Apple and the Congo: Corporate Impact of Congolese Coltan Mining
The Process: From the Mines to Your Pockets
First in the chain of coltan distribution is the physical extraction of the mineral from the Democratic Republic of the Congo. The majority of the coltan comes from its eastern mines, which often are fought over and can have questionable ownership. For more about working conditions in the mines, visit the Human Rights tab.
Next comes the purchase of the coltan from the mines by various different distributors, who then sell the raw mineral to different distributors, who purify it into tantalum and manufacture the capacitors. The coltan may change ownership many times during this step, which typically drives up its price.
Then the pre-made capacitors are purchased by Apple, who then assemble their products, such as the iPhone, using the tantalum capacitors.
Lastly, the finalized iPhone is sold by Apple to consumers, who then keep their phone for an average of about 16 months before replacing it with a new one.
Importance of Coltan Mines
The mines are the single most reliable way of getting columbite-tantalite from the earth. This is why there is so much conflict over them in the eastern DRC; they are the centerpieces of coltan extraction and therefore are enormously profitable. The local economy practically revolves around them, awarding the mines all the attention and ignoring other prospective industries.
Short and Long-Term Strategies: Pros and Cons
Without implementing any major changes in the chain of colton distribution, there are multiple possible approaches that Apple can take to achieve both short and long-term goals.
In the best short term interests of Apple would simply be to purchase as much tantalum is necessary from the cheapest source to meet production quotas without vetting the sources from which such tantalum is bought. This would likely lower the price per tantalum capacitor as bought by Apple, as the least expensive source would likely be run by an illegitimate source using forced labor and such to cut production costs. This would improve Apple's profits, but would likely hurt both the public image of the company and further the human rights, environmental, and political problems present in the Democratic Republic of the Congo.
Alternately, it would be in the company's long term interest to invest solely in distributors who purchase coltan from legitimate mines operated by nonviolent owners who abide by labor laws and use their proceeds to help the DRC, not to fight against it. While the price of coltan purchased from such mines would be higher than the illegitimate mines, it would erode funding for the rebel groups that contribute largely to the longstanding political instability. Therefore, the Congolese government could eventually regain their advantage over the dissidents and restore some semblance of stability, which would result in safer, more easily accessible mines. This strategy is very long-term and there is no guarantee that stability will last or even come about; however, this option improves Apple's image in the public eye, as they are no longer viewed as a heartless corporation looking only for profits but as a socially conscious business working to improve the lives of those suffering in the DRC. However, the process of closely vetting each distributor's legitimacy is time-consuming, expensive, and difficult, and therefore may not be entirely practical.
Currently, Apple is operating on a variation of this long-term plan; it has implemented a strict code of conduct for all its suppliers to follow, but does not investigate each of its 174 suppliers overly closely, which likely results in some "blood minerals" filtering in through the cracks. While it does strive to make conflict-free phones, there could be much more emphasis put on this.
In the best short term interests of Apple would simply be to purchase as much tantalum is necessary from the cheapest source to meet production quotas without vetting the sources from which such tantalum is bought. This would likely lower the price per tantalum capacitor as bought by Apple, as the least expensive source would likely be run by an illegitimate source using forced labor and such to cut production costs. This would improve Apple's profits, but would likely hurt both the public image of the company and further the human rights, environmental, and political problems present in the Democratic Republic of the Congo.
Alternately, it would be in the company's long term interest to invest solely in distributors who purchase coltan from legitimate mines operated by nonviolent owners who abide by labor laws and use their proceeds to help the DRC, not to fight against it. While the price of coltan purchased from such mines would be higher than the illegitimate mines, it would erode funding for the rebel groups that contribute largely to the longstanding political instability. Therefore, the Congolese government could eventually regain their advantage over the dissidents and restore some semblance of stability, which would result in safer, more easily accessible mines. This strategy is very long-term and there is no guarantee that stability will last or even come about; however, this option improves Apple's image in the public eye, as they are no longer viewed as a heartless corporation looking only for profits but as a socially conscious business working to improve the lives of those suffering in the DRC. However, the process of closely vetting each distributor's legitimacy is time-consuming, expensive, and difficult, and therefore may not be entirely practical.
Currently, Apple is operating on a variation of this long-term plan; it has implemented a strict code of conduct for all its suppliers to follow, but does not investigate each of its 174 suppliers overly closely, which likely results in some "blood minerals" filtering in through the cracks. While it does strive to make conflict-free phones, there could be much more emphasis put on this.
Who Benefits?
As the system stands now, nearly everybody but the workers involved profit from the buying and selling of coltan. Distributors and mine owners get their profits from the raw material, Apple gets the capacitors it needs to work its electronics, consumers get the final product. The workers in the DRC mines are exploited and lead horrible, deprived lives. The Congolese government also takes some damage as well, as "blood minerals" exported from the Congo are used to further fund the ongoing coups and civil wars that seem never to end.
How important is this to Apple?
The importance of capacitors in electronics cannot be stressed enough. Simply put, without capacitors, there are no consumer electronics. No iPhones, no MacBooks, no Apple TVs; all of these products require capacitors. Without it, Apple's profits would look not like this....
...but like this.
As such, Apple must do all in its power to protect and maximize this important resource. The iPhone alone consistently brings in over $4 billion in revenue to Apple per quarter. There is no way to work around it; without capacitors, there are no consumer electronics. There can be no iPhone without the tantalum capacitor.
Except for that there can be. There is another option, an alternative kind of capacitor that can replace tantalum entirely. To learn about this possibly revolutionary technology, click here or go to the Solution tab.
Except for that there can be. There is another option, an alternative kind of capacitor that can replace tantalum entirely. To learn about this possibly revolutionary technology, click here or go to the Solution tab.