The EU should not encourage substitution of critical metals and should instead focus on promoting regulations that will help ensure their continued supply, according to Maurits Bruggink.
Bruggink was quoted by the online information service to the metals and steel industry, Metal Bulletin.
Bruggink, director at public affairs consultancy Ridens Public Affairs, made his comments to Metal Bulletin as the European Commission was in the process of analysing substances, including minor metals, that it has classed as “critical” for trade in Europe, to update a report first published in 2010.
The critical raw materials list has already attracted some criticism from the industry, which is concerned that it could promote substitution and create unnecessary fears about supply shortages.
“The word ‘critical’ is a bit unfortunate as customers think that ‘critical’ means ‘we have to find substitution’. The list gives extra encouragement for them to find substitutions, but what is needed is more security of supply in the future,” Bruggink said.
Ridens Public Affairs has coordinated a critical raw materials alliance, which met in Brussels in February to present a voice of the industry to the EU.
“We are very much against the government having any policies towards substitution,” Bruggink said.
“Beryllium, for example, in its pure form, is as expensive as gold, so the private sector is continually looking for substitutions so the government does not have to encourage this,” he said.
“All these critical raw materials simply have unique properties, so they are difficult to substitute. We trust in the private sector to do that and we don’t need Brussels to intervene,” he added, noting that in many cases alternatives for these critical metals can be inferior.
Industry criticisms The industry has criticised measures that the EU has imposed on the metals, on the one hand listing them as critical, and the other hand imposing measures such as Reach and import taxes.
“The policy should be that critical raw materials are always be available in one way or another,” Bruggink said, adding that policies such as Reach and green procurement tighten the supply of these metals.
Others in the market have said that listing certain metals on the critical raw materials list can be alarming and can create “hysteria”, as it implies that these metals are about to run out.
“The government shouldn’t be getting involved in these backwater areas. They have strayed into the unknown,” one trader said.
But while some have expressed concern about their metals being categorised as “critical”, Bruggink said that this can be used as a way to argue against restrictive policies that damage the metals industry.
“The fact in itself that these metals are critical should play to our advantage, because if you have a request it will be more powerful. […] We can say, ‘we are not like any other commodity. Rules are made for the average and you can’t apply them just like that on our metals’,” he said.
Trade deals Ridens and the Beryllium Science & Technology Association, where Bruggink is director of EU affairs, have already been pushing to get critical raw materials recognised in cross-country trade deals, he said.
As part of this, Bruggink has given a presentation to negotiators involved in the transatlantic trade deal between the EU and the USA, arguing that critical raw materials should be given special consideration in any policies.
In the presentation, he argued that industrial companies in Europe and the USA will only flourish if they can compete on a level regulatory platform within the global economy.
“The socio-economic effect of any regulatory measure in the EU-USA is much stronger for critical raw materials, and therefore we have asked the European Commission to start talks on our metals under the TTIP [Transatlantic Trade and Investment Partnership],” a spokeswoman at Ridens said about the presentation.
If critical raw materials are addressed under the agreement, this will have an effect on regulatory issues and could also affect tariff barriers, the spokeswoman said.
“If we are able to establish this, then it will be the world standard as the USA and EU represent 50% of world trade. The next stop is the WTO [World Trade Organization] and other bilateral trade agreements,” Bruggink said.
The concept of critical raw materials can also be brought into different industrial policies, such as the aerospace and automotive industries, Bruggink said.
“We need further measures so as to have a good regulatory environment for metals to flourish, rather than be substituted, leading to second-quality production and a lack of innovation,” he added.
Article by Chloe Smith for Metal Bulletin
Full article appears here: http://www.metalbulletin.com/Article/3334076/EU-should-promote-continued-supply-of-critical-metals-consultant-says.html (for subscribers).