It’s hard to believe the materials inside your PC could be partially responsible for a long-running war in the Democratic Republic of Congo that’s cost five million lives. But that’s the death toll attributed to so-called “blood minerals”.
The focus is on tantalum (used to store electricity in capacitors), tin (used as solder in many electronics), tungsten (used in phone-vibration devices) and gold.
The industry is so price-conscious that no-one really wants to increase costs by eliminating a major source for these rare-earth elements
Human rights groups blame Western manufacturers and consumers for fuelling the trade in such minerals, claiming it funds warlords to buy arms and ammunition – although it’s uncertain that the violence would stop with a reduction in trade, or that IT companies could make a real difference even if they wanted to.
Amid growing condemnation, the US Government introduced legislation
in the shape of the Dodd-Frank Act, which will make US-listed manufacturers come clean over the origins of raw materials. It might sound like a victory for ethical business, and in many media outlets it’s been hailed as a ban on “blood minerals”, but the reality is that the legislation is fundamentally weak.
“The US legislation doesn’t ban conflict materials,” said Patrick Stratton, North America manager for minerals research company Roskill. “It merely requires companies in the US that are listed with the SEC to identify where the materials come from – that’s a subtle difference. It means they might try buying from provably ethical sources.”
In reality, manufacturers have no idea where the metals in computers come from. Global markets experts told us the materials come out of Africa as ore, which is traded on the global commodities and futures markets. From there, it might be traded two or three more times before it’s sent to plants in China and other countries for refining. Only after that will it go anywhere near component manufacturers.
“I am not sure any firm can certify the sources with enough clarity to satisfy the requirements of the Dodd-Frank Act,” said Michael Palma, a senior analyst with research company IDC.
“OEMs and partners can trace back sources of supply several stages in the manufacturing process, perhaps back to the smelters that refine the raw ore. But this is where traceability ends. The smelters anonymise the source of any materials, so in essence the whole focus of this act will be placed on the smelters These are run by non-US companies and most are located in countries that aren’t likely to place any emphasis on this issue.”
Impossible to trace
Surprisingly, manufacturers agree. Although they make all the right noises about being careful about their sources, they admit that tracing the starting point of the components in their machines is virtually impossible.
“OEMs and manufacturers cannot say with full confidence that our products do not contain minerals from conflict zones in the DRC,” said
Michelle Mosmeyer, a sustainable communications manager for Dell. “The mining of metals can be many stages removed from the final product.”
HP said the mines in Congo “are far removed from HP, typically five or more tiers from our direct suppliers”.
There have been attempts to better identify the sources of materials, such as fingerprinting the ore coming out of individual mines. Even then, according to Stratton, “there are only a few deposits where you can get hold of fingerprints and compare them to those mines, but they can be tampered with”.
But as resources dry up, there’s little appetite in the industry for eliminating sources, especially of tantalum. “What this is doing is pushing up prices and putting pressure on supplies,” said Stratton.
“Inventories are not infinite. Australia hasn’t produced since 2008 and Canada has shut up shop, so there’s a real belief that there will be a shortage. Last October, the price was around $40/lb, now it’s $80/lb, and that’s expected to go to over $100. They’ve been living off stocks for a while and they will run out.”
If moves such as the new act lead to a dip in supplies coming from Africa – assuming DRC ore isn’t smuggled out through Rwanda, as is often the case – other suppliers will likely step up production, but that will come at a price. The question is whether the PC industry or consumers are willing to pay.
“The industry is so price-conscious that no-one really wants to increase costs by eliminating a major source for these rare-earth elements,” said IDC’s Palma. “I think the lack of global regulatory enforcement will allow OEMs to say they do not know the source of the material, or rather that they do not believe they are using the subject materials from restricted areas.”
This ignorance-is-bliss approach is already gaining ground among IT suppliers. For example, Cabot – a major producer of tantalum – has made efforts to address the issues, but says it will “not knowingly purchase any material mined in the Congo”. Dell also used the “not knowingly” caveat.
“I think this act will have little real impact beyond causing an additional amount of paperwork and legal costs for the industry, with a negligible impact on costs to consumers,” said Palma.
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