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QuickHit: U.S. mining operations and supply chain security

In this QuickHit episode, we are joined by Jerry Mullins the Senior Vice President, Government Affairs and External Relations for the National Mining Association. In this episode we explore U.S. mining operations in the height of the pandemic. We take a look at the industry’s serious concern about supply chain security. We also talked about rare earths and how the U.S. miners are contributing to the global green economy.

 

The National Mining Association is the voice of mining in Washington, D.C. with the administration, with Congress, and different agencies. The focus of the organization is to grow domestic mining in the United States and highlight the most significant and timely issues that impact mining’s ability to safely and sustainably locate, permit, mine, transport and utilize the nation’s vast resources .

 

This is QuickHit’s episode 16. For previous episodes you might have missed, kindly check:

 

The “Great Pause” and the rise of agile startups

“LUV in the Time of COVID”

Proactive companies use data to COVID-proof their supply chains

 

The views and opinions expressed in this QuickHit episode are those of the guests and do not necessarily reflect the official policy or position of Complete Intelligence. Any content provided by our guests are of their opinion and are not intended to malign any political party, religion, ethnic group, club, organization, company, individual or anyone or anything.

 

Show Notes:

 

TN: From your perspective, looking at what happened in mining during COVID and post COVID, what did mining firms see around continuity of operations and the risks there? Also, what did mining clients find with supply chain continuity? That’s a real question and that’s something we saw a lot of issues around as countries like Peru and others just completely shut down.

 

JM: Fortunately, domestic mining in United States was deemed an essential industry, and so it was allowed to continue to operate. That’s really important to recognize. As an industry, it had the ability to absorb the different environment that a pandemic brought on, and companies were allowed to successfully operate. These companies were able to continue to produce the raw materials that were needed for multiple industries across the globe.

 

As far as the effects of other countries and how they were affected, when you think about the global economies that generally slowed down, a lot of folks hit a pause. Economies had to re-calibrate exactly what they were able to do and the best way to do it. The domestic mining in the United States played a real critical role in leadership of showing the nation how to continue to work forward safely and effectively.

 

TN: With the supply chain disruptions and some of the geopolitical issues, there is a real sense in the US that there may be some supply chain security issues around metals and minerals. Can you help us with that? What is the Association doing?

 

JM: That’s an interesting point you bring up about the security issue. Just last month, the National Mining Association conducted a poll and 64% of the respondents said they were concerned about the supply chain dynamics and how reliant the U.S. was on international supplies of different critical minerals.

 

You’ve seen a real zest of excitement and certainly interest in focusing on the ability for U.S. producers to fill that gap and make sure that those critical minerals that are needed can be produced in the United States. [This means] addressing some of the permitting challenges that domestic mining faces and finding ways to more effectively allow for U.S. mining to meet a lot of demand that exists.

 

TN: When you talk about things like permitting and we talk about supply chain risk, one of the big kind of things that flag up is rare earths. Can we talk a little bit about rare earths and understand for the U.S. electronic sector and Department of Defense and others? What are some of the things that you’re thinking about and your observations about rare earths in the U.S. and the exposure to rare earths from other places?

 

JM: Well, certainly the Department of Defense relies on 750,000 tons of minerals each year. That’s for everything from armor for the individual soldier, to armor on a tank, to different requirements for jet engines to telecommunications. When you think about everything from palladium to copper to gold and silver–some rare–some not as rare. But those necessities are real. There’s an opportunity for tremendous growth in the rare earth field in this country. It is really opening up, and that’s something that international investors as well as domestic investors are starting to recognize.

 

TN: One of the other things we hear quite a lot about is the green economy — electric vehicles, battery technology. We hear a lot about those technologies accelerating in other locations and maybe the U.S. has to catch up or there are minerals from other places that the U.S. may or may not produce. How do you see U.S. miners contributing to the green economy and battery technology and electric vehicles and that whole section of the economy?

 

JM: When you talk about battery technology and when you talk about the electrification of the auto fleet, what you’re talking about is copper. And you’re talking about mass needs of copper, mass needs of gold, mass needs of silver, and be able to satisfy the requirements. If you look at the wind technology and the coking steel that’s going to be required, the coking coal for making steel that’s going to be required, these are needed to achieve the goals that have been put out there. The American miner is absolutely part of of that future.

 

TN: Great. Perfect. Jerry, thanks so much for taking your time today. I really appreciate this and I look forward to speaking again as we see all of the supply chain issues with COVID and post-COVID. It’ll be really interesting to reconnect and hear some of your thoughts at that point.

 

JM: Thank you, Tony. I look forward to it.

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QuickHit Visual (Videos)

QuickHit: How ready is the military to face COVID-19 and its challenges?

In this QuickHit episode, we’re joined by Tate Nurkin to talk about the state of the military in COVID-19 pandemic. Tate is one of the world’s top defense and security experts, who has been in the security field for the past 20-25 years. He works for US defense and intelligence communities, allies, and partners in China and the Indo-Pacific, helping with defense technology to improve the future of military capabilities globally.

 

In our previous QuickHit episodes we covered the oil & gas industry:

 

The views and opinions expressed in this QuickHit episode are those of the guests and do not necessarily reflect the official policy or position of Complete Intelligence. Any content provided by our guests are of their opinion and are not intended to malign any political party, religion, ethnic group, club, organization, company, individual or anyone or anything.

 

Show Notes

 

Tony: One of the key things that I’m curious about is the impact of COVID on militaries and their readiness. We’re not hearing a lot about that. Are you seeing anything there? Do you have any worries? Is that something that will last a few months or years into the future?

 

Tate: There are definitely some short-term implications for militaries and readiness is at the top of the list.

 

We saw a fair amount of media coverage of the situation on the USS Theodore Roosevelt, which actually was a pretty big deal. Over a thousand members of that 5,000-person crew were diagnosed with COVID 19. One passed away.

 

Those incidences are happening, not just with the Theodore Roosevelt. It’s happened on another US Navy ship and it’s happened on a French aircraft carrier. Just like cruise ships, these ships are places where you’re very contained and in close contact with other people who may be carrying the disease. It’s easy for the disease to spread.

 

We’ve also seen it with the Taiwanese Navy. Taiwan did a fantastic job containing the crisis, but they have friendship fleet missions that go to the South Pacific. The most recent one came back from Palau. A bunch of sailors who came off that mission were diagnosed after they had gone out into Taiwan and mingled around.

 

These are big issues. These ships, predominantly ship forces deployed throughout the world, must strike a balance between keeping people safe during peacetime, and also making sure that there’s operational readiness. It’s something that not just the US military has struggled with today.

 

 

Tony: Do you see that we’re going to be contending with this for years? Or do you think we’ll get over this in a matter of months or say a year or so?

 

 

Tate: I would put the time frame for the readiness challenge to be slightly shorter, 18 months maybe. It depends on how long, how many waves there are of outbreaks.

 

I certainly anticipate a second wave globally at least. I think that’s a shorter-term challenge and one that’s a little bit more manageable if you can come up with the right processes and procedures for what precautions to take. But it’s not just with deployed troops, but also with sheriffs working inside the Pentagon or civilians that are also supporting the defense enterprise.

 

There are longer-term challenges though. Some of what we’ve seen are militaries thinking about the new missions that they have to undertake. In the short term, this is supporting COVID-19 response and the longer term, refugee monitoring, border security, etc.. They’re outside of the direct defense sector and more in the security sector. But there are some new missions that the militaries will have to grapple with and a new, different sense of preparedness that will have to be dealt with.

 

 

Tony: In terms of things to grapple with, I’m just wondering about things like social unrest. We’ve seen a lot of economic fallout from this as people have to sit on the sidelines for months, as the industries have stopped, as things like deflation have set in with wages… There are not just the social aspects of being isolated, but the economic impacts also. What I wonder about is social unrest. Is that something that we really don’t need to worry about? Or is that something that you take seriously?

 

 

Tate: I tend to try and navigate the spectrum between alarmism and dismissiveness. In this case, some finding somewhere in between, but maybe on the side closer to the alarmism. This is a big deal. There will be spatial and economic repercussions and some states won’t be particularly well equipped to handle those. Whether it’s overturning of regimes or just extraordinary societal and political pressure on regimes.

 

Asia is a good place to start. Some will be more resilient than others. But this is a big challenge for defense and security communities and for political establishments for sure. Reshoring supply chains, including the defense supply chain, will just amplify some of those pressures.

 

 

Tony: Amplify the pressures in the manufacturing countries today, so the Asian countries?

 

 

Tate: Some of the Asian countries. Japan, for example, has $2.2 billion that were built into it. Most recent supplemental budget for reshoring supply chains out of China. Some of the others will get to Southeast Asia, some will go back to Japan. But the reshuffling of supply chains and the defense supply chain is not immune to that at all. This is something to keep an eye on for both defense readiness and for political stability issues.

 

 

Tony: In terms of that separation of supply chains, it almost sounds like it’s the opposite of the EU spirit. The EU came together with the Coal and Steel Union, then integrated manufacturing. The theory was, as they became integrated, there was less likelihood of conflict in Europe. Am I exaggerating? Is it the opposite of the EU theory and maybe something that you see dangerous over a 5, 10, 15, 20-year horizon? Is it near-term or longer-term? Where do you see conflict happening?

 

 

Tate: Returning to that defense supply chain as somewhat of an analog for the broader challenge. A couple of years ago, the administration commissioned a report on weakness in the US Defense supply chain. And one of the big findings was that the US Defense supply chain was over-relying on the competitor, which is China. Some chemicals that go in some ammunition and other materials are largely sourced out of China.

 

The answer here is to re-shore some critical supply chains. We’ve learned that with the medical supplies most recently. Part of the solution is to find your trusted partners and also to stick with them. And some of that can be regional.

 

One of the challenges coming out of COVID 19 is a geopolitical one, and it’s meeting the challenge of China on a lot of levels. And for the US, retreating back towards autarky might not be the right answer. We need to find the things that we absolutely have to have. Find the partners that we can trust, and try to engage them so that you have some partners to deal with, this is much broader challenge.