Marubeni CEO on New Opportunities in Lithium Sector

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00:00What sort of changes have you made since the trade tensions have started?

00:04I guess, first and foremost, our agribusiness in the U.S. is seeing a little bit of impact.

00:12The U.S. export agriculture has consisted of a number of products, water, soybean is

00:18a classic example where the supply has been shifted from U.S. to Brazil, pending agreement

00:27of ongoing discussions between the U.S. and China, but certainly, I guess, the shift actually

00:34has happened.

00:35So, I guess, increasingly, each domestic consumption push is being promoted by each country, including

00:44Japan, Southeast Asia, to try to create a push for the domestic resilient economy as opposed

00:50to relying upon global supply, sort of trade flow.

00:54And thirdly, you know, higher sense of supply security to critical component.

01:00As I mentioned, copper is probably a very critical element to AI and data center and also power,

01:08renewable power to operate data center safely.

01:11And you are expanding your assets when it comes to copper.

01:13Yeah, we are expanding assets when it comes to the copper.

01:17We are one leading equity copper holder in Japan.

01:21As we are currently expanding our copper mine investment in Chile, currently our volume is

01:25160,000 tons, leading to 200,000 tons in 2027.

01:30Do you have any interest in getting into the rare earths business?

01:34We are looking at it and we hope to be able to capture the opportunity so long as the demand

01:41of rare earths can sustain and continue.

01:43Do you expect that to happen?

01:45Lithium is certainly a very important, critical sort of material and people really want it

01:50to have.

01:51So we hope to be able to explore the opportunity around them.

01:53I know that you have businesses with Australia as well.

01:56Would those be the sort of partners you're looking at?

01:58Yep.

01:59At the moment, yes.

02:00Yes.

02:01But we are globally looking at it.

02:03So our operation is globally.

02:05And we operate with a mindset of where might be the best source of location.

02:10If it is Australia, then of course Australia.

02:13If it is in South America, it's South America.

02:16What about the United States given, of course, that every country is trying to increase investments

02:20in the U.S.?

02:21Of course, U.S. investment is important and the critical mineral and critical asset to the

02:26extent there is a good opportunity we hope to be able to capture.

02:29It also takes a lot of capital that you need to initially invest.

02:32Absolutely.

02:33Hence, I guess private sector plays one role, but public support and private and public collaboration

02:40is very important.

02:41So you're talking to the Japanese government?

02:42Of course.

02:43Whenever we do investment in critical natural resources, some sort of support from the Japanese

02:50government, including export credit agency and so on, is critically important.

02:55What is the size and scope that you're thinking of?

02:57Well, it depends upon the project and it depends upon the size of the project, but of course

03:02always more than a billion and sometimes more than five billion or so.

03:06Yen?

03:07No, dollars.

03:08Dollars.

03:09Do you have sort of an idea of the ratio of your business that it could potentially take?

03:12Yeah.

03:13Well, overall as Marameni strategy, we are perhaps focusing pretty much on non-resource business

03:20at the moment.

03:21And we wanted to ensure the capture, the business that capture the domestic consumption growth,

03:28higher the value and the scalable sort of business model.

03:32These will be a main sort of part of our businesses.

03:34And we would think about around more than 80% capital going into this kind of stable non-resource

03:42businesses.

03:43Non-natural resource business, which is currently around, you know, 20% of our investment capital

03:49would stay where we are.

03:50And we would operate within this sort of philosophy of how we may be able to increase our sort of

03:56footfall within natural resources, within this capital allocation.

04:00How are you working with a new prime minister?

04:01I guess she's a good leader, and everybody in Japan is embracing her strong leadership.

04:07And, you know, how push and focus on investing into what Japan does best in the world, industrial

04:14technology, re-manufacturing, and so on, is quite clear.

04:18So we hope to be able to collaborate with the Japanese government as much as possible with

04:22the view of, you know, making Japan stronger.

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