Recently, most of Australia’s nickel mines have been placed into care and maintenance, due to low nickel prices and competition from Chinese-operated mines in Indonesia. The extra supply of Indonesian low-cost nickel caused the global prices to decrease, resulting in high-cost Australian mines becoming uneconomical.
When low-cost deep sea minerals come to market, this new supply will cause the global nickel price to decrease further. In addition to the high-cost producers, the mid-cost producers will also become uneconomical and will close. As a result, deep sea mining will start to replace terrestrial mining, although it will never replace it 100%. It will also make it very unlikely that new terrestrial mines will open.
Policy can also make a difference. In the U.S., for example, the Uyghur Forced Labor Prevention Act has made significant strides in prohibiting the importation of goods into the United States manufactured wholly or in part with forced labor in the People’s Republic of China. If more countries had secure domestic supplies of critical minerals, it would strengthen their ability to take similarly aggressive action against goods manufactured with minerals mined with forced labor or from rainforests.
