OFR-19-88 Estimated Direct Economic Impacts Of A U.S. Import Embargo On Strategic And Critical Minerals Produced In South Africa ? Executive Summary ? Major Findings:

(l)The direct economic costs to this nation resulting from a decision to embargo South African strategic and critical minerals imports are estimated at $1.85 billion per year.2,3 About 94 percent of these estimated costs are for two platinum-group metals (PGM's), platinum and rhodium. The estimated costs of a 5-year embargo beginning in 1988 for the strategic and critical minerals analyzed are presented in Table 1.4 (2)There are sufficient alternative world sources to South Africa for manganese, chromium, palladium, titanium, and vanadium to meet U.S. industrial demand in the event of an embargo. (3)Alternative world sources to South Africa for platinum and rhodium cannot meet U.S. industrial demand. Non-South African world supply sources can meet about 40 percent of domestic platinum consumption requirements and 50 percent of rhodium requirements. (4)As a result of the increase in prices for platinum and rhodium during the embargo, expansion of domestic platinum-group metals mining and secondary production is expected. During a five year embargo, domestic primary and secondary production expand and together satisfy about one-third of U.S. platinum requirements, one-third of U.S. rhodium requirements, and over one-half of domestic palladium requirements.