116
A. Valéry
the Seoul Summit in November 2010 and the report of the Task Force on Commodity
Futures Markets. Free trading is, for raw materials too, a guarantee of supply security.
Yet, threats to this freedom and, therefore, to the supply of natural resources,
tend to accumulate. However, certain reactions are beginning to emerge and perhaps
foreshadow, in different ways, a future form of international regulation.
Threats Towards Access to Raw Materials
These Threats Arise from Various Types of Concentrations
Firstly, the geographical concentration of the production of many essential raw
materials.
Such concentration can of course be due to the scarcity of metals which are
only found in certain deposits, but it can also be caused by industrialised countries’
prolonged disinterest in certain materials, such as rare earths (which, contrary to
their name, are in no way rare), or by the upstream to downstream control of a metal
by a State, as is the case of China for tungsten
1
.
Over and above rare earths (95 % in China), we can also make mention of
examples such as niobium (90 % in Brazil of which 80 % belongs to the familyowned business CBBM), rhodium (77 % in South Africa) and germanium (75 % in
China)
2
.
Furthermore, over 50 % of raw material reserves are located in countries whose
national income per capita is less than or equal to $ 10 per day, countries which
often suffer from institutional instability leading to consequences such as legal insecurity, but to which mining operators increasingly turn for asset acquisition given
growing demand for raw materials
3
.
Secondly, a concentration of operators.
Figures prior to the 2008 crisis already spoke for themselves: in 2005, 762 mergers and acquisitions had been identified, totalling $ 69.9 billion. Two years later, this
had risen to 1,732 mergers and acquisitions totalling $ 158.9 billion, resulting in the
creation or reinforcement of major firms, representing alone the majority of the total
value of mineral production and therefore able to impose their terms on the markets. In 2008, these companies represented 83 % of the total value of mineral raw
materials production, while the top ten non-energy mineral operators represented
32.69 % of global production
4
.
While we have not yet completely reached 2007 levels again, mining groups
have, following the 2008–2009 crisis, resumed their race for acquisitions. 1,123
transactions for a total value of US$ 113.7 billion were recorded in 2010, compared
1
Cyclope 2011, p. 534.
2
Cyclope 2011, p. 534.
3
Cyclope 2011, p. 534.
4
Cyclope 2011, p. 534.
A. Valéry
the Seoul Summit in November 2010 and the report of the Task Force on Commodity
Futures Markets. Free trading is, for raw materials too, a guarantee of supply security.
Yet, threats to this freedom and, therefore, to the supply of natural resources,
tend to accumulate. However, certain reactions are beginning to emerge and perhaps
foreshadow, in different ways, a future form of international regulation.
Threats Towards Access to Raw Materials
These Threats Arise from Various Types of Concentrations
Firstly, the geographical concentration of the production of many essential raw
materials.
Such concentration can of course be due to the scarcity of metals which are
only found in certain deposits, but it can also be caused by industrialised countries’
prolonged disinterest in certain materials, such as rare earths (which, contrary to
their name, are in no way rare), or by the upstream to downstream control of a metal
by a State, as is the case of China for tungsten
1
.
Over and above rare earths (95 % in China), we can also make mention of
examples such as niobium (90 % in Brazil of which 80 % belongs to the familyowned business CBBM), rhodium (77 % in South Africa) and germanium (75 % in
China)
2
.
Furthermore, over 50 % of raw material reserves are located in countries whose
national income per capita is less than or equal to $ 10 per day, countries which
often suffer from institutional instability leading to consequences such as legal insecurity, but to which mining operators increasingly turn for asset acquisition given
growing demand for raw materials
3
.
Secondly, a concentration of operators.
Figures prior to the 2008 crisis already spoke for themselves: in 2005, 762 mergers and acquisitions had been identified, totalling $ 69.9 billion. Two years later, this
had risen to 1,732 mergers and acquisitions totalling $ 158.9 billion, resulting in the
creation or reinforcement of major firms, representing alone the majority of the total
value of mineral production and therefore able to impose their terms on the markets. In 2008, these companies represented 83 % of the total value of mineral raw
materials production, while the top ten non-energy mineral operators represented
32.69 % of global production
4
.
While we have not yet completely reached 2007 levels again, mining groups
have, following the 2008–2009 crisis, resumed their race for acquisitions. 1,123
transactions for a total value of US$ 113.7 billion were recorded in 2010, compared
1
Cyclope 2011, p. 534.
2
Cyclope 2011, p. 534.
3
Cyclope 2011, p. 534.
4
Cyclope 2011, p. 534.