Abstract
The availability of resources is crucial for the socio-economic stability of our society. For more than two decades, there was a debate on how to structure this issue within the context of life-Cycle assessment (LCA). The classical approach with LCA is to describe “scarcity” for future generations (100–1000 years) in terms of absolute depletion. The problem, however, is that the long-term availability is simply not known (within a factor of 100–1000). Outside the LCA community, the short-term supply risks (10–30 years) were predicted, resulting in the list of critical raw materials (CRM) of the European Union (EU), and the British risk list. The methodology used, however, cannot easily be transposed and applied into LCA calculations. This paper presents a new approach to the issue of short-term material supply shortages, based on subsequent sudden price jumps, which can lead to socio-economic instability. The basic approach is that each resource is characterized by its own specific supply chain with its specific price volatility. The eco-costs of material scarcity are derived from the so-called value at risk (VAR), a well-known statistical risk indicator in the financial world. This paper provides a list of indicators for 42 metals. An advantage of the system is that it is directly related to business risks, and is relatively easy to understand. A disadvantage is that “statistics of the past” might not be replicated in the future (e.g., when changing from structural oversupply to overdemand, or vice versa, which appeared an issue for two companion metals over the last 30 years). Further research is recommended to improve the statistics.
Highlights
Availability is high on the agenda in the United States of America (USA), as well as in the European Union (EU), leading to comprehensive studies and datasets of the British Geological Survey [1], the United States Geological Survey (USGS) [2], and the European Commission [3]
This system might be valuable for political decision taking, especially since the end result of the calculation system is a simple yes/no on the question whether a metal is considered in the EU as a critical raw materials (CRM)
With regard to research question 1 (“Which statistical method can be regarded as suitable to predict the future risk of a sudden jump in prices caused by disruptions in the supply chain?”), it was concluded that the value at risk (VAR) seems to be a suitable way to describe the scarcity of metals for the short term (10–30 years)
Summary
The availability of resources is crucial in our modern society from a socio-economic point of view. Greadel et al compared the extractable global resource (EGR) with the reserve base (RB) estimates of the USGS They calculated a variance of a factor of 100 for the EGR/RB ratio from a list of 64 metals, (eight had more than a factor of 800). The most applied method in LCA along this line of thinking is the ReCiPe method [20,21,22] The problem with this approach, according to experts in the mining industry, is “that grades have so far been of limited relevance to the issue of availability” ([16], Section 10). Many LCA scientists seem to accept the aforementioned long-term uncertainties as a ffaacctt ooff lliiffee,, and still apply midpoint tables that are based on the absolute deplettiioonn ooff resourrcess (seeee Table 1 for some leading indicator systems).
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