If you spent any time at last year’s B20 and G20 gatherings, you might have noticed something unusual. Between the polite smiles and the occasional geopolitical side-eye, there was rare consensus; countries that export raw and unprocessed minerals are effectively shipping jobs, value and long-term industrial advantage to someone else’s shores.
Some say beneficiation is the smarter and only appropriate play and 2026 will hopefully bring a shift in the right direction. We’d like to agree.
Global policy signals, investor appetite, and geopolitical competition around critical minerals are pushing beneficiation back to the centre of the table. And the good news is we might finally have the right tools and the right incentives to make it work. The bad news? If we mess it up, the opportunity will go exactly where our manganese ore already goes: onto ships, headed east.
The Global Cue: Everyone Wants a Piece of the Value Chain
Critical minerals—lithium, nickel, manganese, PGMs and rare earths are no longer just commodities; they’re currency in the global energy transition. The *International Energy Agency (IEA) estimates that demand for critical minerals is expected to quadruple by 2040, and countries are scrambling to secure supply and processing capacity.
At the B20, a recurring theme was that countries that fail to climb the value chain will simply be left behind. And at the G20, developing nations like South Africa successfully pushed the concept that value addition must happen closer to where minerals are mined.
So far, so promising.
But global enthusiasm for beneficiation does not magically suspend load-shedding, build rail lines or reduce port congestion. It also doesn’t convince investors to put billions into smelters or refineries without some comfort that the rules of the game won’t change halfway through the national anthem.
Which leads us to the most misunderstood principle in beneficiation – it cannot be forced.
Why does Beneficiation Fail When It’s Forced?
Mandatory local processing, export quotas and punitive restrictions have been proposed before, and every time, investors and industry respond the same way – a polite smile, a mumble about “policy uncertainty” and capital redirected to another jurisdiction with fewer political mood swings.
Why? Because beneficiation is capital-intensive, energy-hungry, commodity dependent and brutally sensitive to cost structures. South Africa’s realities – power shortages, rising input costs and rail bottlenecks (which we’re hopeful to see alleviate soon) – have shaved billions off export earnings, and regulatory unpredictability meaning that compelling beneficiation through restriction is like insisting your toddler eat broccoli by hiding it under more broccoli.
The Carrat Always Works Better Than the Stick
Countries that get beneficiation right like Botswana for diamonds and Indonesia for nickel do not rely on punitive measures in this regard. They rely on clear legislation, predictability, incentives, industrial capability and an enabling environment.
Botswana didn’t become a global diamond-cutting powerhouse by banning exports. It did it through a deal with De Beers built on long-term certainty, infrastructure build-up, and investment incentives. Today, diamond beneficiation employs thousands and contributes meaningfully to GDP.
The shift of diamond trading to Botswana and local processing triggered auxiliary services – banking, security, and transport contributing to diversification beyond mining itself.
Indonesia, often cited as the “stick-heavy model” is frequently misunderstood. Yes, it banned unprocessed nickel exports, but only after years of incentives, tax breaks, and power-supply guarantees that attracted billions in refinery and smelter investment. By the time the ban came, value addition capacity already existed. Maybe not the ideal model.
The export ban was layered on top of a broader industrial strategy including incentives, regulatory clarity and attraction of foreign investment to build domestic processing capacity. That combination supports the narrative that beneficiation worked through carrots and structural planning, not purely compulsion.
The right carrots include:
- Competitive, long-term electricity tariffs for beneficiation plants/processes.
- Targeted tax incentives, especially for early-stage processing facilities.
- Fast-tracked regulatory approvals for smelting, refining and advanced material production.
- Infrastructure support through rail corridors, industrial hubs, water access – designed around real value chains.
Give investors certainty and support, and South Africa’s natural advantages, resource endowment, industrial expertise and technical capabilities can convert into value.
Focus on the Minerals Where We Have an Edge
Beneficiation must be strategic and South Africa has real competitive advantages in:
- PGMs and hydrogen technologies
- Manganese processing (we hold roughly 70% of global reserves)
- Battery precursor materials
- Titanium and vanadium value chains
- High-grade iron ore applications…to name a few
These are globally relevant value chains already looking for stable jurisdictions with processing capabilities.
The Legal Landscape Is Changing Too
While beneficiation gets the headlines, a quieter revolution is reshaping the mining, energy and infrastructure sectors: the evolution of legal partnership itself.
This matters because legal teams are no longer just drafting contracts, they are strategic allies shaping long-term strategies, investment decisions and operational resilience.
Modern contracts are changing and adapting with increased momentum:
- ESG-linked obligations
- Carbon emission caps and reporting clauses
- Renewable energy supply undertakings
- Water stewardship requirements
- Data governance and cybersecurity responsibilities
- Adaptive compliance clauses that allow contracts to evolve with regulation
- Climate risk modelling
- Closure liabilities
- Community impact assessments
- Water dependencies
- Data compliance
- Cross-border supply chain exposures
- Community evolution around the mines/plants
This is not over-lawyering. This is the value ad lawyers should be providing and the reality investors face when financiers are measuring everything from methane intensity to community grievance response times.
And in a country where a single water-use license delay can derail a R5 billion project, risk assessment has become the glue holding investment confidence and economic growth together.
A legal expert who understands the regulator’s evolving expectations and pain points, the community’s historic grievances, the municipal water constraints, the DMR’s appetite for risk and the political winds of the region, will unlock more progress than fifty pages of well-structured legal argument.
NSDV’s long-standing mantra – people over paper – isn’t soft sentiment. The right relationships can move a project forward with all the checks and balances inplace. The wrong assumptions can bury it deeper than a forgotten prospecting right in a filing cabinet in Polokwane.
So, What Does All This Mean for Beneficiation in 2026?
If South Africa can combine incentives with reliability, strategic focus with regulatory clarity, and humour with humility (we are, after all, trying to run an industrial strategy in a country where the electricity sometimes goes on holiday), we can transform our mineral endowment into sustainable, long-term industrial growth.
And if we get it right?
The next time you sit at a B20 panel, you may hear something even more surprising than consensus – admiration!
