"Need to Expand Mineral Cooperation with South America... Must Pursue Supply Chain Stability"

Martial Arts 'South America Battery Mineral Development Environment and Implications' Report Published

As resource nationalism rises and export controls tighten in mineral-rich countries such as Indonesia and Mexico, there are calls to pursue diversification of battery raw materials and supply chain stability through strategic partnerships with South America, which has abundant deposits and production of critical minerals.

According to the report "South America Battery Mineral Development Environment and Implications" published on the 29th by the Korea International Trade Association (KITA) Institute for International Trade and Commerce, three South American countries?Brazil, Chile, and Argentina?are emerging as promising supply chains for the electric vehicle and battery industries based on their abundant critical mineral deposits.

In particular, the three South American countries are focusing on fostering downstream sectors such as refining and smelting through active new investments. Additionally, they have abundant renewable energy infrastructure such as solar power, which offers the advantage of reducing the carbon footprint generated during mineral mining and refining processes.

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In fact, Brazil is actively discussing the establishment of electric vehicle and battery factories by global companies based on its diverse and abundant mineral types necessary for battery production, including the world's second-largest graphite deposits as well as nickel, manganese, and lithium. Chile and Argentina are key countries in the Lithium Triangle, which holds about 60% of the world's lithium deposits. Chile is expanding its refining and smelting industry under state leadership, while Argentina is creating a foreign-investor-friendly environment.

Focusing on such resource infrastructure, China is accelerating its entry into South America through cooperation between its government and companies. Based on the Chinese government's mineral diplomacy, companies such as BYD, Ganfeng Lithium, and Tianqi Lithium are expanding their presence across the entire electric vehicle, battery, and mineral value chain in South America. In response, the report recommends that Korea also enhance mineral cooperation through joint ventures, equity investments, and local factory establishments based on expanded diplomatic relations.

Park So-young, senior researcher at the Korea International Trade Association, explained, "Although the South American region has enormous potential, risks such as conflicts with indigenous communities during mineral mining and a shortage of highly skilled labor persist," adding, "It is necessary to promote the long-term stability of projects through profit-sharing with local communities and regional return projects."

This content was produced with the assistance of AI translation services.