Coltan; the Magic Dust
One of the main reasons why the conflicts in DRC (Democratic Republic of the Congo) have continued is because of the high demand for cell phones and computer chips as well as other electronics that have become a daily lifestyle especially in the Western world. This need is helping fuel a bloody civil war in the Democratic Republic of Congo. Once refined, coltan can be used to produce highly heat-resistant metal powder called tantalum. It sells for $100 a pound, and it's becoming increasingly vital to modern life. For the high-tech industry, tantalum is magic dust, a key component in everything from mobile phones made by Nokia (NOK) and Ericsson and computer chips from Intel (INTC) to Sony (SNE) stereos and VCRs.
Eight percent of the tantalum ore imported into the United States in 1999 came from the Congo, and that doesn't count the ore U.S. companies imported from Rwanda and Uganda that may have originated in neighboring Congo. And there is much more of the precious dirt where that came from. At the moment, about 15 percent of the world's supply of tantalum comes from Africa. (Australia is the biggest producer, accounting for about 70 percent of the global supply of tantalum-bearing ore.) But the Congo is sitting on a potential gold mine. The mineral-rich nation is tied with Canada in having the world's fourth-largest coltan reserve, according to research firm Roskill Information Services.
The slaughter and misery in the Congo has not abated since 1998. Human Rights Watch estimates that at least 10,000 civilians have been killed and 200,000 people have been displaced in northeastern Congo since June 1999. Rebels have driven farmers off their coltan-rich land and attacked villages in a civil war raging, in part, over control of strategic mining areas. The control of mines has become a way of living for many groups in the DRC. The mining by the rebels is also causing environmental destruction. In particular, endangered gorilla populations are being massacred or driven out of their natural habitat as the miners illegally plunder the ore-rich lands of the Congo's protected national parks.
Coltan - which is found in 3 billion-year-old soils, like those in the Rift Valley region of middle Africa, Western Australia and central Asia - has become a critical raw material in high-tech manufacturing. The tantalum extracted from the ore is used mainly to make tantalum capacitors, tiny components that manage the flow of current in electronic devices. Many semiconductors also use a thin layer of tantalum as a protective barrier between other metal coatings. The metal, which is also found in other minerals and can be extracted as a byproduct of tin refining, is used in the airline, chemical, pharmaceutical and automotive industries as well.
As digital technological development struggled to keep pace with global demand, the Congo—which holds an estimated 80% of the world‘s coltan—increasingly became tapped for its extensive reserves, most notably with the release of the Sony PlayStation 2 in 2000, when coltan prices spiked tenfold because of supply shortages. All of this accelerated violence in the Congo, as coltan was traded by local militias for munitions. These militias, largely composed of child soldiers, are particularly known for their viciousness, as they gang rape, plunder and murder the populations of villages that happen to fall in their path, a strategy of terror designed to facilitate regional domination and unfettered compliance among local populations. Ecological devastation was wrought as protected forests held refuge for warlords and the dwindling populations of gorilla and elephants were consumed by starving child soldiers and wayward miners.
The market for the material is huge. Last year, about 6.6 million pounds of tantalum was used around the world, 60 percent finding its way into the electronics industry, where it can be found in products like mobile phones, computers, game consoles and camcorders. The United States is believed to be the largest consumer of tantalum in the world, accounting for 40 percent of global demand.
In 2000, demand for tantalum capacitors exploded in tandem with the mobile phone and PC markets, causing a severe shortage. Tantalum ore prices shot up, with per-pound charges for refined powder climbing from less than $50 to a peak of over $400 at the end of last year. Today, with demand softening worldwide, prices have fallen to around $100 a pound.
In response to the increased demand, coltan miners all over the world increased production. In the Congo region, both legitimate and rogue coltan merchants joined the rush. The boom brought in as much as $20 million a month to rebel groups, as well as independent factions, who were trading coltan mined mostly from northeastern Congo, according to the U.N. report. That money helps fuel the war.