Paris: Critical minerals have emerged as a significant global concern due to export restrictions and highly concentrated supply chains that threaten trillions of dollars in industrial production.
According to Anadolu Agency, the International Energy Agency's (IEA) Global Critical Minerals Outlook report warns that full implementation of China's export controls could jeopardize an estimated $6.5 trillion in annual production outside China.
A disruption in the supply of battery-grade graphite alone could endanger over $300 billion in annual production, particularly affecting sectors like electric vehicles, energy storage, and battery manufacturing. Essential minerals like lithium, cobalt, graphite, and rare earths are crucial for electric vehicles, batteries, renewable energy systems, and power grids. Meanwhile, gallium, germanium, and tungsten are vital for semiconductors, aerospace, artificial intelligence, and defense technologies.
China continues to dominate the processing of minerals vital for energy and high-tech applications, while Indonesia leads in nickel refining. China's share in mineral processing is projected to reach 72% by 2025, up from 70% in 2023. China and Indonesia together accounted for more than three-quarters of the growth in refined supplies of key energy minerals over the past two years, posing an immediate economic security challenge as governments increasingly implement export restrictions.
Since 2023, the number of mineral tariff categories under China's export controls has tripled. In April 2025, China imposed controls on seven heavy rare earth elements, causing some automakers to cut production or temporarily halt operations. Although these measures were suspended until November 2026, vulnerabilities persist, with China also announcing controls on graphite anode materials, battery cathodes, production technologies, and manufacturing equipment.
Other countries have also introduced restrictions, including cobalt quotas in the Democratic Republic of the Congo and measures covering lithium in Zimbabwe and graphite in Mozambique. Despite stronger prices and long-term demand, critical mineral investment declined by 9% in 2025, ending several years of growth. Capital spending on battery metals fell by more than 20%, and lithium companies reduced investment by around 40%.
The IEA highlights that diversification efforts continue to focus mainly on mining, with refining and manufacturing capacity lagging. New projects outside dominant countries face higher capital costs and operational challenges, including technology shortages and lengthy permitting procedures. The IEA ranks gallium, magnet rare earths, yttrium, graphite, tungsten, tellurium, cobalt, and germanium among the most vulnerable minerals to disruption, emphasizing the need for diversified supply chains to strengthen economic resilience.