BAKU, Azerbaijan, November 2. Kazakhstan can strengthen its position in the global critical minerals market and attract new investment in geological exploration, mining, and processing.
This was stated in a study by Boston Consulting Group (BCG) titled "Why Critical Mineral Shortages Are a CEO Issue."
According to the study, industrial companies underestimate the risks associated with shortages of critical minerals and, as a result, miss strategic opportunities.
Three key gaps in the risk assessment mechanisms used by companies prevent them from identifying sources of vulnerability: companies focus primarily on the cost of raw materials they purchase, limit their analysis to direct suppliers, and concentrate on mineral extraction without paying sufficient attention to processing and the ownership structure of production assets. This particularly applies to so-called "mosquito minerals", such as gallium, germanium, iridium, and arsenic, whose importance is considerable, but whose trading volumes are so small that the associated risks often go unnoticed by companies.
According to BCG's forecasting model, developed using its proprietary methodology, by 2040, demand for a number of key mineral resources, including rare earth elements, graphite, copper, and lithium, could reach 120-250% of projected supply.
"Under these conditions, new opportunities are emerging for countries with abundant mineral resources, including Kazakhstan. It has one of the richest mineral resource bases in Central Asia, with significant explored reserves of copper, chromium, tungsten, lithium, tantalum, rare earth elements, and other critical minerals," the study says.
According to the Organization for Economic Co-operation and Development (OECD), Kazakhstan has the potential to supply the global market with 21 of the 34 raw materials included in the European Union's (EU) list of critical raw materials.
At the same time, around 65% of the country's territory remains geologically underexplored, creating prospects for the discovery of new deposits and additional opportunities to attract investment in geological exploration, mining, and processing.
"Most industrial companies assess their dependence on mineral raw materials based on procurement volumes and data on direct suppliers. However, it is often precisely those minerals on which companies spend very little that can bring production lines to a halt. The question for CEOs and boards of directors is not whether a company is exposed to these risks. It certainly is. The question is whether they will prefer to leave things as they are or find a way to turn existing risks into a competitive advantage," said Tycho Möncks, Managing Director and Partner at BCG and one of the study's authors.
The study states that current conditions in the global critical minerals market offer Kazakhstan an opportunity to strengthen its position in global supply chains, as well as attract new investment in geological exploration, deposit development, and the expansion of processing facilities.
