Friday 24th January 2020

Resource Clips


Posts tagged ‘u.s.’

“It’s time to be ambitious” on critical minerals: Mining Association of Canada

January 24th, 2020

by Greg Klein | January 24, 2020

Canadian-American co-operation on essential elements means opportunity for this country’s wider economy, Pierre Gratton emphasizes. Speaking to the Vancouver Board of Trade, the president/CEO of the Mining Association of Canada commented on the recent Canada-U.S. Joint Action Plan on Critical Minerals Collaboration, as well as the Canadian Minerals and Metals Plan.

Two weeks ago Natural Resources Canada announced the cross-border agreement to secure deposits and develop supply chains for minerals essential to the economy, defence, technology and clean energy. The initiative takes place as the U.S. seeks ways to reduce its dependency on sources considered unreliable, unethical or potential economic and military rivals.

It’s time to be ambitious on critical minerals Mining Association of Canada

Pierre Gratton: “We have an opportunity to lay the foundation
for a new era in investment and middle class job creation,
not just in mining but in new, emerging downstream industrial
and manufacturing sectors.” (Photo: Matt Borck,
courtesy Greater Vancouver Board of Trade)

“Critical minerals are more than rare earth elements, and include several minerals and metals already mined in Canada including cobalt, copper, precious metals, nickel and uranium, which are critical to low-carbon electrification and new battery technologies in the automotive, space, defence and high-tech sectors,” said Gratton.

“It’s time to be ambitious. We have an opportunity to lay the foundation for a new era in investment and middle class job creation, not just in mining but in new, emerging downstream industrial and manufacturing sectors.”

Canada ranks among the world’s top five countries for 15 minerals and metals, MAC stated, and remains a global leader in responsible mining practices. Over the past five years MAC’s Towards Sustainable Mining program has been adopted by mining associations in seven countries on five continents.

“TSM focuses on enabling mining companies to meet society’s needs for minerals, metals and energy products in the most socially, economically and environmentally responsible way through mandatory commitments to annually report and assure social and environmental performance with strong multi-stakeholder oversight,” the association added.

“Canadian metals come conflict-free, meeting the highest environmental standards and a commitment to transparency unmatched anywhere,” Gratton continued. “We are confident that with these sustainable standards and new government commitments, Canada’s mining industry has the tools and support to provide the responsibly sourced minerals vital to industries around the world.”

Gratton also spoke on the Canadian Minerals and Metals Plan, a federal-provincial initiative intended to enhance the industry’s competitiveness, innovation and native participation.

Mining contributes $97 billion to national GDP and 19% of domestic exports, employing 626,000 people directly and indirectly across the country. The industry is proportionally Canada’s largest private sector employer of natives and a major customer of native-owned businesses.

Clint Cox: Formidable challenges face competitors of Chinese rare earths

January 20th, 2020

by Greg Klein | January 20, 2020

Depending which part of the supply chain’s under consideration, this one country produces anywhere from 70% to 95% of these critical minerals. China’s overwhelming rare earths dominance has long been obvious but trade tensions have once again highlighted the problem. Speaking at VRIC 2020 on January 19, Clint Cox outlined the hurdles Westerners face in the struggle to ensure security of supply.

Formidable challenges face competitors of Chinese rare earths

An analyst with The Anchor House who’s specialized in REs since 2006, Cox works with people throughout the supply chain including end users, government agencies, producers and junior explorers.

Last year China’s trade war threat to “weaponize” rare earths brought chills to Western end-users, who are all too familiar with the crisis of 2010. Prior to the Senkaku incident, prices had been trending downwards. Then came the monumental spike, shooting up costs of some elements 30 times.

“Our entire auto industry in North America almost shut down because of this,” Cox says. “A number of other industries almost shut down because of this.”

Naturally juniors found opportunity in crisis. Previously numbering about a dozen, ASX- and TSXV-listed rare earths explorers swelled their numbers beyond 450, a number grossly disproportionate to the availability of qualified geos. “They raised almost $6 billion in that time period,” Cox points out. “They ended up with one producing mine in Lynas Corporation and one mine in Molycorp, the Mountain Pass mine that went bankrupt.”

Mountain Pass in California has since re-opened—as a supplier to China. The world’s greatest source of rare earths deposits has, over the last two years, become a significant importer.

That’s a legacy of environmental neglect that includes an 11-square-kilometre tailings pond with about 100,000 to 150,000 tonnes of exposed radioactive muck, right next to a tributary of the Yellow River.

“China knows this,” he says. “They’re trying to fix it.”

As a result the government has been shutting down mines and looking for external sources. But on a global scale domestic production remains overwhelming.

As does the processing supply chain, led by six state-owned companies that have consolidated their operations. The Big Six benefits from China’s approach to capitalism.

Formidable challenges face competitors of Chinese rare earths

Clint Cox: China’s RE benefits include
geology, expertise, black market production
and totalitarian government support.

“They are all subsidized, every last one of them,” Cox emphasizes. “They’re subsidized at the local level, the provincial level and the national level. This could be free power, this could be interest-free loans, it could be loans that never have to be paid back, and sometimes just flat-out cash payments. They are subsidized at every level.”

Companies in Bayan Obo, China’s most important rare earths-producing region, received about $395 million in government support over just one year. “That’s free money, that’s a subsidy, that’s tough to compete with. That’s way over what the United States is going to spend to try to solve this issue.”

A 20-year expansion plan for rare earths projects in the region finished well ahead of schedule, he notes.

Cox says China began 37 rare earths projects last year, promising some 48,000 tonnes of magnet production. “We only have a couple of hundred tonnes of magnet production in North America. And they spent close to, we gather, ten and twenty billion dollars on making rare earths facilities last year. And we’re excited about tens of millions, or maybe a hundred million dollars spent on some of the projects by the government this year.”

The country’s environmental legacy notwithstanding, China’s current handling of radioactivity presents another advantage. Freeing up the miners, the Chinese nuclear authority now takes responsibility for dealing appropriately with waste. Non-Chinese companies have to fend for themselves. Such challenges have been illustrated by Lynas, which faces opposition to the cracking and leaching plant in Malaysia that processes material from the company’s Mount Weld mine in Western Australia.

Another Chinese advantage: The Big Six launders material from the “unofficial or black market,” coming from unsanctioned, artisanal operations of dubious environmental and workplace standards. Some of it comes from inside China, while additional sources include Myanmar and other parts of southeast Asia, South America and elsewhere.

“So a lot of material flows through this black market. They legitimize it, because once it enters one of their supply chains, one of the Big Six, they can stamp an ‘official’ stamp on it and it becomes official material.”

He adds, “In general, Western countries can’t utilize the black market like China can. That is a huge edge. Some of the black market material can cost one-third of regular material.”

The juniors are definitely the place where the last crop of potential mines came from, and it looks like they might be the next out there. There’s some out there today.—Clint Cox

Supporting all this is a totalitarian regime. “That is tough to compete with.” Despite heightened Washington concern, the U.S. government agencies trying to address the problem remain uncoordinated. U.S. Congress currently has 18 bills concerning rare earths, Cox says.

Still, efforts persist to extract rare earths from sources such as mineral sands and coal. Then there are the juniors.

“The juniors are definitely the place where the last crop of potential mines came from, and it looks like they might be the next out there. There’s some out there today.”

But he has a warning for would-be miners who assume they’d receive a premium for non-Chinese supply. They won’t, he cautions. They’ll have to meet Chinese prices.

Other possibilities might not be predictable. “A dark horse can always come up. You never know what might happen in the rare earths industry. A new application, a new mine, a new processing technology, any of that can transform the industry.”

Read about the Canada-U.S. Joint Action Plan on Critical Minerals Collaboration.

Canada and U.S. formalize action plan for critical minerals deposits and supply chains

January 10th, 2020

by Greg Klein | January 10, 2020

A new commitment binds two neighbouring allies to produce resources essential to the economy, defence, technology and clean energy. Announced January 9, the Canada-U.S. Joint Action Plan on Critical Minerals Collaboration reflects both Canada’s mining potential and American concern about reliance on rival and potentially hostile countries.

Canada and U.S. formalize action plan for critical minerals deposits and supply chains

“Canada is an important supplier of 13 of the 35 minerals that the U.S. has identified as critical to economic and national security,” stated the Natural Resources Canada announcement. “We have the potential to become a reliable source of other critical minerals including rare earth elements, key components in many electronic devices that we use in our daily lives. Canada is currently the largest supplier of potash, indium, aluminum and tellurium to the U.S. and the second-largest supplier of niobium, tungsten and magnesium. Canada also supplies roughly one-quarter of the uranium needs of the U.S. and has been a reliable partner to the U.S. in this commodity for over 75 years.”

Among goals of the action plan are joint initiatives in R&D, supply chain modelling and increased support for industry, NRCan added. Experts from both countries will meet in the coming weeks.

Reflecting Washington’s concern, in 2017 the U.S. Geological Survey released the country’s first thorough study of critical minerals since 1973. Later that year President Donald Trump ordered a federal strategy that initially focused on 23 essential minerals. In 2018 the U.S. officially declared 35 minerals to be critical and at risk of supply disruption.

Since then, discussions have taken place between Trump and Prime Minister Justin Trudeau, along with other representatives from both countries.

By finalizing the collaboration agreement, “we are advancing secure access to the critical minerals that are key to our economic growth and security—including uranium and rare earth elements—while bolstering our competitiveness in global markets and creating jobs for Canadians,” said Canadian Natural Resources Minister Seamus O’Regan.

Read more about the U.S. critical minerals strategy.

Read about the U.S. list of 35 critical minerals.

Infographics: The United States and the new energy era’s lithium-ion supply chain

December 11th, 2019

by Nicholas LePan | posted with permission of Visual Capitalist | December 11, 2019

The world is rapidly shifting to renewable energy technologies. Battery minerals are set to become the new oil, with lithium-ion battery supply chains becoming the new pipelines.

China is currently leading this lithium-ion battery revolution—leaving our neighbour to the south dependent on its economic rival. However, the harsh lessons of the 1970s-to-’80s oil crises have increased pressure on the U.S. to develop its own domestic energy supply chain and gain access to key battery metals.

Introducing the new energy era

This infographic from Standard Lithium TSXV:SLL explores the current energy landscape and America’s position in the new energy era.

 

The new energy era’s lithium-ion supply chain

 

An energy dependence problem

Energy dependence is the degree of a nation’s reliance on imported energy, resulting from an insufficient domestic supply. Oil crises during the 1970s to ’80s revealed America’s reliance on foreign-produced oil, especially from the Middle East.

The U.S. economy ground to a halt when gas prices soared during the 1973 oil crisis—altering consumer behavior and energy policy for generations. In the aftermath of the crisis, the government imposed national speed limits to conserve oil, and also demanded cheaper, smaller and more fuel-efficient cars.

U.S. administrations set an objective to wean America off foreign oil through “energy independence”—the ability to meet the country’s fuel needs using domestic resources.

Lessons learned?

Spurred by technological breakthroughs such as hydraulic fracking, the U.S. now has the capacity to respond to high oil prices by ramping up domestic production.

By the end of 2019, total U.S. oil production could rise to 17.4 million barrels a day. At that level, American net imports of petroleum could fall in December 2019 to 320,000 barrels a day, the lowest since 1949.

In fact, the successful development of America’s shale fields is a key reason why the Organization of the Petroleum Exporting Countries (OPEC) has lost most of its influence over the supply and price of oil.

A renewable future: Turning the ship

The increasing scarcity of economic oil and gas fields, combined with the negative environmental impacts of oil and the declining costs of renewable power, are creating a new energy supply and demand dynamic.

Oil demand could drop by 16.5 million barrels per day. Oil producers could face significant losses, with $380 billion of above-ground investments becoming worthless if the oil industry and oil-rich nations are not prepared for a surge in green energy by 2030.

Energy companies are hedging their risk with increased investment in renewables. The world’s top 24 publicly listed oil companies spent on average 1.3% of their total budgets on low carbon technology in 2018, amounting to $260 billion. That is double the 0.68% the same group had invested on average through the period of 2010 and 2017.

The new geopolitics of energy: battery minerals

Low carbon technologies for the new energy era are also creating a demand for specific materials and new supply chains that can procure them.

Renewable and low carbon technology will be mineral-intensive, requiring many metals such as lithium, cobalt, graphite and nickel. These are key raw materials, and demand will only grow.

 

Material 2018 2028 2018-2028 % growth
Graphite anode in batteries 170,000 tonnes 2.05M tonnes 1,106%
Lithium in batteries 150,000 tonnes 1.89M tonnes 1,160%
Nickel in batteries 82,000 tonnes 1.09M tonnes 1,229%
Cobalt in batteries 58,000 tonnes 320,000 tonnes 452%

(Source: Benchmark Minerals Intelligence)

 

The cost of these materials is the largest factor in battery technology and will determine whether battery supply chains succeed or fail.

China currently dominates the lithium-ion battery supply chain and could continue to do so. This leaves the U.S. dependent on China in this new era.

Could history repeat itself?

The battery metals race

There are five stages in a lithium-ion battery supply chain—and the U.S. holds a smaller percentage of the global supply chain than China at nearly every stage.

 

The new energy era’s lithium-ion supply chain

 

China’s dominance of the global battery supply chain creates a competitive advantage that the U.S. has no choice but to rely on.

However, this can still be prevented if the U.S. moves fast. From natural resources, human capital and technology, the U.S. can build its own domestic supply.

Building the U.S. battery supply chain

The U.S. relies heavily on imports of several key materials necessary for a lithium-ion battery supply chain.

 

U.S. net import dependence
Lithum 50%
Cobalt 72%
Graphite 100%

(Source: U.S. Department of the Interior, Bureau of Land Management)

 

But the U.S. is making strides to secure its place in the new energy era. The American Minerals Security Act seeks to identify the resources necessary to secure America’s mineral independence.

The government has also released a list of 35 minerals it deems critical to the national interest.

Declaring U.S. battery independence

A supply chain starts with raw materials, and the U.S. has the resources necessary to build its own battery supply chain. This would help the country avoid supply disruptions like those seen during the oil crises in the 1970s.

Battery metals are becoming the new oil and supply chains the new pipelines. It is still early in this new energy era, and the victors are yet to be determined in the battery arms race.

Posted with permission of Visual Capitalist.

See European Union pledges €3.2 billion for lithium-ion R&D.

Commerce Resources congratulates Quebec PhD student for research on company’s rare earths project

December 5th, 2019

by Greg Klein | December 5, 2019

A study related to the Ashram rare earths-fluorspar deposit brought Université du Québec PhD candidate Sophie Costis first prize in an academic competition. Commerce Resources TSXV:CCE congratulated her on winning the $2,000 scholarship for her study on flotation tailings using the flowsheet for the company’s deposit. Costis delivered her presentation entitled Impact du gel-dégel et de la salinité sur le comportement de résidus miniers de terres rares en milieu nordique to l’Association Québécoise des Sciences de la Terre. Her first-place finish in le défi de la recherche en géosciences (Geoscience Research Challenge) was announced at last month’s Quebec Mines + Energy conference in Quebec City.

Commerce Resources congratulates Quebec PhD student for research on company’s rare earths project

A first-prize award recognizes the work of PhD candidate
Sophie Costis on Ashram’s flotation management.
(Photo: Université du Québec)

“The company is thrilled to see Sophie recognized for her hard work on the project over the last few years,” said Commerce president Chris Grove. “We are committed to advancing the Ashram project in an environmentally responsible manner and Sophie’s work will help build this foundation through high-quality data-gathering and analysis in a very important field.”

Backed by a $300,000 grant, Costis works in partnership with le Centre Eau Terre Environnement of l’Institut national de la recherche scientifique of l’Université du Québec. Expected to conclude late next year, her project provides further insight on tailings management in the flotation process plant.

Her findings so far show no serious concerns with Ashram’s flotation tailings management, show the process has no acid-generating potential and also show strong indications that there is no metal-leaching potential, Commerce stated.

In early October, Cynthia Kierscht, the U.S. deputy assistant secretary of state for Western Hemisphere affairs, hosted Shawn Tupper, associate deputy minister of Natural Resources Canada, at the first critical minerals working group meeting in Washington. The group will continue talks in coming months to finalize the joint plan.—Canadian Press

The work complements Ashram’s pre-feasibility studies for Ashram, which coincide with heightened concerns about critical minerals like fluorspar and especially rare earths. This week Canadian Press reported Ottawa is examining the role Canada could play in supplying the United States and other allied countries with minerals considered necessary to the economy, technology and defence.

NRCanada has contracted Roskill Consulting to forecast future demand for critical minerals that Canada could supply, CP added.

Last week Commerce released assays from near-surface intervals at Ashram showing high grades over wide widths. The company also has metallurgical studies underway at a Colorado lab to upgrade the project’s fluorspar potential, increase rare earths extraction and produce samples requested by potential customers.

Fluorspar wasn’t considered in the project’s 2012 resource but will be included in an update anticipated for the coming year, as will two seasons of extensive drilling. A major advantage of Ashram is the carbonatite-hosted deposit’s relatively simple monazite, bastnasite and xenotime mineralogy that’s familiar to conventional rare earths processing.

Fluorspar potential also comes under consideration at another critical minerals project two kilometres away, where Saville Resources TSXV:SRE operates the Niobium Claim Group under a 75% earn-in from Commerce. Following a drill program earlier this year, Saville released promising niobium-tantalum-phosphate results in June.

Last month Commerce closed the final tranche of a private placement totalling $2.51 million. A private placement in August brought in $413,749.

 

Update: An academic paper on Ashram’s flowsheet will be presented at the Canadian Mineral Processors conference in Ottawa on January 23. Lead author Jean-François Boulanger, an assistant professor at l’Université du Québec en Abitibi-Témiscamingue in Rouyn-Noranda and manager of the Ashram metallurgical tests completed at l’Université Laval from 2018 to 2019, will discuss his study entitled Challenges of Scale-Up in Grinding and Flotation of Rare Earth Minerals. The report will also be published in the organization’s periodical CMP Proceedings.

“The Ashram deposit, with its simple rare earth and gangue mineralogy, and resultant well-understood processing techniques, potentially presents a base case scenario for some issues and, therefore, the test data generated by Laval has been used to formulate cautionary guidance for scale-up and large-scale concentrate production, potentially applicable to all rare earth projects regardless of mineralogy,” stated an announcement from Commerce.

Second and third authors of the study are Claude Bazin, professor and project supervisor at Laval, and Darren Smith, project manager at Ashram.

Read more about Commerce Resources.

Commerce Resources reports high grades over wide intervals at Quebec rare earths-fluorspar project

November 28th, 2019

by Greg Klein | November 28, 2019

With core moved from the storage vault to the lab, new assays further confidence in a resource update anticipated for next year as the Ashram deposit advances towards pre-feasibility. The results come from a 14-hole, 2,014-metre program sunk in 2016 but only recently assayed for budgetary reasons. Now cashed-up Commerce Resources TSXV:CCE unveils an impressive batch of near-surface rare earths and fluorspar intercepts from the northern Quebec property.

Commerce Resources reports high grades over wide intervals at Quebec rare earths-fluorspar project

Among the highlights are one of the project’s best-yet intercepts: 2.38% rare earth oxides over 64.54 metres, with sub-intervals including 3.02% over 28.35 metres. Another standout shows 1.71% over 221.95 metres, including 2.18% over 36.16 metres. Yet another hole boasts 2.16% over 53.55 metres. (True widths were unavailable.)

These are near-surface results, starting at downhole depths of 66.5 metres, 2.69 metres and 1.54 metres respectively.

Another critical mineral and one not factored into Ashram’s previous PEA, fluorspar also comes through in impressive grades, such as 7.2% calcium fluoride over 221.95 metres, including 11.5% CaF2 over 36.16 metres. Metallurgical studies currently underway work on upgrading the fluorspar to higher-priced acid grade in a flowsheet that would provide both rare earths and fluorspar concentrates, improve RE extraction and reduce tailings. The Colorado lab will also produce samples to meet requests from potential customers.

This round of definition drilling targeted the deposit’s northern, western and southern margins with holes spaced 50 metres apart, and in some cases 25 metres apart. Additional drilling at 25-metre centres may take place.

Using a 1.25% cutoff, Ashram’s 2012 resource estimate showed:

  • measured: 1.59 million tonnes averaging 1.77% total rare earth oxides

  • indicated: 27.67 million tonnes averaging 1.9% TREO

  • inferred: 219.8 million tonnes averaging 1.88% TREO

The carbonatite-hosted deposit features relatively simple monazite, bastnasite and xenotime mineralogy, familiar to conventional rare earths processing

Anticipated for the coming year is Ashram’s first resource update since 2012, factoring in 9,625 metres of drilling since then. Previous drilling followed mineralization from near-surface to depths beyond 600 metres where mineralization remains open, as evidenced by 4.13% REO over 0.6 metres beginning at 599.9 metres’ depth.

Work continues as the United States and other allied countries show increasing concern about China’s domination of several critical minerals with a special focus on rare earths but also including fluorspar, tantalum and niobium. Commerce also holds the advanced-stage Blue River tantalum-niobium deposit in southern British Columbia.

About two kilometres from Ashram, Saville Resources TSXV:SRE operates the Niobium Claim Group under a 75% earn-in from Commerce. After releasing niobium-tantalum-phosphate results last June, Saville now has the project’s fluorspar potential under evaluation.

Earlier this month Commerce closed the final tranche of a private placement totalling $2.51 million. Another placement in August garnered $413,749.

Read more about Commerce Resources.

Over a Barrel: Documentary now online about Vivian Krause vs. the U.S.-funded campaign against Canadian oil

October 25th, 2019

by Greg Klein | October 25, 2019

What they’ve done to us is actually brilliant—it’s pure brilliance. Because they’re not doing it to themselves. They’re getting Canadians to do it to ourselves. And I don’t think Canadians understand that this is what’s happening to them. On a larger scale, they’re doing to Canada what they did to my community. So I don’t think Canada really understands that the real war here is an outside force pitting Canadians against Canadians.—Ellis Ross, B.C. MLA and former chief councillor of the Haisla Nation, from the documentary Over a Barrel

The impressive work of a singularly remarkable activist has come to the screen, both in movie theatres and on computers. Over a Barrel presents a half-hour documentary on the research of Vivian Krause into the American-backed anti-oilsands campaign. Having already appeared in Alberta theatres, the film’s now online and, until October 31, for free (although donations are accepted).

Starting November 1, and in lieu of rich U.S. backers, an online viewing will cost $4.99.

Through well over a decade of perseverance, Krause has documented a money trail leading to powerful American interests whose more than half a billion in funding, tactics of disinformation, and interference in Canadian elections targets Albertans and other Canadians to the benefit of Americans and their oil industry.

The documentary also portrays a human cost to the campaign, as native spokespeople discuss how foreign interference and urban activists deprive their communities of badly needed economic development.

Click here to watch Over a Barrel online, for free or by donation until October 31 and for $4.99 after that.

Read an October 22 op-ed by Vivian Krause: Obama wasn’t the only American interfering in the Canadian election.

Read more about Vivian Krause and her work.

Infographic: The world’s most powerful reserve currencies

October 8th, 2019

by Jeff Desjardins | posted with permission of Visual Capitalist | October 8, 2019

Visual Capitalist The world’s most powerful reserve currencies

 

When we think of network effects, we’re usually thinking of them in the context of technology and Metcalfe’s Law.

Metcalfe’s Law states that the more users a network has, the more valuable it is to those users. It’s a powerful idea that is exploited by companies like LinkedIn, Airbnb or Uber—all companies that provide a more beneficial service as their networks gain more nodes.

But network effects don’t apply just to technology and related fields.

In the financial sector, for example, stock exchanges grow in utility when they have more buyers, sellers and volume. Likewise, in international finance, a currency can become increasingly entrenched when it’s accepted, used and trusted all over the world.

What’s a reserve currency?

This visualization comes to us from HowMuch.net, and it breaks down foreign reserves held by countries—but what is a reserve currency, anyway?

In essence, reserve currencies (i.e. U.S. dollar, pound sterling, euro, etc.) are held by central banks for the following major reasons:

  • To maintain a stable exchange rate for the domestic currency

  • To ensure liquidity in the case of an economic or political crisis

  • To provide confidence to international buyers and foreign investors

  • To fulfill international obligations, such as paying down debt

  • To diversify central bank portfolios, reducing overall risk

Not surprisingly, central banks benefit the most from stockpiling widely held reserve currencies such as the U.S. dollar or the euro.

Because these currencies are accepted almost everywhere, they provide third parties with extra confidence and perceived liquidity. This is a network effect that snowballs from the growing use of a particular reserve currency over others.

Reserve currencies over time

Here is how the usage of reserve currencies has evolved over the last 15 years:

Currency composition of official foreign exchange reserves (2004-2019)
U.S. dollar Euro Japanese yen Pound sterling Other
2004 65.5% 24.7% 4.3% 3.5% 2.0%
2009 62.1% 27.7% 2.9% 4.3% 3.0%
2014 65.1% 21.2% 3.5% 3.7% 6.5%
2019 61.8% 20.2% 5.3% 4.5% 8.2%

Over this timeframe, there have been small ups and downs in most reserve currencies.

Today, the U.S. dollar is the world’s most powerful reserve currency, making up over 61% of foreign reserves. The dollar gets an extensive network effect from its use abroad, and this translates into several advantages for the multi-trillion-dollar U.S. economy.

The euro, yen and pound sterling are the other mainstay reserve currencies, adding up to roughly 30% of foreign reserves.

Finally, the most peculiar data series above is “Other,” which grew from 2% to 8.4% of worldwide foreign reserves over the last 15 years. This bucket includes the Canadian dollar, the Australian dollar, the Swiss franc and the Chinese renminbi.

Accepted everywhere?

There have been rumblings in the media for decades now about the rise of the Chinese renminbi as a potential new challenger on the reserve currency front.

While there are still big structural problems that will prevent this from happening as fast as some may expect, the currency is still on the rise internationally.

What will the composition of global foreign reserves look like in another 15 years?

Posted with permission of Visual Capitalist.

James Rickards says China might have imposed a gold standard on the IMF’s special drawing right

October 7th, 2019

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Donald Trump employs the U.S. Defense Production Act to support reliable supplies of rare earth elements

September 12th, 2019

…Read more