in other words what happens when the material moves that sets up a dynamo effect
Think of the core of the earth as a solid metal ball surrounded by molten metal. As the Earth spins on its axis the edge of the hard metal core sheers against the molten metal, creating the magnetic field. It's kind of like rubbing a magnet on a pin sets up a small temporary magnetic field around the pin. if the metal in the center was non conductive then instead of magnetism you'd just get friction in the form of heat.