On March 16, 2023, the European Commission released the proposal for the Critical Raw Materials Act, aiming to increase Europes capabilities in refining, processing, and recycling critical raw materials through a series of actions and measures, thus achieving a secure, sustainable, resilient, and diversified supply of critical raw materials. The release of this act will have a profound impact on the global raw materials market.

The act updates the list of critical raw materials, including 34 raw materials such as cobalt and lithium required for power batteries, silicon used in solar panels, and rare earths required for wind turbines, and sets a list of strategic raw materials of high strategic importance.solarThe EU has set a self - sufficiency target for 2030, planning to mine at least 10% of critical raw materials within the EU, complete the processing of at least 40% of critical raw materials, and recycle at least 15% of critical raw materials from within the EU.

To enhance the resilience of the critical raw materials supply chain, the EU stipulates the establishment of a Critical Raw Materials Committee to coordinate the monitoring of supply risks related to critical raw materials and issues regarding the strategic raw material inventories among member states.

The act also stipulates the general obligation of member states to increase the collection, treatment, and reuse of waste containing critical raw materials, including requiring member states to recycle critical raw materials from waste and mining waste, increase the proportion of recycled secondary critical raw materials used in manufacturing, and set circular requirements for products containing permanent magnets.

To further improve the supply security of critical raw materials, the EU also requires that by 2030, the annual consumption of each critical raw material can rely on imports from third - party countries, but the consumption from any one third - party country shall not exceed 65% of the EUs annual consumption.

(1) Impact on the Global and Chinas Industrial Development

Essentially, the competition for critical raw materials is an extension of the competition in strategic emerging industries such as new materials. For major producers of critical raw materials like China, the introduction of this act will have a significant impact.

(2) Response Strategies for Relevant EnterprisesNew energyThe customs recommends that relevant enterprises closely monitor changes in the external environment, increase investment in funds, talents, etc., strengthen the advantages of critical raw materials and energy supply, and ensure the security of their own supply chain and their position in the global value chain.

The release of the EUs Critical Raw Materials Act will have a profound impact on the global critical raw materials market. As a major producer of critical raw materials, China must formulate response strategies to ensure the security of its own supply chain and its position in the global value chain.

The EU Releases the Proposal for the Critical Raw Materials Act | Shanghai Import/Export Agent

January 1, 2025 10: 15