Luo Bingxian Yongdao: APEC important commodity supply faces increasing climate risks

According to a special report released by PricewaterhouseCoopers (PwC) at the Asia-Pacific Economic Cooperation (APEC) meeting, even in an optimistic low-emission scenario, six key commodities that are essential for supply chains and global clean energy transition are facing increasingly severe climate risks. Guo Weishi, the Asia-Pacific Sustainable Development Partner at PwC, stated that the commodities produced by APEC economies are crucial for global supply chains and clean energy transition, but they are facing growing climate risks. Even in the optimistic, low-emission scenario analyzed in the report, many key commodities are experiencing increasingly severe climate-related disruptions due to heat stress and drought risks, and in some cases, these risks are escalating rapidly. The report analyzed six key commodities including lithium, cobalt, copper, iron, zinc, and bauxite, and found that their production may be increasingly disrupted by escalating heat stress and drought risks, leading to chain reactions in the supply chain even with slight decreases in output. APEC economies are among the top three global producers of all six commodities studied in the report, with critical minerals and important metals being an essential part of global production and supply chains in electronics, technology, manufacturing, energy systems, consumer goods, and more. The report suggests that business leaders can take three steps to address the growing risks of climate disruptions. Firstly, identify and manage climate risks throughout the entire supply chain to enhance resilience. Secondly, seize opportunities to provide relevant products, services, or business models to help enterprises and communities enhance their resilience to climate change. Lastly, collaborate with stakeholders from government to community to achieve cooperation and strengthen adaptive capacity at the policy and institutional levels.