As you do retail combat on the front lines on this Black Friday, remember that much of what you’re buying is made possible by rare metals, and the supply chains of the companies selling you everything from cars to cell phones are likely 10 or more links deep.

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A simple electronic toothbrush, for instance, requires circuit boards dotted with materials of tantalum in a capacitor that helps it store energy.

Thanks for the circuit board, tantalum! Source: Adobe Stock/Lionelpc

Thanks for the circuit board, tantalum! Source: Adobe Stock/Lionel pcn

It also requires a neodymium, dysprosium, boron and iron magnet to provide the power to spin its bristles and it needs batteries made from nickel and cadmium or lithium.

Smart Rare Metals

Buying that special someone a smartphone this year?

60% of smartphones are made from metals or ceramics. A mobile phone’s antenna requires titanium and boron. Its transmitter requires titanium and barium. Its condensers? Tantalum and strontium. The speaker and microphone require samarium and cobalt. This team of rare metals is held together by a beryliium connector and boosted by a gallium power amplifier.

Rare earth element phosphors make a phone’s screen brighter. The smarter phones get, the more metals they require. Smartphones contain more metals, in greater amount and often at higher grades than their predecessors, according to David Abraham, author of “The Elements of Power: Gadgets, Guns and the Struggle for a Sustainable Future in the Rare Metal Age.

Screen Time

Notice the screen of your smartphone getting bigger? If you purchase anything with a screen this holiday season, you’re very likely buying indium powder as, when it’s combined with tin, it becomes a unique transparent conductor that sticks well to glass.

Abraham writes that smartphones require four to six times more gallium than a regular cell phone just a few years ago.

You could just skip the middleman and get your friends and relatives bulk tantalum or dysprosium, I suppose. This gift probably wouldn’t go over too well, unless they’re metal traders, but it could be a good investment. As rare metals become more, well, rare, the supply chains of smartphones and other electronics will be increasingly strained as we consume more and more technology and even our children’s toys become more interconnected.

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Rare metals are key to building our future of consumer technology, and there is likely no greater example than the rush to purchase new electronics every Black Friday.

The US Court of Appeals for the District of Columbia Circuit in April 2014 upheld the bulk of the Security and Exchange Commission’s then-new Conflict Minerals Rule, but ruled a key disclosure requirement violated the First Amendment because it forced a company to “confess blood on its hands.”

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The same federal appeals court ruled against the disclosure requirement a second time Tuesday, saying an investigation requirement is fine, but disclosing that material remains untracked does not require an admission tantamount to guilt, when it comes to receiving raw materials from war-torn areas.

Disclosure of Unknown Origin

The Dodd-Frank Wall Street Reform and Consumer Protection Act required companies to disclose whether any tin, tantalum, tungsten or gold (commonly known as 3TG), in their supply chains is connected to violent militia groups in Africa.

An SEC spokesman said the commission is reviewing Tuesday’s decision.

The three-judge appeals panel split 2-1, effectively siding with business groups in ruling that forcing companies to designate which products “could not be found to be ‘DRC conflict free’” is tantamount to requiring firms to criticize their own products.

Two judges appointed by Republican presidents voted in the majority and a recent appointee of President Barack Obama dissented.

Conflict Minerals Rule Still Intact

The court’s rulings did not overturn the entire Conflict Minerals Rule, it actually upheld requirements such as having companies investigate whether their products include the minerals and a requirement to file public reports on their investigations, a process that began last year.

One situation where a respondent could not confirm that all of its raw materials were DRC conflict free, was party supply retailer Party City, a company that filled out a conflict minerals compliance form and asked their suppliers where, exactly, all of the materials for their mylar balloons and other party supplies came from. Party City reported it received little response from its supply chain.

That was one of many cases that highlighted the difficulty of actually vetting and confirming supply chain compliance for the wide range of businesses that the Conflict Minerals Rule covers.

What Does This Mean For Conflict Minerals Compliance?

In a statement after the initial ruling against the SEC last April, the regulator indicated that companies are not required to identify products as “DRC conflict free,” having “not been found to be ‘DRC conflict free’” or “DRC conflict undeterminable.” The SEC also indicated that, pending further action, an independent private sector audit (“IPSA”) will not be required unless a company voluntarily elects to describe its own product as “DRC conflict free” in its Conflict Minerals Report. That statement is likely to remain in effect pending the outcome of further litigation. It also looks unlikely that the private sector audits will be required this year and, barring a legal settlement, likely most of next year.

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The SEC can petition the entire DC Circuit Appeals Court to hear the case en banc, a request that the court can decide whether or not to grant. The SEC can also appeal to the US Supreme Court no matter what the outcome is at the circuit court level. The business groups that challenged the Conflict Minerals Rule can ask the court to stay the entire law, as they did after the April decision, but it’s not likely that the court would grant such a request as a stay was not allowed after the initial decision.

Most larger companies — in a variety of industries — intend to continue implementing their 3TG traceability and responsible sourcing initiatives no matter what the outcome of the case concerning the DRC measure.

Like some of you, we have popped onto the SEC website to have a look-see at the recent Form SD filings from manufacturing companies such as Caterpillar Inc., as part of the first deadline for conflict minerals compliance. Any publicly traded manufacturing organization that uses (or may use) one or any of the 3TG (Tin, Tungsten, Tantalum and Gold) must file a Form SD.

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CORRECTED: As of today, SEC has received approximately 1315 forms

We recently caught up with Lawrence Heim, our resident expert on All Things Conflict Minerals and asked him to share with us some of his initial impressions based on his analysis of 110+ filings.

The Not-So-Surprising Observations:

Read more

Last week, the European Union proposed conflict minerals legislation wildly different than what US manufacturers must currently comply with, calling for voluntary participation from importers only.

And yet the proposed EU legislation sees the pinch-point where it exists – at the smelter level.

“Focusing efforts at the root of the issue – material going into smelters and refiners – is a more efficient approach than the SEC’s ‘push from the top’ mandate,” said Lawrence Heim, Director of the Elm Consulting Group International, LLC and frequent contributor to MetalMiner.

The proposed European legislation incorporates the widely publicized and often discussed OECD conflict minerals framework. In some respects, the proposed legislation goes further than the SEC rules as the European legislation “applies to minerals sourced from conflict-affected and high-risk areas worldwide.”

In other words, the European legislation would go beyond the geographic boundaries of the SEC requirements or just the DRC region, according to Michael Littenberg of Schulte Roth and Zabel, who was also a recent speaker at MetalMiner’s Conflict Minerals EDGE conference held back in May 2013.

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conflict minerals compliance

Source: transatlanticacademy.org

In Apple Inc.’s latest Supplier Responsibility Report, they state that all of the company’s tantalum suppliers are conflict-free, using a third-party verification process.

Apple is also pushing their gold, tin and tungsten suppliers to use conflict-free material, according to this Times article, but those suppliers are harder for the company to muscle because Apple has less financial leverage with them.

Of course, Apple (along with HP, Nokia, Intel and others) has been at the forefront of conflict-free smelter sourcing due to their size and spots in the marketplace; but as we’ve reported over the last couple years, it’s much harder for smaller manufacturers to become compliant with the SEC’s conflict minerals law.

We thought it may behoove our readers to see the list of Apple’s suppliers and smelters – the company “identified that its suppliers use 20 global smelters or refiners whose tantalum has been verified by third-party auditors” as conflict-free, according to the Wall Street Journal – and see if you share any supplier or smelters in common.

Apple’s full list of suppliers.

Apple’s list of smelters.

If you do use any of these suppliers, and if you also source tantalum, can you be reasonably sure that these suppliers are providing conflict-free material? We encourage manufacturers to perform their own due diligence (we can help with that).

The compliance deadline for the Conflict Minerals Law is only a few months away – be ready!

Ok, we’d hoped that would catch your attention.

Before you accuse us of being male chauvinists (we are no such thing!), it doesn’t matter whether you’re a man or a woman – if you’re working for companies that source different metal products, all that matters is that you know how best to comply with the conflict minerals rule, inside and out.

Conflict Minerals conferenceSo with just ONE WEEK LEFT to register for our unprecedented one-day conference on the topic, here are a few questions you may have that we can answer:

Q:  Won’t this SEC Conflict Minerals Rule be overturned anyway? I thought the National Association for Manufacturers brought a winnable lawsuit against the SEC…

A: Don’t count on it, bub. While NAM has challenged the rule, chances are not good that the rule will be overturned. MetalMiner recommends that companies continue on the path of planning and developing implementation solutions, as many of the experts we have spoken to do not feel the legal case will actually change the reporting obligation on behalf of publicly traded companies.

Q: All right, my company doesn’t really have a Conflict Minerals compliance process yet…where the heck do I start?

A: Don’t worry, you’re not alone. However, do you have accurate records covering whom to contact (not only name and location, but also personal email and direct phone number information) for every supplier you have used over the past 18 months? Gathering that info may be a good place to start. Alternatively, if you only source a handful of parts, and you know they contain at least traces of tin, tungsten, tantalum or gold, you can undertake a part-centric approach.

Q: How can my company efficiently track this process and streamline my whole supply chain?

A: Thomas Kase, the lead analyst for our sister site Spend Matters, is all over it. One word: technology. More words – here’s what you have to look at, according to Thomas:

  • 3rd Party Enrichment – parent-child linkages, insights & validations
  • Contracts – what you have committed to on the sell-side
  • Customers – what you are about to commit to on the sell-side
  • Inform, Train, Document – across all areas, internal and external
  • Products – and components, sub-components and ingredients to gradually audit your way to the source (certify your entire supply chain, not just your suppliers)
  • Sourcing – early and full visibility to the sourcing process and team to enable early upstream correction
  • Suppliers (i.e, your vendors) – their locations, parents, and subsidiaries, which individuals to engage with at each level, etc.

At Conflict Minerals EDGE, Thomas will present how various players in the technology solutions sphere, “from ERPs to point solutions and modules from suite providers, can get the job done.” The MetalMiner and Spend Matters team will also address what you should consider doing at the same time as you roll out a Conflict Minerals compliance initiative.

Q: Can I still register??!?!?!

A: You bet. Click here.

Q: But what if I can’t make it to Chicago on May 6?

A: MetalMiner has the most comprehensive conflict minerals resource section for manufacturers. Look for the “Conflict Minerals” tab on the top right side of our site!

“Do you know you source conflict minerals (tin, tungsten, tantalum, gold)?”


“Do you know what you must do almost exactly one year from now?”


Yeah, these people aren’t ready either:

Source: IHS

That sample of electronics industry managers surveyed by IHS isn’t alone – in fact, if those in the electronics industry are behind, what does that say for the rest of us? Scary.

Here’s a follow-up poll, from EBN Network (a site covering the electronics industry supply chain):

Source: EBN Network

FULL DISCLOSURE: The one respondent who is “done and cracking the Champagne” – that’s me. I had to vote to see the results. (And I do always fancy myself cracking Champagne.) But in essence, not only is no one done; very few have even begun.

We at MetalMiner have known this for a while, and that’s exactly why we’re in the business of helping manufacturers become compliant.

How do we do that already? Check out our killer white-papers:

Need tangible tools, templates or solutions? Get them at our upcoming one-day conference:

Details and Registration

Conflict Minerals conference


Continued from Part One.

So while the degree of risk associated with the supply of each metal can be debated in broad terms, the layman can see how a country deprived of access to a ready supply of material would have problems maintaining a military the size of the United States’.

As an article in Proedgewire points out, President Obama’s fiscal year 2014 budget request includes $615 billion in military spending, but is largely silent on key strategic and critical material programs.

The US has operated a strategic reserve and a few metals such as tungsten, germanium and beryllium are said to be sufficiently covered by existing stockpiles to not be at risk, but others such as antimony, tantalum and bismuth would require significant stockpiles to safeguard supply.

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Last week, MetalMiner ran a story examining the import and export trends for tantalum. The author discussed the skyrocketing number of tantalum imports compared to falling US exports.

As a follow-up commentary to that guest post from our friends at Zepol, we’d argue the bigger story involves the month-to-month trends of imports (and not so much of exports) – and specifically the time period before and after the August 22, 2012, SEC conflict minerals rule promulgation.

According to Chris Grove, director of communications at Commerce Resources, a junior tantalum mining firm: “In Q1 2013, we became aware of a company in China that stopped selling material to the US…we understood that their feedstock did not comply with the conflict minerals rules.” In terms of the yearly import trends reported on MetalMiner, Grove said, “to be honest, the story’s trends make sense through the eighth month of 2012 (Ed. note: that Chinese imports increased), but this can’t be the story post-Aug. 22,” given the new rules.

“I would expect to see that pie graph shift quite significantly with China looking a lot different,” Grove suggested, “but the real question we have to ask is, has the country of origin changed along with the quantities?” Grove expects a significant drop in 2013 imports from China. If no data supports that then, “the tantalum industry has found a way around the ruling.”

And therein lies the rub.

RELATED: Do you source tantalum? Do you know how to comply with SEC Conflict Minerals rule? Check out Conflict Minerals EDGE.

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MetalMiner interviewed Jay Celorie, Global Program Manager at Hewlett-Packard and active participant in the EICC® (Electronic Industry Citizen Coalition) and GeSI® (Global e-Sustainability Initiative), regarding MetalMiner’s white paper, “The Definitive Guide to Conflict Minerals Compliance for Manufacturers.” Jay shared some of his thoughts on some of the key issues around conflict minerals, our paper and various approaches.

This portion of the interview continues from Part One, available here.

On Tin, Tungsten and Gold Supply Chains

“The electronics industry has been successful in recruiting many of the tantalum smelters to join the CFS Program. This was accomplished in part for many reasons.

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