Securing Minerals for the Energy Transition 2025

Illustration of a real-world demand challenge BOX 8 Lithium prices are declining due to rising supply – in January 2025, exports from Chile increased 23% month-on-month) – and weaker demand. In February 2025, the Lithium Carbonate CIF North Asia price dropped by 4.5% to $9,550/t – the lowest since 2021. Further production cuts are expected in 2025 to balance the market.30 Demand category Key challenges Global trends –Low critical mineral prices, largely shaped by China’s dominant role in processing, can make certain projects economically unviable, particularly in higher-cost regions31 –The critical minerals supply chain is fragmented, with sourcing varying across regions, leading to inefficiencies and limiting transparency Securing potential buyers through offtake agreements or partnerships –Pre-production projects often struggle to meet end-user standards and timelines –Demand for traceability is high, but buyers rarely pay a premium, limiting adoption –Beneficiation is often hindered by difficulty securing stable pricing through offtake deals –Low initial demand complicates inventory buildup and risks mineral degradation –Extensive testing and pilot plants are needed to prove quality and secure offtake agreementsSupply shocks can cause unexpected changes in price levels, increasing demand volatility and rendering some projects unviable by affecting their financing.Illustration of a skill gap challenge BOX 7 The Mining Qualifications Authority (MQA) in South Africa finds that only 14% of employees in the mining sector possess a post-matriculation qualification (beyond Grade 12).27 Workforce category Key challenges Local workforce development –Limited investment in mining-focused technical education and underfunded apprenticeship programmes, often urban-based and focused on non-critical minerals, hinder local skill development and increase reliance on foreign expertise28 –Weak enforcement of local hiring and training laws further limits workforce development, despite existing quotas –Rural mine locations with poor infrastructure make it hard to attract and retain skilled workers –Gender disparities persist, and while inclusion initiatives exist, progress remains uneven29 Overall skills landscape –There is a shortage of skilled technicians, operators and process control experts –University programmes are often misaligned with industry needs –There are limited public-private partnerships for skill development Expatriate talent attraction –Strict visa rules and security concerns limit expatriate hiring and relocation to some SAR countriesA lack of skilled workforce can hinder mining and deter investors. Reducing gender gaps is also key as many international financial institutions require gender impact assessments in their due diligence processes.26Skill gap 7 Demand volatility 8 Securing Minerals for the Energy Transition: Finance for Southern Africa 16