Energy & Environment

For manufacturers, unlocking mineral resources is key to continued growth

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As we move to the back end of October — the “Manufacturing Month” — it is worth considering the front end of the supply chain that feeds and sustains a healthy manufacturing sector. The United States is the world’s largest manufacturing nation. Value added to gross domestic product (GDP) by major American industries that consume metals and mineral materials is $2.5 trillion, or more than 14 percent of total GDP. However, SNL Metals & Mining found, as noted in its study, “U.S. Mines to Market,” a gross structural mismatch developing between domestic minerals supply and demand that jeopardizes the building out of our country’s strong manufacturing base.

{mosads}In 1990, the United States was the largest metallic and industrial minerals-producing country in the world. Now we are seventh. At the same time, our nation has become increasingly dependent on foreign sources, with less than half the minerals consumed by the manufacturing sector sourced from domestically mined resources. As a nation, we are more than 50 percent dependent on imports for 43 key minerals.

America’s growing import-dependence has not gone unnoticed by leaders in the manufacturing industry. A recent survey of more than 400 manufacturing executives revealed that more than 90 percent are concerned about getting the minerals they need when they need them. Shorter and simplified supply chains are a driving force behind the re-shoring of manufacturing in the U.S.

The lack of mineral resources is not the problem. The U.S. is home to one of the richest mineral endowments in the world. While we are blessed with a first-class resource base, we are cursed with a third-rate permitting system. Today, it can take as long as 10 years to secure all the permits necessary to start a mining operation.

Delays of this length, according to SNL Metals and Minerals, destroy half of a mining project’s value before production even begins. In Australia and Canada — countries with environmental requirements as demanding as those in the U.S. — two to three years is the norm. It’s no wonder investments in new mineral exploration and mines flow to countries with permitting systems distinguished by their efficiency and certainty.

Fortunately, bills in both the House (H.R. 1937) and Senate (S. 883) are advancing to bring our permitting system into the 21st-century. These bills would require best practices by coordinating state and federal agencies, clarifying responsibilities and minimizing duplication so that U.S. permitting becomes smarter, efficient and more accountable. These are necessary policies to allow our domestic mining and manufacturing industries to perform to their full potential.

Quinn is the president and CEO of the National Mining Association.

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