Modern Mining March 2023

and base-metals in the global economy

Above: Steel is used predominantly in buildings and large scale infrastructure developments.

Spain, are investing heavily in rolling out green steel related initiatives. SSAB in Sweden has some advanced pro grammes underway through its Hybrit project, as does ArcelorMittal, one of the biggest steel makers in the world, which has announced its intention to start producing hydrogen-based steel at its plants, including those in France and Germany. But, with the prevailing energy crisis in Europe, steel producers are monitoring the space closely. Base-metals and the green agenda Unlike energy challenged steel production, base metals producers in Africa are producing metals such as copper and cobalt using renewable energy, says CRU’s head of base metals costs and emis sions, Thomas Bower. Copper and cobalt are critical for the energy transition and are key components used in the manufacture of electric vehicles, and in renewable energy. According to Bower, in countries such as Zambia and the Democratic Republic of Congo (DRC) where much of the copper and cobalt is produced, it is being done using renewable energy. In fact, between 80 to 100% of these projects are powered by energy sources such as solar and hydropower. Africa accounts for 50% of global cobalt reserves, 42% of manganese reserves and 6% of copper reserves. It also contributes 70% of the world’s cobalt requirements, which translates to 15% of global income. Sixty percent of Africa’s copper sup ply comes from the DRC and 30% from Zambia. These countries, says Bower, produce extremely high-grade copper, with grades twice that of the world average and, from a cost of production point of view, Africa remains highly competitive. On the

Left: Copper and cobalt are critical for the energy transition.

back of high demand and high prices for these met als, producers are reaping the rewards of sky-high profits. Mitigating the challenges facing the African continent A key challenge facing the continent is poor infra structure, particularly infrastructure related to the transport of bulk materials, and this hampers its abil ity to export key commodities in large volumes. Iron ore is extremely heavy, and the price per tonne is quite low, which means transportation of the material becomes crucial. One needs to be able to transport the commodity to the sea, at a very low cost, which is often done by railways. Unfortunately, Africa’s rail access is limited, Hedborg explains. Furthermore, Africa’s ability to court investment needed to bring projects into production, remains a challenge in most instances. According to Hedborg, for Africa to attract invest ment to advance project development, there needs to be greater political stability, reliable power supply, infrastructure development and better transporta tion. For Africa to succeed in garnering a greater share of foreign direct investment, governments, industries and investors will need to work together. Moreover, governments will need to consider offer ing incentives to encourage investment into the countries of operation, Bower concludes. 

Steel Iron ore is the primary raw material used to make steel.

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