Africa: Where the value chain begins — and leaves

It is well known that Africa holds a significant share of the world’s mineral resources, including the majority of global reserves for several critical metals. Yet, very little refining of these reserves takes place within the continent. The contrast becomes more pronounced along the value chain, where mining captures only a fraction of the total value and the real value is created in midstream, at the processing and refining stage.

Africa’s role in the mineral supply chain is limited to the upstream. Mining and concentration are well established across the continent, forming the initial phases of mineral development. However, Africa’s role in the supply chain tapers off before the refining stage, where materials are transformed into high-purity metals and advanced inputs. As a result, while extraction and concentration take place locally, the subsequent stages of processing occur elsewhere, extending the supply chain beyond the point of origin.

The mineral value chain follows a sequential structure: exploration, mining, concentration, refining, and manufacturing. While each stage adds value to the extracted minerals, the most significant gains occur after concentration, during refining and further processing.

Exporting concentrates is often a structural necessity rather than a strategic choice. In many resource-rich countries, mineral extraction generates the primary source of immediate revenue and exporting partially processed materials provides the fastest path to monetization. In this context, export is not a misstep, but a function of the economic constraints within the existing system.

The same material can pass through multiple stages of transformation outside the continent. A mineral may leave in the form of ore or concentrate and return as a finished product. Each stage involves additional processing, technical input, and integration into industrial markets, all of which increase the materials’ value. As a result, while the physical resources originate in one place, the economic value-added associated with them is progressively built elsewhere.

Refining marks the point at which pricing power begins to take shape. Refined materials are traded within global industrial markets, where pricing is established through standardized benchmarks and contractual structures. Participation at this stage determines not only how materials are priced, but also the terms of trade and the degree of market leverage held by producers. This is where the final value is not only created, but defined — and it does not occur within the continent of Africa.

Kiana Kianara

Executive Vice President, Marketing & PR