Research conducted by PwC of Montreal has found that 77% of manufacturing industries consider scarcity of metals and minerals a pressing issue. Seven industries will be most impacted: infrastructure, high tech hardware, automotive, renewable energy, chemical, energy and utilities, and aviation. The highest levels of concern were expressed by the high tech and automotive industries.
The report, “Minerals and metals scarcity in manufacturing: A ‘ticking time bomb'” surveyed 69 senior executives in seven different manufacturing industries across the Americas, the Asia Pacific region and Europe. According to the survey, 83% of respondents indicate their suppliers consider minerals and metals scarcity an issue, and 61% believe their customers are taking the issue seriously. In North and South America, over half of the respondents believe the government is aware of the shortage and its ramifications.
Most regions and industries globally view an increase in demand as the primary cause for minerals and metals scarcity (84%), followed by geopolitics (79%) and extraction shortages (73%).
A number of causes for the looming problem were identified in the PwC report as having high to very high impact on manufacturers. Chief among them is growing demand (65%), followed by geopolitics (54%) and extraction shortage (32%). Other notable causes are low substitution rate (38%), re-use rate low (36%), over demand (supercycle) (39%), reserves running dry (30%) and insufficient research and development (25%).
To read the full report, please visit PwC.com/resourcescarcity.
The flip side of this anticipated scarcity is strong demand for metals and minerals. Strong demand points toward continued high commodity prices. The mining industry can rejoice as long as the rise does not trigger a wave of substitution.