Few of us have conceived what the shortage of rare minerals could occasion on the commodities market. But findings of a recent study indicate that the worst could happen.
The Journal of Science Advances has published findings of a study that analysed the impact of rare minerals on international commodity trade networks. And the discovery foreshadows the worst: a shortage could disrupt the market place, triggering wide-ranging financial instability.
Expounding more on the study, Peter Klimek, researcher at the Medical University of Vienna, Austria, told new agency, AFP that regional shortages of minerals necessary for the manufacture of modern technologies could ripple throughout the trade system, leading to a sharp increase in the price volatility of such minerals in the global markets.
Advanced Systems Analysis researcher, Stefan Thurner, said the study depicted a generally well-known trend.
“Commodity markets, like financial markets, are highly international and interconnected.
“Understanding these networks gives us a handle to explain and possibly predict a large portion of the instabilities in terms of price volatility in the markets,” he stated.
Led by Klimex, the team that carried out the study, Thurner examined the flows of 71 mineral commodities between 107 countries – in collaboration with International Institute for Applied Systems Analysis (IIASA) researchers.
Rare minerals are used in manufacturing mobile phones, electronics and medical equipment.