In a globalized world, raw materials are the lifeblood of industry, energy supply, and consumer society. Rare metals for batteries, fossil fuels, strategic minerals for high-tech products – modern economies depend heavily on stable supply chains. Yet recent geopolitical tensions clearly demonstrate how fragile this system is.

A particularly tangible example is the Strait of Hormuz – one of the most sensitive chokepoints in the global economy.

The narrow strait between Iran and Oman spans only a few kilometers, yet it is of immense importance. As the central maritime route for oil exports from the Gulf states to the Indian Ocean, around 20 million barrels of crude oil pass through it every day. This accounts for approximately one-fifth of the world’s traded oil supply.

Such extreme concentration creates significant vulnerability. Even partial closures or political tensions – such as those in the current conflict environment involving Iran, the United States, and Israel – lead to considerable uncertainty and price volatility in energy markets.

But the issue extends far beyond oil. The Strait of Hormuz symbolizes a broader structural problem: our deep dependence on raw materials – and on stable geopolitical conditions.

Raw Materials as the Foundation of Industrial Society

Raw materials form the basis of nearly all value chains. Without them, there would be no energy transition, no digitalization, no modern mobility, and no high-performance infrastructure.

Today, particular attention is focused on the following materials:

• Lithium, cobalt, and nickel for battery technologies
• Rare earth elements for wind turbines, electric motors, and electronics
• Copper for power grids and electromobility
• Semiconductor materials for digital technologies
• Industrial metals such as aluminum and steel for construction and mechanical engineering

Many of these raw materials are geographically concentrated: cobalt is sourced predominantly from the Democratic Republic of the Congo, rare earths largely from China, and lithium from only a few mining regions in South America and Australia. This concentration creates economic and political dependencies – with strategic implications.

The Structural Risk: The Linear Economic Model

Our economic system still largely follows a linear principle: extract – produce – consume – dispose. Each new production cycle begins with the extraction of new primary raw materials.

This model entails several risks:

• Finiteness: Many raw materials are limited or accessible only with significant ecological impact.
• Geopolitical concentration: Producing countries gain strategic influence.
• Price sensitivity: Shortages immediately lead to volatility.
• Transport dependency: Chokepoints such as the Strait of Hormuz, the Suez Canal, or the South China Sea become systemic risk factors.

The case of Hormuz illustrates that even when resources are technically available, supply chains remain vulnerable whenever transport routes or political conditions become unstable.

Circular Economy: From Environmental Concept to Resource Strategy

This is where the circular economy comes into play – evolving from an environmental guiding principle into a strategic necessity. Instead of extracting, using, and disposing of resources in a linear fashion, it aims to keep materials in circulation for as long as possible through reuse, repair, remanufacturing, and high-quality recycling.

What does this mean in concrete terms for raw material security?

• Reduced import dependency: Through systematic recycling and recovery, valuable materials can be locally and continuously reintroduced into production processes – independent of geopolitically sensitive supply regions.
• Greater resilience: An economic system that relies more heavily on regional value creation and closed material loops is more robust in the face of external shocks such as wars, trade conflicts, or transport disruptions.
• Efficiency and cost advantages: Increased material efficiency and reduced demand for primary raw materials lower vulnerability to price volatility and supply shortages.

Resilience Requires Structure

Raw material security must not remain merely a crisis-driven issue. It needs to be strategically embedded.

This includes:

• Building efficient recycling and take-back systems
• Diversifying supply routes and strengthening regional value chains
• Ensuring transparency and continuous monitoring of supply chains
• Making targeted investments in circular economy models

The goal is not to replace global markets. Rather, it is about reducing structural and corporate dependencies. Companies that consistently implement circular principles enhance their supply security, stabilize their cost structures, and strengthen their competitiveness.

In times of geopolitical uncertainty, one thing becomes clear: the circular economy is not merely a sustainability issue. It is risk management, innovation strategy, and economic resilience combined.

(Source)