Welcome to the New Trade War

The Intersection of Critical Minerals, Energy, and Trade Wars – Part 1

The new U.S. administration came into office with a penchant for taxing imports. The taxes, called tariffs, cause goods from other countries to be more expensive. Ideally, this fights “dumping.” That’s when other countries dramatically undercut the cost of a good to damage U.S. production of that same good. 

However, the current tariffs are not aimed at dumping. Rather, they are an existential threat to get other governments to do what the new administration wants. Countries, like Mexico, Columbia, and Canada, came to an agreement with the U.S. China did not.

And we are now in a trade war. Rather than compromise, China retaliated. It prohibited the export of some critical minerals to the U.S. They include:

• Gallium
• Germanium
• Antimony
• Graphite
• Synthetic industry diamonds

Readers of our New Energy Publication should recognize Antimony. This is a critical metal used in many roles including solar power, glass, electronics, battery technology. But its most notable for its roles in military applications like night vision, explosives, optics, and armor piercing bullets. 
The U.S., European Union, Japan, Russia, Australia, and China all list antimony as a critical mineral. China has the world’s largest deposit – about 32% of the global antimony resources and it produces 48% of the world’s supply.

From Yu Z, Wang L, Zheng Q, et al, 2023

The prohibition on exports to the U.S. will hit industries hard. The U.S. supplies about 63% of its antimony imports from China. And it isn’t only about finding new sources of antimony. Many of the products require purity between 99.99% to 99.999%. That requires advanced processing technologies that don’t exist in the U.S. in the volumes required. 

Further, the U.S. hasn’t mined antimony since 2001. Current production comes from recycled lead batteries. And while places like Alaska mined antimony in the past, new mines are harder to permit and build. 

That creates significant headwinds for antimony supply in the U.S. This is the first of a series here at The Grove on the intersection of critical minerals and trade wars. We believe these issues will distort markets for the next few years. And we believe there will be some excellent trade opportunities for investors as a result.

We’ll keep you informed.

For the Good,

The Mangrove Investor Team

Numbers You Need to Know

51

Antimony, atomic symbol Sb, has atomic number 51 on the periodic table. It lies to the right of tin, and to the left of tellurium. It lies below arsenic, and above bismuth, and it has properties similar to both of those elements. (Chemistry Talk)

5000 Years

Antimony earliest use is around 5000 years ago, Egyptians used forms of antimony in cosmetics and medicines. Ancient Greek doctors prescribed antimony powders for the treatment of skin disorders, and during the Middle Ages antimony was of interest to the alchemist who gave the element its own symbol. (Thought Co)

1791

Some theorize that Wolfgang Amadeus Mozart died from antimony. Mozart was prescribed antimony for a fever in 1791 and took it for several days then passed away on December 5, 1791. (Mozart Project)

What’s New in Sustainable Investing

A clarifying time for sustainable investing

Big fund companies have backed off of ESG, and US funds have closed amid political pressure and as investors have pulled money from them. The funds that remain reveal which managers are committed. (Investment News)

Sustainability is now a core part of most businesses

There’s a lot of noise around sustainability. That’s surprising, given the reality of sustainable investing is that it’s a relatively humdrum activity day-to-day. (Funds Global Mena)

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