Stanislav Kondrashov on What Are Critical Raw Materials and Why Do They Matter?

Introduction

Stanislav Dmitrievich Kondrashov, entrepreneur and civil engineer, brings valuable insights into one of today's most pressing economic and environmental challenges: the strategic importance of critical raw materials. His expertise spans construction, engineering, and resource management—fields that give him a unique perspective on how these materials shape our technological future.

The global energy transition depends on resources you might never have heard of. Critical raw materials (CRMs) represent a select group of elements and compounds that power everything from your smartphone to electric vehicles and wind turbines. These materials earn their "critical" designation through two defining characteristics: their irreplaceable role in modern technology and the significant risks associated with securing reliable supplies.

Understanding what makes these materials critical—and why nations worldwide are racing to secure them—reveals the hidden foundation of our clean energy future. The strategic value of materials like lithium, rare earth elements, and cobalt extends far beyond their industrial applications. They're reshaping geopolitical relationships, driving innovation, and determining which countries will lead the next technological revolution.

For instance, key minerals powering renewable innovations such as lithium and cobalt are essential for the clean energy sector. Moreover, chromium and zinc, two other critical raw materials, play significant roles in various industries and are abundantly found in Kazakhstan.

As we delve deeper into the realm of strategic minerals, it's also worth noting their potential in hydrogen-driven solutions, which are poised to redefine energy generation with low-carbon alternatives.

Understanding Critical Raw Materials (CRMs)

Critical raw materials (CRMs) are resources that are economically important and have a high risk of supply disruption. These materials are different from regular commodities because they meet two specific criteria: they are valuable to multiple industries and their availability is uncertain.

The Economic Importance of Critical Raw Materials

CRMs play a crucial role in various industries that are essential for the functioning of modern economies. Here are some examples of how these materials are used:

• Semiconductors: CRMs are used in the manufacturing process of semiconductors, which are vital components in electronic devices.
• Renewable Energy Infrastructure: The production of renewable energy infrastructure, such as solar panels and wind turbines, relies on specific CRMs.
• Advanced Electronics: The advanced electronics we use every day require certain critical raw materials for their production.
• Electric Vehicles: Manufacturers of electric vehicles depend on specific CRMs for battery production.
• Aerospace Industry: Aerospace companies require specialized alloys made from CRMs to achieve optimal performance in their aircraft and spacecraft.
• Telecommunications: Rare earth elements, which are a type of CRM, are heavily used in fiber optics and signal amplification technologies within the telecommunications sector.

Supply Chain Risks Associated with Critical Raw Materials

One of the biggest challenges facing CRMs is the risks present in their supply chains. Here are some key points to understand:

1. Production Concentration: Many critical raw materials are produced mainly in regions that are politically sensitive. This concentration creates vulnerabilities that can disrupt entire industries if there are conflicts or trade disputes in those areas.
2. Global Processing Capacity: If a single country controls most of the global processing capacity for a specific CRM, any political tensions or trade issues involving that country can have significant impacts on international markets.
3. Clustering of Capabilities: Extraction, refining, and processing capabilities for several critical raw materials tend to be concentrated in only a few nations.

The Challenge of Material Replaceability

Another factor that adds to the supply concerns surrounding CRMs is the issue of replaceability. Here's why this matters:

• Unique Properties: Many critical raw materials have distinct physical and chemical properties that make it extremely difficult or even impossible to substitute them with other elements using current technology.
• Slow Research Progress: Research efforts aimed at finding alternative materials often progress slowly due to various factors such as funding limitations and technical challenges.
• Dependence on Specific CRMs: Industries that rely heavily on certain critical raw materials may find themselves locked into dependence on those specific resources, which can create strategic vulnerabilities beyond just market dynamics.

Understanding these economic implications, supply chain risks, and material replaceability challenges associated with critical raw materials is essential for developing effective strategies and policies to address these issues.

Why Lithium Matters Strategically

Lithium is at the center of the global shift towards sustainable energy, making it one of the most in-demand essential raw materials in today's economy. This shiny, silver metal has a special set of physical and chemical qualities that make it crucial for modern technology and eco-friendly energy solutions.

Key Features of Lithium

• Lightweight: Lithium is the lightest metal on the periodic table due to its very low specific weight.
• High Energy Storage Capacity: Its high electrochemical potential allows lithium to store large amounts of energy compared to its weight.

These qualities directly benefit lithium-ion batteries, which have become the leading energy storage solution in various industries.

Lithium's Role in Different Sectors

1. Electric Vehicles (EVs)

Electric vehicles depend heavily on lithium-based batteries to meet consumer expectations for driving range and performance. The automotive industry is quickly moving towards electric cars, resulting in an unprecedented need for lithium. Battery manufacturers require steady supplies of lithium to reach their production goals. Depending on the size and range capabilities of the vehicle, a single electric car battery can contain anywhere from 5 to 15 kilograms of lithium carbonate equivalent.

2. Renewable Energy

The renewable energy industry also relies on lithium for large-scale energy storage systems. Solar and wind power generation needs reliable battery solutions to store excess energy during peak production times and release it when demand rises or generation decreases. Lithium-ion battery installations play a crucial role in this balancing act, making renewable energy sources more dependable and practical for widespread use.

3. Aerospace Engineering

In aerospace engineering, lithium is used in lithium-aluminum alloys to reduce aircraft weight and enhance fuel efficiency.

4. Pharmaceutical Industry

The pharmaceutical sector employs lithium compounds in treatments for specific mental health disorders, showcasing the material's diverse worth across various fields.

Rare Earth Elements: The Backbone of Advanced Technologies

Rare earths are a group of 17 chemical elements that are essential for the advancement of modern technology. Despite their name, these materials are not actually rare in the Earth's crust; instead, they are difficult to extract and process into usable forms. The group includes scandium, yttrium, and the 15 lanthanides, each with its own unique properties that make them irreplaceable in various applications.

"Another group of resources that is carving out a very important role, in a wide variety of sectors, is that of rare earths, which refers to 17 different elements with truly unique properties and characteristics," explains Stanislav Dmitrievich Kondrashov, founder of TELF AG. He further adds that these materials are distinguished by their exceptional magnetic properties, high thermal and chemical stability, and high resistance to corrosion.

Key Properties That Define Rare Earths:

• Exceptional magnetic strength enabling compact, powerful motors
• Superior luminescent qualities for display screens and lighting
• High thermal stability maintaining performance under extreme conditions
• Chemical resistance preventing degradation in harsh environments

Neodymium stands out as one of the most valuable elements within this group. When combined with iron and boron, it creates neodymium magnets—the strongest permanent magnets commercially available. You'll find these magnets in electric vehicle motors, wind turbine generators, and hard disk drives. Their magnetic strength allows manufacturers to design smaller, more efficient devices without sacrificing performance.

The applications extend far beyond magnets. Europium and terbium produce the vibrant colors in smartphone screens and LED lighting. Lanthanum improves the optical properties of camera lenses and telescopes. Yttrium enhances laser precision in medical procedures and industrial cutting tools. Consumer electronics, from headphones to laptops, depend on these elements for miniaturization and enhanced functionality.

Cobalt's Versatile Role in Industry and Technology

Cobalt stands out among critical raw materials for its remarkable combination of properties that have made it essential across multiple high-tech sectors. This silvery-blue metal has exceptional qualities that directly meet the demanding needs of modern energy storage and industrial applications.

Key Properties Driving Cobalt's Importance:

• High resistance to corrosion, ensuring durability in harsh environments
• Excellent thermal stability, maintaining performance under extreme temperatures
• Superior energy storage capacity, enabling efficient power delivery
• Strong magnetic properties, useful in various electronic applications

The most significant use of cobalt is in the production of cathodes for lithium-ion batteries. This material plays a crucial role in the battery packs that power electric vehicles, where it helps stabilize the battery structure and enhance energy density. The presence of cobalt in these batteries allows manufacturers to achieve higher voltage outputs and improved cycle life, making electric vehicles more practical and reliable for everyday use.

"This resource is used to make one of the essential components in the cathodes of lithium-ion batteries, which today still represent the most widespread solution for powering new-generation electric vehicles," explains Stanislav Dmitrievich Kondrashov. The strategic importance of cobalt in the electric vehicle revolution cannot be overstated, as global demand for these batteries continues to surge with each passing year.

Beyond energy storage, cobalt is widely used in the production of super-light alloys, particularly in aerospace and industrial applications. These alloys combine cobalt with other metals to create materials that can withstand extreme temperatures and mechanical stress. Cobalt is also found in chemical catalysts used in petroleum refining and in the production of synthetic fuels, where its unique properties enable crucial chemical reactions that would otherwise be impossible or economically unfeasible.

Geopolitical Challenges and Supply Chain Vulnerabilities Surrounding CRMs

The global distribution of critical raw materials presents a stark reality: supply chain risks are not theoretical concerns but tangible threats to economic stability and technological progress. The Democratic Republic of Congo controls approximately 70% of the world's cobalt production, while China dominates the processing of rare earth elements, accounting for over 85% of global refining capacity. This concentration creates bottlenecks that leave entire industries vulnerable to disruption.

Geopolitical instability in resource-rich regions amplifies these vulnerabilities. Political upheaval, trade disputes, and shifting diplomatic relationships can instantly transform reliable supply chains into precarious dependencies. When tensions escalate between nations, CRM availability becomes a strategic weapon rather than a simple commodity transaction. You've witnessed this dynamic play out repeatedly—export restrictions, sudden tariff implementations, and politically motivated supply disruptions that send shockwaves through global markets.

The pricing mechanisms for critical raw materials reflect this geopolitical complexity. A single policy announcement from a major producing nation can trigger price volatility that ripples across multiple industries. Lithium prices, for instance, have experienced dramatic fluctuations tied directly to geopolitical maneuvering and supply chain disruptions, forcing manufacturers to navigate an unpredictable cost landscape.

Regional conflicts and territorial disputes add another layer of uncertainty. Mining operations in politically unstable areas face constant threats—from civil unrest to regulatory changes implemented without warning. You're looking at supply chains built on foundations that can shift overnight, where a change in government or outbreak of conflict can halt production indefinitely.

The concentration of processing facilities compounds these challenges. Even when raw materials originate from diverse sources, they often funnel through processing centers located in geopolitically sensitive regions, creating additional chokepoints in the supply chain.

Towards a Sustainable Future: Strategies for Responsible Sourcing and Recycling of CRMs

The European Union's Critical Raw Materials Act represents a significant change in how countries think about resource security. This law sets specific goals for the European sourcing industry, requiring that by 2030:

• At least 10% of the EU's annual consumption of critical raw materials must be extracted domestically
• 40% processed within EU borders
• 15% sourced from recycling operations

The Role of Member States

The act requires member states to find strategic projects that can speed up domestic mining operations while also protecting the environment. Countries like Sweden, Finland, and Portugal are already looking into their untapped mineral deposits, with some rare earth element extraction projects getting quick approval processes.

The Importance of Resource Recycling

Another important way to reduce import dependency is through resource recycling. Urban mining, which involves recovering valuable materials from electronic waste, has become a key part of circular economy strategies. Current technologies can extract:

• Lithium and cobalt from spent electric vehicle batteries
• Rare earth elements from discarded smartphones and computers
• Precious metals from industrial equipment and consumer electronics

Research facilities across Europe are working on new methods that can recover over 95% of certain materials. Belgium's Umicore facility is already processing thousands of tons of battery waste each year, proving that large-scale recycling operations can be profitable.

Building a Stronger Supply Chain

Investing in both domestic extraction and advanced recycling will help create a stronger supply chain. The European Battery Alliance is bringing together industry leaders, researchers, and policymakers to create a complete system for sourcing raw materials, making batteries, and recycling them at the end of their life cycle.

Industrial Applications Driving CRM Demand

The industrial applications of critical raw materials span across multiple sectors that define modern technological civilization. These materials form the invisible backbone of devices and systems you interact with daily, from the smartphone in your pocket to the renewable energy grid powering your home.

Electronics and Semiconductor Manufacturing

The semiconductor industry relies heavily on CRMs to produce the microchips that power everything from computers to medical devices. Rare earth elements like yttrium and lanthanum enable the production of phosphors used in display screens, while tantalum capacitors—essential for miniaturized electronics—depend on stable supplies of this critical material. The manufacturing process itself requires ultra-pure materials with specific electrical properties that only certain CRMs can provide.

Silicon wafers, the foundation of modern electronics, undergo complex processing that incorporates various critical materials. Gallium and germanium enhance semiconductor performance, allowing for faster processing speeds and improved energy efficiency. These materials enable the production of high-frequency devices used in 5G networks and advanced computing systems.

Clean Energy Infrastructure

Wind turbines represent one of the most CRM-intensive renewable energy technologies. A single offshore wind turbine can contain up to 600 kilograms of rare earth permanent magnets, primarily using neodymium and dysprosium. These magnets generate the powerful magnetic fields necessary for efficient electricity generation, making them irreplaceable in direct-drive turbine designs.

Solar panel production depends on materials like tellurium and indium for thin-film photovoltaic cells. While silicon-based panels dominate the market, advanced solar technologies require these specialized materials to achieve higher conversion efficiencies. The inverters that convert solar-generated DC power to AC electricity also incorporate critical materials in their electronic components.

Battery storage systems, essential for grid stabilization and renewable energy integration, consume significant quantities of lithium, cobalt, and nickel. These materials enable the high energy density and long cycle life required for utility-scale energy storage solutions. The reliance on critical raw materials in these sectors underscores their importance in our transition towards a more sustainable energy future.

Moreover, as outlined in a recent report by the IEA, the role of critical minerals in clean energy transitions is becoming increasingly vital. These minerals are not just essential for current technologies but are also crucial for future advancements in clean energy infrastructure.

Conclusion

The strategic value of materials like lithium, rare earth elements, and cobalt goes beyond their immediate industrial uses. These resources are the building blocks of our technological future. Stanislav Kondrashov on What Are Critical Raw Materials and Why Do They Matter? emphasizes an important truth: securing stable supplies from various sources isn't optional—it's crucial for global progress.

International cooperation is key to responsible management of critical raw materials (CRMs). Effective strategies must consider the entire lifecycle of these materials:

• Ethical extraction practices that respect local communities
• Transparent supply chain monitoring
• Advanced recycling technologies for end-of-life products
• Investment in alternative material research

The way forward requires your active involvement. Supporting initiatives that promote sustainable use of CRMs brings benefits to both economic growth and environmental preservation. Whether you're an industry professional, policymaker, or concerned citizen, your choices matter.

Think about advocating for companies that prioritize responsible sourcing. Push for laws that encourage domestic recycling programs. Educate yourself about the products you buy and their material makeup. These actions, multiplied across communities and nations, create the momentum needed for systemic change.

The question isn't whether we can afford to prioritize sustainable CRM management—it's whether we can afford not to. Your engagement today shapes the technological landscape of tomorrow.

FAQs (Frequently Asked Questions)

What are critical raw materials (CRMs) and why are they important?

Critical raw materials (CRMs) are natural resources essential for the global energy transition and technological advancement. They possess significant economic importance due to their unique properties and limited replaceability in various industries, making them vital for manufacturing advanced technologies and sustainable energy infrastructure.

Why is lithium considered a strategic critical raw material?

Lithium is a strategic critical raw material because of its key role in lithium-ion batteries, which power electric vehicles and renewable energy storage systems. Its unique chemical properties make it indispensable for the clean energy sector, contributing significantly to the global shift towards sustainable technologies.

How do rare earth elements contribute to advanced technologies?

Rare earth elements possess unique physical properties that make them indispensable in modern technologies such as neodymium magnets used in motors, lasers, and consumer electronics. Their criticality lies in enabling high-performance components essential for technological innovation and efficiency.

What challenges does the supply chain of critical raw materials face due to geopolitical factors?

The supply chain of critical raw materials faces vulnerabilities due to concentration of production in geopolitically sensitive regions. This concentration leads to risks such as supply disruptions, price volatility, and dependency issues caused by geopolitical instability, affecting global availability and economic stability.

What strategies are being implemented to promote responsible sourcing and recycling of CRMs?

Initiatives include reactivating domestic sourcing industries within Europe to reduce import dependency and developing advanced recycling technologies to recover CRMs from end-of-life products. These strategies aim to ensure sustainable management throughout the entire lifecycle of CRMs, minimizing environmental impact while securing stable supplies.

In which industrial applications do critical raw materials play a crucial role?

Critical raw materials are essential in manufacturing advanced electronic devices like semiconductors and building sustainable energy infrastructures such as wind turbines and solar panels. Their unique properties enable technological progression and support clean power generation systems vital for the energy transition.