The war for critical minerals unleashes a new investment fever: paying for mines that do not yet exist

• Funds and marketers pay for production from mines that do not yet exist to ensure supply

• Africa becomes the epicentre of investment due to its large reserves and financing deficit

• Offtake agreements allow miners to obtain financing in exchange for selling all of their future production.

The global war between China and the US over critical minerals is consolidating a multi-billion dollar sector that, until recently, went relatively unnoticed. This rivalry is underpinning the expansion of large international traders, investment funds, financial institutions and governments, which compete to gain a foothold in supply chains that are increasingly important for the global industry. Mine control is still important, but the need to control where mining is extracted is increasingly being emphasized, but it has become more important to know that during the coming years there will continue to be a constant supply. In this context, a particular business has emerged almost of a prospective nature, financing mining operations and extractions that do not yet exist in order to ensure future production.

Continue reading ElEconomista