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Yep, but it is a useful concept with certain minerals and products. For instance, the vast majority of the cost of producing a lithium battery is the big oven t
by OrganicMSG 9y ago
Yep, but it is a useful concept with certain minerals and products. For instance, the vast majority of the cost of producing a lithium battery is the big oven to dry them out before sealing them, the price of the lithium itself is way down the list and could effectively double before it massively affected battery costs. However if the price does double, suddenly lithium is economically available pretty much everywhere.
- kazinator 9y agoThus if there is a niche use for some material, and that something is very cheap, but that niche use itself is profitable, then that industry somehow ensures that it has enough of the material just for itself. Maybe by owning the production chains of that material; those units don't have to stand alone as profitable. Outsiders can't easily get the stuff, though. If the stuff becomes independently profitable, then the availability follows.
- OrganicMSG 9y agoThese thing can happen by accident also. If it is generally known that there are only a few places in the world that you get lithium from, then investors are going to think that lithium is very risky and may run out. They don't tend to think, "Hey, it is the third lightest element, in theory there should be loads of it, perhaps we are only mining the cheapest possible sources", which is the actual truth of the matter. So while the people inside the industry might know the potential availability, investors on the whole do not and so the market only gets enough money to expand conservatively, rather than enough to kick off a magnitude more resource acquisition at a significantly higher raw material cost.