China Stakes Its Claim in Latin American Energy:

In 2017, the U.S. Department of the Interior issued a list of 35 “critical’ minerals, including bauxite, cobalt, lithium, tin and titanium, all of which are produced in Latin America. Rare earth elements, a category that includes 17 metals, are grouped together in the government’s list as one entry and are essential for a range of high-tech sectors. A mineral-rich country, China has extensive experience extracting minerals used for its industrialization. However, the country is looking overseas to prevent overexploitation of its own resources. The largest Chinese firms producing strategic metals and minerals are also among the largest in the world, and they are moving fast to exploit new reserves in Latin America. Tianqi Lithium and Ganfeng Lithium are two of these companies. Energy storage and electric mobility are the next frontier in energy transition. Components that go into solar, wind and other renewable energy equipment, particularly Li-ion batteries, need critical minerals that abound in the LAC region. According to Benchmark Minerals Intelligence, in 2020 China led the world’s battery cell production with a 63.2% share, while the U.S. was in second place with 14.2% (Figure 1).

Figure 1. Li-ion battery cell global production, 2020 Note: ROW = Rest of World

China’s determination to become the leading supplier of renewable energy technologies has encouraged state-supported companies to make large investments throughout every step in the Li-ion battery supply chain, from mining and processing of minerals, component manufacturing, battery assembly and the export of finished products. No other country in the world has attained such a level of domination in the Li-ion battery value chain (Figure 2).

INSTITUTE OF THE AMERICAS

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