Critical minerals
In October 2024 we made an investment decision to establish a research and development centre and a demonstration plant for the processing of phosphorus and rare earth elements in Luleå. The decision forms part of our strategy for implementing our transformation and is an important milestone in our ambition to develop our business in critical minerals.
The iron ore that we mine today contains the mineral apatite. This is a phosphate mineral and an important source of phosphorus, which is used – among other things – for the production of mineral fertilisers, on which around half of the world’s food production depends.
The EU has designated phosphate mineral as a critical mineral in view of the limited domestic production within the Union. The solution so far has been to import around 90 percent of the phosphorus requirement, a significant part of which came from Russia until the war in Ukraine. Since the start of the war, imports have been restricted and the shortage of mineral fertilisers has resulted in greatly increased costs for agriculture, contributing to the food price inflation experienced in recent years.
The apatite in the ore from the Malmberget mine in Gällivare has the advantage of containing very low levels of cadmium. This enables an almost cadmium-free mineral fertiliser without the risk of soil and crop contamination, compared to some other phosphorus products currently on the market. The apatite also contains rare earth elements (REE) that are not currently mined in Europe. China dominates both mining and processing on the world market, while Europe has a great need for rare earth elements to produce the electric vehicles, wind turbines and other technology needed for society’s transition. Demand for rare earth elements is expected to increase more than fivefold by 2030, and they are also listed as critical minerals by the EU. In May 2024 the EU’s Critical Raw Materials Act (CRMA) came into force, aiming to ensure a sustainable supply of critical raw materials within the Union.
We are already mining the apatite that exists in the ore in our mines. As such it constitutes an untapped resource.
To take advantage of the business opportunity that apatite represents, we have included the establishment of an apatite plant as part of our application for continued and expanded operations in Gällivare. With such a plant we can start producing apatite concentrates from the by-products of sorting and concentrating – thereby increasing the utilisation of materials that are mined. The production capacity in Gällivare is expected to average around 450,000 tonnes of apatite concentrate per year. The apatite concentrate will then be refined further into phosphorus, rare earth elements and pure gypsum in the planned industrial park for critical minerals in Luleå.
Before that, the process for further refinement will need to be verified in the demonstration plant that we have decided to build in Luleå. The demonstration plant will also function as a research and development centre, providing the opportunity to test and explore future potential sources for the processing of minerals. This will be a key part of future work to provide a foundation and make the necessary decisions for the planned scale-up of production and the establishment of a full-scale industrial park.
Development of our business in critical minerals provides an opportunity to exploit more of the value that exists in our deposits and will allow us to enter new markets for minerals.
This will also be of great importance for both Sweden’s and the EU’s degree of self-sufficiency and security of supply. LKAB already plays an important role as the EU’s leading supplier of iron ore products, and in the future this role will also include critical minerals.
