The Critical Raw Materials Act (CRMA) is an essential regulatory framework designed to address the pressing challenges faced by the European Union (EU) in the strategic sectors of decarbonization, digitalization, and aerospace and defense. It aims to tackle the lack of secure and sustainable access to critical raw materials (CRMs) by increasing anticipation and mitigation of supply risks, fostering domestic CRM potential, and promoting sustainable sourcing practices. Part of a broader “Green Industrial Plan” and aligned with the “Net-Zero Industry Act” (NZIA), the CRMA strives to position the EU as a leading hub for clean tech industries. The NZIA and CRMA packages respond to international trends of protecting clean energy technology and resources, akin to the US Inflation Reduction Act. Defining materials as “strategic” based on their relevance and expected demand for strategic technologies, the CRMA regulation establishes benchmarks for minimum shares of EU demand to be covered by domestically sourced and processed as well as recycled raw materials and aims at reducing dependencies on single third country suppliers in all steps of the supply chain. A communication complements the regulation by focusing on increasing CRM supply security and sustainability through circularity, standardization efforts, skill development, and strategic actions for research and innovation. Establishing a “CRM Club” and partnerships with like-minded countries intend to strengthen international partnerships to safeguard CRM supply security and facilitate sustainable investment in resource-rich nations. Challenges arise concerning the concept of “strategic raw materials” and meeting benchmarks, particularly in materials availability, recycling targets, diversification, and the establishment of necessary skills. Data gaps, potential national differences, coherence with national legislation, long-term economic viability, and potential fuelling of international tensions also pose significant challenges to the effective implementation of the CRMA. Addressing these challenges and embracing the opportunities presented by the CRMA are crucial steps toward achieving sustainable resource management and advancing the EU’s clean tech industries.

In this article, we explore concrete examples of circularity strategies for critical raw materials (CRMs) in commercial settings. We propose a company-level framework for systematically evaluating circularity strategies (e.g., material recycling, product reuse, and product or component lifetime extension) in specific applications of CRMs from the perspectives of specific industrial actors. This framework is applied in qualitative analyses—informed by relevant literature and expert consultation—of five case studies across a range of industries: (1) rhenium in high-pressure turbine components, (2) platinum group metals in industrial catalysts for chemical processing and oil refining, (3) rare earth permanent magnets in computer hard disk drives, (4) various CRMs in consumer electronics, and (5) helium in magnetic resonance imaging (MRI) machines. Drawing from these case studies, three broader observations can be made about company circularity strategies for CRMs. Firstly, there are multiple, partly competing motivations that influence the adoption of circularity strategies, including cost savings, supply security, and external stakeholder pressure. Secondly, business models and value-chain structure play a major role in the implementation of circularity strategies; business-to-business models appear to be more conducive to circularity than business-to-consumer models. Finally, it is important to distinguish between closed-loop circularity, in which material flows are contained within the “focal” actor’s system boundary, and open-loop circularity, in which material flows cross the system boundary, as the latter has limited potential for mitigating material criticality from the perspective of the focal actor.

This report showcases five examples of industries applying circular strategies for CRMs: (1) recycling of tungsten carbide scrap by H.C. Starck Tungsten, (2) recycling of battery cathode materials by SungEel Hitech, (3) recovery of rare earth elements from hard disk drives by Hitachi Group, (4) closed rhenium loops by Rolls-Royce, and (5) recovery of platinum group metals by Umicore. The adaptation of business models appears to be one of the biggest enablers of raw material circularity. Ideally, all involved stakeholders (including the manufacturers, the users, and the recyclers) have a common interest in, and are incentivized by retaining the material’s value, which stimulates transparent material flows and close cooperation. This is enabled by retained ownership and with long-term, well-defined relationships between the value chain actors. Such relationships can be enhanced by vertical integration, or by long-term contractual agreements. The benefits of implementing circularity provide a mandate for governmental intervention in stimulating circularity strategies, for example via regulations and subsidies, to overcome initial investment thresholds.