Strategic metals have become indispensably important in recent years, as they are critical for manufacturing electronics and enabling cutting-edge technologies. With the world rapidly transitioning to EVs, 5G, renewable energy, and advanced weaponry, the demand for these scarce metals is skyrocketing. This article will analyze the strategic metals investment landscape and explain why allocating capital to this sector is imperative for technology innovations.
Lithium and cobalt are vital for EV batteries and clean energy
The electric vehicle revolution is heavily dependent on lithium-ion batteries. Lithium, nickel, cobalt, and manganese are key metals needed to produce these high-energy density batteries. In particular, lithium and cobalt are absolutely critical and facing severe supply constraints. With automakers planning over 100 new EV models in the next 5 years, and energy storage demand booming, investing in the mining of these strategic metals is compulsory to ensure adequate future supply.
Rare earths enable all kinds of electronics and defense applications
From smartphones and laptops to MRI scanners and precision missiles, rare earth elements such as neodymium, praseodymium and dysprosium are essential. They are used in tiny amounts in a vast array of electronics due to their magnetic, catalytic and phosphorescent properties. However, with China controlling over 80% of rare earths supply, many countries are trying to reduce their dependence by supporting domestic production and exploring alternatives.
5G rollout is not possible without graphite for lithium-ion batteries
The rapidly approaching 5G networks will enable the Internet of Things, autonomous driving, and mobile broadband. But the 5G revolution critically hinges on lithium-ion batteries to power all the infrastructure equipment. Graphite is an irreplaceable component in lithium-ion battery anodes. With technology giants like Ericsson predicting 4.4 billion 5G subscriptions by 2024, investing in graphite mines to meet battery demand is absolutely necessary.
Silver, platinum and palladium are precious metals with high investment potential
In addition to technology metals, precious metals like silver, platinum and palladium also deserve portfolio allocation for diversification and profit potential. Silver and platinum play critical roles in solar PV manufacturing. And palladium is vital for catalytic converters in gasoline vehicles. With solar and China auto sales rapidly rising, the investment prospects for these precious strategic metals are very strong.
Strategic metals are indispensable in manufacturing the technologies of the future. With accelerating demand due to the mainstream adoption of EVs, 5G networks, clean energy and advanced electronics, allocating investment to develop new sources of these scarce metals is imperative.