Rio Tinto chairman Dominic Barton today warned that meeting supply shortfalls for minerals critical to the energy transition should remain a priority despite current geopolitical uncertainty.
"There is a shortage of critical materials that is irrespective of geopolitics," Barton said at the Indaba Conference in London today. "Keeping an eye on the signal versus the noise is quite important," he added, arguing that supply and demand fundamentals determine capital allocation regardless of geopolitical uncertainty.
"Despite all the volatility, we must remember that we are in the early stages of the energy transition, which is an enormous undertaking. This will be the largest reallocation of capital in human history," he added.
Barton highlighted that Rio Tinto's task is to anticipate where demand will arise and how to meet it. Currently, the metals necessary for the energy transition and trends such as urbanisation are facing potential supply shortfalls.
According to the latest Global Critical Minerals Outlook report by the IEA, copper could face a 30pc deficit by 2035, while lithium is projected to reach a 40pc deficit by the same year.
Barton acknowledged that current geopolitical issues will reshape supply chains, potentially worsening supply-demand imbalances. He also noted that globalisation is likely to become more regional and fragmented, although it will not go away completely.
"It's a challenging environment, but in the medium to long term, there will be numerous opportunities — although they may not be in the areas we have focused on in the past. New sectors will emerge that require our attention, and we will need to adapt to these changes," Barton concluded.
