Author: admin

You’re probably reading this article on a phone or laptop containing more than 30 different metals. Some will be common: aluminium casing, copper wires. But other metals are less familiar and much more scarce. Each iPhone contains less than a gram of lithium, for instance, but would not function without it.

We are in the midst of a geopolitically charged race for lithium and other so-called critical minerals. These materials are crucial for renewable energy, transport, data centres, aerospace and defence, among other things, and the transition to net zero will place unprecedented pressure on their supplies.

Accordingly, the UK has just published a new Critical Minerals Strategy, identifying 34 of these raw materials as essential for national security and the economy. Meeting demand for them will be a monumental challenge.

Take copper: even though it is a well-established commodity, in the coming decades the world will need more of it than has ever been mined in human history. Yet opening a new mine takes a decade and costs billions.

Other minerals, such as cobalt or the 17 “rare earth elements”, present a different problem: supplies are concentrated in countries with competing strategic interests or developing nations, and can be hard to access.

For instance, most high-performance magnets – including those in wind turbines – use the rare earth neodymium, and the vast majority currently comes from China. The metal cobalt is used in batteries: about half of the world’s reserves are in the Democratic Republic of Congo.

Historically, mining has caused significant social and environmental harm in host countries – frequently developing nations – while delivering most of the benefits to consumers in wealthier countries.

Wealthier countries could just turn a blind eye to those harms, but there is a growing awareness of the impact of mining. This, combined with the concentration of supplies in certain countries, creates a challenge for places like the UK, which don’t have critical mineral resources.

Disruptive technologies

New extraction technologies are emerging in the UK and elsewhere. While some companies are making progress with “green mining” – using electric vehicles and renewable energy – the most promising solutions are more radical.

One new avenue is recovering geothermal energy alongside critical minerals. The hot fluids beneath ancient volcanoes can be rich in lithium, gold, silver and other critical elements, with each volcanic system offering its own distinct mix of resources.

Tapping into this heat can offer a double benefit: clean energy and useful minerals. In Cornwall, south-west England, there are plans to do this at a reopened lithium mine.

Synthetic biology is another exciting development. This involves scientists modifying microbe DNA to selectively scavenge specific elements from their surroundings, such as battery waste and sewage sludge. These micro-organisms could recover resources even in extreme environments.

Read more:
As mining returns to Cornwall, lithium ambitions tussle with local heritage

Circular resources

Making better use of the resources we already have is essential. This goes beyond traditional recycling to develop new ways to turn by-products and discarded materials into valuable resources, while simultaneously cleaning up legacy pollution.

For example, mining tailings and coal fly ash contain recoverable metals, and innovative “smart” minerals and microbes can be harnessed to extract them.

However, recycling alone won’t meet future demand. Many metals, while highly recyclable, remain in use for decades before re-entering the supply chain. Take nickel, for instance. It’s an important battery metal, but can stay in circulation for 30 years or more, limiting its availability in the short term.

Mining that does not curse the locals

Future mining must avoid the “resource curse” – the paradox where resource-rich countries often fail to benefit fully from their own mineral wealth. Principles for a new approach should include investment in local industries in producer countries so they can make batteries and magnets, not just export ore.

They should also require genuine community engagement, giving mining de facto permission and acceptance from locals. This unwritten set of positive (or at least tolerant) attitudes is sometimes termed the “social licence” to operate – and without it, mining operations can fail.

Mining companies should promote best practices with regard to the environment, health and safety, and workers rights. Regulators need to enforce environmental protection with teeth, including rewilding and ecosystem restoration after a mine has been emptied.

The mining industry has a bad reputation for a reason, with a history of high-profile environmental disasters. The growing emphasis on environmental, social and governance criteria for investors is encouraging, and may help deliver change.

The UK government’s new strategy outlines promising goals on domestic development, the circular economy and supply chain resilience – but its measures of success don’t match the ambition. Its support for innovation is also cautious and focuses on established approaches. What’s needed is an entirely new way of thinking about how to secure these resources.

This means recovering materials from new sources, using them more wisely, ensuring mining communities benefit, and cleaning up environmental damage. It also means building resilient supply chains that can withstand a major change of government, an economic crash, or some other geopolitical shock.

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

Pets at Home is in the doghouse. And not the padded fabric kind found on the retailer’s own shelves. The UK purveyor of pet food, supplies and medicine is getting mauled: in the past six months, pre-tax profit at its retail business, which makes up around two-thirds of revenue, the rest coming from sales to vets, fell by over 80 per cent.

Dog demographics are not on Pets At Home’s side. The great pandemic pet boom created a surge in demand for beds, collars, crates and treats as new owners kitted out a new generation of companions. Those mollycoddled pups have aged into a cohort of adults requiring less in the way of maintenance. The overall dog market is about flat in sales terms, the company posits, accessories suffering more than food. 

The decline in Pets At Home’s revenue suggests it is faring worse than the average, and gross profitability has been dented by competition. The problem, it would appear, is that canines have fashion trends too, which Pets At Home has misjudged.

In accessories — theoretically the business with the highest gross margins — online rivals such as Amazon and Temu are tough to beat on price, analysts at RBC note. Both, along with online pet platforms like Pets Corner and the US’s Chewy, are nimbler in spotting the next big thing, be it GPS-enabled collars or smart feeders.

Meanwhile, dog food is no longer just dried pellets. It can be raw, freeze-dried, insect-based or probiotic. Startups like Butternut Box and The Farmer’s Dog, which offer a subscription-based experience, and Tuggs, which produces insect-based food, have turned pet food into a lifestyle choice. Online platforms are aggressively staking a claim on that market too. 

Pets At Home is partly to blame for its woes. Investing in food and accessory innovation might get sales growing again. As the pandemic pet generation ages, demographics should become more favourable: more supplements and orthopaedic dog beds.

The challenges Pets At Home faces are not dissimilar to those of High Street fashion retailers, struggling to compete with cheaper and quicker internet giants. The group’s valuation, at less than one times this year’s forecast revenue according to S&P Capital IQ, reflects that.

Across the Atlantic, shares in US petcare chain Petco have slumped nearly 90 per cent in five years. Pets are easy to love; listed pet stores, it turns out, not so much.

gaia.freydefont@ft.com