Rio Tinto minerals chief executive Sinead Kaufman said today’s consumers wanted to know details of the mining and refining of minerals used in electric vehicles and other products.
“Consumers today want to know where their products come from. They also want to know all of the hands it has gone through to get to where it is,” she told a Benchmark Minerals’ battery gigafactories conference in Perth.
“We see more interest than ever before in provenance.
“One part of the portfolio for me in Rio Tinto is diamonds, and so we have done a lot of work over the years on the provenance and sustainability of diamonds and where they have come from.
“We are seeing a similar interest now in what is happening with critical minerals.”
Ms Kaufman said Rio would move downstream in lithium because it was unrealistic to simply mine and sell the key battery ingredient as a bulk commodity.
“I feel like you have to go downstream to be able to understand fully the value of the product and also understand the needs of your customer. How far downstream will depend greatly on different jurisdictions and different countries,” she said.
Rio has so far stayed out of the booming lithium sector in Western Australia, where a number of players have moved downstream as far as lithium hydroxide production, even though its battery minerals team is based in Perth.
The mining giant is pursuing the Jadar lithium project in Serbia and a lithium brine project in the foothills of the Andes in Argentina it acquired from Rincon Mining for $US825 million in March.
Rio remains confident it will be producing lithium carbonate from Rincon in 2024 despite the economic and political turmoil in Argentina, where there are warnings inflation could hit 90 per cent this year and high-profile Australian farming family the Kahlbetzers have just sold up and left after 40 years.
Rio and US carmaker Ford have signed a non-binding memorandum of understanding to jointly develop more sustainable and secure supply chains that cover lithium from Rincon as well as aluminium and copper.
On top of its hard rock and brine lithium mines, Rio is also sourcing some battery-grade lithium by recycling waste stockpiles at its Boron operations in California.
Ms Kaufman said Rio anticipated enormous demand for lithium this decade and beyond and a big supply shortage even if every lithium project in the pipeline made it into production.
Rio sees the world being short by more than a million tonnes based on all mines in the planning stage going ahead and forecasts that electric cars will make up 50 per cent of light vehicles on the road by 2030,
Benchmark Mineral Intelligence chief operating officer Andrew Miller said the capital flow into lithium production was not keeping up with growth in demand despite concerned car and battery makers wading into the downstream space.
Mr Miller said some carmakers had “bet their businesses” on electrification and needed the supply chain to work.
Benchmark sees lithium supply and demand balancing out by the middle of the decade before demand again starts to out-strip supply.