Criticality and geopolitics

By the end you will be able to

• Distinguish criticality, a short-to-medium-term risk of disruption, from long-run scarcity, using gallium and rare earths as examples.
• Explain how the EU combines supply risk and economic importance, and rebuild a published score from its inputs.
• Compare the EU, US and Indian lists and Graedel's three axes, and say why they agree on by-products and minor metals but differ on copper, potash and indium.
• Calculate a Herfindahl index from tile data and identify whether mining or processing is the bottleneck stage.
• Explain why by-product supply is price-inelastic and how export controls, stockpiles and industrial policy work and fail.
• Apply the same framework to battery metals, fertiliser and grain, including export bans and China's grain stocks.

Contents

1. Part 1 What criticality means, and why it is not scarcity

   A material is called critical when a cut in its supply is both plausible and painful. That is a different question from whether the world will run out of it. This part separates criticality from scarcity, sets out the conditions that make a supply cut hurt, and tests the fears against the short list of disruptions that actually happened.

   • Criticality is about disruption and consequence, not running out
   • A supply cut hurts most when imports are high, substitutes are poor and supply is concentrated
   • Damaging disruptions are rare, but fears of them come in waves
2. Part 2 How the lists are built: EU, US, India and Graedel

   Governments turn the idea into lists by scoring materials. The EU combines a supply risk score with an economic importance score and applies two thresholds. The US estimates what a disruption would cost its economy. Academics add environmental harm. Knowing the machinery tells you why a material moves on or off a list, and whether a move reflects the world or the method.

   • The EU scores supply risk and economic importance and lists what clears both bars
   • The 2023 EU list has 34 materials, a strategic subset, and some moves that are purely methodological
   • The US list estimates what a disruption would cost the economy; India's reflects a fast-growing importer
   • Graedel's three axes add environmental harm and vulnerability to supply restriction
3. Part 3 Concentration and companionality: the anatomy of supply risk

   Most supply risk comes down to two structural facts: how few places supply a material, and whether anyone produces it for its own sake. This part measures concentration with the Herfindahl index using tiles from the table, shows why processing is often the real choke point, explains why by-products cannot respond to their own price, and ends with what dozens of studies agree on.

   • The Herfindahl index turns market shares into one number
   • The choke point is often processing, not the mine
   • By-product supply cannot answer its own price
   • Across 32 studies, minor metals and by-products dominate the consensus
4. Part 4 Weaponised supply and the policy response

   Concentration becomes geopolitics when a supplier uses it. Oil set the template in 1973, and the consumer response, the IEA and emergency stocks, remains the best-tested defence. China's rare earth cuts in 2010 and its licensing controls since 2023 extend the pattern to minerals. Importers answer with stockpiles, subsidies and trade rules, and each answer has a cost.

   • The 1973 oil embargo set the template for a resource weapon and for the consumer response
   • China's 2010 rare earth cuts turned market concentration into a diplomatic instrument
   • Since 2023, export controls have spread to gallium, germanium, graphite and antimony
   • Importers answer with stockpiles, supplier choice and industrial policy, each at a cost
5. Part 5 Transition minerals, their costs, and food security

   The energy transition replaces fuel bought every year with metal bought once, in large amounts and from concentrated sources, and its environmental and social costs land where that metal is mined and refined. Food raises the same questions under another name: export bans, dependence on a few exporters, fertiliser, and grain stocks held mostly by one country.

   • Electrification swaps fuel for metal, and the supply chain runs through China
   • The environmental and social costs fall where metals are mined and refined
   • Food security is the agricultural analogue, and the usual threat is an exporter's ban
   • Fertiliser dependence and China's grain stocks complete the picture
6. Wrap-up Key terms, try it in the table, final quiz, sources