Supply chains remain highly concentrated—not only for rare earths, but also for other critical minerals and processing technologies, according to the latest Global Critical Minerals Outlook. The International Energy Agency argues that diversification and strategic stockpiles could significantly reduce supply risks at comparatively modest cost.
Critical minerals are becoming increasingly central to energy, industrial, and national security policy. They are essential not only for batteries, wind turbines, and electricity grids, but also for semiconductors, artificial intelligence, aerospace, and defense applications. The International Energy Agency (IEA) examines trends in supply, demand, and investment in its annual Global Critical Minerals Outlook, whose 2026 edition has now been released.
According to the report, supply risks have intensified further, reflected in the recent rebound in prices for many critical minerals. The increase was driven in part by new export restrictions imposed by major producing countries. At the same time, investment by many of the world’s leading mining companies in critical mineral projects declined by nine percent in 2025.
Geographic concentration across supply chains continued to increase, particularly in the refining of key energy-transition minerals such as nickel, manganese, and graphite. Rare earths, however, stand out as a notable exception. New refining projects in the United States and higher production in Malaysia reduced China’s share of global rare earth refining from more than 90 percent in 2023 to 85 percent in 2025. According to the IEA, this share could fall to 70 percent by 2035 if announced projects move forward as planned. The analysis, however, does not distinguish between light and heavy rare earth elements, where China’s dominance—particularly in heavy rare earth production—remains substantially stronger.
Additional risks are emerging because export controls increasingly target not only raw materials, but also processing technologies and manufacturing equipment. In autumn 2025, China expanded its export restrictions to cover several rare earth elements under this broader framework. While some of these measures have been suspended until November 2026, the IEA warns that their full implementation could put production activities worth approximately $6.5 trillion per year outside China at risk.
The Cost of Preparedness Would Be Modest Compared with the Economic Impact of Supply Disruptions
Despite the high concentration of global value chains, the IEA argues that diversification is financially achievable, particularly for strategically important specialty minerals with relatively small markets. Building more resilient supply chains for magnet-related rare earth elements, for example, would require investment of around US$60 billion over the next decade.
Strategic stockpiles could also play an important role in mitigating short-term supply disruptions. For eleven particularly vulnerable critical minerals, the agency estimates that the annual net cost of maintaining inventories outside the dominant supplier country would amount to less than $900 million. Compared with the potentially severe economic consequences of supply interruptions, the IEA concludes that these costs would be relatively modest.
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