Full metal jackpot

The transition to clean energy will mint new commodity superpowers

We look at who wins and loses

In mid-february Russia seemed on the verge of a revolution with a distinctly reddish tint. Alisher Usmanov, an oligarch, was developing Udokan, a copper mine in Siberia that required removing an entire mountain top. In the Arctic tundra Kaz Minerals, a mining firm, had raised enough cash to build Baimskaya, a rival mine so remote that it needed its own port, icebreaker and floating nuclear plant. For years the projects had been put on hold because of their immense costs. But expectations of soaring demand for copper, used in everything from grids to turbines, had boosted prices of the auburn metal, making the mines viable.

Now the copper price is even higher. But the projects are in trouble. Insiders say they are short of vital foreign equipment that has been blocked by the West after Russia’s invasion of Ukraine, and that they are starved of the funds they had expected from blacklisted Russian banks. Mr Usmanov, too, faces sanctions. A spokesman for Udokan says, "We are doing everything we can to ensure business continuity.” Yet even if the mine starts producing this year as planned, it is unclear who will buy its output. Foreigners, even the Chinese, are shunning Russian production.

As the world weans itself off dirty fuels, it must switch to cleaner energy sources. The International Energy Agency (IEA), an official forecaster, predicts that wind and solar could account for 70% of power generation by 2050, up from 9% in 2020, if the world embarks on a course to become carbon-neutral by 2050. That translates into huge demand for the metals, such as cobalt, copper and nickel, that are vital for the technologies underpinning everything from electric cars to renewables; the IEA reckons that the market size of such green metals would increase almost seven-fold by 2030. And much like fossil-fuel reserves, these commodities are distributed unevenly (see chart 1). Some countries have none at all. Others are blessed with vast deposits.