Released June 09, 2025 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Winning the war for artificial intelligence (AI) over the next few years may require President Donald Trump to be more accommodating to China, as that nation holds a strong, even monopolistic, control over mining and processing capabilities for nearly all of the strategic minerals on which data centers rely, according to a recent report from the International Energy Agency (IEA) (Paris, France). Other advanced industries, such as aerospace, batteries, cell phones, laptops, renewable energy generation, electric vehicles, and other high-tech manufacturing, also are highly dependent on minerals mined or processed in China.
Click on the image at right to see a graphic on China's dominance of processing for 19 of 20 energy-related strategic minerals tracked by the IEA.
China's current, and projected future, dominance of the mining and processing of energy-related strategic minerals is an area of particular concern in the 308-page report, "Global Critical Minerals Outlook 2025," released May 21. The market share of the mining and processing of these strategic minerals has been steadily rising and grew to about 86% among the top three providers.
China has a large and growing share of the market for refining copper, lithium, cobalt, graphite and rare earths while Indonesia has a dominant share of the global nickel refining market.
Rising levels of concentration of the mining and processing of minerals at the heart of a 21st century economy poses significant concerns about potential disruption due to war or hostile trade actions, the IEA wrote. "Diversification is the watchword for energy security, but the critical minerals world has moved in the opposite direction in recent years, particularly in refining and processing," it observed. "High market concentration increases vulnerability to supply shocks, particularly if, for any reason, supply from the largest producing country is disrupted."
China's dominant and rising market share to refine key energy minerals, such as copper, lithium, cobalt, graphite and rare earths, is particularly notable.
Click on the image at right to see how market shares for refining of key energy minerals have risen since 2020 for several strategic minerals.
"In a world of high geopolitical tensions, critical minerals have emerged as frontline issue in safeguarding global energy and economic security," IEA Executive Director Fatih Birol said in a statement accompanying release of the report. "This new analysis reviews what is at stake and what needs to be done to improve the resilience and diversity of critical mineral supply chains--a key concern for ensuring the reliability, affordability and sustainability of energy in the 21st century."
The report reviews recent market trends in supply, demand and prices for battery metals, such as manganese, nickel, cobalt, graphite and lithium; base minerals (zinc, tin, aluminum, copper and lead); precious metals (silver and platinum); and rare earths.
In many cases, demand for battery metals rose sharply in 2024. Lithium demand rose by nearly 30% in 2024, significantly exceeding its 10% annual growth rate seen in the 2010s, the report noted. Demand for nickel, cobalt, graphite and rare earths increased by 6-8% last year.
But prices are generally declining because new supply is outstripping new demand, the report said. Since 2020, the IEA said, supply growth for battery metals has been twice the rate seen in the late 2010s, and that supply growth has helped push prices downward. "Following the sharp price surges of 2021 and 2022, prices for key energy minerals have continued to decline, returning to pre-pandemic levels," the report noted. "Lithium prices, which had surged eightfold during 2021-22, fell by over 80% since 2023. Graphite, cobalt and nickel prices also dropped by 10 to 20% in 2024."
Click on the image at right to see average growth in supply and demand for selected minerals over the 2021-2024 period, and the price changes in copper, battery minerals and rare earths from January 2020 to March 2025.
A market where supply gains outstrip demand gains, leading to lower prices, is good for the short term, but the "Global Critical Minerals Outlook 2025" has significant concerns about the future. "Today's markets may appear well-supplied, but export restrictions and risks to security of supply are proliferating," it pointed out. In December 2024, the report continued, China restricted the export of gallium, germanium and antimony, key minerals for semiconductor production, to the United States. This was followed by further announcements in early 2025, including restrictions on tungsten, tellurium, bismuth, indium and molybdenum and on seven heavy rare earth elements. In February 2025, the Democratic Republic of Congo announced a four-month suspension of cobalt exports to curb falling prices.
The current trade and tariff war launched by the U.S. against the rest of the world, including China, may be paused for the next month or so, but the mutual antagonism between the U.S. and some of its larger trading partners created by that war does not bode well for a future global market where strategic minerals cross national borders with a minimum of friction or tariffs.
The IEA report noted that more than half of a broad group of energy-related minerals are subject to some form of export controls right now. "These restrictions are not only increasing in number but also expanding in scope to cover not just raw and refined materials but also processing technologies, such as those for lithium and rare earth refining."
The report raises particular concerns about copper: it sees a "major" primary copper supply deficit developing later this decade and continuing to 2040 under the three climate change scenarios developed by the energy agency:
Click on the image at right to see the IEA's projection of a supply shortfall of primary copper to 2040 under three climate change scenarios.
To place the global market for strategic minerals on a sounder long-term footing, the IEA has several recommendations, some of which already are being pursued:
The energy agency is seeking to boost mineral security through its multi-pronged Critical Minerals Security Program, through which it is trying to build or nurture systems that enhance mineral resilience against potential disruptions.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
China's current, and projected future, dominance of the mining and processing of energy-related strategic minerals is an area of particular concern in the 308-page report, "Global Critical Minerals Outlook 2025," released May 21. The market share of the mining and processing of these strategic minerals has been steadily rising and grew to about 86% among the top three providers.
China has a large and growing share of the market for refining copper, lithium, cobalt, graphite and rare earths while Indonesia has a dominant share of the global nickel refining market.
Rising levels of concentration of the mining and processing of minerals at the heart of a 21st century economy poses significant concerns about potential disruption due to war or hostile trade actions, the IEA wrote. "Diversification is the watchword for energy security, but the critical minerals world has moved in the opposite direction in recent years, particularly in refining and processing," it observed. "High market concentration increases vulnerability to supply shocks, particularly if, for any reason, supply from the largest producing country is disrupted."
China's dominant and rising market share to refine key energy minerals, such as copper, lithium, cobalt, graphite and rare earths, is particularly notable.
"In a world of high geopolitical tensions, critical minerals have emerged as frontline issue in safeguarding global energy and economic security," IEA Executive Director Fatih Birol said in a statement accompanying release of the report. "This new analysis reviews what is at stake and what needs to be done to improve the resilience and diversity of critical mineral supply chains--a key concern for ensuring the reliability, affordability and sustainability of energy in the 21st century."
The report reviews recent market trends in supply, demand and prices for battery metals, such as manganese, nickel, cobalt, graphite and lithium; base minerals (zinc, tin, aluminum, copper and lead); precious metals (silver and platinum); and rare earths.
In many cases, demand for battery metals rose sharply in 2024. Lithium demand rose by nearly 30% in 2024, significantly exceeding its 10% annual growth rate seen in the 2010s, the report noted. Demand for nickel, cobalt, graphite and rare earths increased by 6-8% last year.
But prices are generally declining because new supply is outstripping new demand, the report said. Since 2020, the IEA said, supply growth for battery metals has been twice the rate seen in the late 2010s, and that supply growth has helped push prices downward. "Following the sharp price surges of 2021 and 2022, prices for key energy minerals have continued to decline, returning to pre-pandemic levels," the report noted. "Lithium prices, which had surged eightfold during 2021-22, fell by over 80% since 2023. Graphite, cobalt and nickel prices also dropped by 10 to 20% in 2024."
A market where supply gains outstrip demand gains, leading to lower prices, is good for the short term, but the "Global Critical Minerals Outlook 2025" has significant concerns about the future. "Today's markets may appear well-supplied, but export restrictions and risks to security of supply are proliferating," it pointed out. In December 2024, the report continued, China restricted the export of gallium, germanium and antimony, key minerals for semiconductor production, to the United States. This was followed by further announcements in early 2025, including restrictions on tungsten, tellurium, bismuth, indium and molybdenum and on seven heavy rare earth elements. In February 2025, the Democratic Republic of Congo announced a four-month suspension of cobalt exports to curb falling prices.
The current trade and tariff war launched by the U.S. against the rest of the world, including China, may be paused for the next month or so, but the mutual antagonism between the U.S. and some of its larger trading partners created by that war does not bode well for a future global market where strategic minerals cross national borders with a minimum of friction or tariffs.
The IEA report noted that more than half of a broad group of energy-related minerals are subject to some form of export controls right now. "These restrictions are not only increasing in number but also expanding in scope to cover not just raw and refined materials but also processing technologies, such as those for lithium and rare earth refining."
The report raises particular concerns about copper: it sees a "major" primary copper supply deficit developing later this decade and continuing to 2040 under the three climate change scenarios developed by the energy agency:
- The Stated Policies Scenario (STEPS) is based on today's policy settings.
- The Announced Pledges Scenario (APS) assumes that governments meet, in full and on time, their national energy and climate targets.
- The Net Zero Emissions by 2050 (NZE) Scenario is a normative scenario that charts a pathway for the global energy sector to reach net zero carbon dioxide (CO2) emissions by 2050.
To place the global market for strategic minerals on a sounder long-term footing, the IEA has several recommendations, some of which already are being pursued:
- Implement new policy initiatives on public funding, strategic partnerships and reforms to domestic policies. The report noted that Trump has issued a series of executive orders to expedite permitting and increase investments in domestic projects. Similarly, the European Commission designated 47 strategic projects under the EU Critical Raw Materials Act to fast-track development and enhance financing access.
- Increase efforts to collaborate globally to diversify supply sources, linking resource-rich countries with those possessing refining capabilities and downstream consumers.
- Expand the supply of strategic minerals by pursuing new technologies in mining, refining and recycling.
- Design public financing policies to reduce the cost of bringing on new mining and refining capacity. Capital costs for new projects are typically around 50% higher than for incumbent producers. These higher costs, combined with price volatility and economic uncertainty, are making it difficult to build up diversified supply of strategic minerals.
The energy agency is seeking to boost mineral security through its multi-pronged Critical Minerals Security Program, through which it is trying to build or nurture systems that enhance mineral resilience against potential disruptions.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
