain in Europe and diversify supply sources. The CRMA aims to ensure that by 2030, Europe's extraction, processing, and recycling capacities for strategic raw materials can meet 10%, 40%, and 25% of the EU's demand, respectively.
It is reported that these 47 strategic projects for critical raw materials are distributed across 13 EU member states: Belgium, France, Italy, Germany, Spain, Estonia, the Czech Republic, Greece, Sweden, Finland, Portugal, Poland, and Romania. They cover one or more segments of the raw material value chain, with 25 projects involving resource extraction, 24 involving processing, 10 involving recycling, and 2 involving raw material substitution.
These strategic projects cover 14 of the 17 strategic raw materials listed in the CRMA, including lithium (22 projects), nickel (12 projects), cobalt (10 projects), manganese (7 projects), and graphite (11 projects). The European Commission stated that these projects will help build the EU's battery raw material value chain, ensuring that the EU can meet its 2030 targets for the extraction, processing, and recycling of lithium and cobalt, while making substantial progress in graphite, nickel, and manganese.
In terms of financial support, the EU stated that to promote the operation of these projects, the total investment is expected to require 22.5 billion euros (approximately 176 billion yuan), and the European Commission, member states, and financial institutions will coordinate support for this.
In terms of process support, these projects can benefit from simplified permitting terms to ensure predictability for project initiators. According to relevant CRMA regulations, the permitting process for extraction projects will not exceed 27 months, while other projects will not exceed 15 months. Currently, the permitting process can last 5-10 years.
It is worth mentioning that all the strategic projects announced this time are located within the EU. The European Commission stated that if projects located outside EU territory meet the criteria set out in Article 6 of the CRMA, they also have the opportunity to be granted strategic project status. The European Commission has currently received 46 applications for projects located outside the EU, and decisions on such projects will be completed in subsequent stages. Meanwhile, the European Commission will soon announce a new call for strategic project applications, planned for late summer this year.
Overall, the EU's strategic practice reflects some changing trends in the global battery industry chain and supply chain:
For a long time, Europe has been heavily reliant on imports for its core battery raw materials. The advancement of these strategic projects means that the "strategic resource" attribute of local critical raw materials has surpassed their commodity attribute.
Based on the local resource situation in Europe, technologies such as low-grade mineral refining/processing and resource recycling will become the core competitiveness of related enterprises in the European market. At the same time, related patent layouts may accelerate.
In addition, the US Inflation Reduction Act (IRA) also imposes requirements on the proportion of local production of battery raw materials and related subsidies, which may compete with EU-related financing support, creating uncertainty in the global supply layout of battery raw materials.
With the EU's new round of strategic project calls set to launch this summer, it also brings new opportunities and challenges for Chinese miners and material companies. Chinese companies have global leading advantages in mineral mining and processing, nickel/cobalt/lithium material processing, and resource recycling, and may participate in the construction of the European supply chain through project applications, technical cooperation, and other forms, jointly building a more open, diverse, and resilient international cooperation system.
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