DailySun
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South Africa is abundantly endowed with minerals that are vital for the ongoing global technological advancement and the shift towards renewable energy in developed nations and beyond. As the leading producer of platinum-group metals, the country is responsible for about 70% of the world’s platinum production and 40% of palladium, both of which are essential for catalytic converters, hydrogen fuel cells, electronics, and various applications.
Moreover, South Africa holds 70% of the global chrome reserves, a critical component in stainless steel and chemical manufacturing, predominantly found in the Bushveld Igneous Complex. It is also among the top producers of manganese globally, containing around 40% of the world’s total reserves.
Other important minerals present in South Africa include vanadium and nickel, which play significant roles in battery technology and energy storage solutions. Recently, deposits of lithium and coltan, which are sources of niobium and tantalum, have also been identified.
Critical minerals are propelling growth in a sector that has encountered numerous obstacles in recent years. In August 2024, Stats SA reported a modest 0.3% increase in South Africa’s mining output, primarily driven by a 16% surge in manganese and a nearly 25% increase in chromium production.
To capitalize further on its mineral resources, South Africa, in collaboration with fellow African nations, needs to improve its beneficiation strategies.
The potential rewards could be significant. President Cyril Ramaphosa has conveyed to investors that by strategically executing value-added projects and amplifying production capacity, the continent might boost its GDP by 12% or more by 2050, creating millions of jobs in the process.
Africa is rich in essential minerals for energy transition, holding 55% of cobalt, 47.65% of manganese, 21.6% of natural graphite, 5.9% of copper, 5.6% of nickel, 1% of lithium, and 0.6% of iron ore, according to the UN Conference on Trade and Development (UNCTAD).
However, coordinated efforts are crucial to gain control over the critical minerals value chain, where China currently holds a dominant position. Major initiatives are being launched to address high energy costs, infrastructure limitations, and to establish stable policy frameworks. There is a pressing need for advancements in skills and technology to close the existing gaps, but progress is ongoing.
With South Africa evolving into a key automotive manufacturing hub in Africa, the rise of electric vehicle production and a robust battery value chain could further exploit the nation’s natural resources and comparative strengths.
Moving beyond traditional practices
Despite the existing potential, a large portion of Africa’s minerals continues to be exported in their raw state, sustaining outdated trade practices between Africa and other regions.
The government recognizes that substantial change requires robust policies. South Africa is aware of this necessity and is crafting a strategic framework intended to enhance its critical minerals sector, thereby positively impacting development initiatives and diversifying its energy sources.
The country’s rich mineral resources support its Just Energy Transition Plan, which aims to reduce South Africa’s dependence on coal by expanding its burgeoning renewable energy sector.
South Africa is rapidly advancing in its goal to establish a green hydrogen sector, guided by its Hydrogen Society Roadmap, which outlines specific targets to be achieved by 2050. The initiative focused on producing and exporting green hydrogen is backed by the nation’s vast reserves of platinum-group metals.
The Green Hydrogen National Programme is currently associated with projects valued at over $45 billion, with around 20% already in the bankable feasibility stage. Projections indicate that global hydrogen consumption will more than double by 2030 and increase six-fold by 2050.
The private sector is actively partnering with the government to nurture this industry as mining companies and others aim to decarbonize their operations and work towards establishing Hydrogen Valley, a project aimed at building an integrated ecosystem of green hydrogen hubs throughout the country.
