What are indicators of criticality?

The European Commission uses a specific method to draw up a list of critical raw materials (CRMs). Criticality is a complex concept, however, and its meaning depends on the interests and concerns of the parties involved. The NMO collects, monitors, and publishes data on a wide range of indicators of criticality.

Supply risks and economic impact

The supply of critical raw materials faces several risks. The European Commission uses a composite indicator to identify these critical raw material supply risks, which takes into account aspects such as the concentration per source country, nature of the source country, recycling rate, substitutability, and import dependence.

The assessment of criticality does not depend solely on estimated supply risks, but also on the expected economic (or other public) impact. The European Commission bases this economic impact on the extent to which raw materials are essential for NACE second level economic sectors (such as chemical and electrical engineering industries).

What does the NMO do?

The NMO develops, monitors, and publishes relevant indicators for the Dutch government, economy, and industry. These indicators aim to provide policymakers and businesses with an overview of the potential impact of supply disruptions within chains. Based on these indicators, specific risk analyses focused on the Netherlands will be carried out and a Dutch critical materials list will be drawn up in 2025.

Indicators of criticality

The NMO assesses more indicators than the European Commission and has a globally recognised methodology for analysing and monitoring the criticality of raw materials. These additional indicators can also be found in the Grondstoffenscanner. For a detailed explanation and analysis of these indicators, see 'Relevant publications' at the bottom of this page.

  • The reserve-to-production ratio estimates the number of years raw materials will last based on remaining reserves.
  • Companionality is an indicator that describes the extent to which a raw material is a by-product (the 'companion') of extraction of another raw material (the 'host'). A high level of companionality may imply that when market conditions for the companion change, it cannot be extracted in greater quantities unless the 'host' is also extracted in greater quantities.
  • Monopoly formation, or market concentration, can be used in a variety of ways to analyse supply chain dependencies.
  • Governance stability is a key factor in determining criticality. The WGI (Worldwide Governance Indicators) are compiled annually by the World Bank and give an indication of stability and reliability with regard to global agreements.

Other indicators the NMO uses for its analyses include price volatility, the extent to which export restrictions apply, the environmental impact of raw materials, and the contribution of recycling to supply security.