The IEA examines the full spectrum of energy issues including oil,gasand coal supply and demand, renewable energy technologies, electricity markets, energy efficiency , access to energy , demand sidemanagement and much more. Through its work, the IEA advocates policies that will enhance the reliability , affordability and sustainability of energy in its 32 Member countries, 14 Association countries and beyond. This publication, as well as any data and map included herein, are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area.<\/p>\n
Executive summary …………………………………………………………………………….5
\nIntroduction …………………………………………………………………………………….. 14
\n1. Market review ………………………………………………………………………………. 19
\nMineral market trends …………………………………………………………………… 20
\nGeopolitical developments and implications for supply security …………. 38
\nDownstream market trends …………………………………………………………… 58
\nInvestment trends ………………………………………………………………………… 75
\nLatest policy developments …………………………………………………………… 91
\nSustainability performance tracking ……………………………………………….. 96
\n2. Outlook for key minerals: Part 1 ……………………………………………………. 108
\nOutlook overview ……………………………………………………………………….. 109
\nOutlook for copper ……………………………………………………………………… 124
\nOutlook for lithium………………………………………………………………………. 138
\nOutlook for nickel ……………………………………………………………………….. 147
\nOutlook for cobalt ………………………………………………………………………. 155
\nOutlook for graphite ……………………………………………………………………. 163
\nOutlook for rare earth elements ……………………………………………………. 174
\nOther key materials ……………………………………………………………………. 186
\nOutlook for key minerals: Part 2 …………………………………………………….. 197
\nStrategic minor minerals ……………………………………………………………… 198
\nOutlook for key minerals: Part 3 …………………………………………………….. 213
\nNuclear supply chains ………………………………………………………………… 214
\n3. Pathways to resilient and diversified supply chains …………………………. 232
\nEmergency preparedness …………………………………………………………… 233
\nPolicy and market frameworks to diversify supply chains ………………… 259
\nTechnology, equipment and workforce ………………………………………….. 283
\n4. Special focus on Latin America and the Caribbean ………………………… 305
\nAnnex …………………………………………………………………………………………… 336
\nAcknowledgements …………………………………………………………………….. 337
\nKey projection results ………………………………………………………………….. 346
\nIEA. CC BY 4.0.<\/p>\n
Critical minerals have rapidly moved to the heart of global
\ndiscussions on energy and economic security. Their indispensable
\nrole across several energy technologies as well as other industries of
\nstrategic importance such as high-tech manufacturing, AI and digital
\nsystems, and aerospace and defence, have underlined the need to
\nenhance the resilience and diversity of their supply chains.
\nThe 2026 edition of the IEA\u2019s annual Global Critical Minerals Outlook
\nincludes a detailed assessment of the latest market, investment and
\ntechnology trends, along with their implications for critical mineral
\nsecurity. The report provides a snapshot of recent industry
\ndevelopments and offers medium- and long-term projections for the
\nsupply and demand of key energy minerals, taking into account the
\nlatest policy and technology developments. This year’s report will
\nalso include several areas of special focus: strategic minor minerals
\nwith applications beyond energy, nuclear supply chains and the role
\nof Latin America in global mineral supply chains.
\nAs countries increasingly call on the IEA to deepen its work on critical
\nmineral security and supply chain diversification \u2013 as reflected in the
\ndeclaration by IEA Ministers and G7 leaders \u2013 the 2026 Outlook will
\ninclude a new chapter examining the policy implications of building
\nresilient and diversified supply chains, including emergency
\npreparedness, policy and market frameworks, and technology,
\nequipment and workforce issues.<\/p>\n
Critical minerals have moved to the forefront of energy, IEA. CC BY 4.0. The IEA examines the full spectrum of energy issues including oil,gasand coal supply and demand, renewable energy technologies, electricity markets, energy efficiency , access to energy , demand sidemanagement and much more. Through its work, the IEA advocates policies that will enhance the reliability , affordability and sustainability of energy in its 32 Member countries, […]<\/p>\n","protected":false},"author":3,"featured_media":56904,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[2,1],"tags":[9966,9954,9964,9962,9969,9963,9968,14,9967,9965],"class_list":["post-56841","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","category-uncategorized","tag-clean-energy-transition","tag-critical-minerals","tag-energy-security","tag-global-critical-minerals-outlook-2026","tag-global-mineral-markets","tag-international-energy-agency-iea","tag-mineral-supply-and-demand","tag-mining","tag-strategic-minerals","tag-supply-chain-security"],"acf":[],"_links":{"self":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/56841"}],"collection":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/comments?post=56841"}],"version-history":[{"count":9,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/56841\/revisions"}],"predecessor-version":[{"id":56910,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/56841\/revisions\/56910"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media\/56904"}],"wp:attachment":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media?parent=56841"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/categories?post=56841"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/tags?post=56841"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
\neconomic and national security agendas in recent years. This
\nreflects growing concerns about supply chain concentration and the
\nexpanding use of trade restrictions. Although the adequacy of supply
\nremains a major concern, notably for copper, governments are now
\nplacing greater attention on resilience, diversification and the security
\nof supply in an increasingly complex geopolitical environment.
\nCritical mineral prices rebounded in 2025 and early 2026 after
\ndeclining in recent years. Driven by tight supply conditions, prices
\nfor base metals such as aluminium, copper and tin rose by one-third
\nbetween January 2025 and April 2026, with copper prices reaching
\nrecord highs. Battery material prices also recovered following a
\ndownturn in 2023 and 2024. Lithium prices more than doubled amid
\nstrong demand from energy storage applications and constrained
\nsupply, while cobalt prices rose by around 130%, largely due to
\nexport restrictions imposed by the Democratic Republic of the Congo
\n(DRC). Prices for strategic minor minerals \u2013 those with relatively
\nsmall market sizes but critical roles across the energy, high-tech,
\naerospace and defencesectors \u2013 had already started rising in 2024
\nand continued to rally through 2025 and early 2026 amid new export
\ncontrols and robust demand growth.Prices for these minerals more
\nthan doubled, with prices for tungsten surging sixfold. Export controls
\nhave also led to a sharp price divergence between Chinese markets
\nand those in other regions. In Europe, prices for gallium and heavy
\nrare earths(dysprosium and terbium) are currently around five times
\nhigher than Chinese domestic prices, and germanium prices are
\nalmost three times higher\u2013 highlighting the challenges of securing
\nsupply outside the dominant supplier.
\nSupply concentration in refining continued to edge higher for
\nmost minerals in 2025, with rare earths the notable exception.
\nOver the past two years, the top refining countries\u2013 Indonesia for
\nnickel and China for other key energy minerals \u2013 accounted for over
\nthree-quarters of total growth in refined supply. In several markets,
\nincluding for manganese, nickel and graphite, virtually all supply
\ngrowth came from the dominant supplier. Rare earth refining was an
\nexception, with new projects in the United States and production
\nincreases in Malaysia leading to a modest decline in concentration,
\nhighlighting the role of targeted policy and investment support in
\nenabling diversification. Excluding rare earths, the average share of
\nthe top refining country rose to 72% in 2025, up from 70% in 2023.
\nGaps between projected demand and anticipated supply over
\nthe next decade have narrowed for copper and lithium, but new
\nrisks have emerged for cobalt due to policy shifts in major
\nproducers. Based on the project pipeline, supply deficits for copper
\nand lithium are set to persist through 2035, although the outlook has
\nsomewhat improved. For copper, the projected supply deficit in 2035. Download: Global Critical Minerals Outlook 2026.pdf <\/span><\/a><\/p>\n
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 7
\nExecutive summary
\nhas narrowed from around 30% in last year’s Outlook to 25% as new
\nprojects advance, particularly in the DRC and Zambia. By contrast, a
\nprojected supply gap has emerged for cobalt due to the DRC’s new
\nexport quota. This development underscores how policy changes by
\nmajor producers can rapidly reshape the global supply outlook in
\nmarkets with high levels of geographic concentration.
\nNew export controls have turned supply concentration risks into
\nreality. The number of mineral tariff codes subject to Chinese export
\ncontrols has tripled since 2023. Other countries also introduced new
\nrestrictions, including the cobalt export quota by the DRC and trade
\nrestrictions by Zimbabwe for lithium and Mozambique for graphite.
\nThe recent proliferation of export controls has transformed concerns
\naround high supply concentration from a theoretical vulnerability into
\nan immediate economic security challenge.
\n2025 marked the year when the economic risks of highly
\nconcentrated supply chains materialised at scale. In April 2025,
\nthe Chinese government introduced major export controls on seven
\nheavy rare earth elements, with significant impacts across
\ndownstream industries, forcingsome automakers to reduce utilisation
\nrates or temporarily halt operations. In October 2025, they were
\nfurther expanded, extending proposed restrictions to internationallymade products containing rare earths sourced from China or
\nproduced using Chinese technologies. Although the expanded
\nmeasures were suspended for one year until November 2026, the
\nvulnerabilities remain. Their full implementation could put an
\nestimated USD 6.5 trillion per year of downstream production outside
\nChina at risk across the automotive, high-tech, defence and energy
\nsectors. In October 2025, China also announced export controls on
\nkey battery supply chain chokepoints, including cathode materials,
\ncathode precursors and graphite anode materials, as well as on
\nbattery manufacturing equipment and technologies. If battery-grade
\ngraphite trade were fully disrupted, over USD 300 billion per year of
\ndownstream production outside China would be at risk. These
\ndevelopments underscore how small volumes of critical minerals
\nunderpin vast economic value and highlight the fragility of highly
\nconcentrated supply chains.
\nStrategic stockpiles can provide an important short-term buffer
\nagainst supply disruptions. The largest-ever oil stock release by
\nIEA Member countries in March 2026 amid the Middle East conflict
\nhelped mitigate market disruptions. While critical mineral markets
\ndiffer from oil markets, strategic stockpiles can still provide an
\nimportant emergency buffer, helping safeguard industrial activities
\nduring supply shocks. For the 11 high-risk materials assessed by the
\nIEA, the net annual cost of stockpiling for countries outside the
\ndominant supplier is estimated at less than USD 900 million, modest
\nrelative to the potentially major economic impacts of disruptions.
\nThe conflict in the Middle East has provided another stark
\nreminder of the vulnerabilities affecting mineral supply chains.
\nWhile the key impacts of the conflict centred on oil and gas markets,
\nthere has also been considerable impact on mineral and metal
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 8
\nExecutive summary
\nmarkets from the closure of the Strait of Hormuz, notably for
\naluminium, sulphur and helium. The Middle East accounts for around
\n8% of global aluminium production, and production curtailments at
\nseveral regional smelters added strain to an already tight market. The
\nregion also supplies around one-quarter of global sulphur and half of
\nglobal seaborne sulphur trade passes through the Strait of Hormuz.
\nSulphur is a key feedstock for sulphuric acid, which is essential for
\nfertiliser production and the processing of a range of critical minerals
\nsuch as copper, lithium, cobalt, nickel and rare earths. Disrupted
\nsulphur supplies prompted China to curb sulphuric acid exports in
\nMay 2026, creating ripple effects across both mineral and fertiliser
\nvalue chains. The resulting surge in acid prices increased production
\ncosts for several critical minerals with acid costs overtaking energy
\ncosts to become the largest cost component in some cases.
\nCritical mineral investment declined by 9% in 2025, ending
\nseveral years of growth. Amid rising geopolitical tensions and price
\nvolatility, investors became more cautious despite strong underlying
\ndemand. Battery metals saw the sharpest pullback, with capital
\nspending falling by more than 20%\u2013 the largest decline in over a
\ndecade\u2013 and lithium companies cutting investment by around 40%.
\nBy contrast, spending by copper-focused companies increased by
\n8%, reflecting confidence in copper’s long-term prospects.
\nExploration spending also declined by more than 10%, with
\nmodest growth in spending on uranium and steady spending on
\ncopper offset by around 45% declines in lithium and nickel. Most
\nregions recorded lower exploration spending, although Asia Pacific
\nbucked the trend with a 20% increase. Merges and acquisitions
\nrebounded in 2025, with strong demand for high-quality copper
\nassets driving a 20% increase in overall deal value compared with
\n2024. Venture capital investment also recovered, increasingly
\ntargeting artificial intelligence (AI) technologies that could improve the
\nefficiency of mineral exploration and resource extraction.
\nPublic finance is increasingly being deployed to accelerate
\ncritical mineral investment. Governments are taking a more active
\nrole in reducing project risks and mobilising private capital. Public
\nfinance commitments in advanced economies reached around USD
\n65 billion in 2025, over four times higher than in 2023. However, a
\nconsiderable gap remains between commitments and actual
\ndisbursements, which will ultimately determine their impact on supply
\ndiversification.
\nAnalysis of project pipelines reveals a structural imbalance in
\nefforts to promote supply chain diversification, with refining and
\ndownstream capacity lagging behind mining.Many projects are
\nbeing developed outside the dominant supplier, but investment
\nremains concentrated in upstream projects compared with refining
\nand manufacturing capacity. In rare earth supply chains, existing and
\nannounced refining capacity in geographically diversified regions is
\nequivalent to around two-thirds of expected mined supply by 2035,
\nwhile planned magnet production represents only one-third. A similar
\npattern is evident in battery materials, where planned cathode
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 9
\nExecutive summary
\nproduction capacity is only about one-third of projected lithium mining
\ncapacity. These imbalances underscore the need for a more
\nbalanced approach to development across value chains.
\nThere is a strong case for greater policy attention to strategic
\nminor minerals. As semiconductors, robotics and AI drive the next
\nwave of innovation, securing supplies of minerals such as gallium,
\ngermanium, indium and antimony is becoming increasingly important.
\nSimilarly, the aerospace and defence sectors depend on minerals
\nincluding cobalt, titanium, tungsten and yttrium to meet stringent
\nperformance requirements. Based on the IEA’s risk assessment
\nframework, gallium, magnet rare earths, yttrium, graphite, tungsten,
\ntellurium, cobalt and germanium rank among the materials most
\nexposed to supply vulnerabilities, due to their high supply
\nconcentration, limited substitution potential and critical importance
\nacross multiple end-use applications. Many of them are already
\nsubject to some form of export restrictions. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nDespite extremely high supply concentration today, strategic
\nminor minerals offer promising opportunities to strengthen
\nsupply security at a reasonable cost, if accompanied by strong
\npolicy support. The markets for these minerals aresmall, but supply
\ndisruptions can carry disproportionate economic consequences.
\nHowever, diversifying these supply chains typically does not require
\ninvestment on the scale needed for bulk commodities, and bringing a
\nlimited number of high-quality projects online can substantially
\nimprove resilience. For example, diversifying magnet rare earth
\nsupply chains would require around USD 60 billion of investment over
\nthe next decade\u2013 modest relative to the huge potential economic
\ncost of supply disruptions.
\nGreater attention is also needed on the strategic role of base
\nmetal smelters. Many strategic minor minerals are recovered as byproducts of copper, zinc and lead processing, making base metal
\nsmelters essential to the security of these materials. Modern copper
\nand zinc smelters are more than producers of refined base metals\u2013
\nthey are strategic processing hubs that enable the recovery of
\nnumerous critical by-product minerals, support downstream
\nmanufacturing and provide recycling capacity for scrap metal. As
\nsuch, they warrant greater policy attention as critical midstream
\ninfrastructure to ensure supply chain resilience.
\nThe base metal smelting sector is showing increasing signs of
\nstress. Despite rising base metal prices, smelter fees have fallen to
\nhistoric lows. Benchmark copper smelter fees were settled at
\nUSD0 per tonne in 2026, the lowest level ever agreed in annual
\nnegotiations, while spot charges have remained negative since 2024;
\nzinc and lead smelter fees have also turned negative. As this revenue
\nstream has effectively disappeared, smelters have become
\nincreasingly reliant on by-product sales, which are inherently more
\nvolatile. Tight concentrate supplies, combined with rapid smelter
\ncapacity expansion in China, have driven this trend. Since 2005,
\nChina has accounted for over 90% of growth in global copper
\nsmelting, increasing its share of global capacity from around 15% to
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 10
\nExecutive summary
\n50% by 2025. Smelter utilisation rates have also diverged sharply
\nsince 2020, falling below 70% outside China by 2025 while remaining
\naround 85% in China. If these conditions persist, many custom
\nsmelters outside China could face growing economic pressure,
\nfurther increasing supply concentration in strategic midstream
\ncapacity.
\nNew projects in geographically diverse regions often face higher
\ncosts than incumbent suppliers, complicating investment
\ndecisions. Capital costs for refining projects are 20% to over 150%
\nhigher outside the dominant supplier, due to higher equipment and
\nconstruction costs. Operating costs are, on average, around 50%
\nhigher, driven by feedstock and energy prices. These cost
\ndisadvantages are compounded by technical and skills constraints,
\ninfrastructure gaps, and lengthy permitting processes, making it more
\ndifficult for market forces alone to bring forward new projects.
\nDiversification requires well-designed policy tools to reduce
\ninvestment risks. Measures such as grants, equity participation,
\nconcessional loans and loan guarantees can lower upfront financing
\nbarriers for capital expenditures. Contracts for difference, price capand-floor, offtake backstops and strategic reserves can support
\noperating expenditures and boost project viability by reducing price
\nand volume risks. Price-based mechanisms are particularly well
\nsuited to strategically important supply chains with a limited number
\nof viable projects, provided they are carefully designed to balance
\ninvestment incentives with fiscal exposure, such as through
\ncompetitive tenders and performance-based eligibility.
\nPolicy tools should be tailored to the characteristics of each
\nmineral market and supply chain segment. Large, liquid markets
\nsuch as copper are generally best supported through measures that
\nreduce upfront investment risks, complemented by support for
\nenabling infrastructure. By contrast, small, opaque and highly
\nconcentrated markets such as rare earths may require targeted
\nmeasures to mitigate price and volume risks. Across the value chain,
\nmining is typically capital-intensive, making upfront capital support
\nmore relevant. Refining projects are more sensitive to cost and
\nmarginpressures and may require operationalrisk-mitigation tools to
\nimprove competitiveness.
\nCountries can combine supply-side support with demand-side
\nmeasures to strengthen the commercial viability of diversified
\nsupply chains. While supply-side policies can help bring new
\nprojects online, they may not by themselves create sufficient
\nincentives for manufacturers to source from these suppliers.
\nDemand-side measures can provide predictable demand, improving
\nthe bankability of projects and incentive to invest in them. Available
\ntools include diversified sourcing requirements, potentially
\ncomplemented by fiscal incentives such as tax credits, to encourage
\nprocurement from non-dominant suppliers; demand aggregation and
\nfacilitated offtake arrangements to build a stable and sizeable
\ncustomer base; and trade-based measures to narrow price gaps
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 11
\nExecutive summary
\nbetween incumbent and diversified supply. Their effectiveness
\ndepends on careful design to balance investment incentives, market
\nefficiency and trade considerations.
\nCritical minerals generally account for a small share of final
\nproduct prices, although their cost contribution varies significantly
\nacross value chains, with important implications for policy design.
\nWhile higher mineral prices can substantially increase the cost of
\nintermediate products such as battery cells and permanent magnets,
\nthe impact on final products is often limited. For example, critical
\nminerals account for around one-quarter of battery cell costs but only
\nabout 3% of the price of an average electric vehicle(EV), while rare
\nearths represent around 40% of permanent magnet costs but less
\nthan 1% of a vehicle\u2019s value. By contrast, materials such as copper
\nrepresent a larger share of equipment costs, accounting for around
\n10-15% of transformer and power cable prices. These differences
\nsuggest that, in some supply chains, downstream users may be able
\nto absorb higher material costs more readily, providing scope for
\ndiversified sourcing without materially affecting end-product prices.
\nFor example, a tripling of rare earth prices would increase the cost of
\na car by just 0.1%, while a tripling of battery material prices would
\nincrease the final price of EVs and storage systems by around 5%.
\nThe additional cost of supply diversification can be viewed as a
\nmineral security premium \u2013 a form of economic insurance
\nagainst major supply risks. Diversified supply often comes at a
\nhigher cost, raising the question of how these additional costs should
\nbe addressed. These costs could be justified as the price of enhanced
\neconomic resilience \u2013 a security premium that provides insurance
\nagainst the risks associated with concentration. As critical minerals
\ngenerally represent a small share of final product costs, much of the
\nadditional cost of diversification could be absorbed with limited impact
\non consumers, although some intermediate sectors may face greater
\ncost pressures and require targeted support. A shared approach
\ninvolving governments, industry and consumers could help finance
\nthis premium and unlock the investment needed to build more
\ndiversified and resilient supply chains.
\nSuccessful diversification requires addressing critical gaps in
\ntechnology, equipment and skilled workforce across the value
\nchain. Diversification is not simply a question of developing new
\nprojects; it requires building a broader ecosystem of capabilities.
\nFrom lithium chemicals and graphite to rare earths and gallium,
\nprocessing and refining stages rely on complex technologies,
\nspecialised equipment and highly skilled expertise that remain
\nconcentrated in a small number of countries. Outside the dominant
\nsupplier, equipment providers are limited, lead times can be lengthy,
\nand accumulation of technical know-how often takes time and
\nresources. For example, outside China, only a handful of suppliers
\nprovide key battery-grade-graphite processing equipment, while
\nultra-high-purity gallium refining and compound semiconductor
\nmanufacturing rely on only one or two specialised equipment
\nsuppliers. In rare earth magnet production, grain boundary diffusion
\n\u2013 a key technology to enhance magnet performance \u2013 is highly
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 12
\nExecutive summary
\npatented, with only one equipment supplier outside China and
\nequipment costs that are reportedly more than ten times higher,
\nalongside longer lead times. Recent export controls targeting not only
\ncritical minerals but also processing technologies and equipment
\nunderscore the importance of closing these capability gaps.
\nAddressing these challenges will require a holistic approach
\ncombining innovation, workforce development, policy support and
\ninternational co-operation to build the technological foundations for
\ndiversified and resilient supply chains. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nRecycling could play an increasingly important role in easing
\nsupply strains, with secondary supply potentially doubling its
\ncontribution by 2040. Under today\u2019s policy settings, average
\nrecycling rates across key energy minerals could rise from around
\n10% today to close to 20% by 2040. Cobalt and copper already have
\nrelatively established recycling streams, with rates expected to
\nincrease further to 2040, while rare earth magnet recycling could
\nbenefit from growing end-of-life volumes from early generations of
\nEVs and wind turbines. Lithium and nickel recycling remain at an
\nearly stage but are expected to expand rapidly. Battery recycling
\ncapacity has expanded significantly, but remains highly concentrated,
\nwith China accounting for over three-quarters of global pre-treatment
\ncapacity and 90% of material recovery capacity. Outside China,
\nKorea is the leading player in material recovery. Realising the full
\npotential of secondary supply will require continued investment in
\ncollection and recycling infrastructure and sustained demand for
\nrecycled materials.
\nThe renewed expansion of nuclear power is driving a need for
\nsignificant investment across the uranium and nuclear fuel
\ncycle. Uranium markets have strengthened sharply since 2020,
\nreflecting expectations of substantial growth in demand for nuclear
\nfuel and the need to expand supply. As global uranium requirements
\nrise, new mine projects will need to be successfully developed and
\nbrought online. However, the most immediate constraints are
\nemerging further downstream, particularly in uranium conversion,
\nwhere global capacity is already tight and additional investment will
\nbe needed to avoid bottlenecks. Enrichment capacity will also need
\nto expand over the medium term, driven by both nuclear capacity
\ngrowth and rising demand for higher-assay fuels, such as high-assay
\nlow-enriched uranium (HALEU), in some next-generation reactors.
\nFuel fabrication capacity is generally adequate for conventional fuels,
\nalthough reactor-specific requirements could create challenges for
\nsome technologies. Supply security risks are heightened by
\nconcentration across the fuel cycle, with the top three countries
\naccounting for almost three-quarters of uranium mining and around
\n70% of conversion and enrichment capacity.
\nLatin America and the Caribbean is well positioned to play a
\nlarger role in diversified global critical mineral supply chains.
\nThe region is a major producer of base metals, accounting for over
\n20% of global tin and zinc production and around 40% of global
\ncopper mine output. It is also a key producer of strategic minor
\nminerals such as molybdenum, niobium and rhenium. The region is
\nstrengthening its position in energy minerals, producing around oneIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 13
\nExecutive summary
\nquarter of global lithium supply, with output expected to grow by
\nnearly 50% by the end of the decade. It also holds substantial
\nreserves of silver, graphite, rare earths and other strategic minerals.
\nHowever, the region refines only around one-fifth of its mined
\noutput of key energy minerals, with the exception of lithium where
\nintegrated chemical processing has developed. If lithium, nickel,
\ncobalt, graphite and rare earths were refined locally and two-thirds of
\ncopper production were processed within the region, the economic
\nvalue generated could increase by nearly 50% from today, reaching
\naround USD 220 billion by 2035. Realising this opportunity requires
\naddressing high financing costs, infrastructure gaps in power and
\nwater, technology and skills constraints, and strengthening
\nengagement with local stakeholders.
\nThe IEA Critical Minerals Security Programme will continue to
\nserve as a key international platform for advancing global efforts
\non mineral security. Recent market developments have elevated
\nmineral supply security, placing it at the forefront of energy and
\neconomic policymaking. As the Agency\u2019s flagship framework, the
\nProgramme supports countries in strengthening emergency
\npreparedness and accelerating supply diversification. Building on
\nmandates from IEA Ministers in February 2026 and G7 Leaders in
\nJune 2026, the IEA will continue to expand Programme activities to
\nhelp deliver more resilient and diversified supply chain.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 14
\nIntroduction
\nIntroduction
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 15
\nIntroduction
\nIntroduction
\nCritical minerals have rapidly risen to the top of the economic and
\nnational security agenda, extending well beyond their role in energy
\nsecurity. Over the past year, critical minerals have become an
\nincreasingly prominent feature of geopolitical and industrial policy
\ndebates, reflecting growing concerns about supply chain
\nconcentration, strategic dependencies and the expanding use of
\ntrade and export restrictions. While earlier discussions focused
\nprimarily on whether supply could keep pace with rapidly rising
\ndemand from energy technologies, the emphasis has increasingly
\nshifted towards the vulnerabilities created by concentrated supply
\nchains, particularly in processing and refining. Although supply
\nadequacy remains a major concern for some materials, notably
\ncopper, governments are now placing greater attention on resilience,
\ndiversification and security of supply in an increasingly complex
\ngeopolitical environment.
\nAlthough the risks associated with high supply concentration have
\nlong been recognised, the proliferation of export controls by dominant
\nsuppliers in recent years has transformed these concerns from a
\ntheoretical vulnerability into an immediate economic and industrial
\nsecurity challenge. In particular, the rare earth and magnet export
\ncontrols introduced by the People\u2019s Republic of China (hereafter,
\n\u201cChina\u201d) in April and October 2025 marked a major turning point.
\nMany downstream manufacturers struggled to maintain operations as
\nthey faced difficulties securing the magnets required for key
\ntechnologies and industrial equipment. Although the stricter export
\ncontrols announced in October 2025 were subsequently suspended
\nfor one year, the episode demonstrated the scale of the risks
\nassociated with concentrated supply chains and highlighted the
\nfragility of critical mineral markets.
\nThe conflict in the Middle East in 2026 provided another stark
\nreminder of the vulnerabilities arising from geopolitical tensions and
\ndependence on a limited number of suppliers and trade routes. While
\nthe immediate focus centred on risks to oil and gas markets,
\nsignificant impacts were also felt across mineral and metal supply
\nchains. Disruptions first affected commodities in which the region
\nplays a major role, including aluminium, sulphur and helium, but
\nquickly propagated through interconnected downstream value chains.
\nSulphuric acid, for example, is a critical input into copper, cobalt and
\nnickel production, while helium is indispensable for semiconductor
\nmanufacturing and a range of medical technologies.
\nThese developments have firmly placed mineral supply security at
\nthe centre of energy and economic policy making, reinforcing the
\nurgency of diversifying supply chains. Governments are increasingly
\nresponding through a growing number of policy initiatives, strategic
\npartnerships and bilateral or plurilateral co-operation frameworks.
\nHowever, while there is broad consensus on the need for
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 16
\nIntroduction
\ndiversification, the question of how to achieve it remains far more
\ncomplex. New projects in geographically diverse regions often face
\nhigher costs than incumbent suppliers, as well as a range of
\nchallenges, including technical and skills constraints, infrastructure
\ngaps, lengthy permitting processes and more stringent environmental
\nrequirements.
\nAgainst this backdrop, this year\u2019s Global Critical Minerals Outlook
\naims to provide a comprehensive assessment of evolving market
\ndynamics and the implications of recent geopolitical developments
\nfor the future of critical mineral supply chains. The report analyses
\nthe latest market, technology and policy trends; examines future
\ndemand, supply and investment prospects for key minerals; and
\nassesses potential risks across different stages of the value chain.
\nIn addition to the regular analysis of demand, supply, prices and
\ninvestment trends, this year\u2019s edition places particular emphasis on
\nthe actions needed to build resilient and diversified supply chains. It
\nexplores short-term emergency preparedness measures, policy and
\nmarket frameworks to support investment in diversified supply chains,
\nand approaches to overcoming technology and industrial ecosystem
\nbottlenecks. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nThe analysis also builds on activities under the IEA Critical Minerals
\nSecurity Programme, the Agency\u2019s flagship framework designed to
\nhelp countries enhance emergency preparedness and accelerate
\nsupply diversification. In February 2026, IEA Ministers adopted
\nthe Declaration Supporting the IEA\u2019s Work on Critical Minerals
\nSecurity. In June 2026, G7 leaders recognised the Programme\u2019s
\ncentral role as a key platform for international co-operation on mineral
\nsecurity.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 17
\nIntroduction
\nScope of the analysis, scenarios and chapter structure
\nCritical minerals play a vital role in a wide range of energy
\ntechnologies, but recent market and geopolitical developments have
\nunderscored their strategic importance far beyond the energy sector.
\nMinerals and metals are increasingly recognised as foundational
\ninputs for a broad range of strategic industries, including energy,
\nsemiconductors, advanced manufacturing, aerospace, defence and
\nother high-tech sectors. As a result, policy attention has expanded
\nbeyond energy-related materials to a wider suite of strategic minerals
\nthat underpin economic competitiveness and national security.
\nThe report continues to place greater focus on \u201ckey energy minerals\u201d,
\nnotably such as copper, lithium, nickel, cobalt, graphite and rare earth
\nelements, for which we provide detailed demand and supply
\nprojections based on bottom-up modelling. However, reflecting
\nrecent developments, its scope has expanded to cover a broader
\nrange of critical minerals that play an important role across strategic
\nindustries. It examines key market trends for important materials such
\nas aluminium, manganese, phosphate, platinum-group metals,
\nsilicon, silver, tin and uranium, as well as strategic minor minerals
\nsuch as gallium, germanium, antimony and tungsten. While these
\nminor minerals represent relatively small markets in terms of volume,
\nthey carry significant economic and strategic importance.
\nOur assessment of mineral demand in the energy sector includes
\ndemand for low-emissions power generation (solar photovoltaic, wind,
\nhydro, nuclear and other renewables), electric vehicle (EV) batteries
\nand battery storage, grid networks (transmission, distribution and
\ntransformers), and hydrogen technologies (fuel cells and
\nelectrolysers) based on detailed assessments of technology
\ndeployment, sub-technology shares, mineral intensity and material
\nefficiency measures. Demand outside the energy sector is projected
\nusing historical consumption by end-use application, relevant activity
\ndrivers and material intensity trends.
\nMineral supply projections are based on a detailed review of all
\nannounced projects across the globe. We present two supply
\nscenarios: a base case and a high-production case. The base case
\nincludes production from existing assets and those under
\nconstruction, along with projects that have a high chance of moving
\nahead because they have obtained all necessary permits, secured
\nfinancing and\/or established offtake contracts. The high production
\ncase additionally considers projects at a reasonably advanced stage
\nof development that are seeking financing and\/or permits. Neither
\ncase considers projects that are in the very early stages of
\ndevelopment, nor does it include theoretical projects for which
\nresources might be adequate, but which have not been proposed.
\nFor these reasons, our supply projections focus on the period to 2040.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 18
\nIntroduction
\nOur forward-looking analysis is based on the main IEA scenarios
\nincluded in the World Energy Outlook 2025, updated for the latest
\ndata on EVs from the Global EV Outlook 2026.
\n\u2022 The Current Policies Scenario (CPS) considers a snapshot of
\npolicies and regulations that are already in place and offers a
\ncautious perspective on the speed at which new energy
\ntechnologies are deployed and integrated into the energy system.
\n\u2022 The Stated Policies Scenario (STEPS) is an exploratory
\nscenario that provides a sense of the prevailing direction of travel
\nfor the energy system, based on today\u2019s policy settings. Barriers
\nto the introduction of new technologies are lower than in the CPS,
\nbut the STEPS does not assume that aspirational targets are met.
\n\u2022 The High Demand Scenario (HDS) assumes a higher level of
\nenergy technology development, in line with the levels projected
\nin the Announced Pledges Scenario of the World Energy Outlook
\n2024. This scenario is included in the report to illustrate the upper
\nrange of potential future demand.
\nAll projection results are made available in the IEA Critical Minerals
\nData Explorer, an interactive online tool that allows users to easily
\naccess the IEA\u2019s projection data.
\nChapter 1 (Market review) offers a snapshot of industry
\ndevelopments in 2025 and early 2026. It reviews major demand,
\nproduction, investment and price trends for key minerals. The chapter
\nalso discusses the latest policy developments and insights based on
\nsystematic tracking of the industry\u2019s sustainability performance.
\nChapter 2 (Outlook for key minerals) provides an outlook for
\ndemand and supply of key minerals and related market and policy
\nissues. The chapter provides detailed projections for key energy
\nminerals, including copper, lithium, nickel, cobalt, graphite and rare
\nearth elements. It also reviews key trends for other important
\nmaterials and includes two special focus areas: (i) minerals critical to
\nhigh-tech, defence and aerospace industries and (ii) mineral supply
\nchain issues related to nuclear energy.
\nChapter 3 (Pathways to resilient and diversified supply chains)
\nprovides practical insights into some of the most pressing questions
\nabout the development of resilient and diversified mineral supply
\nchains. The chapter is structured around three key themes: how
\ncountries can strengthen preparedness against potential supply
\ndisruptions; how effective policy and market frameworks can be
\ndesigned to support investment in diversified assets; and how
\ntechnology and broader ecosystem bottlenecks can be addressed.
\nChapter 4 (Special focus on Latin America and the Caribbean)
\nhighlights one of the world\u2019s most important mineral-producing
\nregions, examining its current state of play, potential for value
\naddition, and the key challenges and opportunities associated with
\ndeveloping mineral resources in a sustainable and responsible
\nmanner. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 19
\n1. Market review
\n1. Market review
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 20
\n1. Market review
\nMineral market trends
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 21
\n1. Market review
\nCritical mineral prices rebounded in 2025, while strategic minor minerals continued to rally on
\nexport controls and robust demand growth
\nPrice developments for selected critical minerals by category
\nIEA. CC BY 4.0.
\nNote: Base metals include aluminium, copper, lead, tin and zinc; alloy metals include chromium, molybdenum and vanadium; battery metals include lithium, nickel,
\ncobalt, graphite, high-purity manganese and purified phosphoric acid; rare earths include four magnet-related elements \u2013 neodymium, praseodymium, dysprosium
\nand terbium; strategic minor minerals include antimony, bismuth, gallium, germanium, indium, tantalum, tellurium, titanium and tungsten.
\nSources: IEA analysis based on data from S&P Capital IQ, Bloomberg and KOMIS.
\n50
\n100
\n150
\n200
\n250
\n300
\nJan-23 Jul-23 Jan-24 Jul-24 Jan-25 Jul-25 Jan-26
\nIndex (January 2023 = 100)
\nApr-26
\nStrategic
\nminor
\nminerals
\nBase metals
\nAlloy metals
\nRareearths
\nBattery
\nmaterials
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 22
\n1. Market review
\nBattery materials and rare earth prices are recovering from recent downturns
\nChange in prices for selected critical minerals
\nIEA. CC BY 4.0.
\nNotes: HPM = high-purity manganese sulphate; PPA = purified phosphoric acid. Assessment based on London Metal Exchange cash prices for aluminium, copper,
\nzinc, tin, nickel and cobalt; China domestic or export prices for molybdenum, graphite, phosphoric acid, manganese sulphate, gallium, germanium, antimony,
\nbismuth, indium, magnet rare earths, tantalum, tellurium, titanium and tungsten; global average prices for lithium carbonate.
\nSources: IEA analysis based on S&P Capital IQ, Bloomberg and KOMIS.
\n– 100%
\n– 50%
\n50%
\n100%
\nAluminium Copper Lead Zinc Tin Molybdenum Chromium Vanadium Average
\nJan 2023 -Jan 2025
\nJan 2025 -Apr 2026
\nBase and alloy metals
\n– 100%
\n– 50%
\n50%
\n100%
\nGallium Germanium Antimony Bismuth Indium Tantalum Tellurium Titanium Tungsten Average
\nStrategic minor minerals 620%
\n– 100%
\n– 50%
\n50%
\n100%
\nLithium Nickel Cobalt Graphite HPM PPA Average Magnet rare
\nearths
\nBattery materials & rareearths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 23
\n1. Market review
\nTungsten, tantalum, cobalt, lithium and rare earth elements have recorded the largest price
\nincreases since 2025
\nChange in selected critical mineral prices, January 2025-April 2026
\nIEA. CC BY 4.0.
\nNotes: PPA = purified phosphoric acid. Manganese refers to manganese sulphate. Assessment based on London Metal Exchange cash prices for aluminium,
\ncopper, zinc, tin, nickel and cobalt; China domestic or export prices for molybdenum, graphite, phosphoric acid, manganese sulphate, gallium, germanium, antimony,
\nbismuth, indium, magnet rare earths, tantalum, tellurium, titanium and tungsten; global average prices for lithium carbonate.
\nSources: IEA analysis based on S&P Capital IQ, Bloomberg and KOMIS.
\n50%
\n100%
\n150%
\n200%
\nTungsten
\nTantalum
\nCobalt
\nNeodymium
\nLithium
\nPraseodymium
\nIndium
\nBismuth
\nTin
\nChromium
\nCopper
\nPPA
\nAluminium
\nTerbium
\nMolybdenum
\nVanadium
\nTellurium
\nZinc
\nAntimony
\nManganese
\nNickel
\nGermanium
\nDysprosium
\nTitanium
\nGraphite
\nGallium
\nLead
\nBase and alloy
\nmetals
\nBattery
\nmaterials
\nMagnet rare
\nearths
\nStrategic
\nminor minerals
\n620%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 24
\n1. Market review
\nPrice divergence between Chinese and ex-China products has widened for several minerals
\nunder export controls
\nRecent price development for selected minerals in China and Europe
\nIEA. CC BY 4.0.
\nNote: European prices – gallium 99.99%, germanium 99.999%; Rotterdam prices from Fastmarkets; average dysprosium and terbium oxide prices from Benchmark
\nMineral Intelligence.
\nSources: IEA analysis based on Bloomberg, Fastmarkets and Benchmark Mineral Intelligence.
\n100
\n200
\n300
\n400
\n500
\n600
\nJan-25
\nApr-25
\nJul-25
\nOct-25
\nJan-26
\nApr-26
\nEurope China
\nGallium
\nIndex (China prices in January 2025 = 100)
\n100
\n200
\n300
\n400
\n500
\n600
\nJan-25
\nApr-25
\nJul-25
\nOct-25
\nJan-26
\nApr-26
\nGermanium
\n100
\n200
\n300
\n400
\n500
\n600
\nJul-25
\nOct-25
\nJan-26
\nApr-26
\nRare earths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 25
\n1. Market review
\nDespite rising base metal prices, treatment charges for smelters have fallen into negative
\nterritory in recent years
\nBase metal prices and treatment charges
\nIEA. CC BY 4.0.
\nNote: TC = treatment charges.
\nSources: IEA analysis based on S&P Capital IQ, Wood Mackenzie and Fastmarkets.
\n-225
\n-150
\n-75
\n0
\n75
\n150
\n3 000
\n6 000
\n9 000
\n12 000
\n15 000
\nJul-23
\nJan-24
\nJul-24
\nJan-25
\nJul-25
\nJan-26
\nCopper prices Spot TC (right axis)
\nCopper
\nUSD per tonne
\n-270
\n-180
\n-90
\n0
\n90
\n180
\n1 500
\n2 000
\n2 500
\n3 000
\n3 500
\n4 000
\nJul-23
\nJan-24
\nJul-24
\nJan-25
\nJul-25
\nJan-26
\nZinc prices Spot TC (right axis)
\nZinc
\nUSD per tonne
\n-225
\n-150
\n-75
\n0
\n75
\n150
\n1 600
\n1 800
\n2 000
\n2 200
\n2 400
\n2 600
\nJul-23
\nJan-24
\nJul-24
\nJan-25
\nJul-25
\nJan-26
\nLead prices Spot TC (right axis)
\nLead
\nUSD per tonne
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 26
\n1. Market review
\nDemand for key energy minerals grew much faster than demand for other materials, driven
\npredominantly by energy sector applications
\nAnnual change in demand for key energy minerals
\nIEA. CC BY 4.0.
\nNotes: Key energy minerals include copper, battery metals and rare earth elements. Rare earths refer to magnet rare earths only.
\n– 5%
\n5%
\n10%
\n15%
\n20%
\n25%
\n30%
\n’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 Aluminium
\nZinc Lead
\nEnergy Other uses Total Net growth
\nCopper Lithium Nickel Cobalt Graphite Rare earths
\nSourceof demand growth:
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 27
\n1. Market review
\nDespite strong demand growth, robust supply expansion kept most key energy mineral markets
\nin surplus in 2025
\nDemand and refined supply growth for key energy minerals, 2024-2025
\nIEA. CC BY 4.0.
\nNote: Rare earths refer to magnet rare earths only.
\n– 15%
\n– 5%
\n5%
\n15%
\n25%
\n35%
\nCopper Lithium Nickel Cobalt Graphite Rare Earths
\nDemand Supply
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 28
\n1. Market review
\nCritical mineral markets turned upward in 2025, driven by tightening supply conditions, export
\ncontrols and resilient demand growth
\nPrices for critical minerals rebounded in 2025 following downturns in
\nrecent years. Base metals such as aluminium, copper, zinc and tin
\nrose strongly, driven by tight supply conditions, particularly in copper
\nand aluminium markets. Copper prices reached record highs in early
\n2026, exceeding USD 14 000 per tonne in May. Aluminium prices
\nincreased by over 10% in 2025 and rose a further 20% from February
\n2026 following the Middle East conflict, reflecting the region\u2019s role as
\na key supplier and the importance of shipping routes through the
\nStrait of Hormuz (see Geopolitical implications section). Tin prices
\nalso increased sharply, by around 40% in 2025, driven by supply
\ndisruptions in Myanmar, tight concentrate availability for smelters,
\nand resilient demand from the electronics and semiconductor sectors.
\nPrices for bulk alloy metals such as chromium, molybdenum and
\nvanadium also edged up, albeit to a lesser extent than base metals.
\nBattery metals and rare earth prices remained subdued in 2023-2024
\nas supply growth outpaced demand, reflecting capacity expansions
\nfollowing the 2021-2022 price cycle. However, prices began to
\nrecover in 2025. Lithium prices almost doubled between January
\n2025 and April 2026, supported by strong growth in battery demand,
\nparticularly from energy storage applications, alongside constrained
\nsupply conditions caused by Zimbabwe\u2019s export restrictions and
\ntighter permitting in China\u2019s Jiangxi region. Cobalt prices increased
\nby around 120% in 2025, largely driven by export restrictions
\nimposed by the Democratic Republic of the Congo (DRC). Policy
\nchanges in Indonesia created uncertainty around future nickel supply,
\ncontributing to a 20% increase in nickel prices since the end of 2025.
\nThe conflict in the Middle East and associated disruptions to sulphur
\nand sulphuric acid supply added further upward pressure on prices,
\nparticularly for purified phosphoric acid, which increased by around
\n50% following the crisis. However, not all battery metals followed this
\ntrend: graphite prices remained subdued due to persistent oversupply
\nconditions. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nRare earth markets also experienced strong price increases following
\nthe introduction of export controls by China in 2025. In recent months,
\nyttrium prices have seen particularly sharp gains, driven by strong
\ndemand from high-tech, aerospace and defence applications,
\ncompounded by tighter export conditions.
\nFor strategic minor minerals \u2013 those with relatively small market sizes
\nbut critical roles across energy, high-tech, aerospace and defence \u2013
\nprices had already been rising since 2024 due to robust demand and
\na series of export controls imposed by China, the dominant supplier
\nfor many of these materials. As export restrictions broadened and
\ntightened further, prices surged in 2025, with particularly strong
\nincreases in indium and tungsten. Indium prices were supported by
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 29
\n1. Market review
\ngrowing demand from semiconductor, display and photovoltaic
\napplications, while tungsten prices rose on the back of strong
\ndemand from the electronics, aerospace and defence sectors. The
\nexpansion of export controls further tightened market conditions,
\ncontributing to sharp price increases. Given the highly concentrated
\nnature of supply and the relatively small size of these markets, small
\nshifts in supply patterns or purchasing behaviour had an outsized
\nimpact on prices. Between January 2025 and April 2026, tungsten,
\ntantalum, cobalt, lithium and rare earth elements have recorded the
\nlargest price increases, with tungsten prices surging six-fold.
\nA widening divergence between Chinese domestic and ex-China
\nprices has emerged for several critical minerals. European prices are
\ncurrently around five times higher than Chinese domestic prices for
\ngallium and heavy rare earths, and around three times higher for
\ngermanium. While ex-China price assessments are based on
\nrelatively limited market liquidity and fewer transactions, the widening
\npremium highlights the growing challenges of securing supply outside
\nthe dominant supplier.
\nDespite rising base metal prices, smelter fees, known as treatment
\nand refining charges (TC\/RCs), have moved in the opposite direction,
\nfalling to historic lows. Annual copper benchmark TC\/RCs settled at
\nUSD 0 per tonne in 2026, the lowest level ever agreed in annual
\nnegotiations, while spot charges have remained negative since 2024;
\nzinc and lead smelter fees have also turned negative. Tight
\nconcentrate supplies, combined with rapid smelter capacity
\nexpansion in China, have driven this trend, placing increasing
\npressure on the economic viability of base metal smelters, particularly
\noutside the dominant supplier.
\nFor key energy minerals such as copper, lithium, nickel, cobalt,
\ngraphite and rare earth elements, demand continued to grow strongly
\nin 2025, driven primarily by their increasing use in energy
\ntechnologies, including batteries for electric vehicles (EVs) and
\nenergy storage, electricity infrastructure such as grids, wind turbines
\nand solar PV, and permanent magnets for high-performance
\napplications. Demand for these minerals has grown at close to 10%
\nper year on average in recent years, significantly outpacing demand
\ngrowth for base metals such as aluminium, lead and zinc, which
\naveraged around 1% annually. Lithium demand has been particularly
\nstrong, increasing by around 25% per year on average over the past
\ntwo years. Across key energy minerals, the energy sector drove, on
\naverage, around 75% of demand growth in 2025, up from 70% in
\n2024. Cobalt is an exception, where end uses such as portable
\nelectronics, aerospace and defence have been accounting for an
\nincreasing share of demand in recent years.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 30
\n1. Market review
\nThe leading producer has led refined supply growth across almost all key energy minerals
\nChange in refined output of key energy minerals, 2023-2025
\nIEA. CC BY 4.0.
\nNotes: Manganese refers to manganese sulphate. The top producer is Indonesia for nickel and China for all others.
\n– 25%
\n25%
\n50%
\n75%
\n100%
\nCopper Lithium Cobalt Nickel Graphite Manganese Rare earths
\nTop producer Rest of world
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 31
\n1. Market review
\nAs a result, concentration in refined material production edged higher again in 2025 across
\nmost minerals, with rare earths being the exception
\nShare of refined material production by country in 2025 compared with the top producer\u2019s share in 2023
\nIEA. CC BY 4.0.
\nNotes: DRC = Democratic Republic of the Congo. Graphite refers to battery-grade graphite, and rare earths to magnet rare earths.
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\nCopper Lithium Nickel Cobalt Graphite ManganeseRare earths
\nRest of world
\nDRC
\nIndia
\nJapan
\nAustralia
\nArgentina
\nChile
\nUnited States
\nEurope
\nChina
\nIndonesia
\nTop producer’s
\nshare (2023)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 32
\n1. Market review
\nMining concentration shows a mixed picture across minerals, with lithium, graphite and rare
\nearths seeing modest improvement
\nShare of mined output by country in 2025 compared with the top producer\u2019s share in 2023
\nIEA. CC BY 4.0.
\nNotes: DRC = Democratic Republic of the Congo. Graphite refers to mined natural graphite, and rare earths to magnet rare earths.
\nLithium Nickel Cobalt
\nRest of world
\nIndia
\nJapan
\nChile
\nAustralia
\nUnited States
\nAfrica
\nEurope
\nChina
\nIndonesia
\nDRC
\nTop producer’s
\nshare (2023)
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\nCopper Graphite ManganeseRare earths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 33
\n1. Market review
\nRefining concentration has again reached record levels, while mining has seen mixed progress
\nMined and refined output growth has become increasingly
\nconcentrated in recent years, driven by capacity expansions in a
\nsmall number of leading producers. For refined materials, this growth
\nwas largely driven by the top producers \u2013 Indonesia for nickel and
\nChina for most other key energy minerals \u2013 which together accounted
\nfor over three-quarters of total supply growth between 2023 and 2025.
\nIn several markets, including manganese, nickel and graphite, almost
\nall supply growth originated from the leading supplier. Rare earth
\nrefining was a notable exception, with new projects in Malaysia and
\nthe United States leading to a modest decline in supply concentration
\nbetween 2023 and 2025, highlighting the role of targeted policy and
\ninvestment support in enabling diversification.
\nAs a result, refining concentration across energy minerals reached
\nnew record levels. The average share of the top refined supplier
\nstood at around 72% in 2025, up from 70% in 2020. Lithium recorded
\nthe largest increase, reflecting continued investment in refining
\ncapacity in China and its dominant position in chemical conversion,
\nparticularly for battery-grade lithium chemicals. Nickel also saw a
\nmarked increase, driven by rapidly expanding integrated industrial
\nparks in Indonesia such as Morowali, Weda Bay and Pomalaa. For
\ngraphite, China accounted for virtually all growth in battery-grade
\nsupply in recent years, particularly through the expansion of synthetic
\ngraphite anode production.
\nBy contrast, changes in concentration were more mixed for mining,
\nwith the top producer\u2019s share declining for lithium, graphite and rare
\nearths between 2023 and 2025. For rare earths, this reflects new
\nprojects in regions such as the United States (MP Materials) and
\nAustralia-Malaysia (Lynas) coming online, while lithium and graphite
\nsaw diversified projects come online in Latin America and Africa.
\nCopper concentration remained broadly stable. Nickel, however, saw
\nincreased mining concentration: Indonesia expanded its share of
\nnickel output through growth in hubs such as Weda Bay, while
\nhigher-cost projects elsewhere were curtailed or put under care and
\nmaintenance amid weaker prices. For cobalt, the Democratic
\nRepublic of the Congo (DRC) remained dominant despite policy
\nchanges in the country that affect production, while Indonesia
\ncontinued to gain market share.
\nChina not only dominates mined and refined output by geography,
\nbut also by ownership, with Chinese firms holding major positions in
\nupstream mining in countries such as the DRC and Indonesia and
\ndominating midstream processing globally. Recent investments,
\nparticularly in rare earths, have supported some diversification of
\nownership (see Investment trends and Latest policy developments
\nsections). Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 34
\n1. Market review
\nEnergy mineral reserves increased notably, particularly between 2020 and 2025, reflecting
\nrising interest in exploration and development activities
\nChanges in selected commodity reserves, 2010-2025
\nIEA. CC BY 4.0.
\nNotes: Graphite refers to natural graphite. Reserves are defined by the United States Geological Survey as the portion of an identified resource that can be
\neconomically and legally extracted at the time of determination.
\nSource: IEA analysis based on data from the United States Geological Survey.
\n-100%
\n0%
\n100%
\n200%
\n300%
\n400%
\nGraphite
\nLithium
\nNickel
\nCopper
\nCobalt
\nRare earth
\nLead
\nZinc
\nIron ore
\nBauxite
\nTin
\nEnergy minerals Base metals Change during 2020-2025
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 35
\n1. Market review
\nReserves for energy minerals have increased notably in recent years, driven by increased
\nexploration activity
\nFrom 2010 to 2025, energy minerals, including copper, lithium, nickel,
\ncobalt, natural graphite and rare earth elements, recorded stronger
\nreserve growth than base metals, reflecting increased exploration
\nactivity. Across key energy minerals, estimated reserves increased
\non average by 120% between 2010 and 2025, compared with a much
\nmore modest 7% increase for base metals.
\nThis growth was not uniform across commodities. Natural graphite
\nrecorded the largest increase in reserves among energy minerals.
\nChina, the largest producer, steadily expanded its reserve base over
\nthe period. Brazil also recorded strong growth, while Mozambique
\nsaw a sharp increase following the discovery of significant new
\ndeposits.
\nLithium also recorded strong reserve growth, led by Chile, Australia
\nand Argentina. Nickel reserves increased significantly, particularly in
\nIndonesia, which increased its share of global reserves from around
\n5% in 2010 to more than 40% by 2025. Australia, which accounted
\nfor around 40% of global reserves in 2010, maintained broadly stable
\nabsolute volumes, although its global share declined to around 20%
\nby 2025.
\nCobalt reserves increased notably during the 2020s, driven by
\nintensified exploration in copper-rich areas of the DRC. Traditional
\nproducers such as Australia and Cuba saw relatively limited changes
\nin reserve volumes, while Indonesia emerged as a new contributor to
\nglobal cobalt reserves over the period.
\nRare earths were the only major energy mineral group to record a
\ndecline in reported reserves. China increased its reported reserves
\nover the period, while the United States saw decreases following the
\nrestart of previously idle mines after 2012. Countries such as the
\nRussian Federation (hereafter, \u201cRussia\u201d) and Viet Nam also recorded
\ndecreases in reserve estimates.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 36
\n1. Market review
\nAluminium inventory trends diverged across regions, with stocks declining at the LME and
\nrising at the SHFE, while copper inventories have moved higher in recent months
\nInventory levels of selected metals at major exchanges
\nIEA. CC BY 4.0.
\nNotes: LME = London Metal Exchange; SHFE = Shanghai Futures Exchange. Inventory levels indicate the monthly average of daily inventory volumes on major
\nmetal exchanges: aluminium (LME, SHFE); copper (LME, SHFE); nickel (LME); and zinc (LME).
\nSource: IEA analysis based on data from Bloomberg.
\n750
\n1 500
\n2024 2025 2026
\nLME SHFE
\nkt
\nAluminium
\n400
\n800
\n2024 2025 2026
\nLME SHFE
\nkt
\nCopper
\n150
\n300
\n2024 2025 2026
\nLME
\nkt
\nNickel
\n150
\n300
\n2024 2025 2026
\nLME
\nkt
\nZinc
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 37
\n1. Market review
\nInventory levels remained highly volatile amid rapidly changing market conditions
\nMonitoring inventory levels is important from a supply security
\nperspective. A sharp decline in inventories may indicate potential
\nsupply tightening, whereas a rapid build-up in inventories may signal
\nweakening demand or oversupply. Over the past two years, inventory
\ntrends for aluminium, copper, nickel and zinc have reflected differing
\nregional market conditions and supply-demand balances.
\nAluminium inventories at the London Metal Exchange (LME) and
\nShanghai Futures Exchange (SHFE) have followed contrasting paths.
\nLME inventories generally declined, reflecting tighter availability in
\ninternational markets amid relatively robust demand and supply
\nconstraints, including production challenges in Europe linked to high
\nenergy costs. By contrast, SHFE inventories began to rise from
\nmid-2025 as domestic production in China increased and downstream
\nconsumption softened. The divergence between LME and SHFE
\ninventories became particularly pronounced from late 2025,
\nhighlighting growing regional imbalances in market fundamentals.
\nCopper inventories on both the LME and SHFE were highly volatile.
\nLME stocks declined through late 2024 and much of 2025 as
\nsupply tightened and demand expectations improved. Anticipation
\nof US import tariffs under Section 232 measures also encouraged
\nthe movement of copper inventories into COMEX warehouses in
\nthe United States. However, from late 2025, inventories across
\nboth the LME and SHFE began to increase, driven largely by shortterm demand weakness.
\nNickel inventories on the LME followed a markedly different trajectory,
\nrising steadily throughout the period. This reflected persistent
\noversupply in global markets, driven by rapid production growth in
\nIndonesia and the inclusion of intermediate products such as mixed
\nhydroxide precipitate into LME-deliverable nickel products. The
\napproval of additional nickel brands for LME delivery further
\nexpanded the pool of eligible material, contributing to inventory
\naccumulation.
\nZinc inventories on the LME generally trended downward, particularly
\nduring 2025, supported by strong demand from galvanised steel
\napplications and some supply-side constraints. However, exchange
\ninventories may not fully reflect overall market conditions, as a portion
\nof metal appears to have remained outside the exchange system or
\nconcentrated in China.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 38
\n1. Market review
\nGeopolitical developments and
\nimplications for supply security
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 39
\n1. Market review
\nExport controls:In a year characterised by rising geopolitical tensions, new export controls
\nhave been implemented on critical minerals and their processing technologies
\nExport controls announced, proposed or updated in 2025 and 2026
\nIEA. CC BY 4.0.
\nNote: LFP = lithium iron phosphate.
\nMaterial Technology
\nBy Latest development Market share (2025)
\nChina Tungsten Export licensing in Feb 2025 98% 76%
\nChina Bismuth Export licensing in Feb 2025 98% 73%
\nChina Indium Export licensing in Feb 2025 98% 86%
\nChina Tellurium Export licensing in Feb 2025 98% 73%
\nChina Molybdenum Export licensing in Feb 2025 98% 41%
\nChina Batteries (LFP) Proposed controls on batteries, battery equipment and components suspended until Nov 2026 98% 99%
\nChina Lithium refining Proposed technology export control in Jan 2025 98% 71%
\nChina Gallium Suspended its ban on export to the United Statesuntil Nov 2026 98% 99%
\nChina Germanium Suspended its ban on export to the United Statesuntil Nov 2026 98% 94%
\nChina Antimony Suspended its ban on export to the United Statesuntil Nov 2026 98% 44%
\nDRC Cobalt Export quota system in Oct 2025 98% 66%
\nChina Rare Earths Export licensing on seven rare earths in Apr 2025;further restrictions suspended until Nov 2026 98% 91%
\nChina Rare Earths Proposedcontrols on related products, equipment and technologiessuspended until Nov 2026 91%
\nPhilippines Nickel Proposed ban on raw mineral exports to start in 2030 11%
\nMozambique Graphite (mined) Mandated local processing of mined material 4%
\nLithium Suspended exports of lithium concentrate in Feb 2026, followed by potential export ban in 2027 Zimbabwe 10%
\nGabon Manganese Proposed ban on raw mineral exports to start in 2029 22% 25%
\nGuinea Aluminium (Bauxite) Proposed new export control to be effective in Jun 2026 XX% 34%
\nChina Graphite (refined) Proposed new restrictions, suspended until Nov 2026 98% 94%
\nChina Sulphuric acid Halted exports from May 2026 until the end of the year 98% 34%
\nshare of mining
\nshare of refining
\nshare of cell manufacturing
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 40
\n1. Market review
\nExport controls: The number of items under export control from China has tripled since 2023
\nNumber of tariff codes under export control from China, 2023-2025
\nIEA. CC BY 4.0.
\nNotes: The figure shows the number of 8-digit tariff codes that have been affected by export restrictions introduced by China since 2023. Other includes bismuth,
\nboron, cadmium, indium, molybdenum, tellurium and silver.
\nSource: IEA analysis based on Chinese Customs data. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\n20
\n40
\n60
\n80
\n01-Aug-23 01-Dec-23 15-Sep-24 04-Feb-25 04-Apr-25
\nNumber of controlled tariff codes
\nOther
\nTungsten
\nGraphite
\nRare earth elements
\nAntimony
\nGermanium
\nGallium
\nx3
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 41
\n1. Market review
\nExport controls:The value of exports of all items under restriction from China increased to over
\nUSD 11 billion in 2025
\nValue of exports from China for items under control by mineral, and exports of tungsten and antimony oxide by importing economy
\nIEA. CC BY 4.0.
\nNotes: Based on customs data for 8-digit tariff codes for items under export restriction from China. Tungsten articles include ammonium paratungstate (tariff code
\n28418010), carbides of tungsten (28499020), tungsten powders (81011000) and tungsten trioxides (28259012). Antimony oxide refers to tariff code 28258000.
\n4
\n8
\n12
\n’23 ’24 ’25
\nBillion USD
\nGraphite
\nIndium
\nGallium
\nTungsten
\nGermanium
\nRare earths
\nAntimony
\nOther
\nValue of trade of minerals under control
\n5
\n10
\n15
\nQ1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
\n’24 ’25 ’26
\nOther Canada Viet Nam Japan
\nChinese Taipei Mexico Korea Thailand
\nIndia Russia United States
\nAntimony oxide
\nkt
\n1
\n2
\n3
\nQ1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
\n’24 ’25 ’26
\nkt
\nTungsten articles
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 42
\n1. Market review
\nExport controls:Risks from high supply chain concentration became reality in 2025, as
\ngeopolitical tensions shaped markets and export controls surged
\nIn recent years, a series of geopolitical events, such as trade tensions,
\nexport controls and disruptions to maritime trade, have demonstrated
\nhow strongly global economies depend on secure and resilient
\nmineral supply chains. Concerns around mineral supply security had
\nalready been an important driver of investment, but developments in
\n2025 drove a stronger push for policies, measures and investment
\naimed at strengthening resilience against future shocks.
\nExport controls
\nIn 2025 and early 2026, a new wave of export controls was
\nannounced by major producers. The most significant controls were
\nannounced by China on rare earth elements and other materials such
\nas bismuth, tellurium and tungsten, but other countries also
\nintroduced new restrictions, particularly in a number of African
\ncountries. For example, in September 2025, the DRC, the world\u2019s
\nlargest mined cobalt supplier, introduced cobalt export quotas(see
\nCobalt section in Chapter 2), and Zimbabwe and Mozambique
\nintroduced trade restrictions on raw materials aimed at developing
\nlocal mineral processing industries for lithium and graphite,
\nrespectively.
\nFocusing on China, the number of tariff codes that require a licence
\nincreased threefold from December 2023 to April 2025, when the
\nlatest wave of restrictions was implemented.
\nFor most products, trade was not fully disrupted by the controls, but
\nthey added frictions to exchanges and increased costs and prices.
\nFor some items, trade volumes significantly decreased or stopped;
\nthis was the case for some rare earth-related items, such as
\npermanent magnets, and for other dual-use elements, such as
\nantimony oxide and tungsten carbide and powder. In some cases,
\ntrade flows were restricted to a specific number of countries. For
\nexample, exports of antimony oxide to Japan, Chinese Taipei and the
\nUnited States have been halted since September 2024.
\nApril 2025 rare earth export controls
\nOn4 April 2025, the Chinese government introduced export controls
\non seven heavy rare earth elements. Export volumes from China
\ndropped sharply in April and May, leaving many automakers in the
\nUnited States, Europe and beyond struggling to source permanent
\nmagnets. Some were forced to reduce utilisation rates or temporarily
\nshut down production lines. Exports of dysprosium and terbium
\noxides and metals were also affected by the restrictions, dropping in
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 43
\n1. Market review
\nMay before slowly recovering in the following months, impacting the
\nsupply of feedstocks for magnet manufacturing outside China.
\nOctober 2025 export controls on rare earths
\nOn9 October 2025, the Ministry of Commerce of China announced
\nfurther export controls on rare earth elements and related products,
\nequipment and technologies. The new controls required foreign
\ncompanies to obtain a licence from China to export \u201cparts,
\ncomponents and assemblies\u201d containing Chinese-sourced rare earth
\nmaterials or produced using Chinese rare earth technologies. The
\nannouncement also included a clause implying that, from
\n1 December 2025 the Chinese government would require a licence
\nto trade \u201cinternationally made\u201d products containing Chinese-sourced
\nmaterials or manufactured using Chinese technologies, even if traded
\noutside China.
\nThe inclusion of \u201cinternationally made\u201d products and \u201cparts,
\ncomponents and assemblies\u201d, beyond the previous isolated controls
\non selected rare earth magnets and materials, marked a major
\nescalation and considerable expansion of the scope of export
\ncontrols. A wide range of strategic sectors across the world rely on
\nproducts and components containing controlled Chinese rare earth
\nelements. If the October export controls had been fully enacted, the
\nconsequences for many key strategic sectors and global economies
\nwould have been exceptional, causing major economic impacts
\nacross many sectors, given the vast range of downstream products
\nthat rely on Chinese rare earths.
\nIn November 2025, China announced a one-year suspension of the
\nexport restrictions introduced in October 2025, providing relief to the
\nmarket. However, the underlying risks and potential for future
\nimplementation remain. In January 2026, China tightened export
\ncontrols on dual-use goods destined for Japan. These developments
\nunderscore the growing prominence of supply chain risks exposed by
\nrecent export controls.
\nOctober 2025 export controls on battery supply chains
\nRare earth elements were not the only materials affected. On
\n9 October 2025, China also announced major export controls on
\nlithium-ion battery supply chains. These controls expanded on
\nprevious targeted controls on graphite and high-performance LFP
\ncathode material to cover a much broader range of battery materials,
\ntechnologies and equipment across multiple stages of the supply
\nchain. The controls targeted all critical chokepoints in global battery
\nsupply chains simultaneously, where China holds the highest
\nconcentration of supply, including LFP cathode materials, LFP
\nbatteries, graphite anode materials, cathode material precursors, and
\nbattery production equipment and technologies. The controls were
\nsuspended for a year until November 2026, alongside the rare earth
\ncontrols.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 44
\n1. Market review
\nGiven the scale of the impact faced across a range of sectors by the
\nexport controls on rare earths, the potentially major consequences of
\nthe export controls on battery supply chains may have been
\nsomewhat overlooked in policy response development. However, if
\nfully enacted, the proposed export controls would severely restrict the
\nability of the rest of the world to produce batteries in the nearterm,
\nwith major economic consequences, given the range of strategic
\nsectors for which batteries have critical applications beyond transport
\nand energy storage, including defence, aerospace, artificial
\nintelligence (AI) data centres and even medical applications.
\nLFP batteries are a case in point, with markets expanding rapidly.
\nThey represent over half of the global electric car battery market and
\nover 90% of the battery energy storage market. While China currently
\ndominates this segment, efforts are underway to develop LFP battery
\nproduction outside China. However, new restrictions on LFP cathode
\nmaterials could impede these initiatives, reinforcing China\u2019s
\ndominance in this technology, with major implications for grids, which
\nincreasingly depend on battery energy storage deployment. The
\nsimultaneous restrictions on battery equipment and technologies
\ncould also lead to even greater market concentration in China, as
\nthey could significantly hinder countries\u2019 efforts to produce batteries
\noverseas. Sustained restrictions could lead to major revenue and job
\nlosses for producers of batteries and battery materials around the
\nworld, with knock-on effects for the EV producers, grid developers,
\ndata centre providers and defence contractors that depend on them.
\nWhile the focus on rare earths is imperative, this should not cloud the
\nmajor strategic risks posed by the battery supply chain export
\ncontrols. Strengthened emergency preparations and diversification
\nefforts are needed across both supply chains. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 45
\n1. Market review
\nMiddle East conflict: The war has sent shockwaves through critical mineral value chains
\nIEA. CC BY 4.0.
\nNotes: MRI = magnetic resonance imaging; PPA = purified phosphoric acid; REE = rare earth elements.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 46
\n1. Market review
\nMiddle East conflict: Aluminium production facilities in the Middle East, among the largest in
\nthe world, have reported major disruptions
\nPrimary aluminium production plants in the Middle East
\nIEA. CC BY 4.0.
\nEmirates Global
\nAluminium \u2013Al Taweelah
\nSohar Aluminium
\nEmirates Global
\nAluminium \u2013Jebel Ali
\nQatalum
\nAluminium Bahrain (Alba)
\nMa\u2019adenAluminium
\n400
\n1 600
\nReported disruption
\nCapacity (kt\/year)
\nSalco
\nAlmahdi Aluminium
\nHormozalAluminium
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 47
\n1. Market review
\nMiddle East conflict: Further pressure on a tight aluminium market, where exchange stocks had
\nalready been declining, has contributed to higher prices
\nAluminium price and stocks at major exchanges
\nIEA. CC BY 4.0.
\nNote: LME = London Metal Exchange; SHFE = Shanghai Futures Exchange.
\nSources: IEA analysis based on data from SHFE, LME and Bloomberg.
\n300
\n600
\n900
\n1 200
\n1 000
\n2 000
\n3 000
\n4 000
\nJan-24 Oct-24 Jul-25 Apr-26
\nStocks (kt)
\nPrice (USD\/tonne)
\nPrice
\nSHFE stocks
\n(right axis)
\nLME stocks
\n(right axis)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 48
\n1. Market review
\nMiddle East conflict: The Middle East accounted for 8% of global primary aluminium production
\nin 2025, one-third of which was lost during the conflict
\nShare of global production of primary aluminium, alumina and bauxite, and production from the Middle East
\nIEA. CC BY 4.0.
\nNote: CSAM = Central and South America.
\nSource: IEA analysis based on data from the International Aluminium Institute (2026) and United States Geological Survey (2026).
\n0%
\n25%
\n50%
\n75%
\n100%
\nBauxite Alumina Aluminium
\nUnspecified
\nAfrica
\nAustralia
\nCSAM
\nNorth America
\nOther Asia
\nEurope
\nMiddle East
\nChina
\nShareof supply by region
\n150
\n300
\n450
\n600
\nApr-26 May-26
\nkt
\nPrimary aluminium production in the Middle East
\nJan-25 to Mar-26
\naverage
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 49
\n1. Market review
\nMiddle East conflict: Already tight aluminium markets have been directly affected
\nThe conflict that started in the Middle East on 28 February 2026 is
\nhaving major impacts on the energy market. Trade flows through the
\nStrait of Hormuz have been disrupted for months, causing the largest
\nsupply disruption in the history of the global oil market and significant
\ndisruptions to natural gas flows. However, the impact has also been
\nhighly visible in mineral and metal markets. While trade in key energy
\nminerals such as copper, lithium and graphite was less directly
\naffected, the crisis has had important implications for a range of key
\nmaterials, such as aluminium and helium, as well as key feedstocks,
\nsuch as sulphur and needle coke, which are used in metal processing
\nand the production of precursor materials and synthetic graphite.
\nAluminium
\nDuring the conflict, several aluminium production facilities in the
\nMiddle East were directly hit. Direct damage, together with
\ndisruptions to flows through the Strait of Hormuz, is affecting global
\naluminium trade. The Middle East accounts for 8% of primary
\naluminium production, a share that increases to one fifth when
\nexcluding China. Exports from the region before the conflict
\naccounted for more than 10% of total aluminium supply for the
\nEuropean Union, Japan, Korea and Mexico, and just under20% for
\nthe United States. Moreover, aluminium smelters in the MiddleEast
\nare key producers of high-purity aluminium, particularly Emirates
\nGlobal Aluminium\u2019s Al Taweelah plant. High-purity aluminium plays a
\ncrucial role in aerospace and defence applications, making the
\nimpacts of lost supply from the region a significant concern for
\nstrategic sectors.
\nThe disruptions hit the market after demand for aluminium had
\nincreased by around 7% from 2023 to 2025. In addition to energy
\ntechnologies, aluminium is an essential input across multiple
\nstrategic sectors, including transport and aerospace, construction,
\ninfrastructure and defence.
\nOn the supply side, concerns around a supply deficit have been
\nbuilding, as China reached the 45 Mt production cap set in 2017 in
\n2025. The combination of resilient demand and constrained supply
\nled to a drawdown of LME aluminium inventories, which decreased
\nsharply from over 1 Mt in June 2024 to around 350 kt in June 2025.
\nAt the same time, stocks at the SHFE have been increasing since the
\nstart of 2026, reflecting softening demand in China. New trade and
\nregulatory policies in 2025 also came into play. The United States
\nincreased tariffs to 50% on most imported aluminium products. At the
\nsame time, China removed some export tax rebates on semi-finished
\naluminium products on 1 December 2024, contributing to decreasing
\naluminium exports.
\nAgainst this backdrop, the conflict in the Middle East quickly
\nescalated market pressures. Aluminium Bahrain (Alba), the world\u2019s
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 50
\n1. Market review
\nlargest smelter outside China, with a capacity of 1.6 Mt, was
\noperating at 30% in April 2026 after declaring force majeure due to
\nlogistical challenges around the Strait of Hormuz and shutting down
\nthree smelting lines accounting for 19% of its capacity. Qatalum, a
\nsmelter in Qatar with a capacity of 0.65Mt, also announced force
\nmajeure due to a lack of gas supply linked to the Ras Laffan natural
\ngas processing facilities and was operating at 60% capacity in April
\n2026. In late March, Aluminium Bahrain\u2019s Alba plant and Emirates
\nGlobal Aluminium\u2019s Al Taweelah plant reported damage after being
\nhit by strikes. Following the strikes, the Al Taweelah plant had to halt
\noperations due to damage to its power facilities. The affected
\ncapacity is likely to return only gradually, as restarting smelters after
\nshutdown can take 6-12 months. Logistical challenges around input
\nmaterials and energy supply may add further pressure. The loss of
\nEmirates Global Aluminium is particularly concerning for aluminium
\nsupply to the aerospace sector.
\nAluminium prices reached a four-year high of almost USD3 700 per
\ntonne in April 2026. Regional premiums were also on the rise, with
\nthe Rotterdam premium up 60% from February to April 2026.
\nInsurance premiums and emergency freight surcharges are adding
\nto rising shipping costs. Aluminium users in Europe, Japan and the
\nUnited States are particularly exposed to high prices, and a
\nprolonged disruption threatens the production of finished products in
\nsectors such as automotive, construction and packaging.
\nIn addition to direct effects on aluminium trade, the conflict is also
\naffecting the supply of feedstocks, such as green and calcined
\npetroleum coke, which are needed to manufacture anodes consumed
\nduring the electrolysis of alumina to produce primary aluminium.
\nPrices of green petroleum coke increased by around 35% between
\nFebruary and April 2026, a trend that is expected to be followed by
\ncalcined petroleum coke, affecting global aluminium production.
\nIn the near term, aluminium markets are expected to remain tight,
\nwith the Middle East conflict adding further pressure. Supply growth
\nremains constrained by China\u2019s production cap and rising energy
\ncosts. Although some easing could occur with new smelting capacity
\nin Indonesia, aluminium prices are likely to remain elevated and
\nvolatile in the short term. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 51
\n1. Market review
\nMiddle East conflict: Half of global seaborne sulphur trade passes through the Strait of Hormuz,
\nand the Gulf accounts for a quarter of global supply, affecting metals and fertilisers
\nSulphur and sulphuric acid supply, and the sulphuric acid supply chain
\nIEA. CC BY 4.0.
\nNotes: HPAL = high-pressure acid leaching. SX\/EW = solvent extraction and electrowinning.
\nSulphur
\nOil refining
\nSour gas
\nprocessing
\nMetal smelting
\nSulphuric
\nacid
\nPyrite
\nPhosphoric
\nacid
\nFertilisers
\nPhosphate
\nrock
\nMetal
\nleaching
\nCopper
\nSX\/EW
\nNickel HPAL 0%
\n20%
\n40%
\n60%
\n80%
\n100%
\nSulphur Sulphuric acid
\nChina
\nMiddle East
\nUnited States
\nRussia
\nMorocco
\nOther
\nSupply by country
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 52
\n1. Market review
\nMiddle East conflict: Disruptions to sulphur supply have prompted China to curb exports of
\nsulphuric acid
\nSulphuric acid exports from China, and sulphur and sulphuric acid prices, January 2025-April 2026
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on Chinese Customs data.
\n1
\n2
\n3
\n4
\n5
\n6
\n100
\n200
\n300
\n400
\n500
\n600
\nPrice index (Jan-25 = 1)
\nkt
\nOther
\nIndia
\nMorocco
\nSaudi Arabia
\nIndonesia
\nChile
\nSulphuric acid price
\n(right axis)
\nSulphur price
\n(right axis)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 53
\n1. Market review
\nMiddle East conflict: Ripple effects from sulphur markets are increasing risks in fertiliser and
\nmetals value chains
\nAround half of global seaborne sulphur trade passes through the
\nStrait of Hormuz, while the Middle East accounts for a quarter of
\nglobal sulphur supply, which is produced as a by-product of oil and
\ngas production. Disruptions to sulphur exports from the region have
\naffected countries that rely on imported sulphur to produce sulphuric
\nacid, which is in turn used in fertiliser production and in the leaching
\nof key metals, such as copper, nickel and cobalt. China is particularly
\nexposed to sulphur disruptions, as 55% of its sulphur imports in 2025
\noriginated in the MiddleEast.
\nSulphur markets had already been structurally tight since mid-2024,
\nreflecting strong demand for sulphuric acid from fertiliser production
\nand Indonesia\u2019s expanding nickel sector based on high-pressure acid
\nleaching (HPAL) operations, alongside some supply disruptions in
\n2025, such as Russia\u2019s sulphur export ban and damage to its
\nrefineries. In March 2026, disruptions to maritime trade flows in the
\nStrait of Hormuz led to sharp increases in global sulphur prices, with
\nsulphuric acid prices also doubling from USD 144 per tonne in
\nFebruary 2026 to USD 283 per tonne in April 2026.
\nChina is a net importer of sulphur and produces 40% of the world\u2019s
\nsulphuric acid, followed by the United States, India, Russia and
\nMorocco. China accounts for around one third of global demand,
\nfollowed by North America, Africa, and Central and SouthAmerica.
\nIn January 2026, as sulphuric acid prices were increasing, China
\nannounced an export cap for January-April 2026 to safeguard
\ndomestic supply, resulting in a year-on-year decrease in exports of
\naround 50%.
\nAs sulphur supply has tightened following the conflict in the
\nMiddle East, China halted exports of sulphuric acid from May 2026
\nuntil the end of the year, affecting almost a quarter of ex-China acid
\nneeds, with major implications for the metals and fertiliser sectors.
\nThe restrictions are expected to apply to both sulphur burner-based
\nsulphuric acid and smelter by-product sulphuric acid, with an
\nexemption only for electronic-grade sulphuric acid, typically used in
\nthe production of semiconductors. In 2025, China exported 4.7 Mt of
\nsulphuric acid, with Chile and Indonesia importing half of the total.
\nFertilisers
\nRising sulphur prices have caused sulphuric acid prices to spike just
\nas the northern hemisphere enters the spring planting season, when
\nfertiliser consumption typically peaks. Sulphuric acid is a core input
\nfor phosphoric acid and thus phosphate fertiliser, but it is also used
\nin potassium-based fertilisers and some nitrogen-based fertilisers.
\nChina halted phosphate fertiliser exports in December 2025, citing
\nglobal sulphuric acid price spikes, a restriction that is expected to last
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 54
\n1. Market review
\nuntil August 2026. This ban will put further pressure on the fertiliser
\nmarket, with the Philippines, Kenya and Myanmar particularly
\nvulnerable, accounting for 31%, 14% and 13%, respectively, of
\nexposed imports from China in 2025.
\nFertiliser markets are already experiencing pressure on nitrogenbased products, as around one-quarter of ammonia and 40% of
\nglobal urea exports pass through the Strait of Hormuz. By affecting
\nthe other two types of fertilisers, phosphate and potassium-based,
\ndisruptions to sulphur and sulphuric acid supply effectively put the
\nentire fertiliser production chain at risk. Increased fertiliser costs are
\nlikely to squeeze farmer margins and have a particularly significant
\nimpact on developing countries, which could lead to reduced yields,
\nincreased food prices and higher food security risks.
\nMetals and battery materials production
\nSulphuric acid is critical for copper, nickel and cobalt leaching
\noperations, and disruptions to sulphur and sulphuric acid markets
\npose risks of increased costs, tighter supply and potentially even
\nproduction cuts, with knock-on effects on downstream sectors.
\nOver 15% of global primary copper output is produced using
\nsulphuric acid leaching and is therefore affected by the conflict, with
\nthe DRC and Chile the most vulnerable countries, as they have the
\nlargest sulphuric acid-based operations. For nickel, Indonesia is
\nhighly exposed, as it relies heavily on imports of sulphur from the
\nMiddle East (75% of its sulphur imports) to produce the large volumes
\nof sulphuric acid required for nickel refining using the HPAL route.
\nGiven that the majority of cobalt is produced as a by-product of
\ncopper mining in the DRC or from nickel HPAL intermediate
\nproduction in Indonesia, cobalt production is also affected.
\nCopper production based on sulphuric acid leaching, 2025
\nIEA. CC BY 4.0.
\nNote: DRC = Democratic Republic of the Congo.
\nAround 60% of all battery-grade lithium chemicals currently rely on
\nsulphuric acid-based processing. Over 99% of hard rock lithium
\nprocessing relies on acid roasting processing, which requires
\nsulphuric acid. Due to the increase in acid prices, acid costs have
\nincreased from 3% of the cost of producing lithium chemicals from
\nhard rock sources at the start of the year to over 11% as of the end
\nof May 2026, overtaking energy inputs to become the largest cash
\ncost component.
\n1 2 3 4
\nMt Cu
\nDRC Chile United States Mexico Zambia Other
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 55
\n1. Market review
\nSulphuric acid is also critical to rare earth concentrate processing,
\nparticularly the acid bake-and-leach route used for monazite,
\nxenotime and lower-grade bastnaesite concentrates. Higher acid
\nprices have caused sulphuric acid to increase to over 20% of rare
\nearth C1 costs up from just 5% before the conflict.
\nFinally, a number of critical battery precursors are affected by the
\nconflict in the Middle East. All the battery metal sulphates, including
\nnickel sulphate, cobalt sulphate and manganese sulphate, require
\nsulphuric acid in their processing and, therefore, higher input costs
\nare adding price pressure to these materials. Prices for all three have
\nincreased since the start of the conflict. Purified phosphoric acid, a
\ncritical precursor to LFP batteries, also requires sulphuric acid for its
\nproduction. Phosphoric acid prices increased by almost 30% in the
\nfirst quarter of 2026, reflecting the rise in sulphur and sulphuric acid
\nprices.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 56
\n1. Market review
\nMiddle East conflict: Disruptions to helium and energy markets have created spillover risks for
\nsemiconductor, metals and mineral supply chains
\nHelium
\nThe Middle East conflict has also affected the global supply of helium,
\na key material for semiconductor, fibre optics and medical supply
\nchains, as well as semiconductor-dependent downstream industries.
\nHelium production by country, 2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from the United States Geological Survey
\n(2026).
\nQatar is the world\u2019s largest helium exporter, accounting for roughly
\n35% of global production. Helium production at Ras Laffan, currently
\nhalted, accounts for most of Qatar\u2019s helium supply. Helium prices
\nspiked from around USD 15 per cubic metre in late February to
\nalmost USD 70 per cubic metre in April. This increase is not yet
\ncausing major price spikes across the downstream supply chain, as
\nthe helium price accounts for only minor shares of final product prices.
\nHowever, a prolonged disruption could lead to physical supply
\nshortages, prompting available supply to be prioritised for highermargin applications, such as AI chips, with major implications for
\nconsumer electronics and industrial semiconductors.
\nShare of helium imports from Qatar in selected economies, 2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from the World Integrated Trade Solution
\nand International Trade Administration.
\nQatar accounts for more than half of helium imports in China, India,
\nKorea and Chinese Taipei, making these economies the most
\n50 100 150 200
\nmcm
\nUnited States Qatar Russia Algeria Canada Other
\n0%
\n20%
\n40%
\n60%
\n80%
\nIndia China Chinese
\nTaipei
\nKorea Japan
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 57
\n1. Market review
\nexposed to the disruptions. Alternative sources have responded
\ndifferently to the crisis, with the United States increasing its exports
\nto some of the most exposed countries, while Russia introduced
\nexport controls in April 2026.
\nDespite the significant disruptions, buffers and additional supply are
\nstill available to global helium markets. Major helium producers hold
\nstrategic inventories in Germany and the United States, with refining
\ncapacity available globally to process them, and both China and
\nRussia are expected to add new production in 2026.
\nOther materials and feedstocks
\nIran produces more than half of global strontium supply, which is key
\nto producing permanent ceramic ferrite magnets. These are used
\nwidely in many sectors, from industrial motors to electronics and
\nhealthcare, sometimes as an alternative to rare earth magnets.
\nSome effects of the conflict are also being felt in steel markets. Iran
\naccounts for 11% of global semi\u2011finished steel trade, particularly
\nlow\u2011cost billet and slab. Two major Iranian steel plants, Khuzestan
\nSteel and Mobarakeh Steel, were hit by airstrikes, resulting in damage
\nto production infrastructure. Both facilities reported having shut down
\noperations and stated it could take up to one year to restart the units.
\nHigh crude oil prices in early 2026 had knock-on effects on the
\navailability and pricing of needle coke, a critical feedstock for
\nsynthetic graphite production and a by-product of delayed coking
\nunits in refineries. As a result, short-term volatility in upstream oil
\nmarkets translated into tighter conditions for segments of the graphite
\nsupply chain, particularly for battery-grade synthetic graphite.
\nImplications of energy disruptions
\nThe outsized impact on energy markets is generating significant
\nspillover effects in mineral supply chains. Mining operations are
\nparticularly exposed to disruptions in refined fuel markets, as diesel
\nis a key input for heavy equipment, on-site power generation and
\ntransport, especially in remote and off-grid locations.
\nRising diesel prices have already translated into operational
\nchallenges, especially for smaller mining producers, for which fuel
\nlogistics are more constrained. Disruptions have been reported in
\nAustralia, the DRC and Ethiopia. Large, diversified mining companies
\nreport that higher fuel costs have increased operating expenses by
\naround 5%, though most have so far been able to maintain production
\nby absorbing costs or drawing on long-term fuel supply contracts.
\nNatural gas markets have also been affected by the crisis, notably
\nliquefied natural gas (LNG) exports from Qatar and the
\nUnitedArab Emirates. Sustained constraints on LNG supply could
\nhave broader global repercussions through higher gas and electricity
\nprices. Experience from the 2022 energy crisis highlights the
\nvulnerability of energy-intensive metals production to such shocks,
\nparticularly in Europe, where high gas and power prices led to
\nwidespread curtailments of aluminium, zinc and other smelting
\ncapacity. While current price levels remain below the peaks observed
\nin 2022, persistently higher energy costs may compress margins.
\nSeveral smelters have announced temporary shutdowns or reduced
\noperating rates, raising concerns about the resilience of midstream
\nmineral processing capacity.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 58
\n1. Market review
\nDownstream market trends
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 59
\n1. Market review
\nDeployment of renewables, electric cars and battery storage demonstrated steady growth in
\n2025, with solar PV breaking new records
\nAnnual capacity additions for selected energy technologies
\nIEA. CC BY 4.0.
\nNote: GW = gigawatt; GWh = gigawatt-hour.
\n120
\n240
\n360
\n480
\n600
\n720
\n2023 2024 2025
\nGW
\nSolar PV
\n27%
\n12%
\n30
\n60
\n90
\n120
\n150
\n180
\n2023 2024 2025
\nGW
\nWind
\n-1%
\n39%
\n4
\n8
\n12
\n16
\n20
\n24
\n2023 2024 2025
\nMillion
\nElectric cars
\n26%
\n20%
\n70
\n140
\n210
\n280
\n350
\n420
\n2023 2024 2025
\nGWh
\nBattery storage
\n69%
\n50%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 60
\n1. Market review
\nSolar PV and wind set new records across major markets, but China continues to lead global
\ncapacity additions
\nIn 2025, global annual renewable capacity additions increased by
\n16%, reaching 800 GW despite facing challenges linked to supply
\nchains, grid connection delays, financial pressures and policy shifts
\nin some regions. It was the 23rd consecutive year in which
\nrenewables set new expansion records. Solar PV accounted for over
\nthree-quarters of new renewable capacity additions globally, followed
\nby wind at 20%. China alone commissioned around 370 GW of
\nsolar PV and 117 GW of wind capacity, notable increases from 2024.
\nIndia\u2019s annual renewable capacity additions rose by almost 60%, the
\nfastest growth among major markets. The European Union added
\naround 85 GW of new renewable capacity, a record high and about
\n10% more than in 2024. The United States installed 49 GW of
\nrenewable capacity in 2025, becoming the only major market to see
\na decline, at 10% compared with the previous year.
\nSolar PV capacity additions in 2025 rose by around 12%, surpassing
\n600 GW for the first time. This expansion brought cumulative global
\nsolar PV capacity to around 2 800 GW, making it the technology with
\nthe largest installed power generation capacity. Thirty countries
\ninstalled over 1 GW of solarPV in 2025, almost twice as many as in
\n2020. China\u2019s shift from long-term fixed tariffs to competitive auctions,
\neffective from June 2025, accelerated installations in the first half of
\nthe year, followed by a slowdown in the second half. In the
\nEuropean Union, solar PV led renewables growth, with almost
\n70 GW installed. Germany alone added 17 GW, accounting for
\none-quarter of the region\u2019s solar PV additions. Spain hit a record
\n14 GW, up 50% from 2024. India commissioned almost 50 GW of
\nsolar PV in 2025, double the previous year. Installations also
\ncontinued to grow in Pakistan, with around 10 GW of additions in
\n2025, driven almost entirely by on\u2011 and off\u2011grid distributed systems.
\nSouth Africa installed over 3 GW of solar PV for the first time.
\nSaudi Arabia\u2019s solar PV additions quadrupled to nearly 7 GW.
\nAfter a slowdown in 2024, annual wind capacity additions resumed
\ngrowth in 2025, rising by nearly 40% globally to a record level of
\naround 160 GW, despite ongoing supply chain challenges.
\nInstallations continued to accelerate in China as large-scale projects
\nwere completed. India\u2019s wind additions doubled in 2025 to reach over
\n6 GW. In the European Union, onshore wind capacity additions rose
\nto about 13 GW. Offshore wind additions, however, fell to just 1 GW,
\ndown from 1.7 GW in 2024, with only France and Germany installing
\nnew capacity in 2025. The offshore wind industry faces multiple
\nchallenges, with several developers reducing their 2030 deployment
\ntargets. Lower expectations have been driven by the policy shift in
\nthe United States and project cancellations and delays in Europe,
\nIndia and Japan due to cost and supply chain challenges. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 61
\n1. Market review
\nAs technology matures and scales to compete with traditional sources of power generation, the
\nsolar PV industry also continues to make strides in material efficiency
\nSince 2020, solar PV deployment has expanded rapidly while the
\nintensity of key minerals has declined materially. Crystalline silicon
\n(c-Si) technology retained a dominant market share of around 98%
\nof global production, but manufacturers substantially reduced silicon
\nconsumption per unit of capacity through thinner wafers, lower kerf
\nlosses from improved diamond wire sawing and higher-efficiency cell
\narchitectures. Silicon intensity declined from roughly 3.2grammes
\nper watt (g\/W) in 2020 to around 2 g\/W by 2024, continuing a longterm trend of declining polysilicon consumption at an average annual
\nrate of 10% between 2004 and 2024, despite rapidly increasing
\nmodule output. At the same time, average module power ratings
\nincreased sharply, with mainstream utility-scale modules rising from
\naround 400 W to close to 700 W over the same period as larger wafer
\nformats and higher-efficiency tunnel oxide passivated contact
\n(TOPCon) designs became standard.
\nSilver intensity also declined significantly over the period, although
\ntotal silver demand from the solar sector continued to rise because
\ninstallation growth outpaced thrift gains. Despite making up just 0.14%
\nof a PV module\u2019s weight, silver accounts for approximately 60% of
\nthe cell cost and 10% of the module cost. The crucial importance of
\nsilver in the PV industry is further amplified by the ongoing shift in the
\ndominant PV technology. Within the c-Si segment, passivated emitter
\nand rear contact (PERC) cells, which currently represent the
\nindustrial standard, are expected to be gradually replaced by more
\nefficient c-Si sub-technologies, such as TOPCon cells and silicon
\nheterojunction (SHJ) cells, both of which involve higher silver
\nintensity. Nevertheless, advances in screen printing, multi-busbar
\narchitectures and finer metallisation lines reduced silver consumption
\nin mainstream crystalline silicon cells from around 16milligrammes
\nper watt (mg\/W) in 2020 to close to 10 mg\/W in 2024. The industry is
\nincreasingly pursuing copper substitution to mitigate exposure to
\nrising silver prices and potential supply constraints, particularly as
\nTOPCon technologies typically require higher metallisation loadings
\ndue to contacts on both the front and rear sides of cells, compared
\nwith the earlier single-face metallisation PERC cells. Fraunhofer ISE
\nreports that leading TOPCon and SHJ pilot designs are now
\napproaching 5 mg\/W through silver-copper pastes and copper plating
\ntechnologies.
\nTin intensity exhibited a more moderate downward trend over the
\nsame period. Tin is primarily used in solder ribbons and
\ninterconnection materials rather than within the solar cell itself, and
\nreductions were driven mainly by thinner ribbons, improved module
\nlayouts and lower solder volumes associated with multi-busbar
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 62
\n1. Market review
\ntechnologies. Industry estimates indicate that tin intensity declined
\nfrom around 70 mg\/W in 2020 to approximately 53 mg\/W in 2024.
\nBy contrast, copper intensity for solar PV increased steadily since
\n2020 as manufacturers increasingly substituted silver with copper for
\ncell metallisation and expanded the use of copper-intensive electrical
\ninfrastructure associated with larger utility-scale installations. While
\ncopper has long been used in module ribbons, cabling, inverters and
\ntransformers, recent technology shifts have accelerated its role within
\nthe solar cell itself. In particular, TOPCon and SHJ architectures have
\nprompted growing industry interest in copper electroplating and
\nsilver-copper hybrid pastes to reduce reliance on silver amid rising
\nprices and concerns over long-term supply availability. Copper
\nsubstitution is emerging as one of the principal pathways for reducing
\nPV metallisation costs and lowering exposure to critical mineral
\nsupply risks. Although industry-wide copper intensity data for
\nsolar PV applications remain less standardised than for silicon or
\nsilver, copper use per watt increased gradually over the period as
\nsilver thrift strategies accelerated and module power ratings
\ncontinued to rise.
\nOverall, the technology has been characterised by a structural
\ndecoupling between growth in deployment and mineral intensity per
\nunit of power delivered. However, because annual global solar
\ninstallations have consistently increased at remarkable pace,
\nabsolute demand for silicon, silver, copper, aluminium and glass has
\ncontinued to rise strongly despite sustained efficiency improvements
\nin material usage.
\nChange in material intensity per unit of power (top) and evolution
\nof average module size and efficiency for c-Si modules (bottom),
\n2020-2024
\nIEA. CC BY 4.0.
\nSources: IEA analysis based on data from Fraunhofer ISE and IEA-PVPS.
\n-60%
\n-40%
\n-20%
\n20%
\n40%
\n60%
\nCopper
\nTin
\nSilver
\nSilicon
\n% change (index 2020)
\n15%
\n17%
\n19%
\n21%
\n23%
\n25%
\n350
\n450
\n550
\n650
\n750
\n850
\n2020 2021 2022 2023 2024
\nAverage module size
\nWeighted average efficiency (right axis)
\nWatts
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 63
\n1. Market review
\nGlobal electric car sales reached 25% of global car sales, exceeding 20 million in 2025
\nElectric car sales by mode and region
\nIEA. CC BY 4.0.
\nNote: BEV = battery electric vehicle; PHEV = plug-in hybrid electric vehicle.
\nSource: IEA (2026), Global EV Outlook 2026.
\nBEV PHEV China Europe United States Rest of world Global
\n5
\n10
\n15
\n20
\n25
\n2020 2021 2022 2023 2024 2025
\nMillion
\n10%
\n20%
\n30%
\n40%
\n50%
\n60%
\n2020 2021 2022 2023 2024 2025
\nSales Sales share
\nRegion Powertrain
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 64
\n1. Market review
\nElectric car sales resurged in Europe in 2025, reversing a stagnating trend
\nGlobal electric car sales reached new highs in 2025, exceeding
\n20 million, growing by 20% from 2024. One in four new cars sold
\nglobally were electric in 2025, with around 5% of the global car stock
\nnow electrified. Market developments again varied across regions,
\nwith growth slowing slightly in China due to the temporary halt of a
\ntrade-in scheme. However, the key story of 2025 was the major
\nresurgence of electric car sales in Europe. Europe experienced
\nstrong sales growth following the step change in the
\nEuropean Union\u2019s carbon dioxide standards, with sales increasing 30%
\nto more than 4 million.
\nChina remains by far the world\u2019s largest electric car market, with more
\nthan 13 million electric cars sold in 2025, over 60% of all global
\nelectric car sales that year. Almost 55% of cars sold in China were
\nelectric in 2025, up from around half in 2024. Sales grew by almost
\n20% in China, a slight decline from the previous year, as the trade-in
\nscheme introduced in 2024 was temporarily halted in several cities.
\nEurope was the standout story among major markets in 2025, with
\nelectric car sales increasing by more than 30%, reversing the relative
\nstagnation seen since 2022. Europe\u2019s electric car sales share was
\nalmost 30%, and 24 out of 27 EU member states experienced an
\nincrease in their electric car sales share. This strong resurgence was
\nthe result of policy design, with the European Union\u2019s carbon dioxide
\nstandards coming into effect in 2025. In Germany, sales increased
\nstrongly, by 50%, with wider availability of affordable models reducing
\nthe average battery electric vehicle (BEV) price by 6% in 2025 and
\npreferential tax treatment for electric car companies. In France, BEV
\nsales increased by almost 15% while plug-in hybrid vehicle (PHEV)
\nsales decreased by 25%. There was impressive sales growth in Italy
\n(+65%), Poland (+125%) and Spain (+80%), supported by the
\nreintroduction or continuation of EV purchase subsidies in 2025.
\nSales grew strongly in the United Kingdom, increasing by more than
\n25%, with electric cars sales now comprising more than one in three
\nnew cars sold in 2025. Strong sales were supported by a subsidy for
\nlower-priced BEVs, with over a quarter of sales eligible. One of the
\nfastest-growing electric car markets in Europe in 2025 was T\u00fcrkiye,
\nwhere sales more than doubled compared to 2024. Electric cars
\nrepresented over 20% of new car sales in 2025, up from just over 1%
\nin 2022, supported by tax support and growing domestic production.
\nAs a result, T\u00fcrkiye became the fourth-largest electric car market in
\nEurope last year, after Germany, the United Kingdom and France.
\nIn the United States, sales of electric cars were slightly lower in 2025
\nthan in 2024, at around 1.5 million, while the sales share of electric
\ncars remained relatively stable, at just below 10%. The stagnation
\nwas due to several policy shifts, including the ending of tax credits
\nand removal of penalties for non-compliance with existing fuel
\neconomy standards through the passage in July 2025 of the One Big
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 65
\n1. Market review
\nBeautiful Bill Act. The Act terminated tax credits for new and used
\nelectric car purchases after September 2025, which resulted in sales
\nfalling significantly in the last quarter of the year.
\nOutside these major markets, electric car sales increased steadily to
\nreach 2 million in 2025, growing by 50%, primarily driven by
\nincreasing sales in key emerging markets. Rapid growth in these
\nmarkets was driven by the increasing availability of lower-cost electric
\ncar models, primarily imported from China, which accounted for 60%
\nof sales in these markets. Several markets doubled in size compared
\nto 2024, with Southeast Asia experiencing the largest absolute sales
\ngrowth. In Southeast Asia, annual sales more than doubled to reach
\na sales share of nearly 20%, led by Viet Nam, Indonesia and Thailand.
\nIn Latin America, sales grew by 75%, led by Brazil and Mexico.
\nIn the first quarter of 2026, global sales were 8% lower than in the
\nsame period last year, mainly due to lower sales in China and the
\nUnited States, following key policy changes. However, this global
\ndecline masks strong sales growth in many countries: in Europe,
\nQ1 2026 sales were up almost 30% year-on-year, with around
\n250 000 more cars sold than in Q1 2025; countries in Asia Pacific
\noutside China saw Q1 year-on-year sales growth of 80%; and Q1
\nsales across Latin America were up by 75%.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 66
\n1. Market review
\nGlobal battery demand grew by over 35% in 2025, surpassing 1.5 TWh, with electric trucks the
\nfastest growing market
\nEV and storage battery demand by mode and region, 2020-2025
\nIEA. CC BY 4.0.
\nNotes: LDV = light-duty vehicle; GWh = gigawatt-hour. Battery demand reflects the batteries installed in vehicles sold in each region and not the battery demand for
\nvehicles manufactured in each region.
\nSource: IEA analysis based on data from EV Volumes.
\n200
\n400
\n600
\n800
\n1 000
\n1 200
\n1 400
\n1 600
\n2020 2021 2022 2023 2024 2025
\nGWh\/year
\nLDVs Two\/three-wheeler Bus Trucks Storage
\n200
\n400
\n600
\n800
\n1 000
\n1 200
\n1 400
\n1 600
\n2020 2021 2022 2023 2024 2025
\nChina Europe United States Other
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 67
\n1. Market review
\nLithium iron phosphate is now the dominant chemistry, supplying over half of the global
\nelectric car market
\nElectric car battery cathode and anode chemistry sales shares, 2020-2025
\nIEA. CC BY 4.0.
\nNotes: LFP = lithium iron phosphate; Si-Gr = silicon-doped graphite, with the stated percentage of silicon content. Low-nickel includes NMC333 and NMC532, where
\nNMC refers to lithium nickel manganese cobalt oxide. High-nickel includes NMC622, NMC721, NMC811, nickel cobalt aluminium oxide and nickel manganese cobalt
\naluminium oxide. Sales shares are based on capacity. LFP data include some lithium manganese iron phosphate.
\nSources: IEA analysis based on data from EV Volumes, BloombergNEF and the China Automotive Battery Industry Innovation Alliance.
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\n2020 2021 2022 2023 2024 2025
\nLow-nickel High-nickel LFP Other
\nCathode
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\n2020 2021 2022 2023 2024 2025
\nGraphite Si-Gr 5% Si-Gr 10%
\nAnode
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 68
\n1. Market review
\nBattery pack prices fell again in 2025, but critical minerals account for an increasing share of
\ncosts
\nGlobal average lithium-ion battery pack price and share of critical mineral costs, 2015-2025
\nIEA. CC BY 4.0.
\nNotes: kWh = kilowatt-hour. Raw material costs include lithium, nickel, cobalt, manganese, graphite and copper. Other cell costs include electrolytes, separators and
\nother components, as well as costs associated with labour, manufacturing and capital depreciation. The percentages on the bars show the year-on-year total global
\naverage battery pack price change. The analysis includes all cathode chemistries and global chemistry sales shares.
\nSource: IEA analysis based on data from BloombergNEF.
\n10%
\n20%
\n30%
\n40%
\n150
\n300
\n450
\n600
\n2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
\nUSD\/kWh
\nCritical minerals Other cell cost Pack cost Share of critical minerals (right axis)
\n-23%
\n-25%
\n-13%
\n-8%
\n-18%
\n-13%
\n-11% -6%
\n+7%
\n-20%
\n-35%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 69
\n1. Market review
\nChina dominates both battery recycling pre-treatment and material recovery capacity, but
\nKorea is the current material recovery leader outside China
\nPre-treatment and material recovery capacity, 2023-2035
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from Benchmark Mineral Intelligence.
\n4
\n8
\n12
\n16
\n2023 2024 2025 2030 2035
\nMt
\n2
\n4
\n6
\n8
\n2023 2024 2025 2030 2035
\nMt black mass
\nChina Europe United States Korea Lao PDR India Other
\nPre-treatment Material recovery
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 70
\n1. Market review
\nBattery markets reached new heights in 2025, but supply chain risks became a stark reality with
\nnew export controls targeting critical battery supply chain chokepoints
\nGlobal battery demand from EVs and storage surpassed 1.5 TWh in
\n2025, growing by over 35% year-on-year, up from 30% in 2024.
\nGrowth was primarily driven by EV deployment, with electric car
\nbattery demand alone surpassing 1 TWh. The fastest demand growth
\ncame from electric trucks, where demand more than doubled for the
\nsecond year in a row, primarily driven by a sharp acceleration in sales
\nin China. Electric trucks accounted for over 6% of total EV and
\nstorage battery demand in 2025, up from just 2% in 2023. China
\nagain dominated battery deployment, with almost 60% of global
\ndemand in 2025, at over 900 GWh, increasing its share from 2024.
\nEurope was the second-largest battery market, with 20% of global
\ndeployment, while deployment in the United States stagnated, with
\nits global share falling to just over 10%. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nBattery storage market
\nBattery storage demand grew robustly in 2025, growing by over 70%
\nto reach 330 GWh (110 GW) and over 20% of the global battery
\nmarket. Battery storage is now a major driver of battery demand
\ngrowth. Utility-scale battery storage accounted for the majority of
\ncapacity additions, at 80% in 2025. Deployment continued to be led
\nby China, the United States and Europe, but there was major growth
\nin other markets, particularly Australia and Saudi Arabia, showing a
\nbroadening of the global battery storage rollout.
\nBattery storage additions by region, 2020-2025
\nIEA. CC BY 4.0.
\nNote: Includes both utility-scale and behind-the-meter battery storage.
\nSource: IEA analysis based on data from Benchmark Mineral Intelligence.
\nAdditions in China grew by one-third in 2025, with utility-scale
\ninstallations accounting for around 90%, while behind-the-meter
\nadditions continued to expand steadily alongside distributed solar.
\nThe United States saw the strongest growth among major markets in
\n2025, growing by 75% year-on-year, with utility-scale systems
\ncomprising around 85% of demand. In Europe, total battery storage
\nadditions were slightly lower than last year falling by 20% but with a
\n20
\n40
\n60
\n80
\n100
\n120
\n2020 2021 2022 2023 2024 2025
\nGW
\nRest of world
\nMiddle East
\nAustralia and
\nNew Zealand
\nEurope
\nUnited States
\nChina
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 71
\n1. Market review
\nclear structural shift towards utility-scale systems, which reached 75%
\nof additions. Australia stood out, with additions surging to nearly
\n8 GW, almost nine times higher than the previous year. This was
\ndriven by the increasing use of storage to support renewables
\nintegration. Behind-the-meter storage also grew strongly in Australia,
\nsupported by federal and state incentives. The Middle East saw
\nsignificant growth in additions, reaching 3 GW, a threefold increase
\nin 2025. This was driven almost entirely by Saudi Arabia, where
\nbattery storage has become a key source of system flexibility.
\nBattery pack price trends
\nIn 2025, average battery pack prices fell by 8% to USD 108\/kWh,
\ndriven by continued improvements in manufacturing efficiency,
\nbattery chemistries and technology developments, as well as intense
\nglobal market competition. The share of critical minerals in battery
\nprices increased in 2025 for the first time since 2022, reaching almost
\n20% of total pack costs, driven by major increases in lithium and
\ncobalt prices, with lithium doubling and cobalt increasing by 130%
\nfrom the start of 2025 to April 2026. Lithium prices increases were
\ndriven by strong battery demand growth, particularly from energy
\nstorage, alongside constrained supply from Australia and China and
\nuncertainty from Zimbabwe\u2019s export restrictions. Cobalt price
\nincreases were driven by export restrictions imposed by the DRC. If
\nthese trends continue, there could be strains on battery producer
\nprofitability or increasing upward pressure on battery prices. Regional
\ndisparities in battery prices increased in 2025, with battery pack
\nprices in China 30% lower than in North America and 35% lower than
\nin Europe, compared with 20-25% in 2022.
\nLithium iron phosphate (LFP) battery prices hit record lows in 2025
\nand were a major driver of global battery price reductions that year.
\nLFP battery packs were more than 40% cheaper on average than
\nlithium nickel manganese cobalt oxide (NMC) alternatives per kWh in
\n2025. LFP batteries benefit from structurally lower material costs than
\nnickel-based chemistries, but there are concerns that intense market
\ncompetition is driving prices too low. Many LFP cathode active
\nmaterial producers are currently operating at a loss while still
\nincreasing manufacturing capacity, raising the risks of excess
\ncapacity and consolidation.
\nBattery chemistry trends
\nLFP is now the dominant battery chemistry, accounting for 55% of
\nglobal EV batteries sold in 2025, up from nearly half in 2024.
\nDeployment of LFP batteries remains concentrated in China, with a
\nsales share of 80% in 2025, but LFP batteries are rapidly increasing
\ntheir penetration in other emerging markets, accounting for two-thirds
\nof EV sales in these regions in 2025, up from 45% in 2024. This
\nremarkable growth has been driven by increasing imports of Chinese
\nvehicles and batteries. In the European Union, the share of LFP
\nincreased slightly to almost 15%. Nearly all the batteries imported into
\nthe region were from China, with the majority (70%) imported in LFPequipped EVs and a minority (30%) imported directly. In the
\nUnited States, the share of LFP in EVs deployed almost halved in
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 72
\n1. Market review
\n2025 to less than 5%. This decrease was driven by increased tariffs
\non Chinese imports and more stringent tax credit sourcing
\nrequirements.
\nShare of electric vehicle battery sales by chemistry and region,
\n2023-2025
\nIEA. CC BY 4.0.
\nNotes: EMDEs = emerging markets and developing economies. Two\/threewheelers are excluded from the analysis. Low-nickel includes lithium nickel
\nmanganese cobalt oxide (NMC) 333, NMC442 and NMC532. Mid- and highnickel includes NMC622, NMC721, NMC811, lithium nickel cobalt aluminium
\noxide and lithium nickel manganese cobalt aluminium oxide. Lithium iron
\nphosphate also includes lithium iron manganese phosphate. Battery chemistry
\nsales shares are based on the battery capacity of new electric vehicles
\nregistered.
\nSource: IEA (2026), Global EV Outlook 2026.
\nSodium-ion batteries are on course for commercial success, and
\n2026 could prove to be a pivotal year for the technology\u2019s scaling
\nefforts, with leading battery producers, such as CATL and BYD,
\nstarting to commercialise the technology at scale. The significantly
\nimproved low-temperature performance of sodium-ion batteries
\ncompared to lithium-ion batteries has driven considerable attention in
\nChina. Nevertheless, highly optimised and low-cost LFP technologies
\ncontinue to offer advantages in energy density, supply chain maturity
\nand cost. For sodium-ion batteries to compete more broadly, it is
\nlikely that there would need to be sustained higher lithium prices or
\ntechnological advances. Solid-state battery research and investment
\ncontinue to attract attention and financing due to promised higher
\nenergy density and safety, but these advantages have not yet been
\ndemonstrated in real-world applications. Emerging markets, such as
\nhumanoid robots, may become an early source of demand for solidstate battery manufacturers, supporting production scale-up and
\noptimisation to help reduce high manufacturing costs.
\nBattery supply chains
\nChina currently dominates the midstream and downstream battery
\nsupply chain and is particularly dominant in the LFP battery supply
\nchain. In 2025, China processed 70-95% of global lithium, cobalt,
\nphosphate, manganese and graphite and produced 98% of LFP
\ncathode materials, two-thirds of nickel-based cathode material, over
\n90% of anode material and 80% of global battery cells. It also
\naccounts for 95% of global cathode material precursor production
\ncapacity.
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\n202320242025202320242025202320242025202320242025
\nChina EMDEs ex-ChinaEuropean Union United States
\nLow-nickel High-nickel LFP
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 73
\n1. Market review
\nChina\u2019s dominance in the production of LFP cathode materials and
\nbatteries, graphite anode materials and cathode material precursors
\nmakes these critical chokepoints in global battery supply chains.
\nTheir vulnerabilities were highlighted by the battery export controls
\nintroduced in October 2025, which are currently suspended and
\ncovered all of these materials as well as battery manufacturing
\nequipment and technologies. Moreover, with the continued growth in
\nLFP battery deployment and emerging chemistries such as sodiumion and manganese-rich chemistries, the importance of battery-grade
\nmanganese sulphate and purified phosphoric acid is rapidly growing.
\nAs China also dominates the production of both materials, they are
\nemerging as additional chokepoints for global battery supply chains.
\nEfforts to develop diversified LFP battery production capacity are
\ngaining momentum. The United States is among the leaders, with
\nover 50 GWh of battery manufacturing capacity reallocated to LFP
\nproduction in 2025, notably from LG Energy Solution and Ford,
\ntargeting the rapidly expanding battery energy storage market, which
\naccounted for one-third of battery deployment in the United States in
\n2025. Korean and Japanese producers are also investing in LFP
\nproduction, while new capacity is being developed in Indonesia.
\nThese developments are an important first step towards
\ndiversification. However, the LFP battery supply chain remains highly
\nconcentrated in China, and there are major ecosystem barriers to
\nrealising LFP production at scale, including production expertise,
\nequipment and technology gaps, which should not be underestimated.
\nBattery recycling
\nGlobal pre-treatment capacity has reached almost 4 Mt of spent
\nbatteries, while material recovery has reached over 2 Mt of black
\nmass refining capacity, considerably exceeding available feedstock.
\nCurrently, recycling plays an important role in battery supply chains,
\nprimarily by recovering material from manufacturing scrap generated
\nduring the production of battery cells and components. China
\ncontinues to dominate global battery recycling capacity, with over
\nthree-quarters of pre-treatment capacity and almost 90% of material
\nrecovery capacity. Some Chinese recyclers, such as Brunp, the
\nbattery recycling subsidiary of CATL, benefit from direct links with the
\ntop battery manufacturers, enabling preferential access to
\nmanufacturing scrap feedstock. Many other recyclers face challenges
\nsecuring feedstock given the excess global recycling capacity.
\nOutside China, Europe holds the largest share of global pretreatment capacity, at almost 10%, but accounts for less than 2% of
\nglobal material recovery capacity. Korea is the leading country
\noutside China in material recovery, with 6% of global capacity. The
\nUnited States holds less than 5% of pre-treatment capacity and less
\nthan 1% of material recovery capacity.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 74
\n1. Market review
\nBlack mass payables, 2024-2026
\nIEA. CC BY 4.0.
\nNotes: Nickel and cobalt payables, CIF South Korea (% payable against LME
\nnickel and Fastmarkets standard-grade cobalt prices).
\nSource: IEA analysis based on data from Fastmarkets.
\nIn August 2025, China started allowing imports of high-grade black
\nmass, which had previously been banned. There has been limited
\nshort-term impact, as black mass flows were often being upgraded
\nelsewhere for final refining in China, but this policy shift could
\nincrease direct flows to China. In March 2025, the European Union
\nformally classified black mass as hazardous waste, banning its export
\nto non-Organisation for Economic Co-operation and Development
\n(OECD) countries. Black mass leakage has been prevalent due to
\nthe lack of material recovery capacity in Europe, but this policy aims
\nto reduce further outflows and incentivise domestic recovery capacity
\ndevelopment. At present, most black mass exported from the
\nEuropean Union has been directed to Korea.
\nBlack mass prices have surged through 2026, driven by tightening
\nsupply across battery metals. Increased demand from China due to
\nthe lifting of its black mass import ban and the reduction in import
\ntariffs has also been fuelling price rises. Black mass payables have
\nsurged to over 100% in recent months, reflecting these compounding
\nfactors.
\nGlobal recycling capacity is set to surge in anticipation of the
\nexpected wave of end-of-life EVs in the 2030s. By 2030, pretreatment capacity is set to increase almost fourfold while material
\nrecovery capacity is set to rise by more than threefold. However,
\nlimited global diversification is anticipated based on the current
\nproject pipeline. China dominates planned capacity expansions,
\nincreasing its share of pre-treatment capacity to 85% and maintaining
\na similar share of material recovery. Nevertheless, both Europe and
\nthe United States are planning to expand their material recovery
\ncapacity significantly by 2030, increasing sixfold and thirteen-fold,
\nrespectively. It remains to be seen how much of this planned material
\nrecovery capacity will materialise.
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\n120%
\n‘2
\n4
\n‘2
\n5
\n‘2
\n6
\n2024 2025 2026
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 75
\n1. Market review
\nInvestment trends
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 76
\n1. Market review
\nFinancial performance improved across mineral producers in 2025, with copper companies
\nrecording the strongest gains
\nAggregate financial performance of major mining companies by type
\nIEA. CC BY 4.0.
\nNote: EBIT = earnings before interest and taxes.
\nSource: IEA analysis based on data from S&P Capital IQ.
\n-15%
\n15%
\n30%
\n45%
\n60%
\n– 150
\n150
\n300
\n450
\n600
\n2022 2023 2024 2025
\nBillion USD
\nRevenue EBIT as % of revenue (right axis) Free cash flow as % of revenue (right axis)
\nDiversifed mining majors
\n-15%
\n15%
\n30%
\n45%
\n60%
\n– 40
\n40
\n80
\n120
\n160
\n2022 2023 2024 2025
\nBillion USD
\nCopper players
\n-15%
\n15%
\n30%
\n45%
\n60%
\n– 20
\n20
\n40
\n60
\n80
\n2022 2023 2024 2025
\nBillion USD
\nBattery metals players
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 77
\n1. Market review
\nIn 2025, production costs for copper and battery metals continued to decline, although the pace
\nof reductions slowed for battery metals
\nProduction cash cost trends
\nIEA. CC BY 4.0.
\nNotes: MER = market exchange rate; TC\/RC = treatment and refining charges. Production costs are based on the weighted average value of the assets in the 75th
\nquartile.
\nSource: IEA analysis based on data from S&P Capital IQ.
\n1
\n2
\n3
\n4
\n5
\n’23 ’24 ’25
\nLabour Energy Reagents Other on-site TC\/RC and shipment Royalties
\nUSD per kilogramme (2025, MER)
\nCopper
\n1.2
\n2.4
\n3.6
\n4.8
\n6.0
\n’23 ’24 ’25
\nLithium
\n3
\n6
\n9
\n12
\n15
\n’23 ’24 ’25
\nNickel
\n5
\n10
\n15
\n20
\n25
\n’23 ’24 ’25
\nCobalt
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 78
\n1. Market review
\nDeclining production costs and rising prices supported margins, although trends diverged
\nacross commodities
\nIn 2025, improved market conditions, including rising commodity
\nprices, led to a 5% increase in industry revenues, reversing the
\ndownward trend observed since 2023, based on our assessment of
\n24 mining companies with a strong presence in critical minerals
\nproduction (see Annex for details). However, the recovery was
\nuneven across company types. Copper-focused companies were the
\nprimary drivers, with revenues increasing by around 10%, supported
\nby strong demand growth, higher prices and increased by-product
\nrevenues. Profitability also improved markedly, with average
\noperating profit margins rising from 17% to 21% and free cash flow
\nmargins increasing from 5% to 7% of revenue, underscoring copper\u2019s
\nstrong cash-generating position. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nBy contrast, battery metals companies, including those focused on
\nnickel, cobalt and lithium, experienced some revenue recovery
\nfollowing the downturn in 2024. However, operating profitability
\ndeclined slightly, with free cash flow generation improving but
\nremaining negative. While these trends indicate some degree of
\nmarket stabilisation, financial performance remains relatively
\nconstrained, reflecting weaker pricing conditions across battery metal
\nmarkets. Recent price increases are nevertheless likely to provide
\nsome support to company financials in 2026.
\nDiversified mining majors continued to demonstrate resilient
\nperformance, with aggregate revenues increasing by 4%
\nyear-on-year, while operating profit and free cash flow margins
\nremained broadly stable.
\nProduction costs for copper, nickel, cobalt and lithium continued to
\ndecline in 2025, extending the downward trend observed since 2024.
\nCopper costs fell gradually over the past three years, while cost
\nreductions for battery metals moderated in 2025 following substantial
\ndeclines in earlier years. The decline in 2025 was underpinned mainly
\nby lower labour, energy, reagent and other on-site costs, with nickel
\nseeing strong reductions across most categories, while cobalt largely
\nbenefited from lower on-site costs. Lithium costs were pulled down
\nby lower labour and on-site costs, although higher treatment and
\nrefining charges and shipment costs partly offset these gains. Copper
\ncosts saw more modest declines, with lower labour and on-site costs
\nhelping to offset rising royalty payments.
\nDespite recent declines in production costs, supply chain disruptions
\nlinked to the Middle East conflict could place upward pressure on
\ncosts in 2026. Higher energy prices, freight rates and reagent costs,
\nparticularly for sulphuric acid, may increase operating costs across
\nseveral mineral supply chains.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 79
\n1. Market review
\nCritical mineral investment fell in 2025 after several years of growth, with the strongest decline
\namong battery metal companies
\nCapital expenditure on non-ferrous metal production by major mining companies
\nIEA. CC BY 4.0.
\nNotes: MER = market exchange rate. Excludes budgets for iron ore, coal, aluminium, gold and diamonds. Based company reporting from 24 major mining
\ncompanies.
\nSource: Based on company reporting from 24 major mining companies. The companies are listed in the Annex.
\n10
\n20
\n30
\n40
\n50
\n60
\n2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
\nBillion USD (2025, MER)
\nDiversified major Copper Battery metals
\n-30% -15% 0% 15%
\n2013 to 2025 year-over-year 2024 to 2025 growth
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 80
\n1. Market review
\nThe growth in exploration spending seen since 2021 stalled in 2024 and declined in 2025\u2026
\nExploration spending for selected non-ferrous mineral resources, 2021-2025
\nIEA. CC BY 4.0.
\nNotes: MER = market exchange rate. Excludes budgets for iron ore, coal, aluminium, gold and diamonds. Others refer to cobalt, rare earth elements,
\npotash\/phosphate and many other minor metals.
\nSource: IEA analysis based on data from S&P Capital IQ.
\n2
\n4
\n6
\n8
\n2021 2022 2023 2024 2025
\nBillion USD (MER, 2025)
\nRest of world
\nAfrica
\nAsia Pacific
\nAustralia
\nLatin America
\nCanada
\nUnited States
\nBy region
\n2
\n4
\n6
\n8
\n2021 2022 2023 2024 2025
\nOthers
\nUranium
\nPlatinum
\nSilver
\nLithium
\nNickel
\nZinc
\nCopper
\nBy commodity
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 81
\n1. Market review
\n\u2026while M&A activity picked up, driven by financial investors and majors acquiring copper
\nassets
\nM&A activity for selected non-ferrous mineral resources, 2021-2025
\nIEA. CC BY 4.0.
\nNotes: MER = market exchange rate. M&A activity only considers completed transactions and is categorised according to the primary commodity of the acquired
\ncompany.
\nSource: IEA analysis based on data from S&P Capital IQ and company information.
\n5
\n10
\n15
\n20
\n2021 2022 2023 2024 2025
\nCopper
\nZinc
\nNickel
\nCobalt
\nLithium
\nSilver
\nUranium
\nOthers
\nBy target primary commodity
\nBillion USD (2025, MER)
\n2021 2022 2023 2024 2025
\nUndisclosed
\nOther
\nDiversified resources\/holding
\ncompany
\nDownstream\/strategic buyer
\nJunior
\nIntermediate
\nGovernment
\nFinancial investor
\nMajor
\nBy buyer company type
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 82
\n1. Market review
\nVenture capital spending grew strongest in companies focused on innovative ways to extract
\nminerals
\nEquity funding of critical minerals technology start-ups, 2015-2025
\nIEA. CC BY 4.0.
\nNotes: MER = market exchange rate. Since the publication of Global Critical Minerals Outlook 2025, a new category for data-led exploration has been added to
\nreflect the growing interest of innovators in the use of artificial intelligence in this area. This category now includes KoBold Metals, whose January 2025 deal has
\nbeen allocated to 2025 instead of 2024.
\nSources: IEA analysis based on data from Cleantech Group and Crunchbase.
\n0%
\n3%
\n6%
\n9%
\n12%
\n0
\n1
\n2
\n3
\n4
\n2015 2020 2025
\nBillion USD (2025, MER)
\nOther exploration, extraction and refining Battery reuse
\nBattery recycling Recovery from waste streams
\nData-led exploration Lithium extraction and refining
\nShare of total venture capital spending in energy (right axis)
\n0
\n10
\n20
\n30
\n40
\n2015 2020 2025
\nYearly funding Number of start-ups receiving their first funding
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 83
\n1. Market review
\nCritical mineral investment diverged across segments, with battery metals weakening while
\ncopper remained strong, reflecting its central role in electricity systems
\nDespite improved financial performance, strong underlying demand
\nand a recovery in prices for some critical minerals in 2025, companies
\nand investors remained cautious. This reflects elevated risks
\nassociated with market concentration and geopolitical developments,
\nprice volatility and uncertainty around future technology pathways.
\nAfter several years of rapid growth, investment in critical minerals
\nslowed in 2025. Our assessment of 24 large mining companies
\nindicates that aggregate capital expenditure fell 9% year-on-year,
\nmarking the first substantial decline since 2020. The sharp price
\nincreases observed between 2021 and 2022, followed by renewed
\nvolatility in 2024-2025, exposed structural uncertainties around
\ncritical mineral supply chains and complicated investment decisions.
\nInvestment trends vary markedly by company type and commodity.
\nCompanies focused on battery metals, such as lithium, nickel and
\ncobalt, experienced the largest decline in capital spending in over a
\ndecade, falling by over 20%. Lithium specialists in particular reduced
\ninvestment by around 40%, following several years of strong growth.
\nThis retrenchment reflects a combination of shifting battery chemistry
\npreferences, oversupply-driven price weakness and policy
\nuncertainty in key markets, all of which have weighed on investor
\nconfidence in battery metal markets.
\nDiversified majors scaled back their spending more modestly, while
\ncompanies focused on copper registered an increase of 8% year-onyear, underscoring investor confidence in copper\u2019s long-term growth
\ngiven its central role in electricity systems.
\nThese patterns are also reflected in mineral exploration. Critical
\nmineral exploration spending fell by over 10% in 2025. Again, this
\nslowdown was commodity-specific: copper continued to be the main
\nfocus of exploration budgets, with spending remaining broadly steady
\nyear-on-year. Lithium and nickel, however, both saw notable drops of
\naround 40%. For lithium, this largely reflects subdued prices following
\nrapid supply expansion in recent years, while for nickel, it is the result
\nof rising uncertainty linked to battery chemistry shifts and policy
\nchanges by major suppliers. Across regions, the largest declines in
\nexploration spending were in Australia and the United States, at
\naround 25%, whereas Asia Pacific recorded a 20% increase.
\nIn parallel, China has made substantial domestic investments in
\ngeological exploration, exceeding USD 15 billion in 2024 across all
\nminerals, and has continued to expand refining and processing
\ncapacity both domestically and through overseas investment,
\nreinforcing its central role across multiple stages of critical mineral
\nsupply chains.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 84
\n1. Market review
\nOverall M&A deal value rebounded in 2025, though the increase
\nresulted largely from a single USD 6.3 billion deal between Rio Tinto
\nand Arcadium Lithium. Behind this rise, divergence across
\ncommodities was very pronounced. Spending on copper assets
\ndoubled between 2024 and 2025 owing to consolidation and
\ncompetition for high-quality resources, reflecting copper\u2019s strategic
\nimportance and the concentration of high-value assets. In contrast,
\ndeal activity in battery metals remained subdued beyond the Rio TintoArcadium transaction, again highlighting weaker investor sentiment.
\nVenture capital (VC) investments in critical minerals recovered in 2025
\nand remain concentrated in technologies aimed at extracting more
\nvalue from resources. Critical minerals have accounted for around 5%
\nof total energy technology VC funding since 2021, up from negligible
\nlevels previously. In 2025, critical minerals start-ups raised
\nUSD2 billion in total, almost 1.5-times higher than the 2024 level. This
\n2025 trend runs counter to the decline seen in energy technology VC
\nin general, and in VC across all economic sectors except AI.
\nThis reflects strong investor interest in new technologies with high
\nperceived market potential, particularly direct lithium extraction, dataled exploration and advanced separation processes. However,
\nfunding is not evenly spread across regions, with much of it going to
\nUS start-ups. KoBold Metals, a United States-based data-led
\nexploration start-up founded in 2018, alone accounted for one-third
\nof total funding in 2025.
\nHowever, funding remains well below the level in 2023, reflecting a
\nmore difficult environment for VC fundraising amid higher interest
\nrates and policy uncertainty. These concerns have not eased in 2026,
\nand a near-term rebound in VC for critical minerals to previous levels
\nremains unlikely. This poses a challenge for new start-ups that are
\nbeing launched and seeking funding. While almost 70 start-ups
\nraised their first round of funding in 2022 or 2023, only 40 did so in
\n2024 or 2025. They are also raising less money on average, with an
\naverage first-round size of USD 12 million in the last year, versus
\nalmost USD 20 million twoyears ago.
\nData suggest that it has become more difficult to scale up rapidly.
\nOnly three start-ups founded since 2020, Cyclic Materials, Vulcan
\nElements and Genomines, are among the 40 that have raised more
\nthan USD 40 million and account for around 90% of total funding to
\ndate. Just three start-ups, Redwood Materials, KoBold Metals and
\nAscend Elements, account for 50% of funding since 2015. In other
\nenergy technology fields, the average share of post-2020 start-ups
\nrepresenting 90% of fundraising is higher, at 20%. Battery recycling
\nstart-ups find it especially difficult to scale up quickly, as reliable
\nstreams of waste materials and clear standards are not yet developed.
\nExtraction and refining start-ups often face high capital barriers to
\nstarting operations.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 85
\n1. Market review
\nTrading volumes for lithium and cobalt continue to expand, albeit from a small base, whereas
\nvolumes for nickel remain subdued
\nDaily trade volumes for copper and battery metals at major exchanges
\nIEA. CC BY 4.0.
\nNotes: Trading liquidity indicates the monthly average of daily traded volumes on major metal exchanges: copper (LME, SHFE, Chicago Mercantile Exchange
\n[CME]); nickel (LME, SHFE); cobalt (LME, CME); and lithium (LME, CME). Trading volumes for copper and nickel are around 15% of annual production, while those
\nfor cobalt and lithium are less than 1% of annual production. Physical trade volumes through these exchanges are much smaller than those figures.
\nSource: IEA analysis based on data from Bloomberg.
\n2
\n4
\n6
\n8
\n10
\n2021 2022 2023 2024 2025 2026
\nCopper Nickel
\nCopper and nickel
\nMt
\n200
\n400
\n600
\n800
\n1 000
\n2021 2022 2023 2024 2025 2026
\nCobalt Lithium
\nCobalt andlithium
\nt
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 86
\n1. Market review
\nLithium markets are experiencing increasing trading liquidity, with growing interest in hedging
\nand price risk management, but remain at an earlier stage of market development
\nTrading volumes on major metal exchanges reflect the liquidity and
\nmaturity of different mineral markets. Copper and nickel remain the
\nmost actively traded commodities, with long-established markets on
\nthe LME, SHFE and Chicago Mercantile Exchange (CME), supported
\nby their large and diversified industrial demand base. Copper trading
\nactivity reached record levels in early 2026, with average daily
\nvolumes on the LME (including both futures and options) peaking
\nbetween January and March due to high price volatility and inventory
\nreallocation driven by policy uncertainty.
\nTrading activity for battery metals has expanded in recent years but
\nremains at an earlier stage of development. Cobalt and lithium have
\nseen notable trading volume growth on the LME and CME over the
\nlast two years, reflecting rising demand and increasing interest in
\nmanaging price risk. Lithium contracts on the CME in particular saw
\na sharp increase in early 2026, after the market launched in 2023, as
\nmarket participants increased their hedging activity amid heightened
\nprice volatility.
\nDespite this growth, liquidity in battery metals markets remains
\nsignificantly lower than in base metals. Exchange-trade volumes
\naccount for around 15% of annual copper production and 14% of
\nannual nickel production, but remain below 1% for lithium and cobalt.
\nAs a result, exchange prices play a more limited role in price
\ndiscovery for these materials, although they remain an important
\nbenchmark for bilateral contracts.
\nExchanges have accelerated efforts to develop more liquid trading
\ninstruments in the lithium market. A notable example is the launch of
\nexchange-traded contracts, such as the LME lithium hydroxide CIF
\nbased on Fastmarkets prices. However, these contracts remain
\nclosely linked to external price assessments and have yet to reach
\nthe depth and liquidity of more established metal markets.
\nMore broadly, lithium markets remain comparatively opaque and
\nfragmented, with no single universally accepted benchmark price
\nequivalent to those of traditional base metals. Pricing continues to
\nrely largely on assessments from price reporting agencies, which
\npublish price indexes with different methodologies, regional coverage
\nand use cases. Unlike copper or nickel, lithium markets also lack a
\nmature stockholding function, as trading is still dominated by bilateral
\ncontracts, products are not fully standardised and derivatives markets
\nremain illiquid.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 87
\n1. Market review
\nPublic finance announcements for critical minerals have been rising since 2023, reaching
\naround USD65 billion in 2025, over four times higher than in 2023…
\nTypes of public sector financing commitments in selected countries, 2025
\nIEA. CC BY 4.0.
\nNotes: Policies included in the analysis are announced public financing commitments specifically targeted at critical minerals value chains and converted to USD.
\nFinancing associated with regulatory measures or policies without quantified public support is excluded. Where policies contain multiple financing instruments,
\nfinancing has been apportioned across instrument types to avoid double counting. Grants cover direct disbursements for production-stage or supply chain projects as
\nwell as policy envelopes supporting research, demonstration, pilot and innovation programmes. Budget allocation refers to government budget items used to support
\nnational strategies where financing is provided through a broader spending envelope rather than a single disbursement mechanism.
\nSource: IEA (2025), Critical Minerals Policy Tracker.
\n20
\n40
\n60
\n80
\n2023 2024 2025
\nBillions
\nTotal
\nTax
\nincentive
\nGuarantee
\nEquity
\ninvestment
\nLoan
\nBudget
\nallocation
\nGrants
\n0%
\n25%
\n50%
\n75%
\n100%
\n2025
\nUnited Kingdom
\nRussia
\nBrazil
\nAustralia
\nIndia
\nCanada
\nJapan
\nEuropean Union
\nKorea
\nUnited States
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 88
\n1. Market review
\n\u2026though the direction and pace of disbursements will determine supply chain outcomes
\nGiven the strategic importance of critical minerals and the financing
\nchallenges facing many projects, governments are increasingly
\ndeploying public finance to de-risk investment across supply chains,
\nparticularly in strategically important markets and for early-stage
\nprojects. This marks a shift towards more active state participation,
\nmirroring China\u2019s longer history of policy-backed financing across the
\nfull supply chain.
\nBased on our assessment of public financing announcements,
\ngovernments have increasingly deployed blended finance
\ninstruments to crowd in private capital for critical mineral supply
\nchains, a trend that has grown markedly since 2023. These include
\nequity funds, concessional loans and co-investment grants, though
\nthe mix varies significantly by country and market context. Advanced
\neconomies have increasingly combined direct state equity through
\nsovereign funds, export credits, state-owned enterprise participation
\nand development bank co-investment with risk-sharing tools such as
\nloan guarantees and offtake-backed facilities deployed to crowd-in
\nprivate capital. Concessional and blended finance structures have
\ngrown in prominence, particularly in instruments targeting supply
\nchains in geographically diverse regions.
\nSeveral governments made headline financing commitments in 2025,
\nsignalling a marked escalation in public ambitions for developing
\ncritical mineral supply chains in line with their strategic objectives.
\nThe United States alone mobilised over USD7 billion in direct
\nappropriations under the One Big Beautiful Bill Act, covering the
\nNational Defense Stockpile, the Industrial Base Fund and Defense
\nProduction Act financing, with a further USD 250 billion in loan
\nguarantee authority extended to the Department of Energy\u2019s Energy
\nDominance Financing office. Canada announced a USD 1.4 billion
\nCritical Minerals Sovereign Fund alongside a USD 1.1 billion First
\nand Last Mile Fund, India approved the USD3 billion National Critical
\nMinerals Mission, and Brazil’s BNDES and Finep launched a
\nUSD1 billion fund targeting domestic processing and value chain
\ndevelopment. Governments also expanded previously established
\nfunds, including USD 163 million for Korea\u2019s Supply Chain
\nStabilisation Fund in 2025 and USD 690 million for Australia\u2019s Critical
\nMinerals Facility in 2026. At the multilateral level, the European Union
\ncommitted USD 3.4 billion under its RESourceEU Action Plan.
\nThe gap between announced commitments and actual
\ndisbursements remains considerable, however. Many instruments,
\nincluding sovereign funds, loan guarantees and blended finance
\nvehicles, were still in the design or early operationalisation phases at
\nthe end of 2025, with project pipelines under assessment and
\neligibility criteria being established. While the scale of headline
\nfigures reflects political commitment and signal an important step up
\nin government ambition, the translation of announced commitments
\nIEA. CC BY 4.0.
\nPAGE | 89
\n1. Market review GlobalCriticalMinerals Outlook 2026
\ninto deployed capital remains uneven or uncertain. For example, the
\nEU Critical Raw Materials Act\u2019s 47 European Union-based strategic
\nprojects selected in 2025 carry an estimated total capital investment
\nrequirement of USD 26 billion, yet the CRMA confers strategic project
\nstatus and access to a financing subgroup \u2013 bringing together the
\nEuropean Investment Bank, national promotional banks and private
\nlenders \u2013 rather than a direct funding guarantee. Actual
\ndisbursements under the RESourceEU Action Plan are similarly still
\nbeing operationalised.
\nWhere disbursements have been made, they tend to reflect targeted,
\nproject-level interventions. Support has included direct equity, such
\nas the US government\u2019s USD 400 million investment in MP Materials
\n(acquiring preferred stock and warrants convertible into a potential
\n15% stake) as part of a broader multibillion-dollar public-private
\npartnership to build a domestic rare earth magnet supply chain,
\nand the UK National Wealth Fund\u2019s USD 41 million direct
\ninvestment in Cornish Lithium. Others have deployed concessional
\nfinancing, loan guarantees and grants to reduce early-stage
\ncapital burdens and improve project bankability, such as
\nAustralia’s USD 1.2 billion concessional loan to Iluka\u2019s Eneabba
\nrare earth refinery and France’s fiscal support for Caremag,
\nstructured as a tax credit, alongside additional backing from
\nJapan. These show a pattern of public financing that functions
\nprimarily as a risk-reduction tool at the project level, rather than as a
\nmechanism for broad sectoral capitalisation.
\nExpandingbeyond supply:demand-sideinterventions
\nAlongside supply-side measures, governments are looking at
\ndeploying demand-side interventions to support investment in
\nmineral supply chains. Approaches such as demand aggregation,
\nstrategic stockpiling and facilitated offtake arrangements gained
\ntraction in 2025 as tools for improving revenue certainty and reducing
\ncommercial risk at the project level. These measures address a
\nfundamental challenge in mineral project finance, where the absence
\nof long-term offtake has been a primary barrier to debt mobilisation.
\nAustralia\u2019sCritical Minerals Strategic Reserve and the US
\ngovernment\u2019s announced magnet offtake commitment to MP
\nMaterials are among the clearest expressions of this approach.
\nThe US Export-Import Bank also announced a direct loan of
\nUSD 10 billion for Project Vault to establish strategic mineral
\nreserves in the country. China\u2019sfinancing model, bycontrast, has
\nlong embedded demand security structurally rather than
\ninstrumentally, with vertically integrated supply chains
\nestablished by linking overseas upstream production to domestic
\nprocessing capacity to internalise offtake risk.
\nThe scale of public financing announcements in 2025 is an inflection
\npoint in how governments approach critical mineral supply chain
\ndevelopment. The central question for markets is not merely the
\namount of public finance announced, but how, when and where
\nfinancing will be deployed. For the supply additions that consuming
\neconomies are counting on to come online in the coming years, the
\npace and reliability of public finance disbursement remain
\nconsequential.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 90
\n1. Market review
\nBox 1.1 Investments by China in the last decade
\nChina\u2019s position in critical mineral supply chains is the product of
\nsustained, policy-backed investment over decades. It continues to
\nleverage state-backed lending and project finance structures
\nchannelled through state-owned commercial banks, policy banks
\nand provincial subsidy programmes. Underpinned by strategic
\nframeworks, including the Belt and Road Initiative and successive
\nFive-Year Plans, and channelled through state-owned commercial
\nbanks, such as the Bank of China, these investments have been
\nstructurally coherent.
\nThe dominant instrument has been limited-recourse project finance,
\nwith lending portfolios supporting upstream project companies,
\nincluding special-purpose vehicles and joint ventures in which
\nChinese firms hold equity stakes, across emerging markets and
\ndeveloping economies. This structure ensures that raw or processed
\nmineral outputs from overseas projects are channelled back for
\nfurther domestic processing, effectively internalising offtake risk and
\ninsulating downstream processors from supply disruptions and spot
\nmarket volatility. Between 2018 and 2023, the country poured over
\nUSD 98 billion in upstream investment across copper, nickel, lithium,
\ncobalt, niobium and other minerals in nearly 20 countries.
\nThe pace has since accelerated. Chinese firms deployed an
\nestimated USD 120 billion in outbound mining investment from 2023
\nto 2025. China also financed around USD 24 billion in 363 port
\nprojects from 2001 to 2025, around 50% of which serve energy and
\nmineral supply chains. Sixty-three of these projects are located
\nwithin 500 km of a China-financed mine, anchoring the upstream
\nsupply chain. At the domestic level, China has sustained over in
\ngeological exploration spending since 2022, with most provincial
\ngovernments expanding exploration subsidies in 2025.
\nChina state-backed mineral financing by region, 2018-2023
\nIEA. CC BY 4.0.
\nNote: CSAM = Central and South America.
\nSource: AidData (2026), Tracking China\u2019s Transition Mineral Financing.
\n3
\n6
\n9
\n2018 2019 2020 2021 2022 2023
\nBillion USD
\nOceania
\nEurope
\nAsia exChina
\nAfrica
\nCSAM
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 91
\n1. Market review
\nLatest policy developments
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 92
\n1. Market review
\nPolicy developments in 2025 reinforced diversification, international partnerships and broader
\ngovernment engagement across supply chains
\nIn 2025, supply risks arising from highly concentrated mineral supply
\nchains materialised at scale. Against this backdrop, many governments
\nintensified efforts to address these vulnerabilities, introducing a wide
\nrange of policy measures to strengthen supply security and resilience.
\nPolicy developments between 2025 and the first quarter of 2026
\nillustrate the growing use of government intervention to respond to
\nconcentration risks and support supply chain diversification.
\nThe IEA\u2019s Critical Minerals Policy Tracker organises government
\npolicies around four core objectives: ensuring supply reliability and
\nresilience; promoting exploration, production and innovation;
\nencouraging sustainable and responsible practices; and scaling up
\nrecycling. Activity in 2025 was concentrated on the first two objectives,
\nunderpinned by expanded public investment and marked growth in
\ninternational arrangements.
\nRevised critical minerals lists
\nSeveral governments refreshed their official designations of which
\nminerals constitute strategic priorities, with notable shifts in scope
\nand rationale. The United States updated its List of Critical Minerals
\nfrom 50 to 60 minerals, adding ten new entries, including copper,
\nuranium and lead, and extending strategic designation beyond
\ntechnology-critical metals to inputs required across the broader
\nindustrial economy. The United Kingdom revised its critical minerals
\nlist to introduce a second tier of \u201cgrowth minerals\u201d, explicitly linking
\ndesignations to industrial strategy, energy technology deployment,
\ndefence and advanced manufacturing, encompassing industrial
\nminerals, battery minerals, germanium as a technology material and
\nphosphorus as a fertiliser input. SouthAfrica, as a major resource
\nholder, revised its list to prioritise domestically abundant and exportoriented minerals, with an emphasis on industrialisation,
\nbeneficiation and greater value capture in global supply chains.
\nNew Zealand released its first critical minerals list, covering
\n37 minerals with potential to be produced domestically and those for
\nwhich resilient supply will need to be supported.
\nRefreshed strategies and national frameworks
\nSome governments issued new or updated overarching minerals
\nstrategies in 2025. New Zealand published its Minerals Strategy to
\n2040, targeting a doubling of its mineral export value to
\nUSD 1.69 billion by 2035. The European Commission adopted the
\nReSourceEU Action Plan to accelerate implementation of the Critical
\nRaw Materials Act, including the designation of 47 strategic projects
\nintended to fast-track development and improve financing access.
\nThe United Kingdom\u2019s Vision 2035: Critical Minerals Strategy sets
\nquantitative diversification objectives for 2035: at least 10% of
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 93
\n1. Market review
\naggregate annual demand met through domestic production, 20%
\nfrom recycling and no more than 60% of annual demand for any
\nindividual critical mineral sourced from any one supplier country. This
\nfollows similar single-supplier thresholds adopted elsewhere,
\nincluding the European Union’s Critical Raw Materials Act (65% of
\nannual consumption of each strategic raw material) and Korea’s 2023
\ncritical minerals strategy (50% by 2030). The Association of
\nSoutheast Asian Nations published the Minerals Development Vision
\n2045 and accompanying Minerals Cooperation Plan 2026-2030,
\ncovering integrated value chain development, workforce capacity,
\ninvestment facilitation and responsible supply principles. Chile
\nadopted its National Critical Minerals Strategy, aiming to strengthen
\nits role as a reliable and responsible global supplier of minerals, with
\na focus on domestic value addition and international partnerships.
\nInternational arrangements and multilateral cooperation
\nOne of the most active areas of policy in 2025 was bilateral and
\nmultilateral arrangements between consuming and producing
\neconomies, spanning memoranda of understanding (MOUs),
\ndedicated partnership frameworks and joint investment vehicles.
\nThe United States was among the most active parties. By early 2026,
\nthe country had concluded more than 20 critical minerals frameworks
\nor MOUs, including frameworks with Australia and India and MOUs
\nwith Cambodia, Malaysia, Thailand and Saudi Arabia. Its
\narrangement with the DRC is notable for explicitly providing priority
\naccess for US private sector participants, extending beyond a
\nstandard government-to-government model to embed commercial
\nofftake interests within a diplomatic framework. In addition, the United
\nStates launched the Forum on Resource Geostrategic Engagement
\n(FORGE) in February 2026 to strengthen multilateral co-operation.
\nSince 2025, India has concluded MOUs and partnership frameworks
\nand issued joint declarations of intent on co-operation on critical
\nminerals with Argentina, Brazil, Canada, France, Germany, Italy,
\nJapan, the Netherlands, Norway, the UnitedArab Emirates, the
\nUnited Kingdom and the United States.
\nIn May 2026, Indonesia and the Philippines formalised a co-ordinated
\nnickel supply corridor under an MOU, committing to move
\n200 000 tonnes of ore per month from Philippine mines to Indonesian
\nsmelters starting June 2026 and establishing a structured partnership
\nbetween upstream Philippine producers and Indonesia\u2019s downstream
\nprocessing capacity.
\nAlso in May 2026, Australia, India, Japan and the United States
\nannounced the Quad Critical Minerals Initiative Framework,
\nadvancing the Quad Critical Minerals Initiative launched in July 2025.
\nThe framework aims to coordinate investment, policy tools and
\nsupply chains across the full minerals value chain and mobilise up to
\nUSD 20 billion to reduce reliance on concentrated supply by jointly
\ndeveloping mining, processing and recycling capacity.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 94
\n1. Market review
\nUnder Canada\u2019s presidency of the Group of Seven (G7) in 2025, G7
\nleaders launched the Critical Minerals Action Plan, building on
\nsuccessive G7 presidencies\u2019 work since 2023. Its principal
\ndeliverable was the Roadmap to Promote Standards-Based Markets
\nfor Critical Minerals, which identifies non-market policies and
\npractices as a core systemic challenge to mineral supply chains and
\ncommits G7 members to using available instruments, including
\nprocurement, financial incentives, trade measures and price floors, to
\ndiversify supply chains. In parallel, Canada launched the Critical
\nMinerals Production Alliance to advance project-level collaboration
\nand financing among like-minded partners. This initiative has been
\ncarried forward as the G7 Critical Minerals Resilience and Production
\nAlliance, with further project announcements expected.
\nIn 2026, France assumed the G7 presidency and designated the
\nminerals agenda as a cross-cutting priority. G7 leaders adopted the
\nDeclaration on Securing Supply Chains for Critical Minerals in June
\n2026, escalating collective ambition across industrial co-operation,
\nfinancing, market structuring, transparency and traceability,
\nstockpiling and recycling. The leaders set a concrete diversification
\ntarget for rare earths of reducing dependency on a single non-G7
\nsupplier for rare earths and permanent magnets to below 60% by
\n2030. The Declaration also recognised the IEA\u2019s Critical Minerals
\nSecurity Programme as a key international platform to advance G7
\nefforts. In February 2026, IEA Ministers acknowledged the significant
\nprogress made under the Programme and adopted a Declaration
\nSupporting the IEA\u2019s Work on Critical Minerals Security, directing the
\nIEA to reinforce and expand the Programme to support countries in
\nenhancing preparedness for potential supply disruptions and
\naccelerating supply diversification.
\nRevenue capture and supply management in emerging
\nmarkets
\nGovernments of producing countries among emerging markets have
\nused policies to capture greater economic value from mineral
\nendowments and, in some cases, to exercise greater control over
\nexport flows. Indonesia revised its nickel ore pricing framework in
\nApril 2026 to embed the value of battery-relevant by-products,
\nincluding cobalt, in the government\u2019sbenchmark formula, a change
\nwith direct implications for downstream cost structures and mixed
\nhydroxide precipitate production economics. The DRC, having
\nimposed a cobalt export ban in February 2025, replaced it with an
\nexport quota in October 2025, aimed at supporting prices while
\nmaintaining export revenue. The Philippines officially enacted the
\nEnhanced Fiscal Regime for Large-Scale Metallic Mining in
\nSeptember 2025, introducing a royalty structure to increase
\ngovernment revenue from mineral extraction. Raw mineral export
\nrestrictions more broadly, including Malaysia\u2019s ban on raw rare earth
\nelements, remained a feature of the policy landscape in 2025.
\nStrategic reserves
\nGovernments are increasingly complementing investment and
\npartnership strategies with dedicated stockpiling and reserve
\nmechanisms, reflecting concerns about near-term supply disruption
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 95
\n1. Market review
\nrisk. In February 2026, the United States announced Project Vault \u2013
\nformally, the US Strategic Critical Minerals Reserve. The initiative is
\nstructured as an independently governed public-private partnership
\nand is described as a demand-driven reserve backed by up to USD
\n12 billion, including roughly USD 10 billion in financing from the
\nExport-Import Bank of the United States and about USD 2 billion from
\nprivate capital. Rather than relying on centralised government
\nforecasting, the programme is intended to stockpile critical minerals
\nbased on manufacturer commitments and supply-chain needs, with
\nrare earth elements receiving early emphasis. Complementary
\ninstruments include equity stakes in mining companies, bilateral
\nprice-floor frameworks, and offtake-linked financing.
\nAustralia\u2019s Critical Minerals Strategic Reserve is oriented towards supplyside investment facilitation for selected critical minerals: antimony, gallium
\nand rare earth elements. It has a range of financial tools to secure supply,
\nsell and selectively stockpile critical minerals, allowing it to de-risk
\ninvestment in projects where private finance is constrained, mitigate
\nsupply shocks and address market distortions. The Reserve has
\nAUD1 billion (Australian dollars) available for transactions as part of an
\nexpanded AUD5 billion Critical Minerals Facility. A further
\nAUD 150 million has been allocated for selective stockpiling of minerals.
\nThe Democratic Republic of the Congo (DRC) has also adopted a
\nstrategic reserve mechanism for critical minerals. In April 2026, the
\ngovernment established a strategic reserve for cobalt, coltan and
\ngermanium, administered by the Regulatory and Control Authority for
\nStrategic Mineral Substances. The reserve complements the existing
\nexport quota and allows the government to acquire, hold and market
\nstrategic minerals, providing an additional instrument to influence
\nsupply availability and respond to market imbalances.
\nTraceability and transparency
\nTraceability is gaining traction as a policy instrument, with
\ngovernments across both consuming and producing economies
\nmoving to establish or strengthen systems for monitoring mineral
\nflows through supply chains. The G7 Roadmap reflects this
\nmomentum at the multilateral level, calling for interoperable digital
\ncredentials and digital product passport compatibility aligned with the
\nUnited Nations Transparency Protocol. At the national level, India has
\nannounced the development of a dedicated traceability system under
\nthe National Critical Mineral Mission, signalling that major emerging
\neconomy consumers are integrating traceability into their broader
\nminerals security frameworks. Among producing countries, Zambia
\nlaunched the Zambia Integrated Mining Information System in
\nFebruary 2025. The digital platform consolidates mining-related
\ntransactions, including applications for mining and non-mining rights,
\npayment of area charges and submission of statutory reports, with
\nthe objectives of increasing transparency, streamlining licensing
\nprocesses, reducing corruption and enhancing inter-agency
\ncollaboration. In Indonesia, the SIMBARA platform, established in
\n2022 to integrate government oversight of mineral and coal flows,
\nwas required to be expanded in 2025 to include cobalt tracking,
\nextending its monitoring across additional critical minerals. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 96
\n1. Market review
\nSustainability performance tracking
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 97
\n1. Market review
\nSustainability risks continue to disrupt supply, underscoring the need for monitoring amid
\ngradual overall improvement
\nRecent developments in 2025 highlight that social, environmental
\nand governance-related risks continue to pose material threats to
\ncritical mineral supply chains. At the operational level, regulatory noncompliance has led to abrupt supply disruptions. Crackdowns on
\nillegal mining, licence revocations and asset seizures in some
\nproducing countries have temporarily removed supply from the
\nmarket. For example, in October 2025, Mali revoked over 90 mining
\nexploration permits and Ghana revoked over 270 small-scale mining
\nlicenses due to regulatory non-compliance. In September 2025,
\nIndonesia suspended 190 coal and mineral permits due to
\ncompliance deficiencies. Sourcing minerals from conflict-affected
\nareas can also disrupt supply, as seen in rare earth supply chains
\nwhen the Kachin Independence Army seized parts of Myanmar in
\n2024. These events illustrate how governance-related risks can
\ntranslate directly into physical supply constraints.
\nLabour violations or disputes also disrupted supply in 2025 and 2026.
\nWorkplace fatalities in Chile, Indonesia and Kazakhstan led to
\ntemporary halts in production. In the DRC, a labour strike at CMOC\u2019s
\nTenke Fungurume copper mine temporarily disrupted operations in
\nJune 2026. These events illustrate how poor labour standards can
\nlead to strikes or government stop-work orders that affect the steady
\nsupply of minerals.
\nClimate-related risks also continue to affect production in key regions.
\nWater stress, extreme weather events and changing environmental
\nconditions pose rising challenges for mining operations. Over the
\npast decade, excessive rainfall in Australia has disrupted
\ntransportation links and forced copper mines to reduce production,
\nwhile in Chile, water scarcity has continued to cause declining
\nproduction at mines. In Canada, forest fires forced a halt in operations
\nat Hudbay Minerals\u2019 Snow Lake mine in summer 2025. Climate or
\nenvironmental risks can disrupt production directly, delay project
\ndevelopment and increase operational costs. They can also affect
\nfinancing and investment: in September 2025, Norway\u2019s state
\npension fund divested its stake in Eramet over alleged environmental
\ndamage and Indigenous rights violations at the PT Weda Bay Nickel
\nsite in Indonesia.
\nAt the same time, social opposition and community-related risks
\nremain a key source of disruption. Project delays linked to permitting
\nchallenges, legal appeals and local stakeholder opposition continue
\nto affect timelines across multiple jurisdictions. For example, the
\nResolution Copper project in the United States faced significant
\npermitting delays owing to legal challenges and community
\nobjections. In Indonesia, four nickel mining permits were revoked in
\nRaja Ampat over environmental violations after public protests. In
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 98
\n1. Market review
\nPeru, road blockades by informal miners in 2025 disrupted the
\ntransportation of copper, highlighting how social tensions and
\ninformality can constrain the movement of mined output. In some
\ncases, companies have sought to mitigate these risks through
\nincreased stakeholder engagement, benefit-sharing agreements and
\nlocal partnerships, although outcomes remain mixed.
\nSustainability performance is also increasingly being integrated into
\nmineral trade flows. Many consuming economies are rolling out policy
\nmeasures that seek to encourage responsible practices in mineral
\nsupply chains. For example, due diligence requirements are
\nincreasingly common, requiring large downstream companies to
\nidentify, assess and mitigate adverse impacts in their supply chains.
\nExamples include the European Union\u2019s Batteries Regulation and
\nCorporate Sustainability Due Diligence Directive, France\u2019s Duty of
\nVigilance Law and Germany\u2019s Act on Corporate Due Diligence
\nObligations in Supply Chains. Government policies that link market
\naccess to high sustainability performance are also increasingly
\ncommon. For example, forced labour import bans are now in force in
\nCanada, Indonesia, Mexico and the United States, with Canada
\nannouncing an expanded ban in June 2026 and the European Union
\nplanning to implement a new forced labour regulation in 2027. High
\ngreenhouse gas (GHG) emissions performance is also increasingly
\na condition for market access in importing countries, for example
\nthrough carbon border adjustment mechanisms in the
\nEuropean Union and the United Kingdom or through the
\nEuropean Union\u2019s Deforestation Regulation. While some of these
\npolicies have recently been pared down, for example in the
\nEuropean Union, companies continue to face sustained regulatory
\nexpectations to prevent or minimise adverse impacts within their
\nsupply chains.
\nTaken together, these developments underscore the importance of
\ncontinued monitoring and redress of sustainability-related risks.
\nStrengthening transparency, utilising voluntary reporting standards,
\nimproving operational practices and enhancing traceability will be
\ncritical to mitigating supply disruption risks and ensuring resilient and
\nresponsible mineral supply chains.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 99
\n1. Market review
\nAfter several years of improvement, sustainability reporting slowed in 2024 across major
\nproducers
\nNumber of companies with a strong presence in energy minerals reporting on selected indicators
\nIEA. CC BY 4.0.
\nNotes: Data from 25 companies were reviewed from 2020 to 2024, with two subsidiaries counted separately despite M&A. GHG emissions refer to reporting on total
\nscope 1 and 2 emissions; gender diversity refers to the share of women in the workforce; water use considers total water withdrawals; responsible labour refers to
\npolicies to prevent child and forced labour; and biodiversity commitments refer to \u201cno net loss\u201d or \u201cnet positive impact\u201d targets. Reporting numbers in the chart are
\nbased on whether a given company disclosed a metric or policy for the relevant category in its annual sustainability report.
\nSources: IEA analysis based on data from 2020-2024 sustainability reports from 24 major mining companies. Companies are listed in the Annex.
\n5
\n10
\n15
\n20
\n25
\nGHG
\nemissions
\nGender
\ndiversity
\nCommunity
\ninvestment
\nWater use Injury rate Waste
\ngeneration
\nResponsible
\nlabour
\nReporting
\nframework
\nLand disturbed
\n\/ rehabilitated
\nBiodiversity
\ncommitments
\n2020 2021 2022 2023 2024
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 100
\n1. Market review
\nEnvironmental indicators show mixed results across key mineral producers, with improving
\nbiodiversity and waste outcomes but stagnating emissions and water performance
\nIndustry performance across environmental indicators, 2020-2024
\nIEA. CC BY 4.0.
\nNotes: Left-axis values for GHG emissions, water use and mine waste are calculated as the production\u2011weighted averages across companies, using mineral
\nproduction data reported in sustainability disclosures. For GHG emissions and biodiversity indicators (net annual land change and annual rehabilitation), values for
\n2024 include estimates for companies that reported in 2023 but not in 2024.
\nSource: IEA analysis based on 2020-2024 sustainability reports.
\nMine waste
\n0.4
\n0.8
\n1.2
\n150
\n300
\n450
\n2020 2021 2022 2023 2024 kt per kt of mineral
\nkilotonnes
\nMine waste Per mined output (right axis)
\n0.10
\n0.20
\n0.30
\n12
\n24
\n36
\n2020 2021 2022 2023 2024
\nktCO2
\ne per kt of
\nmineral
\nMtCO2e
\nScope 1 and 2 emissions Per mined output (right axis)
\nGHG emissions
\n1.0
\n2.0
\n3.0
\n250
\n500
\n750
\n2020 2021 2022 2023 2024
\nGL per kt mineral
\nGigaliters
\nWater use Per mined output (right axis)
\nWater use
\n8%
\n16%
\n24%
\n8
\n16
\n24
\n2020 2021 2022 2023 2024
\nHundred km2
\nNet annual land change Annual rehabilitation ratio (right axis)
\nBiodiversity
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 101
\n1. Market review
\nGains in women\u2019s workforce participation and community investment contrast with stagnating
\nprogress in senior leadership diversity
\nIndustry performance on gender balance and community investment, 2020-2024
\nIEA. CC BY 4.0.
\nNotes: Social indicators are based on publicly reported data from major mining companies and may be subject to differences in reporting scope and methodology.
\nCoverage varies across indicators and years. Community investment figures are reported in nominal terms.
\nSource: IEA analysis based on 2020-2024 sustainability reports.
\n25
\n50
\n75
\n100
\n2020 2021 2022 2023 2024
\nThousand USD\/tonne
\nCommunity investment
\n6%
\n12%
\n18%
\n24%
\n30%
\n2020 2021 2022 2023 2024
\nWomen in senior management
\nShare of women in the workforce
\nGenderbalance
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 102
\n1. Market review
\nSustainability reporting weakened in 2024, while industry environmental and social
\nperformance remained mixed
\nMomentum on sustainability reporting across major mineral
\nproducers showed signs of slowing in the 2025 reporting cycle (which
\ncovers activities during the 2024 calendar year), with progress
\nbecoming more uneven. After years of steady expansion in coverage
\nand disclosures, this trend has moderated, even as companies
\ncontinue to recognise that stronger sustainability performance helps
\nmitigate financial risks and ensure compliance. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nTo assess how companies are performing on sustainability reporting,
\nwe selected six priority areas relating to sustainability, namely water,
\nGHG emissions, biodiversity, human rights, communities and
\ncorruption. We then examined whether companies are disclosing
\nspecific quantitative metrics relating to these six priority areas in their
\nannual sustainability reports, enabling comparison across companies
\nand over time. While human rights and corruption were identified as
\npriority areas, analysis was limited to the presence of corporate
\npolicies due to limited comparable quantitative data. Overall, major
\nproducers did not consistently disclose the same metrics for the 2025
\ncycle, with some operators providing less information than in previous
\nyears. This suggests that, while reporting has not lost relevance,
\nmomentum has weakened, reflecting a reprioritisation of company
\nresources and evolving regulatory uncertainty.
\nAmong companies that reported, the quality and scope of disclosures
\nimproved in some areas, although gaps remain in the consistency
\nand comparability of reported data. For example, comparability
\nrequired the use of externally estimated production data. For
\nbiodiversity indicators, fewer companies reported relevant metrics
\nthan in previous years, even where they had previously disclosed
\nannual land rehabilitated and land disturbed. Similar comparability
\nchallenges are observed for gender balance indicators, as
\ncompanies report these using differing definitions and scopes, for
\nexample focusing only on board-level diversity, reporting the share of
\nwomen in management, or combining multiple categories of staff,
\nsuch as middle, senior and executive management, relative to total
\nemployees. This variation reflects the flexibility in existing reporting
\nframeworks, as reporting standards provide general guidance on
\ndisclosing gender composition across governance bodies and
\nemployee categories but do not prescribe a single, harmonised
\nmethodology. This reinforces the case for standardising reporting
\nframeworks across companies and jurisdictions, facilitating
\ncomparison of performance among major producers.
\nThird-party verification has continued to strengthen, particularly at the
\nmine-site level. An increasing number of operations are participating
\nin independent assurance mechanisms, with five sites announced as
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 103
\n1. Market review
\ncommencing audits under the Initiative for Responsible Mining
\nAssurance (IRMA) in Q1 2025, compared with the announced
\ncompletion of three audits in the previous year. Similarly, the number
\nof sites undergoing Copper Mark assurance has expanded,
\nincreasing from around 50 independently verified operations in 2023
\nto approximately 100 participating sites in 2024, of which around
\nthree-quarters had already been verified. In 2025, membership of the
\nInternational Council on Mining and Metals expanded for the first time
\nsince 2021, with Hindustan Zinc and Maaden joining the group, and
\nboth companies also joined the Extractive Industries Transparency
\nInitiative, reflecting growing alignment with recognised standards and
\nprinciples.
\nChina-owned mining companies, which had shown notable
\nimprovements in disclosure in the 2024 cycle, did not sustain the
\nsame pace of progress in the latest cycle, in part reflecting delays in
\nreporting. Among these, CMOC continues to stand out as a leading
\ndiscloser, maintaining relatively comprehensive reporting across
\nwaste and energy indicators, whereas disclosures on social and
\ngovernance indicators are comparatively less standardised in
\nquantitative terms and rely more on qualitative reporting. Other
\nChinese companies have shown limited updates, with variations in
\nboth the depth and timeliness of disclosure.
\nPerformance trends
\nDespite mixed progress in reporting coverage, the underlying
\nperformance indicators present a varied picture. Recent disclosures
\nsuggest that some social performance indicators have shown steady
\nimprovement since 2020. For example, in 2024, reported figures for
\ncommunity investment were up 20% from 2020 and, after a downturn
\nin 2022, up 12% from 2023. Worker safety has also improved.
\nGender balance shows mixed performance, with the share of women
\nin the workforce growing from 19% in 2020 to 22% in 2024, although
\nthe share of women in senior management has stagnated since 2021.
\nAt the same time, indicators related to environmental performance
\ncontinue to show gradual efficiency gains. Companies report
\nimprovements in mine waste intensity, pointing to continued
\noperational optimisation across major key mineral producers.
\nBiodiversity-related indicators indicate gradual improvement, with
\nland rehabilitation increasing relative to annual land disturbed. The
\nrehabilitation ratio increased from 18% in 2020 to 20% in 2024,
\nnotwithstanding year-to-year variations. However, performance has
\nbeen less favourable for other environmental dimensions: water-use
\nintensity shows signs of deterioration, and scope 1 and 2 GHG
\nemissions (both in absolute terms and on an intensity basis) are
\nstagnating. These patterns reflect persistent structural challenges,
\nincluding expanding mining operations, declining ore grades and an
\nincreasing reliance on lower\u2011quality deposits, which continue to place
\nupward pressure on absolute levels of resource use and
\nenvironmental disturbance.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 104
\n1. Market review
\nDevelopments in regulations and standards
\nRegulatory developments also contributed to uncertainty in 2024 and
\nmay have influenced corporate reporting practices in 2025. Progress
\nhas varied significantly across jurisdictions, with regulatory
\nmomentum strengthening in some countries while slowing or
\nreversing in others. In several jurisdictions, policy makers have
\nsought to recalibrate or streamline corporate reporting and due
\ndiligence requirements. In the European Union, the Omnibus I
\nPackage narrowed the scope and simplified the reporting
\nrequirements under the Corporate Sustainability Reporting Directive
\nand the Corporate Sustainability Due Diligence Directive, with
\nextensions also made to compliance timelines. In the United States,
\nthe Securities and Exchange Commission proposed rescinding its
\n2024 rules on climate-related disclosures, though California is set to
\nenforce its regulation on GHG emissions reporting beginning in 2026.
\nIn Canada, the Canadian Securities Administrators paused the
\ndevelopment of a new mandatory rule on climate-related disclosures,
\nwith a view to supporting Canadian markets and issuers. There was
\nforward momentum in Australia, with its mandatory climate reporting
\nstandards coming into effect for eligible companies on 1 January
\n2025.
\nDespite growing regulatory uncertainty, voluntary standards continue
\nto emerge and strengthen responsible mining, with an increasing
\nfocus on harmonisation and alignment between existing standards.
\nFor instance, the Global Reporting Initiative\u2019s Sector Standard for
\nMining came into effect on 1 January 2026. The Initiative for
\nResponsible Mining Assurance is updating the IRMA Standard to
\nbroaden coverage across the mining value chain and strengthen
\nrequirements for responsible mining. In addition, the Consolidated
\nMining Standard Initiative is developing a global standard that
\nconsolidates the Copper Mark, the International Council on Mining
\nand Metals\u2019 Mining Principles, the Mining Association of Canada\u2019s
\nTowards Sustainable Mining and the World Gold Council\u2019s
\nResponsible Gold Mining Principles, which is expected to launch in
\nearly 2027. In 2026, the China Chamber of Commerce of Metals,
\nMinerals & Chemicals Importers & Exporters also opened a global
\npublic consultation for the development of a Sustainability Mining
\nCode, with a view to aligning it with international responsible mining
\nstandards.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 105
\n1. Market review
\nFor some key energy minerals, the pace of decline in production-related emissions intensity
\naccelerated in 2025
\nChange in emissions intensity associated with critical minerals production
\nIEA. CC BY 4.0.
\nNote: Changes in emissions intensity are based on scope 1 and scope 2 GHG emissions from mining and refining activities.
\nSource: IEA analysis based on data from Wood Mackenzie.
\n-10%
\n-8%
\n-6%
\n-4%
\n-2%
\n0%
\n2%
\n4%
\n6%
\n8%
\nCopper (mining) Copper (smelting) Lithium Nickel
\n’23 ’24 ’25 ’23 ’24 ’25 ’23 ’24 ’25 ’23 ’24 ’25
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 106
\n1. Market review
\nDeclining emissions across key energy mineral production highlight progress towards
\ncompany decarbonisation targets
\nGHG emissions intensities for copper, lithium and nickel production
\ndeclined overall in 2025 compared with the previous year. Copper
\ncontinued the downward trend observed since 2023, with emissions
\nintensities for mining falling by 6% year-on-year in 2025 and by 8%
\nfor smelting. The reduction in copper smelting was the most
\npronounced. For lithium and nickel, growth in emissions intensity
\nslowed or shifted into decline in 2025. Emissions intensity for nickel
\ncontinued the reduction trend observed in 2024, while lithium shifted
\ninto declining intensity in 2025.
\nThe drivers of lower emissions varied across commodities. In copper
\nmining, the decline was led by lower emissions from purchased
\nelectricity for milling, which accounts for one of the largest shares of
\nemissions in this segment. In copper smelting, lower emissions from
\npurchased power also contributed to the decline. Facility-level
\ndisruptions may also have played a role: for example, the Philippines’
\nsole copper smelter, PASAR, was taken offline for part of 2025 amid
\nunfavourable market conditions. For lithium, emissions related to
\ndiesel use at mine sites, which increased from 2023 to 2024, declined
\nin 2025, contributing to the overall reduction. For nickel, lower
\nemissions from coal use and purchased electricity in the smelting
\nsegment supported the reduction in 2025.
\nThese trends are taking place alongside a growing number of
\ncompanies setting medium- and long-term decarbonisation targets.
\nAmong the companies covered, 20 have established net zero or
\nequivalent targets for 2050, while 14 have set interim targets for 2030.
\nHowever, variation in target scope and underlying methodologies
\ncontinues to limit comparability and assessment of progress against
\nthese goals.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 107
\n1. Market review
\nBox 1.2 Traceability to support market differentiation and responsible supply chains
\nTraceability is a foundational tool for the development of
\nsustainable and responsible supply chains. Implementing
\ntraceability systems can enable the collection of information on
\nsustainability metrics, such as GHG emissions, corruption risk or
\ncompliance with labour standards. This can allow upstream
\nproducers with higher standards to differentiate their products from
\nthose associated with poorer practices, supporting the emergence
\nof performance-based purchasing by midstream and downstream
\ncompanies. In turn, this could support the emergence of \u201chighperformance price premiums\u201d or \u201clow-performance grey discounts\u201d.
\nIEA analysis indicates that traceability is on the rise: in a joint survey
\nconducted by the IEA and the OECD, two-thirds of surveyed
\ncompanies reported having some form of traceability system in
\nplace. Yet companies still face many obstacles to traceability
\nimplementation. Major obstacles reported by companies include
\nhigh implementation costs, a lack of interoperability and limited
\nincentives for sharing information along the supply chain. Price
\nsignals also remain weak: only one-quarter of respondents
\nreported receiving some form of premium for differentiated
\nmaterials. Further, most companies collect core provenance and
\nownership data, while far fewer collect the broader performancerelated and corporate transparency information needed to underpin
\nperformance-based purchasing.
\nGovernments can help accelerate uptake of traceability systems by
\nproviding financial support for traceability infrastructure, harmonising
\ntraceability standards and strengthening incentives for data sharing
\nalong the supply chain. Strengthening traceability systems through
\ngovernment intervention can help develop standards-based
\nmarkets, which in turn can unlock supply in non-incumbent countries
\nand mitigate the risk of supply disruptions associated with poor
\npractices.
\nShare of companies that indicated receiving price premiums
\nacross five focus minerals
\nIEA. CC BY 4.0.
\nNotes: \u201cPrice premium\u201d refers to companies that indicated receiving a price premium
\nbased on origin, low GHG emissions or material with social audit certificates. \u201cNo price
\npremium\u201d refers to companies that expressly stated that they do not currently receive a
\nprice premium for traced material. The remaining percentage refers to companies that
\neither reported discounts for non-traced material, provided their own response (e.g.
\n\u201cn\/a\u201d or \u201cnot yet tracked\u201d) or did not answer.
\nSource: IEA-OECD joint survey, October 2025.
\n25%
\n50%
\n75%
\n100%
\nCopper Lithium Nickel Rare earths Graphite
\nNo price premium Price premium
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 108
\n2. Outlook for key minerals
\n2. Outlook for key minerals
\nPart 1
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 109
\n2. Outlook for key minerals
\nOutlook overview
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 110
\n2. Outlook for key minerals
\nEnergy technologies continue to drive strong demand growth for critical minerals across all
\nscenarios
\nGlobal critical minerals demand in the STEPS, 2025-2040
\nIEA. CC BY 4.0.
\nNotes: CPS = Current Policies Scenario; HDS = High Demand Scenario; kt = kilotonnes; Li = lithium; Mt = million tonnes; STEPS = Stated Policies Scenario.
\nThe figures for copper are based on refined copper demand (excluding direct-use scrap). Rare earths refer to magnet rare earth elements only. Growth rates (in
\nblue) are between 2024 and 2040.
\n43%
\n54%
\n53%
\n4
\n8
\n12
\n16
\n202520302040
\nGraphite (Mt)
\n1.9x
\n29%
\n34%
\n37%
\n10
\n20
\n30
\n40
\n202520302040
\nEnergy technologies Other uses CPS HDS
\nCopper (Mt)
\n1.3x
\n23%
\n32%
\n32%
\n50
\n100
\n150
\n200
\n202520302040
\nRareearths(kt)
\n1.5x
\n35%
\n45% 42%
\n120
\n240
\n360
\n480
\n202520302040
\nCobalt (kt)
\n1.3x
\n18%
\n32%
\n41%
\n2
\n4
\n6
\n8
\n202520302040
\nNickel (Mt)
\n1.7x
\n74%
\n85%
\n90% 0.4
\n0.8
\n1.2
\n1.6
\n2025 2030 2040
\nLithium (Mt Li)
\n3.4x
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 111
\n2. Outlook for key minerals
\nAccounting for recycling, global supply gaps persist through 2035 for copper and lithium and
\nwiden slightly for nickel
\nExpected mine supply from existing and announced projects and primary supply requirements for key energy minerals
\nby scenario, 2035
\nIEA. CC BY 4.0.
\nNotes: CPS = Current Policies Scenario; HDS = High Demand Scenario; STEPS = Stated Policies Scenario. The percentage values indicate the share of base case
\nsupply against 2035 primary supply requirements in the STEPS. Expected supply is based on mined or raw material output based on announced projects, except for
\ngraphite, where the figure refers to the sum of natural flake graphite and synthetic graphite supplies. Primary supply requirements are calculated as total demand net
\nof secondary supply, also accounting for losses during refining operations. Rare earths refer to magnet rare earth elements only.
\n0.4
\n0.8
\n1.2
\nCPS Additional in STEPS Additional in HDS
\nLithium (Mt Li)
\nPrimarysupply requirements
\n68%
\n10
\n20
\n30
\nBase case High-production case
\nCopper (Mt)
\nExpectedsupply
\n75%
\n150
\n300
\n450
\nCobalt (kt)
\n74%
\n5
\n10
\n15
\nGraphite (Mt)
\n96%
\n3
\n6
\n9
\nNickel (Mt)
\n9
\n92%
\n50
\n100
\n150
\nRareearths(kt)
\n107%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 112
\n2. Outlook for key minerals
\nOver USD 750 billion in investment is required across key energy mineral value chains to meet
\ndemand
\nCumulative capital requirements for mining and refining in the STEPS, 2026-2040
\nIEA. CC BY 4.0.
\nNotes: STEPS = Stated Policies Scenario. Capital requirements cover greenfield and brownfield mining, refining expansions and sustaining capital. Requirements
\nare derived from projected production gaps to 2040 and assume rising capital intensity over time, reflecting declining ore grades.
\nSources: IEA analysis based on data from company reports and S&P Capital IQ.
\n100
\n200
\n300
\n400
\n500
\n600
\nMining Refining
\nCobalt
\nLithium
\nNickel
\nCopper
\nBillion USD
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 113
\n2. Outlook for key minerals
\nProject pipelines reveal a structural imbalance in diversification efforts, with limited refining
\nand downstream capacity in the project pipeline
\nEstimated 2035 production from existing and announced projects outside top refiners
\nIEA. CC BY 4.0.
\nNotes: REE = rare earth element. Supply estimates are for base case.The top refiners include Indonesia and China for nickel and China for others. Rare earths refer
\nto magnet rare earths only. For downstream sectors, the values respectively reflect the contained volume of lithium (in kt Li equivalent), spherical graphite (in kt
\nbattery-grade equivalent) and rare earths (in kt REE equivalent) in battery cathodes, battery anodes and permanent magnets manufactured. Graphite mining is in kt
\nbattery-grade equivalent, accounting for processing losses.
\n100
\n200
\n300
\n400
\nMining
\nRefining
\nCathode
\nkt Li equivalent
\nNorth America Central and South America Europe Asia except top refiners Australia Africa Russia Other
\n200
\n400
\n600
\n800
\nMining
\nRefining
\nAnode
\nkt battery-grade equivalent
\n0.5
\n1.0
\n1.5
\n2.0
\nMining
\nRefining
\nMt
\n50
\n100
\n150
\n200
\nMining
\nRefining
\nkt
\n15
\n30
\n45
\n60
\nMining
\nRefining
\nMagnet
\nkt REE equivalent
\nLithium Graphite Nickel Cobalt Rare earths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 114
\n2. Outlook for key minerals
\nProcessing bottlenecks persist despite a strong critical mineral demand outlook
\nDemand outlook
\nCritical mineral demand continues to grow strongly in the Stated
\nPolicies Scenario (STEPS), which reflects today\u2019s policy settings. The
\ndeployment of electric vehicles (EVs), battery storage, renewables and
\nelectricity networks keeps energy technologies at the centre of
\ndemand growth for a wide range of minerals through to 2040.
\nStrong growth is also evident across the broader range of scenarios,
\nincluding the Current Policies Scenario (CPS), which provides a more
\nconservative outlook for energy technology deployment, and the High
\nDemand Scenario (HDS), which assumes more rapid adoption of
\nlow-emissions energy technologies. Demand in the CPS is around
\n10% lower than in the STEPS by 2040, while demand in the HDS is
\naround 16% higher. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nLithium experiences the strongest growth, with demand increasing
\nwell over threefold by 2040 in the STEPS. Demand for graphite
\ndoubles over the same period, while nickel demand grows by 65%.
\nDemand for rare earth elements rises by around 50%, and copper
\ndemand increases by over 25%, adding around 7 million tonnes (Mt)
\nby 2040. Energy technologies account for an increasing share of total
\ndemand across all major minerals. For example, energy applications
\naccount for around 18% of nickel demand today, but this share rises
\nto around 40% by 2040.
\nThe assessment also reflects ongoing technology evolution. For
\ncobalt, demand growth is moderated by the increasing adoption of
\nlithium iron phosphate (LFP) battery chemistries. While the share of
\nenergy technologies in total cobalt demand rises from 31% today to
\n43% by 2030, it subsequently declines towards 2040. Nevertheless,
\ntotal cobalt demand still increases by over 30% between today and
\n2040 in the STEPS.
\nSupply outlook
\nSupply projections are derived from a detailed, asset-by-asset
\nassessment of announced mining and refining projects. Reflecting
\nthe latest project developments, this year\u2019s analysis updates both the
\nbase case and the high-production case.
\nThe base case includes output from existing operations, assets
\nunder construction and projects considered highly likely to proceed,
\nbased on factors such as secured permits, committed financing and
\nestablished offtake agreements. The high-production case
\nincorporates projects at a relatively advanced stage of development
\nthat are still seeking financing and\/or permitting approval. Neither
\nscenario includes speculative projects or projects that remain at an
\nearly stage of development.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 115
\n2. Outlook for key minerals
\nIn recent years, the number of announced projects targeting key
\nenergy minerals has continued to increase, signalling the potential for
\na notable expansion in future mining and refining capacity.
\nNonetheless, expected supply from existing and announced projects
\nsuggests that supply gaps for copper and lithium persist through 2035,
\nwhile the gap for nickel is slightly tighter than in last year\u2019s Global
\nCritical Minerals Outlook. A supply gap also emerges for cobalt in this
\nyear\u2019s assessment, driven almost entirely by the export quota
\nintroduced by the Democratic Republic of the Congo (DRC).
\nInvestment requirements
\nMeeting the rising demand for critical minerals requires substantial
\ninvestment. In the STEPS, just over USD 750 billion in capital
\ninvestment is required for both mining and refining between now and
\n2040. This reflects the upfront capital needed to develop new mines
\nand refineries, as well as capital for brownfield expansions and
\nsustaining capital expenditure. It also captures rising capital intensity
\nfor new projects, driven by declining ore grades, particularly in more
\nmature markets such as copper.
\nAmong the minerals, copper accounts for the largest capital
\nrequirements at about USD 310 billion, reflecting the sizable
\nprojected supply gap, which requires significant investment to bring
\nnew mining capacity online, expand existing operations and address
\nrising capital intensity as ore grades decline. Nickel also faces
\nUSD 280 billion in investment needs, primarily in mining, as supply
\ngaps begin to emerge after 2030. By contrast, although lithium also
\nfaces supply gaps, its relatively lower capital intensity limits overall
\ninvestment requirements, while cobalt\u2019s small market size means that
\nonly modest investment is required to meet demand.
\nSupply chain imbalances
\nThis year\u2019s analysis places a stronger focus on pathways to supply
\nchain diversification, examining the extent to which projects outside
\nthe leading countries could reduce vulnerabilities associated with
\nhighly concentrated supply chains. The assessment covers mining
\nand refining activities, as well as selected downstream processing
\nsegments, including battery chemicals and permanent magnets.
\nAcross several minerals, the project pipeline points to a structural
\nimbalance between upstream supply growth and midstream and
\ndownstream manufacturing capacity. While mining projects are
\nexpanding across geographically diverse regions, the pipeline for
\nrefining and downstream capacity remains relatively small, creating
\npotential bottlenecks in the event of supply disruptions.
\nRare earth elements illustrate these challenges. By 2035, announced
\nprojects are sufficient to reach close to 50 kilotonnes (kt) of rare earth
\nelement content in mining capacity outside the leading producer.
\nHowever, planned refining and separation capacity amounts to less
\nthan 40 kt, with activity concentrated primarily in Malaysia and the
\nUnited States. Downstream capacity is more constrained.
\nAnnounced projects for rare earth metals, alloys and magnets total
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 116
\n2. Outlook for key minerals
\nonly around 18 kt on a rare earth element content basis as of early
\n2026, equivalent to about half of the mining capacity in the pipeline.
\nA similar pattern is evident in lithium supply chains. Mining projects
\nlocated outside the dominant supplier point to potential supply growth
\nwell above 350 kt by 2035, but announced refining capacity remains
\nbelow 200 kt. At less than 120 kt, cathode material capacity outside
\nthe dominant supplier is even smaller. For graphite, battery-grade
\nprocessing capacity outside the dominant supplier also lags behind
\nmining supply growth. Similar trends are visible for nickel and cobalt,
\nwhere downstream processing expansion remains smaller relative to
\nupstream supply. In the case of cobalt, refining capacity outside the
\ndominant supplier amounts to only below 40% of projected mined
\nsupply.
\nThis imbalance should also be interpreted in light of different
\ninvestment timelines across the supply chain: mining projects
\ngenerally require longer lead times for permitting and construction
\nthan refining or processing facilities, so their announcements tend to
\nappear earlier.
\nThis leaves room for policy action to change the picture, as timely
\nmeasures to reduce investment risks and support strategic capacity
\nin refining and downstream manufacturing could help ensure more
\nbalanced supply chain development (see Chapter 3).
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 117
\n2. Outlook for key minerals
\nExcept for nickel, announced projects suggest gradual progress towards diversification of
\nmining supply sources across regions\u2026
\nGeographical distribution of mined or raw material production for key energy minerals in the base case, 2025-2035
\nIEA. CC BY 4.0.
\nNotes: DRC = Democratic Republic of the Congo. Graphite mining is for natural flake graphite. Rare earths refer to magnet rare earth elements only. The figure
\nshows the production shares of the top three producing countries in the given year.
\n20%
\n40%
\n60%
\n80%
\n100%
\n20252035 20252035 20252035 20252035 20252035 20252035
\nRest of world
\nBrazil
\nUnited States
\nMyanmar
\nMadagascar
\nMozambique
\nRussia
\nPhilippines
\nIndonesia
\nChina
\nPeru
\nDRC
\nChile
\nAustralia
\nLithium Copper Nickel Cobalt Naturalgraphite Rare earths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 118
\n2. Outlook for key minerals
\n\u2026 while refining shows a starker picture, with diversification momentum emerging for rare
\nearths but remaininglimited across most other minerals
\nShare of the top refiner of key energy minerals in the base case, 2025-2035
\nIEA. CC BY 4.0.
\nNotes: GCMO = Global Critical Minerals Outlook. Figures for graphite are based on battery-grade graphite, including spherical graphite and synthetic graphite. Rare
\nearths refer to magnet rare earth elements only.
\n0%
\n25%
\n50%
\n75%
\n100%
\nShare
\ntoday
\nGCMO
\n2025
\nGCMO
\n2026
\nShare
\ntoday
\nGCMO
\n2025
\nGCMO
\n2026
\nShare
\ntoday
\nGCMO
\n2025
\nGCMO
\n2026
\nShare
\ntoday
\nGCMO
\n2025
\nGCMO
\n2026
\nShare
\ntoday
\nGCMO
\n2025
\nGCMO
\n2026
\nShare
\ntoday
\nGCMO
\n2025
\nGCMO
\n2026
\nChina Indonesia Rest of world
\nLithium(kt Li)
\nNickel(Mt) Cobalt(kt) Graphite(Mt) Rare earths(kt) Copper(Mt)
\n2035 2035 2035 2035 2035 2035
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 119
\n2. Outlook for key minerals
\nMeeting demand outside the dominant supplier requires additional refining projects to emerge
\nacross both upstream and end-market geographies
\nDemand and refined supply outside the dominant suppliers for selected minerals, 2035
\nIEA. CC BY 4.0.
\nNotes: CSAM = Central and South America. N-1 supply excludes production volumes from the largest refiners from the total global supply, and N-1 demand
\nexcludes consumption of those countries from total global demand. Graphite considers only battery-grade requirements and battery-grade supply, covering both
\nspherical and synthetic materials.
\n125
\n250
\nDemand
\n2035
\nOutput
\ntoday
\nBase
\ncase
\n2035
\nHigh
\ncase
\n2035
\nkt
\nDemand Supply: CSAM Australia Europe North America Asia ex-China Africa Russia Other
\n1.5
\n3.0
\nDemand
\n2035
\nOutput
\ntoday
\nBase
\ncase
\n2035
\nHigh
\ncase
\n2035
\nMt
\n1
\n2
\nDemand
\n2035
\nOutput
\ntoday
\nBase
\ncase
\n2035
\nHigh
\ncase
\n2035
\nMt
\nLithium Nickel Graphite
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 120
\n2. Outlook for key minerals
\nSecondary supply could double its share, with recycling rates rising from around 10% on
\naverage today to close to 20% by 2040 under today\u2019s policy settings
\nPrimary and secondary supply of key energy minerals in the STEPS, 2025-2040
\nIEA. CC BY 4.0.
\nNotes: STEPS = Stated Policies Scenario. The figure includes recycled volumes from end-of-life equipment and manufacturing scrap. For copper, direct-use scrap is
\nexcluded. Rare earths refer to magnet rare earth elements only.
\n10
\n20
\n30
\n40
\n2025 2040
\nMt
\nSecondary supply Primary supply Share secondary (right axis)
\n150
\n300
\n450
\n600
\n2025 2040
\nkt
\n10%
\n20%
\n30%
\n40%
\n50
\n100
\n150
\n200
\n2025 2040
\nkt
\n1.5
\n3.0
\n4.5
\n6.0
\n2025 2040
\nMt
\n150
\n300
\n450
\n600
\n2025 2040
\nkt
\nCopper Lithium Nickel Cobalt Rare earths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 121
\n2. Outlook for key minerals
\nMining diversification improves, but refining concentration remains high andgraphite and
\nnickel reveal persistent \u201cN-1\u201d challenges
\nSupply concentration
\nMining supply shows some signs of diversification, though progress
\nremains uneven across different minerals. Except for nickel, a
\npipeline of new project announcements offers some optimism for a
\nmore diversified geographic base in mining. Since 2021, the IEA has
\ntracked supply concentration using the combined share of the top
\nthree producing countries. On average, these countries account for
\naround 76% of global mine production today, and this share is
\nprojected to decline modestly to 73% by 2035. Lithium supply is
\nexpected to become more diversified as growing production in Africa
\nand continued investment in Argentina reduce the combined share of
\nAustralia, Chile and China from around 75% to below 70%. Graphite
\nand rare earths follow a similar trend. Cobalt supply concentration
\nremains broadly stable as the share of the DRC declines, offset
\ngrowing production in Indonesia and uncertainty over the extent to
\nwhich DRC supply will reach the market under current export
\nrestrictions. Nickel is the notable exception, with concentration
\nincreasing further as Indonesia\u2019s share of global supply rises above
\n70%. The top three producers are expected to remain largely
\nunchanged over the next decade, with two exceptions: in graphite,
\nTanzania is set to overtake Madagascar, while in magnet rare earths,
\nAustralia and the United States switch position. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nThe picture for refining is considerably starker. Refining remains
\nsignificantly more concentrated than mining, with China maintaining
\ndominant positions across multiple midstream segments. Today,
\nChina accounts for just under 50% of global copper refining capacity,
\n70% of lithium refining, 75% of cobalt refining, 85% of magnet rare
\nearth separation and over 90% of battery-grade graphite production.
\nLast year\u2019s Global Critical Minerals Outlook pointed to a modest
\ndecline in top-refiner concentration, from around 70% today to 67%
\nby 2035, and recent project announcements have done little to alter
\nthe broader picture. New rare earth separation projects outside China
\nprovide some diversification momentum, but structural inertia
\nremains strong across most value chains. For many minerals, refining
\ncapacity remains closely linked to established chemical processing
\ninfrastructure, accumulated technical expertise and proximity to
\ndownstream manufacturing. As a result, even as mining becomes
\nmore geographically diversified, midstream bottlenecks persist,
\nreinforcing supply chain vulnerabilities and strategic dependencies.
\nN-1 assessment and security implications
\nHigh levels of supply concentration create the risk of significant
\nsupply shortfalls if production from the largest supplier is disrupted
\nfor any reason. A common approach to assessing such vulnerabilities
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 122
\n2. Outlook for key minerals
\nis the \u201cN-1\u201d framework, which evaluates how a system would function
\nin the absence of its largest participant. Applied to critical minerals,
\nthis framework helps illustrate how markets would operate without the
\ndominant supplier. Under this approach, N-1 supply refers to global
\nsupply excluding the largest producing country, while N-1 demand
\nexcludes consumption from that same country. Comparing N-1
\nsupply and demand provides a useful indication of the extent to which
\nmarkets outside the dominant supplier can meet their own needs.
\nCurrent project pipelines suggest that significant gaps between N-1
\nsupply and demand could persist for several minerals, particularly
\nnickel and graphite, highlighting continued exposure to disruptions in
\nthe dominant supplier. Closing these gaps would require substantial
\nadditions of refining and processing capacity, both in upstream
\nresource-rich economies and in downstream manufacturing and
\nconsumer markets. The N-1 framework provides a practical lens for
\nassessing diversification progress and identifying remaining
\nvulnerabilities.
\n\u2022 For lithium, announced lithium chemical projects suggest the
\npotential to roughly double refined output outside China. This
\nexpansion is geographically distributed between upstream-linked
\nfacilities in Latin America and Australia and downstream-oriented
\nprojects in North America. Despite a sizeable overall supply gap,
\nthe N-1 gap is relatively modest.
\n\u2022 For graphite, project announcements indicate strong ambition to
\nreduce the current level of concentration. In the base case,
\nproduction outside the dominant supplier could increase nearly
\nfivefold, rising to as much as ninefold in the high-production case,
\ndriven primarily by new capacity in Asia and additional projects in
\nEurope. However, even with this rapid expansion, a sizeable N-1
\ngap remains.
\n\u2022 For nickel, diversification prospects remain more limited. Refining
\ncapacity outside China and Indonesia is projected to meet only
\naround one-third of N-1 demand, reflecting a relatively modest
\npipeline of new projects.
\nSecondary supply
\nSecondary supply from recycling can play an increasingly important
\nrole in easing primary supply constraints and strengthening system
\nresilience. There is potential for its contribution to roughly double,
\nwith average recycling rates rising from around 10% today to close to
\n20% by 2040 in the STEPS. However, prospects vary considerably
\nacross minerals, reflecting differences in product lifetimes, collection
\nsystems, manufacturing scrap availability, and technical and
\neconomic feasibility.
\nCobalt and copper already benefit from relatively well-established
\nrecycling streams, with recycling rates of around 16% and 10%,
\nrespectively (excluding direct use of copper scrap). These could
\nincrease to approximately 25% for cobalt and 20% for copper by 2040,
\nsupported by improvements in collection, sorting and processing
\nsystems. Rare earth magnet recycling remains dependent on
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 123
\n2. Outlook for key minerals
\nmanufacturing scrap from magnet production, with only limited endof-life recovery today. However, the retirement of early generations
\nof EVs and wind turbines is expected to create a significant new
\nsource of recyclable material.
\nFor lithium and nickel, recycling remains at an early stage, with
\ncurrent rates below 5%. Despite this, rapid market growth and rising
\nconcerns over supply security provide strong incentives for the
\nexpansion of recycling capacity. Overall, secondary supply could
\naccount for a substantially larger share of future demand by 2040,
\nprovided that supportive policies, investment in recycling
\ninfrastructure and sustained end-market demand are in place.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 124
\n2. Outlook for key minerals
\nOutlook for copper
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 125
\n2. Outlook for key minerals
\nCopper prices hit record highs in 2026 as structural and short-term pressures converge
\nCopper monthly average price, 1990-2026
\nIEA. CC BY 4.0.
\nNotes: The copper price is the LME Copper Grade A Cash price. Prices are nominal.
\nSource: IEA analysis based on data from S&P Capital IQ.
\n2 000
\n4 000
\n6 000
\n8 000
\n10 000
\n12 000
\n14 000
\nUSD\/tonne
\nCopper price 1990-2026 average price
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 126
\n2. Outlook for key minerals
\nCopper prices surge due tomajor supply disruptions, acid supply risks from the Middle East
\nconflict and structural challenges
\nCopper prices rose sharply throughout 2025, surpassing USD 12 000
\nper tonne for the first time in December, and surged further to record
\nhighs in 2026, exceeding USD 14 000 per tonne in May. Initially, the
\nunprecedented price levels were driven by several important shortterm developments, including supply disruptions at several major
\nmines and a build-up of US copper inventories due to tariff uncertainty
\nin 2025. However, they were also underpinned by underlying factors
\nsuch as challenges in developing new copper mines and the
\nanticipation of strong demand growth from electrification and data
\ncentre construction. Lower interest rates, a softer US dollar, a
\nbroader investor shift into physical assets and significant financial
\nspeculation also amplified upward pressure on prices. However, with
\nthe closure of the Strait of Hormuz in February 2026, new pressures
\nemerged around sulphuric acid, a critical input for primary copper
\nleaching, solvent extraction and electrowinning (SxEw) operations,
\ngiven the Gulf\u2019s role as a major sulphur supplier and the Strait\u2019s
\nimportance as a key trade route. This was amplified further by China\u2019s
\nban on sulphuric acid exports, fuelling increasing supply concerns
\nand price rises.
\nGlobal demand for refined copper reached almost 28 Mt in 2025, a
\nrobust increase of 3.7% from 2024. India, Saudi Arabia and Malaysia
\ncontinued to record strong demand growth, while Viet Nam also saw
\na major increase in demand, driven by rapid industrial and
\ninfrastructure development. Although volumes remain relatively low,
\nAfrica was the fastest-growing region of demand. Demand in China
\ngrew by almost 5%, led by particularly strong demand from the
\nindustrial and manufacturing sector.
\nChange in annual copper consumption by sector and region
\nIEA. CC BY 4.0.
\nNote: Includes direct-use scrap.
\nOn the supply side, there were major supply disruptions of 1.5 Mt in
\n2025, equivalent to over 6% of global mined supply for the year. This
\n-1 500
\n-1 000
\n– 500
\n500
\n1 000
\n1 500
\n’22 ’23 ’24 ’25 ’22 ’23 ’24 ’25 ’22 ’23 ’24 ’25
\nGrid networks Transport Construction Others Net change
\nkt
\nGlobal China Ex-China
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 127
\n2. Outlook for key minerals
\ntipped the refined market into deficit and was the primary driver of the
\nexceptional copper price rises. There were disruptions at two major
\nmines, Grasberg in Indonesia and Kamoa-Kakula in the DRC.
\nGrasberg is the second-largest copper mine in the world, accounting
\nfor almost 4% of global mined copper production in 2024. A
\ndisastrous mudflow in September 2025 caused major disruption and
\nfatalities, causing production in 2025 to be around half that in 2024.
\nSignificant disruptions are expected throughout 2026, with a full
\nrecovery only anticipated in 2028. At Kamoa-Kakula, the largest
\ncopper mine in the DRC and the fourth-largest copper mine in the
\nworld by 2024 production, seismic activity caused severe flooding
\nand infrastructure damage, leading to a production cut of almost
\none-third in 2025 relative to guidance. Rehabilitation requirements
\nand timelines mean that 2026 production guidance is expected to
\nremain below 2024 levels.
\nImpact of the conflict in the Middle East and China\u2019s
\nban on sulphuric acid exports
\nThe conflict in the Middle East and effective closure of the Strait of
\nHormuz caused a supply shock for sulphur and sulphuric acid, with
\nconsequences for metals and fertiliser markets. Around half of global
\nseaborne sulphur trade passes through the Strait of Hormuz, while
\nGulf countries and Iran account for a quarter of global sulphur supply.
\nCompounding this effect, China implemented a ban on sulphuric acid
\nexports from May 2026 until the end of the year, affecting almost a
\nquarter of ex-China acid needs.
\nSulphuric acid is a critical input to primary copper leaching, affecting
\nproduction through SxEw methods. Over 15% of global primary
\ncopper output is produced via this route. There are major leaching
\noperations relying on sulphuric acid in the DRC (almost 1.5 Mt) and
\nChile (1.2 Mt), which are the most vulnerable to the acid export ban
\nand any supply shortages. The DRC is particularly vulnerable, with
\nalmost 45% of its total copper production using sulphuric acid
\nleaching, compared to 20% for Chile. For an average SxEw facility,
\nacid accounts for 13% of costs, but the DRC has higher cost
\nexposure, at 20%, due to the higher carbonate content of the ore.
\nMexico, the United States and Zambia are also exposed as
\nsignificant producers relying on acid leaching for copper production.
\nWith existing pressure from sulphur supply challenges in the Middle
\nEast now combined with China\u2019s restrictions on sulphuric acid
\nexports, copper producers are facing significant headwinds. Sulphur
\nor acid inventory levels in some producers are reportedly down to
\n30-60 days, with warnings of potential production cuts growing.
\nAt the global level, reduced acid availability from a prolonged acid
\nban or sustained high prices would result in global SxEw production
\ncurtailments, adding considerable supply stress to an already tight
\ncopper supply market. Copper prices are already near record highs,
\nand further supply strains are likely to drive prices higher, with
\nimpacts on a range of strategic sectors and electrical technologies
\nthat depend on copper, including grids, energy technologies,
\ntransport, data centres, industrial equipment, defence and
\nconstruction.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 128
\n2. Outlook for key minerals
\nCopper SxEw production based on sulphuric acid leaching, 2025
\nIEA. CC BY 4.0.
\nDRC = Democratic Republic of the Congo.
\nSource: IEA analysis based on data from Wood Mackenzie.
\nDespite relatively low volumes, Iran is the leading copper producer in
\nthe Middle East, at over 400 kt in 2025, but these volumes are unable
\nto access the global market due to the closure of the Strait. Damage
\nto the copper production infrastructure in the Middle East remains
\nlimited, as most of the main mines are inland and away from the
\nconflict zones. Nevertheless, planned project developments are likely
\nto be hindered by financing and construction risks.
\nTrade developments
\nThe United States implemented tariffs on semi-finished copper
\nproducts and copper-intensive derivative products in 2025. Refined
\ncopper (cathode) was excluded from these tariffs but was under
\nconsideration. The prospect of tariffs on copper cathode led to net
\nimports of 1.5 Mt of cathode to the United States and a build-up of
\n0.5 Mt on the COMEX, while inventories fell to low levels at Asian and
\nEuropean exchanges. This inventory building in the United States
\nreflects front-loading of demand in anticipation of potential tariffs,
\nregional stock relocation and precautionary stock holding. There was
\nsignificant arbitrage between the London Metal Exchange (LME) and
\nthe Chicago Mercantile Exchange(CME) amid expectations of US
\ntariffs. Recently renewed concern over tariffs has again increased
\narbitrage and is expected to increase cathode imports to the
\nUnited States. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nThere has also been a shift in copper scrap trade flows in recent
\nyears. China originally tightened rules on low-grade copper scrap
\nimports, leading to the development of significant processing capacity
\nin Southeast Asia to upgrade scrap from the UnitedStates and other
\ncountries before it entered China. However, countries in
\nSoutheast Asia, such as Viet Nam and Thailand, have tightened their
\nrules on scrap imports in recent years, leading to India and Pakistan
\nemerging as two of the leading hubs for low-grade scrap processing.
\n1
\n2
\n3
\n4
\n5
\n6
\nDRC Chile United
\nStates
\nMexico Zambia
\nMt Cu
\nSxEw Conventional
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 129
\n2. Outlook for key minerals
\nDespite record copper prices, smelter fees have fallen to record lows, underscoring deepening
\nrisks for the midstream sector
\nCopper smelter treatment charges, 2016-2026
\nIEA. CC BY 4.0.
\nNotes: TC = treatment charge. The shaded area shows the period of exceptionally low TCs. Spot TC shows monthly miner selling terms to traders in the Far East
\nspot market (CIF Asia). Benchmark TC refers to the annual TC benchmark. For treatment and refining charges, a refining charge is added to the TC and is closely
\ncorrelated with it. In 2026, both the benchmark TC and refining charge fell to USD 0\/tonne.
\nSource: IEA analysis based on data from Wood Mackenzie.
\n– 150
\n– 100
\n– 50
\n50
\n100
\n2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
\nUSD\/tonne
\nBenchmark TC Spot TC
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 130
\n2. Outlook for key minerals
\nStrategic pressures rise for copper smelters
\nDespite record-high copper prices, the copper midstream market is
\nfacing growing challenges. Smelter fees for processing copper
\nconcentrate, known as treatment and refining charges (TC\/RCs),
\nhave hit all-time lows. The annual TC\/RC benchmark, which is based
\non an agreement between Chilean miner Antofagasta and major
\nChinese smelters, settled at USD 0 per tonne in January 2026, the
\nlowest level ever agreed in annual negotiations. Meanwhile, spot
\nTC\/RCs have been negative since 2024 and have fallen to all-time
\nlows.
\nThe annual TC\/RC benchmark is used to settle the majority of smelter
\ncontracts, with a smaller share using the spot price, although
\nbenchmark usage has been declining. The annual TC benchmark
\nsettling at USD 0 per tonne in 2026 means that copper smelters using
\nthis benchmark would effectively be eliminating any processing
\nincome.
\nThese lows have been driven by a surge in smelter capacity additions
\nfrom China, which has significantly outstripped growth in copper
\nconcentrate production, sharply weighing on smelter fees. Since
\n2005, China has accounted for over 90% of growth in global copper
\nsmelter output, lifting its share from around 15% to half of global
\nsupply in 2025.
\nCopper smelter production by region, 2005-2025
\nIEA. CC BY 4.0.
\nNote: DRC = Democratic Republic of the Congo.
\nSource: IEA analysis based on data from Wood Mackenzie.
\nDespite the sharp decline in TC\/RCs, many smelters remain
\nprofitable for now. This is largely due to revenues from selling byproducts, such as gold, silver, free metal and sulphuric acid. With
\nprices for these by-products recently at record highs, smelters with
\naccess to by-product-rich concentrate and the ability to maximise
\nrecoveries are still generating robust profits, offsetting losses from
\nlow TC\/RCs. However, increasing volatility and recent declines in
\n0%
\n10%
\n20%
\n30%
\n40%
\n50%
\n5
\n10
\n15
\n20
\n25
\n’05 ’07 ’09 ’11 ’13 ’15 ’17 ’19 ’21 ’23 ’25
\nMt Cu
\nChina Europe
\nJapan and Korea Chile
\nDRC Other
\nShare of Chinese supply(right axis)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 131
\n2. Outlook for key minerals
\nprecious metal prices raise questions about how long this protective
\nbuffer can be sustained in the medium term. The smelter revenue
\nstructure, which has historically relied heavily on TC\/RCs, has
\nbecome much more dependent on by-products and premium markets,
\nboth of which are inherently more exposed to volatility.
\nSurging acid prices from the conflict in the Middle East have recently
\nsupported smelter economics. China\u2019s acid export ban is also likely
\nto drive a bifurcation in acid prices between China and ex-China
\nmarkets, a dynamic that is already emerging. There is recent upward
\npressure on acid prices outside China, supporting ex-China smelter
\neconomics, while prices have been falling in China due to the surplus
\ndomestic acid supply that cannot be exported.
\nCopper smelter revenue structure, 2020-2026
\nIEA. CC BY 4.0.
\nNote: TC\/RCs = treatment and refining charges.
\nSource: IEA analysis based on data from Benchmark Minerals Intelligence.
\nCustom smelters are likely to be more affected by the tight
\nconcentrate market and depressed TC\/RCs than integrated smelters,
\nwhich can secure a large share of their concentrate internally from
\naffiliated mining operations. Some custom smelters outside China
\nhave already been forced to cut production, and others have received
\nemergency government support to prevent closure. Some are
\nreducing primary operations but expanding recycling operations.
\nAverage copper smelter utilisation rates, 2020-2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from Wood Mackenzie.
\nThere is already a large disparity in utilisation rates for smelters inside
\nand outside China. All smelters operated at around 80% utilisation in
\n2020, but by 2025 utilisation had diverged, falling to below 70% for
\n0% 20% 40% 60% 80% 100%
\n2026
\n2023
\n2020
\nTC\/RCs Free metal copper By-product metals
\nBy-product acid Premiums
\n65%
\n70%
\n75%
\n80%
\n85%
\n90%
\n2020 2021 2022 2023 2024 2025
\nChina Rest of world Global
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 132
\n2. Outlook for key minerals
\nex-China smelters, while Chinese smelters operated at 85%.
\nSmelters in China generally benefit from lower capital and operating
\ncosts than those outside China, reflecting lower labour and
\nconstruction costs, greater economies of scale and newer smelters
\nwith higher energy efficiency, greater yields, and lower maintenance
\nand refurbishment requirements. Most Chinese smelters are stateowned enterprises, some of which may also benefit from government
\nsupport during periods of low TC\/RC income. These factors make
\nleading Chinese smelters more competitive and typically more
\nresilient to periods of depressed TC\/RCs than many custom smelters
\noutside China. Nonetheless, low TC\/RCs are also recognised in
\nChina as one of the most pressing challenges facing the domestic
\ncopper smelting industry.
\nThere is broad consensus that low TC\/RCs are likely to persist over
\nthe medium term. A structural increase in TC\/RCs would require
\neither a major boost in concentrate supply or a meaningful reduction
\nin smelter capacity. Most new concentrate supply growth in the
\npipeline is linked to integrated or semi-integrated smelters, while
\ncustom concentrate supply is already declining, making a surge in
\nfreely available concentrate unlikely.
\nThis leaves smelter cuts or closures as the main mechanism to
\nbalance the market. China\u2019s top smelters have agreed to cut
\nproduction capacity by over 10% in 2026, and the government has
\nhalted around 2Mt of planned new smelting capacity to address the
\nissue. However, these cuts are not enough to meaningfully balance
\nthe market. Moreover, China remains a net importer of refined copper,
\nmaking large-scale smelter closures unlikely. In the first two months
\nof 2026, output actually increased by almost 10%, and some smelters
\nare planning to raise or maintain output this year. However, if acid
\nprices in China fall because of the export ban, Chinese smelters may
\nbring forward planned maintenance to mitigate the risks from lower
\nby-product revenues and acid inventories, which could provide some
\nshort-term relief to TC\/RC pressure. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nCopper smelter production cost curve, 2025
\nIEA. CC BY 4.0.
\nNote: c\/lb = cents per pound.
\nSource: IEA analysis based on data from Wood Mackenzie.
\nIf the low TC\/RC environment persists and by-product prices fall,
\nmany custom smelters outside China could face significant economic
\n10
\n20
\n30
\n40
\n50
\n60
\n70
\n5 000 10 000 15 000
\nDirect cash costs (c\/lb)
\nOther
\nChina
\nCopper from concentrate (kt)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 133
\n2. Outlook for key minerals
\nchallenges. Should these conditions materialise, the copper market
\ncould follow a pattern seen for some other critical minerals:
\noversupply drives low prices, rendering production outside China
\nuneconomic, in turn resulting in curtailment or rationalisation, and
\neventually increasing China\u2019s market concentration. This recently
\nplayed out in the nickel market, where a flood of supply from
\nIndonesia, predominantly developed with Chinese investment, drove
\nthe market into sustained oversupply, rendering projects around the
\nworld uneconomical, while rapidly increasing the concentration of
\nsupply in Indonesia. It is becoming increasingly crucial to pay close
\nattention to growing midstream concentration risks in copper supply
\nchains. Consideration may also need to be given to whether the
\ncurrent TC\/RC framework remains fit for purpose in a changing
\nmarket structure.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 134
\n2. Outlook for key minerals
\nThe large primary supply deficit remains the greatest challenge for copper markets, but there
\nhas been some progress in project development
\nMined copper supply from existing and announced projects and primary supply requirements by scenario
\nIEA. CC BY 4.0.
\nNotes: CPS = Current Policies Scenario; HDS = High Demand Scenario; STEPS = Stated Policies Scenario. Based on mined output. Primary supply requirements
\nare calculated as total demand net of secondary supply, also accounting for losses during refining operations. See the Introduction section for definitions of the base
\nand high-production cases.
\n5
\n10
\n15
\n20
\n25
\n30
\n2025 2030 2035 2040
\nHigh-production case
\nBase case
\nCPS
\nSTEPS
\nHDS
\nMt Cu
\nExpectedsupply
\nPrimary supplyrequirements
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 135
\n2. Outlook for key minerals
\nThe copper supply gap remains sizeable at around 25% in 2035, slightly narrower than last year,
\ndue to new project development
\nCopper is one of the most strategically important metals, playing a
\nfundamental role across strategic sectors including energy, transport,
\nconstruction, data centres and defence. However, despite a strong
\ndemand outlook, the key challenge for the copper market remains the
\ndifficulty of developing new mined supply. Despite record-high copper
\nprices, project development remains insufficient. Based on the
\nproject pipeline, global primary copper supply could face a 25%
\ndeficit in 2035 under today\u2019s policy settings.
\nOne of the key challenges in developing new copper supply is
\ndeclining copper ore grades, with the average global grade of copper
\nmines having decreased by 40% since 1991, increasing capital costs
\nand project complexity. The average capital intensity for expanding
\nexisting projects (brownfield) has also increased by 65% since 2020,
\napproaching levels typically associated with new greenfield projects.
\nThese challenges are compounded by a rapidly declining rate of new
\nresource discoveries. Of all the copper deposits discovered in the last
\n35years, only 5% have been discovered in the last decade. Finally,
\nlead times for new copper projects are long, at around 17 years from
\ndiscovery to production, and many major projects have recently
\nexperienced significant delays and cost overruns. These dynamics
\nsuggest a structurally tighter market for copper concentrate, raising
\nrisks for supply security and underscoring the need for supply- and
\ndemand-side measures.
\nRecent project development progress in the DRC,
\nZambia, Peru and Canada
\nThere has, however, been some notable progress in project
\ndevelopment in the last year, increasing the number of projects with
\na higher chance of materialising. This has led to a slight narrowing of
\nthe projected deficit, from 30% in last year\u2019s Outlook to over 25% in
\nthis year\u2019s base case for 2035. Africa is the greatest source of
\nincreased supply, with the DRC and Zambia together adding almost
\n650 kt in 2035 compared to last year\u2019s Outlook. In the DRC, this
\nincrease is primarily driven by higher projected output from Chinesebacked Malachite ore operations. There are also significant project
\nexpansions, such as the Kisanfu mine expansion, operated by
\nChina\u2019s CMOC Group. In Zambia, growth has been primarily driven
\nby a major expansion at the Lumwana mine, owned by Canada\u2019s
\nBarrick Gold, planned for production by 2028, as well as a number of
\nnew smaller operations.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 136
\n2. Outlook for key minerals
\nIncrease in 2035 mined supply outlook relative to last year\u2019s
\nOutlook
\nIEA. CC BY 4.0.
\nNote: DRC = Democratic Republic of the Congo.
\nPeru also shows a major increase of almost 300 kt, primarily through
\nthe life extension of the large Antamina project and the long-delayed
\nTia Maria SxEw project from Southern Copper. However, in April, the
\npermit for Tia Maria was revoked before being reauthorised 11 days
\nlater, demonstrating the uncertainty and challenges in bringing major
\nnew copper projects online. In the United States, the large-scale
\nResolution project remains tied up in legal proceedings and is
\ntherefore too uncertain to include in either the base or highproduction case. Russia could add almost 350 kt, primarily through
\nthe major Baimskaya project, though it faces some development
\nchallenges. Canada adds 200 kt, primarily through the life extension
\napproval for the major Highland Valley Copper mine operated by
\nTeck Resources.
\nDespite a slightly improved long-term outlook, the short- and
\nmedium-term supply outlook appears to have worsened considerably.
\nConstraints on sulphuric acid availability pose a significant risk to
\nSxEw production. Coupled with slower-than-expected recoveries
\nfrom disruptions at major mines and an already tight market, the
\ncopper market faces a strong set of near-term challenges.
\nSubstitution efforts could stall, but copper scrap
\npresents some opportunity
\nAluminium is the leading substitute for copper, with substitution
\nalready occurring in some applications, such as overhead power lines,
\nheat exchangers and certain EV cabling. However, beyond
\nperformance constraints, such as lower conductivity (around 60% of
\ncopper), reduced safety and greater maintenance requirements,
\naluminium is now also facing significant supply challenges and a
\ntighter market. With 8% of aluminium supply coming from the
\nMiddle East, conflict in the region is constraining exports and pushing
\nprices higher. A price ratio of 3 to 1 between copper and aluminium
\nwas often heralded as the threshold for significant substitution of
\ncopper by aluminium. However, the price ratio has exceeded 3.5 to 1
\nfor much of the past five years without triggering a major tipping point
\n100
\n200
\n300
\n400
\nkt Cu
\nAfrica Latin America China North America Other
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 137
\n2. Outlook for key minerals
\nfor substitution. If aluminium supply challenges persist, there will
\nlikely be a slowdown in substitution efforts.
\nCopper scrap, however, presents a significant but underexploited
\nsource of supply. The share of demand met by secondary supply
\nincreased in 2025 to 18%, from 17% in 2024, following the increase
\nin copper prices. In 2026, this share is expected to increase further
\ngiven the surge in copper prices to record levels this year.
\nNevertheless, the collection rate for end-of-life copper products
\nremains relatively low, particularly compared with aluminium. If
\ncollection rates are significantly increased through targeted policy
\nsupport, secondary supply could become a major source of global
\ncopper supply, potentially meeting over a third of global copper
\ndemand by 2050 in the STEPS.
\nConstruction remains the largest source of end-of-life copper scrap
\nacross all scenarios to 2050. However, copper from EVs and storage
\nis the fastest-growing source of end-of-life scrap. The higher copper
\nintensity of EVs compared with internal combustion engine vehicles,
\nfrom the batteries and motors, results in greater copper volumes
\nbecoming available when EVs reach end of life, compared with the
\ndisplaced copper from conventional internal combustion engine
\nvehicles. Copper volumes from end-of-life EVs are set to become
\navailable particularly in the major current EV markets of China,
\nEurope, the United States and Southeast Asia. Key policy priorities
\nfor increasing secondary copper production include increasing
\ncollection rates for legacy copper applications, such as old buildings
\nand cables, strengthening recycling mandates, improving sorting
\nsystems and investing in new secondary smelters.
\nRecycled copper volumes outlook, 2023-2050
\nIEA. CC BY 4.0.
\nNote: Recycled copper volumes detail the volumes recovered from recycling
\nfrom secondary production and direct-use scrap, accounting for collection and
\nrecycling process yield losses.
\n20%
\n40%
\n60%
\n10
\n20
\n30
\n2023 2024 2025 2040 2050
\nMt Cu
\nDirect-use scrap
\nSecondary production
\nShare of demand incl. direct scrap (right axis)
\nShare of demand excl. direct scrap (right axis)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 138
\n2. Outlook for key minerals
\nOutlook for lithium
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 139
\n2. Outlook for key minerals
\nLithium chemical output continued to expand strongly in 2025, driven by new Chinese capacity
\nadditionsand outpacing growth in mine supply
\nChange in mined and refined lithium output by region, 2024-2025
\nIEA. CC BY 4.0.
\nNotes: CSAM = Central and South America. Volumes are in elemental content (kt Li) unless otherwise stated. Raw materials cover the extraction of lithium from hard
\nrock ore, as well as from clays and brines. Lithium chemicals cover the first production of lithium carbonate, hydroxide, sulphates and chlorides, and exclude
\nreprocessing.
\n200
\n225
\n250
\n275
\n300
\n325
\n2024 Australia China Africa CSAM Other 2025
\nkt Li
\n200
\n225
\n250
\n275
\n300
\n325
\n2024 China CSAM AustraliaIndonesia Korea 2025
\nMining Refining
\n+18%
\n+32%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 140
\n2. Outlook for key minerals
\nChanging lithium markets in 2025: lithium demand from battery storage grew by 60%, while
\noutput from Africa expandedmarkedly by 44%
\nChina and energy storage: keywords for sustained
\nlithium demand growth
\nLithium demand continued to expand rapidly in 2025, reaching more
\nthan 275 kt. This represents a 23% year-on-year increase: a slight
\nmoderation from growth in 2024, but still well above the growth rates
\nseen in most other commodity markets. The expansion reflects the
\ncontinued acceleration of electrification. Demand from EVs rose by
\n20% to 170 kt, while demand from battery storage reached 30 kt.
\nChina accounted for about 90% of the increase in global lithium
\ndemand, followed by Korea (+4.2 kt) and Central Europe (+1.4 kt),
\nwhere battery material production capacity is being developed.
\nLithium prices back on the rise
\nLithium prices rebounded sharply in early 2026, with lithium
\ncarbonate prices nearly doubling over a short period to about
\nUSD 20 000 per tonne of lithium carbonate equivalent. This reflected
\ntightening upstream supply conditions caused by overseas bans on
\nore exports by Zimbabwe, as well as tighter permitting in China\u2019s
\nJiangxi region. Restocking by downstream cathode buyers also
\nadded to price pressure. This marked a recovery from two years of
\nweak market conditions, when oversupply and destocking pushed
\nprices down.
\nLithium carbonate, hydroxide and spodumene prices, April 2025-April 2026
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from S&P Capital IQ and Bloomberg.
\nCurrent prices remain moderate compared with the peaks observed
\nin 2022, when they reached USD 80 000 per tonne of lithium
\ncarbonate equivalent. A fall back in lithium prices remains possible,
\nwhich could typically be caused by a resumption of lepidolite mining
\nin China, a stabilisation of lithium ore trade flows or a rise in
\ninventories at cathode production plants.
\n5 000
\n10 000
\n15 000
\n20 000
\n25 000
\n30-04-2025 31-08-2025 31-12-2025 30-04-2026
\nUSD\/t LCE
\nCarbonate Hydroxide Hard-rock ore (spodumene)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 141
\n2. Outlook for key minerals
\nGrowing strains on hard-rock lithium supplies
\nHard-rock ore, and particularly spodumene, is increasingly becoming
\nthe dominant source of lithium supply compared with brine-based
\nresources. The market for hard-rock ores tightened significantly over
\nthe course of 2025, due to strong feedstock demand and mining
\nsupply constraints. In 2025, lithium chemical output grew by 32%,
\nwhereas mined output grew by 18%.
\nLithium raw material supply by type, 2020-2025
\nIEA. CC BY 4.0.
\nDiversifying lithium mining driven by African suppliers
\nIn 2025, Argentina saw faster growth output than the historical major
\nproducers, Chile, China and Australia. New entrants are reshaping
\nthe supply landscape, particularly in Africa: mined output from the
\ncontinent grew by 44%, helping diversify supply but also involving
\nchallenges related to infrastructure and logistics. While three regions,
\nthe South American \u201clithium triangle\u201d, China and Australia, account
\nfor the majority of lithium supplies today, African nations now
\nrepresent 14% of global supplies, a 26-fold increase from 2020. While
\ncontributing to the diversification of mining supply, this trend could,
\nhowever, reinforce the dominance of the top refining country, as over
\n65% of new lithium mining capacity on the continent is owned by
\ncompanies headquartered in China. With the rise of regional output,
\nthe importance of small-scale mining is slowly expanding, bringing its
\nown challenges.
\nThis year, significant steps were also taken to increase European
\noutput. In 2025, Finland\u2019s Keliber mine began operating, with a
\nplanned annual capacity of 2.5 kt before 2030, sufficient to meet 90%
\nof European demand for cathode production in the short term. France
\nis also accelerating strategic mining projects, such as the Allier hardrock lithium and Alsace brine projects.
\nIncreasing lithium refining concentration
\nGlobal lithium refining output grew rapidly in 2025, with Chinese
\noutput expanding by close to 40% year-on-year due to the ramp-up
\nof new capacity, such as Ganfengs\u2019s new Dazhou plant (7.2 kt of
\ncapacity each), as well as increased utilisation. Some new capacity
\nalso emerged in the United States, Korea, Indonesia and Australia
\nbut has yet to ramp up, as average utilisation rates remain well below
\nthose of China. Overall, this led to increased concentration in lithium
\nrefining output, with China\u2019s share rising from 70% in 2024 to 75% in
\n2025.
\nThe first half of 2026 was marked by the start of the first lithium
\nrefining plant in Africa, with the ramp-up of a China-owned Zhejiang
\n0% 20% 40% 60% 80% 100%
\n2025
\n2024
\n2020
\nBrine Hard-rock ore: Spodumene Lepidolite Petalite
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 142
\n2. Outlook for key minerals
\nHuayou factory in Zimbabwe. The plant, at a total investment cost of
\nUSD 400 million, is designed to refine about 6.5 kt in the form of
\nsulphate, which can then be further refined overseas into carbonate
\nor hydroxide and then battery chemicals. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nLithium refining output and capacity, 2024-2025
\nIEA. CC BY 4.0.
\nMarket conditions remained uneven across products. Lithium
\nhydroxide, a chemical used in nickel-rich chemistries, continued to
\nperform less strongly than carbonate, due to the rise of LFP
\nchemistries. This continued to weigh on hydroxide refineries, as well
\nas those converting carbonate into hydroxide, and led to curtailments
\noutside China, including at Australia\u2019s Kemerton plant.
\nRecycling and market maturity
\nSecondary supply continues to scale rapidly, with recycled volumes
\nincreasing by over 40% year-on-year in 2025. However, it still
\naccounts for only around 5% of total supply, highlighting both its
\ngrowing importance and its current limitations in materially
\ncontributing to overall supply growth.
\nThe lithium market is gradually becoming more structured, as
\nreflected in record trading volumes for lithium futures and the
\ndevelopment of forward pricing tools. Downstream players are
\nincreasingly securing long-term supply, as illustrated by recent deals
\ninvolving MinRes and POSCO, as well as Pilbara Minerals and
\nCanmax.
\n6
\n12
\n18
\n24
\n’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25
\nUnited
\nStates
\nGermany Korea Indonesia Australia
\nkt Li
\nRefining output Refining capacity Utilisation rate (right axis)
\n0%
\n25%
\n50%
\n75%
\n100%
\n100
\n200
\n300
\n400
\n’24 ’25
\nChina
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 143
\n2. Outlook for key minerals
\nCost competitiveness is becoming increasingly important amid volatile lithium prices, with
\nLatin American production leading the lowest-cost supply
\nExisting and projected lithium mining capacity to 2035 by country and production cost
\nIEA. CC BY 4.0.
\nNote: DRC = Democratic Republic of the Congo, LCE = Lithium carbonate equivalent. Production costs are C3 costs, which include operating expenditure and
\ncapital expenditure costs accounting for depreciation and amortisation, interest and royalties, in current US dollars.
\nSource: IEA analysis based on data from Benchmark Minerals Intelligence, S&P Capital IQ and Wood Mackenzie.
\n25
\n50
\n75
\n100
\n125
\n150
\n175
\nArgentina Australia Chile China United
\nStates
\nDRC Mali Canada Brazil Zimbabwe
\nkt Li
\nLess than USD 9\/kg LCE Between USD 9\/kg and10\/kg LCE Between USD 10\/kg and11\/kg LCE
\nBetween USD 11\/kg and14\/kg LCE Over USD 14\/kg LCE
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 144
\n2. Outlook for key minerals
\nLithium is the fastest-growing critical mineral, with demand quadrupling between today and
\n2040 and requiring a 2.5-fold increase in mined output
\nLithium demand and supply requirements in the STEPS, 2020-2040
\nIEA. CC BY 4.0.
\nNotes: STEPS = Stated Policies Scenario. Based on raw material output covering the extraction of lithium from hard rock ore, clays and brines. Planned new projects
\nare based on the base case supply projection.
\n250
\n500
\n750
\n1 000
\n2020 2025 2040
\nkt Li
\nElectric vehicles
\nStorage
\nOther
\nDemand in the STEPS
\n250
\n500
\n750
\n1 000
\n2020 2025 2040
\nSecondary supply
\nAdditional mine requirements
\nPlanned new projects
\nExisting capacities
\nMining and secondary supply
\nx3.9
\nx3.8
\nx3.8
\nx2.5
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 145
\n2. Outlook for key minerals
\nIn a context of surging lithium demand, the project pipeline highlights the continued need for
\nnew mines, as well as opportunities for diversification on the refining side
\nLithium demand is set to continue rising strongly over the next two
\ndecades. In the STEPS, demand in 2040 is 3.5-times higher than in
\n2025 and around 14 times higher than in 2020. EVs remain the main
\nsource of growth as their deployment continues to expand across
\nmajor markets. At the same time, energy storage is becoming an
\nincreasingly important source of demand growth. In the STEPS,
\nlithium demand from energy storage rises to around 70 kt in 2040 and
\nreaches 90 kt in 2050, around three times today\u2019s level. In the HDS,
\ndemand from storage reaches 120 kt in 2050, underlining the growing
\nrole of batteries in power systems with rising shares of variable
\nrenewables.
\nLithium recycling to rise 25-fold, moderating mining
\nneeds
\nSecondary lithium production from recycling reaches around 250kt
\nin 2050, around 25 times higher than today, as larger volumes of endof-life batteries become available and collection and processing
\nsystems improve. In the HDS, which assumes stronger recycling
\nrates, secondary supply rises further to around 560 kt in 2050. This
\ngrowing contribution from recycling does not remove the need for
\nlarge-scale investment in new supply, but it helps ease pressure on
\nprimary production and improve supply security over time.
\nTen more median-sized lithium mining projects are
\nneeded to fill the long-term supply gap
\nEven after accounting for the growing contribution of recycling, lithium
\nmining needs to expand substantially to keep pace with rising
\ndemand. In the STEPS, primary lithium supply requirements
\n(demand net of contributions from secondary supply) rise to around
\n850 kt by 2040, implying that mined output needs to increase by
\naround 2.5 times from current levels. The current project pipeline
\npoints to roughly 500 kt of mining output by 2035 in the base case, or
\naround 550 kt in the high-production case. Around 40% of additional
\noutput in the base case is located in China, 222% in Argentina, 16%
\nin Australia and 14% in North America, with smaller additions planned
\nin Europe, Africa and elsewhere in Latin America. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 146
\n2. Outlook for key minerals
\nAdditional lithium mining output in the base case by region and
\ntop additional project, 2025-2035
\nIEA. CC BY 4.0.
\nNote: Base case projects = dark colour. Top additional projects = light colour.
\nThis still leaves a sizeable gap between projected primary supply
\nrequirements and the current pipeline. Closing this gap of around 25%
\nwould require the emergence of about 10 additional median-sized
\nprojects. While challenging, this is not out of reach: lithium mining
\noutput has grown nearly fourfold over the past five years, and recent
\ntechnological progress, including the ramp-up of direct lithium
\nextraction by Eramet in Argentina, points to stronger prospects for
\nunlocking new resources.
\nGrowing prospects for lithium refining diversification
\nThe refining project pipeline also suggests potential for diversification.
\nThe project pipeline in the base case is broadly sufficient to process
\nprojected mining output, but additional projects would still be needed
\nto meet demand requirements in the STEPS. Over the projection
\nperiod, refining concentration eases from today\u2019s elevated levels,
\nwith the dominant supplier\u2019s share falling from around 75% to 66%
\nby 2035. While more than half of additional refining capacity in the
\nbase case is still planned in China, a growing number of chemical
\nplants are expected elsewhere. Argentina is set to play a stronger
\nrole, supported by rising brine supply, and could account for around
\n10% of global lithium chemical capacity by 2035. It is followed by the
\nUnited States, with projects including Tesla\u2019s Corpus Christi, Lithium
\nAmericas\u2019 Thacker Pass, Albemarle\u2019s Silver Peak and Standard
\nLithium\u2019s lithium development, and by Australia, where Kwinana and
\na possible Kemerton restart could support renewed growth, alongside
\nadditions in Indonesia and Chile.
\n40
\n80
\nChina Argentina North
\nAmerica
\nAustralia Mali Chile Europe
\nkt Li Da Hongliutan Hombre Muerto Thacker Pass Greenbushes
\nGoulamina Atacama Keliber Other
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 147
\n2. Outlook for key minerals
\nOutlook for nickel
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 148
\n2. Outlook for key minerals
\nThe nickel market is well supplied in the shortterm, but policy and cost pressures are emerging
\nin the leading producer, Indonesia
\nThe nickel market remained in a 200 kt surplus in 2025, keeping
\nprices subdued throughout the year. Global production increased by
\n9% year-on-year in mined output and 7% in refined output, driven
\nprimarily by Indonesia, which remains the world\u2019s largest producer of
\nboth mined and refined nickel. Outside Indonesia, persistently low
\nprices continued to weigh on output, with production in the rest of the
\nworld declining by over over 10%% in mined production and just
\nunder 3% in refined production. At the same time, global nickel
\ndemand rose by almost 3% in 2025 to 3.5 Mt, largely supported by
\ngrowth in nickel use in battery applications, particularly in nickel-rich
\nchemistries for EVs.
\nThe global nickel market has become increasingly concentrated in
\nIndonesia, which now accounts for almost two-thirds of mined supply
\nand just under half of refined output. This reflects structural
\nadvantages, including a large laterite resource base, an integrated
\nprocessing ecosystem, strong state support focused on industrial
\npolicy, Chinese capital and technology, economies of scale and
\naccess to relatively low-cost coal-based energy. As a result, policy
\ndevelopments in Indonesia are increasingly shaping global market
\ndynamics. Despite continued physical oversupply, nickel prices
\nbegan to rise towards the end of 2025 and into early 2026 following
\na series of policy announcements in Indonesia.
\nNickel supply and demand growth, 2015-2025 (left), and market
\nbalance, 2025 (right)
\nIEA. CC BY 4.0.
\nNotes: RoW = rest of world. Supply and demand are for refined nickel supply.
\nIndonesia\u2019s mined nickel output is governed by production quotas
\n(RKAB), introduced in 2023 as three-year allocations. This framework
\nwas revised in October 2025, shortening quotas to one year and
\nrequiring companies to reapply for quotas covering 2026 and 2027.
\n-20%
\n0%
\n20%
\n40%
\n60%
\nChina Indonesia RoW
\n2015-2020 2020-2025
\n0
\n1
\n2
\n3
\n4
\nMt
\n2025
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 149
\n2. Outlook for key minerals
\nShortly after, Indonesia\u2019s Minister of Energy and Natural Resources
\nannounced plans to curb nickel output in 2026 to support prices and
\ngovernment revenues. These measures followed the revocation of in
\nSeptember 2025 due to non-compliance with rehabilitation or
\nproduction requirements. Taken together, these developments
\ntightened expectations around future supply availability and
\ncontributed to a 20% increase in nickel prices between December
\n2025 and mid-2026.
\nNickel prices, January 2025-April 2026
\nIEA. CC BY 4.0.
\nNote: The nickel sulphate price refers to China nickel sulphate, with a
\nminimum nickel content of 22% and a maximum cobalt content of 0.4%.
\nSources: IEA analysis based on data from S&P Capital IQ and Bloomberg.
\nAs policies increasingly restrict access to domestic ore and aim to
\nsupport higher prices and royalties, Indonesian smelters have
\nincreasingly turned to imported feedstock, importing almost 300 kt of
\nnickel metal equivalent from the Philippines in 2025, up by almost 50%
\nfrom 2024. The Philippines is the world\u2019s second-largest holder of
\nnickel reserves, largely limonite ore, which feeds into high-pressure
\nacid leaching (HPAL) processing facilities and enables the production
\nof battery-grade intermediates. Co-operation between the two
\ncountries was recently formalised through the IndoPhil Nickel
\nCorridor, which aims to provide stable feedstock supply for
\nIndonesia\u2019s expanding HPAL capacity.
\nThe Indonesian government also revised the mineral ore benchmark
\nprice (HPM) in April 2026. The HPM serves as Indonesia\u2019s official
\nfloor price for nickel ore, ensuring a minimum price for mines while
\nincreasing royalty revenues and limiting the ability of smelters, which
\nare mostly Chinese-owned, to push domestic ore prices too low.
\nPreviously, higher-grade saprolite (1.5-2.7% nickel content) had a
\nhigher HPM floor price, while limonite (typically 0.8-1.8% nickel
\ncontent) was priced lower. Under the revision, limonite and saprolite
\nfloor prices were brought closer into alignment, with the adjustment
\nraising the limonite floor price relative to its nickel content. Although
\nthis provides support to domestic miners, it also increases feedstock
\ncosts for HPAL operations. The revision was reportedly introduced to
\nstrengthen fiscal revenues, support domestic miners and provide
\nupward pressure on nickel prices.
\n5 000
\n10 000
\n15 000
\n20 000
\n01-01-2025 01-07-2025 01-01-2026
\nLME Nickel Nickel sulphate
\nUSD\/tonne
\nJan-25 Jan-26 July-25
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 150
\n2. Outlook for key minerals
\nComposition of new versus old mineral ore benchmark price
\n(HPM) compared with Chinese ore price
\nIEA. CC BY 4.0.
\nNotes: CIF = cost, insurance and freight; wmt = wet metric tonne.
\nSources: IEA analysis based on data from Wood Mackenzie and Bloomberg.
\nA key structural feature of the nickel market is the two main
\nprocessing routes for laterite ores, each with distinct cost profiles and
\nend-use applications. Rotary kiln electric furnace technology, which
\ndominates in Indonesia, produces nickel pig iron and ferronickel for
\nstainless steel applications and generally benefits from lower capital
\nintensity. In recent years, part of this nickel pig iron output has been
\nfurther processed into nickel matte, enabling conversion into batterygrade products and creating an additional pathway into the battery
\nvalue chain. This has provided some producers with flexibility to
\nredirect part of their output between stainless steel and battery
\nmarkets, depending on the relative economics and demand
\nconditions.
\nBy contrast, high-pressure acid leaching enables the production of
\nbattery-grade intermediates, such as mixed hydroxide precipitate
\n(MHP), but is significantly more capital-intensive and highly sensitive
\nto input costs, particularly sulphur. While recent policy changes in
\nIndonesia have contributed to higher ore benchmark prices and
\ntighter market conditions, they have also weakened HPAL project
\neconomics, compounded by rising sulphur costs resulting from a
\ntighter global market. Requiring approximately 9 tonnes of sulphur
\nper tonne of contained nickel, an 80% increase in sulphur prices
\nraises operating costs for HPAL facilities by roughly USD1.7 per
\nkilogramme of nickel, pushing up marginal production costs for
\nintermediates such as MHP. As a result, there has been additional
\nstrain on some operations, causing some HPAL facilities to decrease
\noutput and tightening availability of battery-grade intermediates.
\nHowever, although nickel matte production also relies on sulphur, its
\nintensity is around three times lower, resulting in a much smaller cost
\nimpact. As a result, the nickel pig iron and ferronickel market remains
\nrelatively well supplied, with elevated inventories continuing to
\nmoderate price pressures. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\n20
\n40
\n60
\n80
\nOld New Old New
\nChromium
\nIron
\nCobalt
\nNickel
\nUSD\/wmt
\nSaprolite Limonite
\nCIF China
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 151
\n2. Outlook for key minerals
\nImpact of rising sulphur costs on Indonesian HPAL producers
\nIEA. CC BY 4.0.
\nNotes: 2026e = 2026 estimated costs. Costs are based on an average of
\nHPAL costs across two projects in Indonesia. The 2026 estimates assume an
\n80% increase in sulphur costs.
\nSources: IEA analysis based on data from company reporting and Wood
\nMackenzie.
\nA key question is whether Indonesia will expand domestic HPAL
\nfacilities to produce nickel sulphate in line with its downstreaming
\nstrategy, given its importance for precursor and cathode
\nmanufacturing. At present, HPAL facilities produce mostly
\nintermediates, and Indonesian nickel sulphate capacity remains
\nlimited relative to downstream battery cell manufacturing capacity.
\nIndonesia produces only 10% of global nickel sulphate and continues
\nto export intermediate products such as MHP to China for further
\nprocessing. China remains the dominant battery-grade nickel
\nsulphate producer, accounting for 75% of production.
\nIn 2025, Indonesia exported 75 kt of nickel mattes, about 25% of its
\ntotal supply, to China, where they were further refined. This export of
\nIndonesian intermediate products to China for further processing
\nexplains why Indonesia still has a smaller market share in refining
\nthan in mining, despite bans on the export of unprocessed ore.
\n2
\n4
\n6
\n8
\n2025 2026e
\nSulphur cost
\nOre
\npurchase
\nRefining
\ncosts
\nUSD\/lbNi
\n14%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 152
\n2. Outlook for key minerals
\nSupply concentration increases across nickel mining and refining as Indonesia continues to
\ndrive supply growth, while projects in geographically diverse regions face challenges
\nMining and refining supply additions from 2025 to 2040 and early-stage projects
\nIEA. CC BY 4.0.
\nNotes: CSAM = Central and South America; RoW = Rest of world. Refined nickel includes all final products. Potential supply includes supply from projects outside
\nthe base or high-production case and at the exploration, scoping, prefeasibility, permitting, financing, feasibility or construction stage, as well as those on hold or on
\ncare and maintenance.
\n23% -6%
\n15%
\n36%
\n13% -2% 7%
\n55%
\n2
\n4
\n6
\n8
\n2025 2040
\nBase case
\n2040
\nHigh
\nproduction
\nPotential
\nsupply
\n2025 2040
\nBase case
\n2040
\nHigh
\nproduction
\nPotential
\nsupply
\nIndonesia Philippines China Australia North America CSAM Africa Europe RoW
\nMining
\nMt
\nRefining
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 153
\n2.Outlook for key minerals
\nDespite robust demand growth, the nickel market is expected to remain well supplied, although
\nIndonesia\u2019s policy shifts could alter the outlook
\nThe nickel market is expected to remain in surplus over the next
\nfew years, with excess supply persisting before 2030 despite
\ncontinued demand growth. Based on announced projects, Indonesia
\ncontinues to drive production expansion, accounting for over 100%
\nof the supply growth in mining and 80% in refining to 2030 in the base
\ncase. Indonesia\u2019s production share is set to rise further to almost 75%
\nin mining and around half in refining by 2035, from almost two-thirds
\nand 45% today, respectively, reflecting structural advantages.
\nAt the same time, demand continues to grow at a robust pace. By
\n2035, batteries are expected to account for 30% of total nickel
\nconsumption, accounting for almost two-thirds of demand growth.
\nChina, Indonesia, Japan and Korea represent the bulk of incremental
\ndemand as battery manufacturing and downstream capacity continue
\nto expand. Although the shift towards LFP chemistries moderates
\nnickel demand relative to last year\u2019s Outlook, nickel-rich chemistries
\nare expected to retain an important role, particularly for battery
\nmakers outside China and in markets such as North America and
\nEurope, where consumers prefer long-range vehicles.
\nNickel demand use by sector in the STEPS, 2015-2040
\nIEA. CC BY 4.0.
\nNotes: STEPS= Stated PoliciesScenario. Otherenergyincludesnickeluse
\nforrenewablesand hydrogen.
\nSupply gaps start to emerge beyond in the late 2020s in the base
\ncase, with a 1.9 Mt gap emerging by 2040. The high-production case
\ncloses over 60% of thisshortfall but depends on sustained
\nexpansion in a limited number of jurisdictions, mainly Indonesia.
\nDespite this, a number of projects remain on hold or under care and
\nmaintenance. In addition, almost 2 Mt of early-stage mining projects
\n0% 20% 40% 60% 80% 100%
\n2015
\n2025
\n2030
\n2035
\n2040
\nEV and storage batteries Other energy
\nAlloys Other uses
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 154
\n2. Outlook for key minerals
\nexist across Indonesia, Australia, North America and LatinAmerica,
\nwhich could provide additional supply if economic conditions support
\ndevelopment and help narrow supply gaps.
\nConcentration in the battery-grade nickel market, 2025 and 2035
\nIEA. CC BY 4.0.
\nNotes: For these purposes, convertible feedstock refers to any nickel product
\nthat can be used to produce nickel sulphate, even if a further processing step
\nis required, such as nickel pig iron or mixed hydroxide precipitate.
\nSource: IEA analysis based on data from Wood Mackenzie.
\nHowever, many projects in geographically diverse regions have
\nstruggled to emerge or recover following prolonged periods of low
\nprices, given persistent and structural challenges. Higher energy and
\noperating costs, stricter environmental standards, smaller project
\nscale and slower ramp-up profiles limit competitiveness at prevailing
\nprices. Both brownfield expansions and greenfield developments
\noutside today\u2019s dominant producers require higher incentive prices to
\nproceed.
\nThe largest concentration risks in the nickel market are closely linked
\nto the battery value chain, where supply disruptions or policy shifts
\ncan have outsized impacts on the availability of battery-grade nickel
\nproducts. Battery production requires nickel sulphate, which can be
\nproduced either from Class I nickel metal or from nickel intermediates,
\nsuch as MHP and nickel matte. While Indonesia has rapidly
\nexpanded production of these intermediates and is expected to
\naccount for just over 70% of the global market by 2035, China is
\nexpected to remain the dominant supplier of nickel sulphate,
\naccounting for 70% of the market by 2035. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\n25%
\n50%
\n75%
\n100%
\n2025 2035
\nIndonesia China Rest of world
\nConvertible feedstock
\n2025 2035
\nSulphate capacity
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 155
\n2. Outlook for key minerals
\nOutlook for cobalt
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 156
\n2. Outlook for key minerals
\nThe cobalt market is expected to shift into deficit from 2026 due to DRC export restrictions,
\nwith the outlook increasingly shaped bypolicy developments in the DRC and Indonesia
\nIn 2025, mined cobalt production stood at around 320 kt, similar to
\nproduction levels in 2024. However, trade in cobalt intermediates
\n(unrefined cobalt), particularly cobalt hydroxide, saw a notable
\nreduction following the introduction of export controls by the
\nDemocratic Republic of the Congo (DRC), the world\u2019s largest mined
\ncobalt supplier.
\nFollowing several years of oversupply and depressed prices, the
\nDRC implemented an export ban on cobalt, including cobalt
\nhydroxide, the country\u2019s prevalent export form, in early 2025. Later in
\n2025, this was followed by a quota system capping cobalt exports at
\n96 600 tonnes, less than half of 2024 production volumes. These
\nmeasures led to supply tightness in intermediate feedstocks and
\ncontributed to upward pressure on prices. Cobalt metal prices
\napproached USD58 000 per tonne in the first quarter of 2026, more
\nthan three times as high as the previous year. However, refined
\ncobalt inventories remained elevated, resulting in differing price
\ndynamics between intermediates and refined products. In early 2026,
\nprices of cobalt hydroxide approached those of cobalt metal. Strong
\ndemand growth from the batteries and electronics sectors in 2025
\nwidened the price premium of cobalt sulphate and cobalt tetroxide
\nover cobalt metal.
\nMeanwhile, Indonesia has emerged as a significant alternative
\nsupplier, producing cobalt as a by-product of nickel operations. Its
\nshare of global production has increased from around 1.5% in 2020
\nto approximately 15% in 2025.
\nCobalt intermediates and cobalt metal prices
\nIEA. CC BY 4.0.
\nNote: DRC = Democratic Republic of the Congo. The DRC implemented an
\nexport ban on cobalt in February 2025 and replaced this with an export quota
\nsystem in September 2025.
\nSource: IEA analysis based on data from Benchmark Minerals Intelligence.
\n25
\n50
\n75
\n100
\nJan-25 May-25 Sep-25 Jan-26 May-26
\nCobalt hydroxide Cobalt sulphate Cobalt metal
\nThousand USD\/t Co
\nDRCexport quota
\nDRCexport ban
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 157
\n2. Outlook for key minerals
\nImpact of the DRC\u2019s policy changes: export restrictions,
\nstrategic reserve and mineral partnerships
\nThe DRC remains the world\u2019s largest cobalt producer, accounting for
\ntwo-thirds of global mined output. However, its supply profile has
\nbeen fundamentally altered by successive policy interventions since
\nlate 2024. The quota system introduced by the Regulatory and
\nControl Authority for Strategic Mineral Substances (ARECOMS) in
\nSeptember 2025 took effect in October 2025 to bring up cobalt prices
\nand incentivise value addition. Under this system, ARECOMS will
\ndistribute quotas pro rata based on historical export volumes, with
\nexceptions granted to the state-owned entity Entreprise G\u00e9n\u00e9rale du
\nCobalt and Soci\u00e9t\u00e9 pour le Traitement du Terril de Lubumbashi.
\nCompanies are excluded from the quota system if they exported less
\nthan 100 tonnes in 2024, operate refineries without mining activity or
\npossess depleted cobalt reserves.
\nA strategic quota was also allocated to ARECOMS and will be used
\nfor projects of national strategic importance, with the right to buy back
\nexcess cobalt stocks and withdraw quotas from companies that
\nprocess third-party or artisanal cobalt.The system increased supply
\nuncertainty, with no clear allocation framework provided beyond 2027.
\nMeanwhile, inventories of cobalt hydroxide in the DRC continue to
\nbuild, forcing mining operations to manage excess materials through
\nstockpiling in warehouses, storage in tailings facilities or production
\ncurtailments.
\nMarketed global mined cobalt supply by region
\nIEA. CC BY 4.0.
\nNotes: DRC = Democratic Republic of the Congo. The supply numbers for
\n2025-2026 consider sold supply volumes, instead of production volumes, in
\nthe DRC. Following 2026, the export quota is assumed to remain in place at
\nthe current level.
\nIn April 2026, the DRC established a strategic reserve of critical
\nminerals, administered by ARECOMS. The mechanism enables the
\nstate to withhold or release volumes in response to prevailing price
\nconditions. As such, downstream buyers will need to factor in
\ndiscretionary state interventions by ARECOMS, which could increase
\nmedium-term price uncertainty.
\nThe Strategic Partnership Agreement between the United States and
\nthe DRC has also led to early-stage deals aimed at enabling value
\naddition within the DRC while diversifying ownership of supply. In
\nJanuary 2026, the DRC offered US investors access to state-owned
\n50
\n100
\n150
\n200
\n250
\n300
\n350
\n2025 2026 2027 2028 2029 2030 2035
\nRest of
\nworld
\nIndonesia
\nDRC
\nktCo
\n-26%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 158
\n2. Outlook for key minerals
\nmineral assets not committed under existing farm-outs or joint
\nventure arrangements, including Gecamines\u2019 Mutoshi copper-cobalt
\nproject, Sakima\u2019s coltan and gold assets and Cominiere\u2019s lithium
\nlicences. Through the partnership, Glencore announced a nonbinding (MoU) with the Orion Critical Minerals Consortium (backed
\nby the US International Development Finance Corporation) for a
\npotential 40% stake acquisition in Glencore\u2019s DRC assets in February
\n2026. Also with support from the Orion Critical Minerals Consortium,
\nVirtus Minerals announced the acquisition of Chemaf in April, one of
\nthe largest producers of high-grade copper and cobalt, with a
\npotential capacity of at least 20 kt of cobalt hydroxide annually.
\nShortly after, Virtus Minerals signed an MoU with US Strategic Metals
\nto supply cobalt and copper directly to US Strategic Metals\u2019
\nhydrometallurgical plant. While these initiatives may help attract nonChinese capital into the sector, they are unlikely to translate into
\nsignificant new volumes in the near term.
\nIndonesia\u2019s rise as an alternative supplier amid
\nemerging cost and input constraints
\nIndonesia is the second-largest and fastest-growing cobalt producer.
\nBy 2035, mined cobalt production in the country is set to almost
\ndouble in the base case, supported by the expansion of the Pomalaa
\nand Morowali processing hubs. However, structural challenges
\nremain. In Indonesia, cobalt is produced as a by-product of nickel
\nprocessing via the High Pressure Acid Leach (HPAL) route, which
\ntreats limonite ore \u2013 a lateritic nickel ore type that also contains
\nrecoverable cobalt. Production of MHP from HPAL operations is
\nslowing down due to tight availability of sulphuric acid, a constraint
\nthat is being reinforced by rising sulphur import costs and supply
\ndisruptions, given Indonesia\u2019s heavy reliance on imported inputs for
\nacid-intensive processing. While copper-cobalt SxEw operations in
\nthe DRC are also highly dependent on sulphuric acid inputs, the nearterm impact on cobalt supply is expected to be more contained due
\nto elevated inventory levels and more established acid sourcing
\nchannels, including regional suppliers such as Zambia, reducing
\nexposure to disruptions affecting Middle East sulphur trade routes.
\nLarger, integrated producers in particular benefit from access to
\ndomestic or contracted supply, although smaller operations remain
\nexposed to rising reagent costs and procurement risks.
\nAt the same time, in April 2026, Indonesia revised its mineral
\nbenchmark ore price (HPM) formula for nickel ore, for the first time
\nexplicitly valuing cobalt content as a priced component of the nickel
\nore HPM, rather than treating it as an free-of-charge by-product.
\nAssociated cobalt is also now subject to a 2% royalty tax rate. With
\ncobalt content factored into the price and tax base of nickel ore,
\nofftake contracts for mixed hydroxide precipitate (MHP) or other
\nintermediates sourced from HPM-referenced ore must account for
\ncobalt\u2019s contribution to the benchmark price. This further increases
\nprocessing costs for MHP and battery-grade intermediates containing
\ncobalt. Any increase in cobalt production also requires a considerable
\nincrease in nickel production in the country at a time when nickel
\nprices are low. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 159
\n2. Outlook for key minerals
\nElectric vehicles maintain the largest share of demand, while aerospace and defence see
\nsteady growth through to 2040
\nCobalt demand by sector in the STEPS (left) and sectoral demand composition (right)
\nIEA. CC BY 4.0.
\nNote: STEPS = Stated Policies Scenario.
\n100
\n200
\n300
\n400
\n2025 2030 2035 2040
\nkt Co
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\n2021-2025 2026-2030 2031-2035 2036-2040
\nElectric vehicles Portable electronics Aerospace and defence
\nPower devices Energy storage systems Others
\nShare of total demand
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 160
\n2. Outlook for key minerals
\nThe cobalt market transitions to deficit from 2026 under persistent DRC export constraints, with
\nadequate supply contingent on responses from Indonesia and other producers
\nCobalt demand growth continues to be led by EVs, with cobalt use
\nfor EV batteries rising by nearly two-thirds through 2040 in the STEPS,
\neven though cobalt demand for EV batteries has been revised down
\ncompared with last year’s Outlook due to shifts in battery chemistry
\nchoices.
\nThe rapid rise of LFP batteries continues to weigh on cobalt demand
\ngrowth. However, this effect is partially offset by changes within
\nnickel-cobalt-manganese (NCM) chemistries compared with previous
\nexpectations. In particular, NCM 622 and NCM 532, both more
\ncobalt-intensive than higher-nickel chemistries such as NCM 811, are
\nmaintaining stronger market shares in premium EV segments,
\nespecially in Europe and North America, where energy density
\nrequirements, vehicle performance considerations and original
\nequipment manufacturer product cycles continue to support cobaltbearing cathodes. As a result, battery chemistry developments have
\na mixed impact on cobalt demand, with the growth of LFP reducing
\ndemand while the persistence of cobalt-intensive NCM chemistries
\nprovides an important source of support.
\nBeyond EVs, non-EV sources make growing contributions to cobalt
\ndemand. Devices and wearables enabled with artificial intelligence
\n(AI) functions are driving energy density requirements that favour
\nlithium cobalt oxide cathodes, and smartphone replacement cycles
\nhave exceeded prior projections. The share of portable electronics is
\nset to grow from over 15% to almost 30% in the medium term and by
\nup to 40% to 2040 from the base year. Cobalt superalloys, used
\nprimarily in high-temperature aerospace engine components where
\ndemand is not substitutable, account for approximately 7% of global
\ncobalt consumption. Aerospace and defence are exhibiting structural
\ndemand growth: commercial aircraft order backlogs are extending
\ndelivery timelines, sustaining superalloy demand beyond military
\napplications. Should planned increases in defence spending
\nmaterialise across major economies, incremental demand for cobalt
\nin superalloys and lithium-cobalt battery applications could provide
\nadditional upside to projections. Total demand for cobalt is growing,
\nwith an increasing regional share from North America and Europe.
\nMined supply of cobalt is increasingly shaped by policy
\ndevelopments in the top suppliers
\nNear-term mined supply is driven by DRC policy implementation and
\nIndonesian ramp-up, but intermediate markets are expected to be
\ntight while export controls remain in place. In 2025, large-scale
\nminers in the DRC posted strong production results. CMOC produced
\n117 kt from Tenke Fungurume and KFM, while Glencore\u2019s production
\nfrom KCC and Mutanda totalled 36 kt. However, export quotas limited
\nthe material reaching the market: KCC and Mutanda did not export
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 161
\n2. Outlook for key minerals
\ncobalt in Q4 2025, and while CMOC\u2019s cobalt production was up 0.3%
\nyear-on-year, sales were down 92% year-on-year. For 2026, CMOC
\nreceived 31 200 tonnes of the total quota of 96 000 tonnes, including
\nthe DRC\u2019s strategic quota to be distributed by ARECOMS to projects
\nof national strategic importance, while Glencore received
\n22 800 tonnes. The currently published 2026 quota levels are
\ninsufficient to meet projected intermediate supply requirements,
\nwhich may be further constrained by administrative delays in physical
\nexports.
\nConcentration in battery-grade cobalt material production
\nIEA. CC BY 4.0.
\nNote: DRC = Democratic Republic of the Congo. Cobalt intermediates include
\ncobalt hydroxide and mixed hydroxide precipitate.
\nThis has tightened hydroxide availability and increased competition
\nfor intermediate feedstocks, limiting the ability of refining capacity to
\nrespond to growing demand. While Indonesia is expected to provide
\nincremental supply, its contribution is subject to constraints.
\nIndonesia\u2019s 2026 RKAB quota tightening and rising sulphur costs
\nhave disrupted HPAL feedstock availability and increased cost
\npressures. At the same time, quota-driven tightness on nickel supply
\nsupports nickel prices, which in turn underpins the economics of
\ncobalt produced as a by-product. As Indonesian nickel production
\ndrives cobalt supply expansion over the long term, cobalt markets
\nbecome increasingly linked to nickel markets, with almost 50% of
\nglobal cobalt projected to be produced as a by-product of nickel by
\n2035 in the base case.
\nFrom around 2030, production in the DRC starts to decline by around
\n5% per year to 2040, driven by diminishing ore quality. Meanwhile,
\nIndonesia already accounts for over 15% of total mined cobalt supply
\nand is projected to expand output by almost 40% to 2040 in the base
\ncase. Diversification of mined supply beyond the DRC and Indonesia
\nremains limited in the near term. Australia and Canada together
\naccounted for 3.5% (around 11 kt) of global cobalt production in 2025,
\na share projected to reach 4% by 2040, supported by by-product
\nextraction from nickel and copper operations and government
\nsupport programmes. Moreover, many projects in alternative
\njurisdictions projects remain pre-production, with no material volume
\ncontribution expected before 2027. For example, Cobalt Blue\u2019s
\nBroken Hill Cobalt Project in Australia may provide supply outside of
\n0%
\n25%
\n50%
\n75%
\n100%
\n2025 2035
\nDRC Indonesia Rest of world China
\nCobalt intermediates
\n2025 2035
\nRefinedcobalt
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 162
\n2. Outlook for key minerals
\nthe top two producing countries by 2027, with around 0.6 kt of cobalt
\nper annum. It is in the process of submitting its environmental permits
\nfor 2026. Possible projects in Canada include Nickel Creek
\nPlatinum\u2019s Nickel Shaw and Giga Metals\u2019 Turnagain, which may add
\naround 3 kt to global supply by 2027, though both are in pre-feasibility.
\nChina\u2019s lead in refining persists as diversification
\nprospects remain limited
\nChina remains the leading cobalt refiner, accounting for more than
\n75% of the market in 2025, a share that remains broadly unchanged
\nthrough the projection period. Limited new refining projects in
\ngeographically diverse regions are in sight, keeping China\u2019s refining
\ndominance intact in the near to medium term. Chinese refineries have
\ndealt with shortages in cobalt intermediates due to administrative
\ndelays in DRC quota allocation, though the impact has been
\ncontained given that quota allocations have been directed primarily
\nto Chinese-invested DRC operations.
\nFor cobalt sulphate, a key precursor for EV batteries, the market is
\nset to grow by almost 60% by 2035, with few operations outside
\nChina and Indonesia. In January 2026, Morocco\u2019s Managem planned
\nto switch its cobalt metal production in Bou Azzer to sulphate, with a
\ncapacity estimated at 6 kt per annum, of which 1.2 kt is contained
\ncobalt. In the long term, operations such as Umicore\u2019s Kokkola cobalt
\nrefinery in Finland will continue to contribute almost 2.5 kt per annum.
\nSecondary cobalt supply is projected to over double by 2035 to
\nalmost 45 kt, though volumes remain insufficient to close the demand
\ngap from primary sources. China lifted its ten-year ban on black mass
\nimports on 1 August 2025, redirecting secondary feedstock to
\nChinese refiners and reinforcing its downstream position. A
\ncombination of policy actions incentivising higher recycling of
\nconsumer and EV batteries is projected to raise the secondary share
\nof total supply to 15% by 2035 in the STEPS.
\nOverall, the market remains constrained by uncertainty around
\nexports of DRC-mined material, with limited ability to offset these
\nrestrictions through increased production elsewhere. In 2025, supply
\nwas sufficient to meet demand, with only a marginal surplus, although
\nthis outcome was supported by the extension of Q4 2025 export
\nquotas into the first quarter of 2026, allowing delayed shipments to
\nbe completed as the DRC\u2019s quota system was being implemented.
\nThis masked underlying tightness in intermediate markets. If existing
\nexport quotas persist at current levels, the market will move into
\ndeficit from 2026 onwards, with these imbalances expected to persist
\ninto the longer term. This reflects the continued reliance on DRC
\nsupply, limiting the ability of the market to respond to growing demand
\ndespite expansion projects in other regions. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 163
\n2. Outlook for key minerals
\nOutlook for graphite
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 164
\n2. Outlook for key minerals
\nNew synthetic graphite production in China drives supply growth\u2026
\nGrowth of natural and synthetic graphite supply and demand, 2023-2025
\nIEA. CC BY 4.0.
\n– 150
\n150
\n300
\n450
\n600
\n2023 2024 2025
\nChina Japan India United States
\nIndonesia Canada Other Demand
\nBattery-grade supply and demand growth
\nkt
\n-10%
\n0%
\n10%
\n20%
\n30%
\n40%
\n2023 2024 2025
\nNatural spherical Synthetic battery anodes
\nSpherical and synthetic supply growth
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 165
\n2. Outlook for key minerals
\n\u2026consolidating a downward trend in prices
\nPrice of China\u2019s synthetic and natural anode active materials
\nIEA. CC BY 4.0.
\nNotes: Free on board China prices. High power: >340 mAh\/g; medium power: 320-340 mAh\/g; low power: <320 mAh\/g.
\nSource: IEA analysis based on data from Wood Mackenzie.
\n2 000
\n4 000
\n6 000
\n8 000
\n10 000
\n12 000
\n2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
\nHigh power
\nMedium power
\nLow power
\nUSD\/tonne
\nNatural
\nSynthetic
\nHigh power
\nMedium power
\nLow power
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 166
\n2. Outlook for key minerals
\nGraphite demand grows strongly, while overcapacity drives a persistent low-price environment
\nIn 2025, global graphite demand increased by around 6%
\nyear\u2011on\u2011year, driven almost entirely by the battery sector, where
\ndemand rose by over 14%, reflecting continued growth in EV and
\nstationary storage deployment. By contrast, demand from
\nnon\u2011battery applications remained broadly stable. Despite the strong
\ndemand growth, the graphite market remained oversupplied across
\nall major segments of the supply chain, with sustained downward
\npressure on prices. New supply was mainly driven by the growth of
\nsynthetic graphite, which increased by 22% in 2025, while natural
\nspherical graphite supply decreased by 3%.
\nNatural graphite
\nIn the natural graphite segment, additional supply entered the market
\nin 2025 following the restart of the Balama mine in Mozambique and
\nsome output from the Lindi Jumbo project in Tanzania, although
\noperations there remained constrained after entering administration.
\nThese developments contributed to a modest diversification of
\nupstream supply, reducing the share of the top supplier in mined
\ngraphite output to around 80% in 2025, from 84% in 2023.
\nIn 2025 and early 2026, some spheroidisation and coating projects,
\nin which mined graphite is converted into battery-grade anode
\nmaterial, announced significant developments. These included the
\nVittangi anode project in Sweden, the Tangier anode plant in
\nMorocco, and the B\u00e9cancour plant in Canada, which together are
\nexpected to produce around 20 kt of battery-grade coated spherical
\ngraphite by 2030.
\nSynthetic graphite
\nThe synthetic graphite market remains highly concentrated, with the
\nvast majority of production capacity located in China and only a
\nlimited number of projects producing at scale elsewhere. From 2022
\nto 2025, synthetic graphite supply increased at an average rate of 15%
\nper year, outpacing the growth of natural graphite. With growing
\ncompetitive pressures in a prolonged low-price environment,
\nconsolidation and vertical integration are becoming more visible
\nalong the anode supply chain, including moves by established
\nChinese producers, such as China Baoan Group\u2019s participation in the
\nrestructuring of Shanshan Group through its subsidiary BTR.
\nSome projects outside China have revised or scaled back their
\nplanned capacity expansions in response to weaker project
\neconomics. Recent examples include SGL\u2019s graphite facilities in
\nPoland and Tokai COBEX\u2019s project in France, both of which have
\nadjusted their ambitions amid sustained price pressure, high
\noperating costs and strong competition from the dominant supplier.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 167
\n2. Outlook for key minerals
\nAs production costs become an increasingly critical factor for battery
\nmanufacturers, the synthetic graphite industry is shifting away from
\nan exclusive reliance on high\u2011quality needle coke towards a
\nmulti\u2011feedstock model in which low\u2011sulphur petroleum coke accounts
\nfor a growing share of inputs. In addition to lowering costs, this
\ntransition reduces exposure to needle coke supply constraints. China
\nremains a net importer of needle coke, despite recent investments to
\nexpand domestic production capacity.
\nGlobal share of synthetic graphite in battery anodes, 2010-2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from Wood Mackenzie.
\nAnode material
\nThe supply and demand dynamics described above led prices of
\nsynthetic graphite anodes for medium- and low-power applications to
\nroughly halve from 2022 to 2025, while prices of spherical natural
\ngraphite anodes fell less sharply, with those for low-power
\napplications decreasing by one-third. Synthetic anodes used to be
\nmore expensive than those made of natural graphite, reflecting higher
\nproduction costs. However, more recently, the use of lower-cost
\nfeedstocks has contributed to a sharper decline in synthetic battery
\nanode prices. These dynamics have reinforced a structural shift in
\nanode composition: anode active material production in China is now
\nalmost entirely based on synthetic graphite, while natural spherical
\ngraphite retains a higher share outside China. Prices of anode
\nmaterial are now set at historic lows, making further reductions
\nchallenging.
\nNeedle coke
\nContrasting with this trend, needle coke prices increased in 2025,
\nwith calcined petroleum needle coke up around 4% year-on-year,
\nreflecting persistent supply deficits in China and rising production
\ncosts. In early 2026, shipping disruptions in the Strait of Hormuz
\npushed up oil prices, with knock-on effects on needle coke markets:
\nprices rose by more than 20% since the start of the conflict, and
\nuncalcined needle coke reached USD 928 per tonne in April. These
\nincreases could materially affect the cost base of synthetic graphite
\nanode production.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 168
\n2. Outlook for key minerals
\nGraphite electrodes for electric arc furnaces
\nThe graphite electrodes market remained subdued in 2025, as delays
\nin electric arc furnace project expansions weighed on demand. Prices
\nedged up slightly in 2025 but remained below historical averages
\namid ample supply and slower steel sector activity. However, in early
\n2026, several producers announced price increases, citing rising
\ninput costs.
\nTrade and industrial policies add to market uncertainty
\nTrade policy developments are adding a further layer of uncertainty
\nto already concentrated graphite and battery supply chains.
\nChina\u2019s exports of battery-grade natural spherical graphite
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on China Customs statistics, commodity codes
\n25041091 and 38019010.
\nFollowing the introduction of export controls on natural and synthetic
\ngraphite in 2023 and 2024, China announced new export controls
\ncovering batteries in October 2025, including graphite anode
\nmaterials and anode production equipment. One month later, in
\nNovember 2025, China\u2019s Ministry of Commerce and Customs
\nsuspended these measures for one year. While the suspension has
\nalleviated immediate supply disruptions, risks remain elevated. Any
\nre-imposition or expansion of restrictions would significantly constrain
\nefforts to establish competitive anode supply chains outside China,
\nwhich already face challenges related to financing, cost
\ncompetitiveness and access to advanced processing technologies.
\nTrade in battery-grade graphite from China has been affected by the
\ncontrols announced in 2024, with total exports of spherical graphite
\ndecreasing by 16% in 2025. The issuance of export licences has in
\nsome cases been targeted to specific countries, with exports of
\nspherical graphite to the United States halted since April 2025. In
\nJune 2026, Mozambique also introduced restrictions on the export of
\nunprocessed materials, mandated local value addition and required
\n10% of mining revenues to be directed to local communities.
\nRegulatory changes in importing countries are also reshaping
\nincentives for local production. In the United States, total tariffs on
\ngraphite imported from China fell sharply from over 200% in February
\n2026 to about 35% by late March, following rulings by the
\nSupreme Court and the United States International Trade
\nCommission. At the same time, in May 2026 the International Trade
\nCommission determined that graphite electrodes imported from
\nChina and India were sold at less than fair value, highlighting the
\ncontinued use of trade measures to address perceived market
\ndistortions. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\n10
\n20
\n30
\n40
\n50
\nQ4 Q1 Q2 Q3 Q4
\n2024 2025
\nOther
\nIndonesia
\nHungary
\nJapan
\nKorea
\nUnited
\nStates
\nkt
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 169
\n2. Outlook for key minerals
\nEV and storage batteries drive graphite demand growth through 2040, with China playing a
\nleading role
\nGlobal graphite demand outlook by sector and region in the STEPS
\nIEA. CC BY 4.0.
\nNote: EAF = electric arc furnace; STEPS = Stated Policies Scenario.
\n2
\n4
\n6
\n8
\n10
\n12
\n2025 2030 2035 2040
\nEV batteries Battery storage Other batteries
\nElectrodes (EAF) Other uses
\nMt
\n2
\n4
\n6
\n8
\n10
\n12
\n2025 2030 2035 2040
\nChina Asia ex-China North America
\nEurope Other
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 170
\n2. Outlook for key minerals
\nSupply is also expected to grow strongly, with significant idle synthetic graphite production
\ncapacity available
\nTotal and battery-grade graphite supply from existing and announced projects in the base case, additional supply from synthetic anode
\nprojects, and demand in the CPS, STEPS and HDS, 2025-2040
\nIEA. CC BY 4.0.
\nNote: CPS = Current Policies Scenario; HDS = High Demand Scenario; STEPS = Stated Policies Scenario.
\n2025 2030 2035 2040
\nSTEPS
\nHDS
\nCPS
\n2
\n4
\n6
\n8
\n10
\n12
\n14
\n2025 2030 2035 2040
\nChina
\nAfrica
\nAsia (except China)
\nNorth America
\nEurope
\nRussia
\nOther regions
\nAdditional synthetic
\nanode projects
\nMt
\nTotal supply (natural and synthetic) Refined battery-grade supply (spherical and synthetic)
\nSupply
\nPrimary supply
\nrequirements
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 171
\n2. Outlook for key minerals
\nConcentration risks call for strong action and policy support fordiversification
\nThe global graphite market remains broadly well supplied through
\n2030, with ample idle synthetic production capacity that could be
\nmobilised in China in response to market signals. However, new
\ndemand comes not only from batteries but increasingly from
\nnon-battery applications, notably electrodes for electric arc furnaces,
\nas well as graphite use in other industrial and strategic sectors.
\nSeveral of these applications require specific graphite grades that are
\nnot readily interchangeable with battery-grade material, underscoring
\nthe emerging risks of grade-specific tightness.
\nDemand
\nGraphite demand is set to almost double from 2025 to 2035 in the
\nSTEPS, mainly driven by strong growth in demand for EV and storage
\nbatteries. In the long term, material choice and technology
\nsubstitution will play a role in shaping demand for battery-grade
\ngraphite, as silicon, lithium metal and hard carbon are set to
\nprogressively increase their market shares and substitute graphite.
\nDemand is expected to remain concentrated in China, which
\naccounted for two-thirds of demand in 2025. Outside China, new
\ngraphite demand is expected to come mainly from new battery
\nprojects in Asia, North America and Europe.
\nElectrification of steel is driving demand growth for graphite
\nelectrodes, set to increase by around 50% from 2025 to 2035, though
\nsurplus production capacity is expected to persist into the 2030s,
\nwhile other uses such as refractories, foundries and recarburising are
\nexpected to overall increase by 30%.
\nSupply
\nGraphite supply growth by country, 2025-2035
\nIEA. CC BY 4.0.
\n-20%
\n0%
\n20%
\n40%
\n60%
\nMined
\nsupply
\nSpherical
\nnatural
\nSynthetic
\nOther
\nIndia
\nIndonesia
\nJapan
\nBrazil
\nCanada
\nMadagascar
\nTanzania
\nMozambique
\nChina
\nTotal growth
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 172
\n2. Outlook for key minerals
\nFrom 2025 to 2035, total graphite supply is expected to grow by over
\n50% in the base case, driven by new battery-grade supply (both
\nnatural spherical and synthetic) from China. Mined supply, however,
\nis expected to decrease in China, offset by new flake mine
\ndevelopments in other regions, mainly Africa, Canada and Brazil. In
\nCanada, Nouveau Monde Graphite confirmed the final investment
\ndecision for its Matawinie Mine project, which is expected to produce
\naround 100 kt per year of graphite starting before 2030. New graphite
\nmine developments are expected to deliver significant progress in
\nmined supply diversification, decreasing China\u2019s share from 80% in
\n2025 to 53% in 2035. However, the country is expected to retain a
\nstrong hold on refined graphite markets, with its share of batterygrade graphite supply decreasing only from 94% to 91% in the next
\ndecade.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 173
\n2. Outlook for key minerals
\nBox 2.1 Strategic importance of specialised graphite beyond batteries
\nGraphite plays a strategic role across defence, aerospace, nuclear
\nand other high-technology sectors where performance
\nrequirements combine extreme temperatures, mechanical stress,
\nelectrical conductivity and chemical or nuclear stability. In many of
\nthese applications, graphite and carbon-based materials are
\neffectively non-substitutable.
\nHigh-purity graphite for these specialised applications, with carbon
\ncontent higher than 99.9%, is obtained through isostatic pressing,
\nwhich requires ultra-fine controlled powders, and is always
\nproduced from synthetic feedstocks. However, there is growing
\ninterest among producers in high-purity natural graphite as demand
\nfrom these sectors grows.
\nIn defence and aerospace, graphite and carbon-carbon composites
\nare essential inputs for missile and rocket nozzles, hypersonic and
\nre-entry structures, aircraft braking systems, seals and bearings.
\nThese applications require high-density materials that retain
\nstrength and dimensional stability at very high temperatures while
\nremaining lightweight.
\nIn nuclear energy systems, nuclear-grade graphite is a critical
\ncomponent in graphite-moderated reactors, serving both as a
\nneutron moderator and a structural material.
\nThe safety and performance requirements of nuclear applications
\nimpose exceptionally tight specifications, including ultra-high purity
\n(up to 99.999% carbon content), controlled isotropic microstructure,
\nhigh density and resistance to radiation-induced degradation.
\nOther strategically important industries, such as semiconductors,
\nsolar PV, fuel cells and hydrogen technologies, depend on very
\nhigh-purity graphite with tightly controlled grain size, porosity and
\nthermal properties. Materials for these applications are required to
\noperate in ultra-clean, high-temperature environments where
\ncontamination or microstructural variability can lead to system
\nfailure.
\nWhile these non-battery applications account for a relatively small
\nshare of total graphite volumes, they are highly
\nspecification-sensitive and mission-critical. Demand for specialised
\ngraphite is expected to increase steadily over the next decade,
\ndriven by rising defence expenditure, expansion of aerospace and
\nspace systems, expansion of nuclear capacity, and the scaling-up
\nof semiconductor manufacturing. This creates strategic exposure,
\nas supply chains for high-grade graphite remain highly
\nconcentrated, and capacity for specialised grades is significantly
\nmore difficult to substitute or scale than bulk battery materials.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 174
\n2. Outlook for key minerals
\nOutlook for rare earth elements
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 175
\n2. Outlook for key minerals
\nWith export controls, rising prices and supply uncertainty, 2025 was one of the most turbulent
\nyears for rare earth element markets since the 2010s
\nEvolution of rare earth magnet export volumes from China (left) and price of selected rare earth elements (right) since January 2025
\nIEA. CC BY 4.0.
\nNotes: kt = thousand tonnes; NdFeB = neodymium-iron-boron permanent magnet; REE = rare earth elements. Magnet REE = neodymium, praseodymium,
\ndysprosium and terbium. Non-magnet REE = yttrium, samarium, gadolinium, holmium, erbium and lutetium. The assessment is based on neodymium,
\npraseodymium, dysprosium, terbium, yttrium, samarium, cerium, erbium and lanthanum rare earth oxide 99.5% min free on board China spot prices, and scandium,
\ngadolinium, holmium and europium rare earth oxide 99% min Ex Works China prices. Indexed values were calculated relative to January 2025.
\nSources: IEA analysis based on statistics from China\u2019s General Administration of Customs, accessed 13 May 2026 and KOMIS (2026), accessed 29 April 2026. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\n0.8
\n1.0
\n1.2
\n1.4
\n1.6
\n1.8
\n2.0
\n2.2
\nJan-25 Apr-25 Jul-25 Oct-25 Jan-26 Apr-26
\nIndex (1 Jan 2025 = 1)
\nMagnet REE Non-magnet REE
\n1
\n2
\n3
\n4
\n5
\n6
\n7
\nJan
\nFeb
\nMar
\nApr
\nMay
\nJun
\nJul
\nAug
\nSep
\nOct
\nNov
\nDec
\nJan
\nFeb
\nMar
\n2025 2026
\nkt NdFeB
\nEurope United States Korea Japan Rest of World
\nExport restrictions
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 176
\n2. Outlook for key minerals
\nAgainst the backdrop of supply uncertainty triggered by geopolitical events, unprecedented
\nmomentum emerged to support projects in geographically diverse regions
\nExport controls, trade and prices
\nIn 2010, China implemented rare earth controls using quotas and
\nlicensing, causing a global supply shock and rare earth prices to spike
\ntemporarily by as much as ten times. These controls were eventually
\nruled non-compliant with the World Trade Organization (WTO),
\nleading to their removal. In 2025, significantly strengthened and
\nexpanded rare earth export controls from China re-emerged.
\nThe April 2025 export controls on seven heavy rare earths (including
\ndysprosium, terbium and samarium, which have applications in
\npermanent magnets) and their related products led export volumes
\nfrom China to drop sharply in April and May, leaving many
\nautomakers in the United States, Europe and beyond struggling to
\nsource permanent magnets. Exports of dysprosium and terbium
\noxides and metals were also affected by the restriction, dropping in
\nMay before slowly recovering in the following months, impacting the
\nsupply of feedstocks for magnet manufacturing outside China. Even
\nafter trade volumes recovered, a significant premium for magnets
\nproduced outside China remained.
\nExpanded export controls announced in October 2025 not only
\nadded five additional rare earth elements, notably holmium, which
\nwas used as a substitute by magnet makers in the aftermath of the
\nApril controls, but also broadened the scope to include
\n\u201cinternationally made\u201d products containing Chinese-sourced \u201cparts,
\ncomponents and assemblies\u201d or manufactured using Chinese
\ntechnologies. In November 2025, China announced a one-year
\nsuspension of the export restrictions introduced in October 2025,
\nproviding relief to the market. However, the underlying risks and
\npotential for future implementation remain (see Chapter 1).
\nNotably, prices for neodymium\u2011praseodymium (NdPr) oxide nearly
\ndoubled over the seven months from October 2025, reaching around
\nUSD 125 perkilogramme in February 2026, their highest level since
\nmid\u20112022. The elevated prices are likely to be temporary, with a
\nmarginal downward correction already being observed.
\nNew landscape for policy support and partnerships
\nGovernments have rapidly deployed a range of policy instruments to
\nreduce vulnerabilities across rare earth supply chains, spanning trade,
\nproject financing, research and development, and international
\npartnerships. These efforts were accelerated by the announcement
\nof export controls and growing recognition of the importance of
\nfostering long-term supply chain resilience.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 177
\n2. Outlook for key minerals
\nFinancing has been the most widely utilised policy response, with
\ngovernments stepping in where private capital is lacking. Australia\u2019s
\nAUD 1.65 billion (Australian dollar) loan to Iluka Resources for the
\nEneabba rare earths refinery is one example, alongside the
\nUnited States\u2019 USD 150 million loan to MP Materials for its plan to
\nexpand heavy rare earth separation capabilities. Additional actions
\nfrom the Australian government are expected, partly linked to the
\ncountry\u2019s Critical Minerals Strategic Reserve initiative. The US
\nInternational Development Finance Corporation has also been active,
\nincluding through the Critical Minerals Consortium, which is backed
\nby USD 600 million in funding. Export credit agencies have started to
\nfinance projects as well, including Export Development Canada\u2019s
\nletter of interest to support a Viridis mining project in Brazil with
\nCAD 100 million (Canadian dollars) in debt financing. In November
\n2025, the Indian government approved an INR 72.8 billion (Indian
\nrupee) (approx. EUR 780 million) scheme to develop integrated
\npermanent magnet manufacturing capacity of , covering the full value
\nchain from rare earth oxides to finished magnets.
\nResearch, development and innovation along the supply chain
\nhave also received significant funding, including the US Department
\nof Energy\u2019s National Energy Technology Laboratory\u2019s letter of intent
\nwith USA Rare Earth to develop digital twin technology for heavy rare
\nearth separation at the company\u2019s Wheat Ridge laboratory and
\nRound Top deposit.
\nGeological exploration has been a way for countries to expand their
\ndomestic resource base. India\u2019s Atomic Minerals Directorate, for
\nexample, has been conducting systematic rare earths exploration
\nand targeting monazite and xenotime deposits. Between 2021 and
\n2024, the Geological Survey of India launched 368 critical mineral
\nexploration projects, which include rare earths, with a further 195
\nprojects initiated from 2024 to 2025. These efforts were
\ncomplemented by the 2026 Union Budget, which introduced
\ndedicated rare earth industrial corridors in Andhra Pradesh, Kerala
\nand Odisha, designed to bundle extraction, processing and valueadded manufacturing into a coherent development strategy for
\nelectronics and defence supply chains.
\nRecycling is also a parallel priority for many countries. The
\nEuropean Union\u2019s Critical Raw Materials Act introduced a suite of
\nmeasures aimed at strengthening rare earth recycling across the
\nregion, including requirements for rare earth content labelling and
\nminimum recycled content obligations, with implementation
\nscheduled between 2028 and 2032. In parallel, under the
\nRESourceEU Action Plan, the European Commission is expected to
\nput forward a proposal to restrict exports of permanent magnet scrap
\nand waste from EU countries. India\u2019s incentive scheme to promote
\ncritical minerals recycling sets aside INR1 500crore (approx.
\nEUR 145 million) to provide financial incentives for the development
\nof recycling capacity for the separation and production of critical
\nminerals from secondary sources.
\nInternational partnerships have increasingly become a cornerstone
\nof many countries\u2019 efforts to secure rare earth supply chains. For
\nexample, the United States has signed many bilateral agreements
\nIEA. CC BY 4.0.
\nPAGE | 178
\n2.Outlook for key minerals GlobalCriticalMinerals Outlook 2026
\nsince 2025, including a framework with Australia specifically focused
\non securing supply in the mining and processing of critical minerals
\nand rare earths, and more recently a strategic
\ncooperation framework with Saudi Arabia. Last December,
\nMalaysia signed a memorandum of cooperation to
\nstrengthen technical collaboration on rare earth exploration
\nand resource evaluation to support geological surveys,
\ntechnology exchange and capacity building, and to position
\nMalaysia as a hub for an integrated rare earth supply chain. In
\nFebruary 2026, Brazil and India signed a non\u2011binding MoU on rare
\nearths and critical minerals, establishing a framework for
\ncooperation on reciprocal investment, exploration, mining and
\ntechnology applications, including AI. In April 2026, France
\nand Japan agreed to strengthen their existing
\ncooperation on rare earth supply chains, building on their
\ncooperation on the Caremag project for rare earth processing and
\nrecycling. The IEA Critical Minerals Security Programme was
\nreinforced in February 2026 to serve as an avenue for partnerships
\non strategic projects and policy instruments. In addition, a growing
\nnumber of governments are making collaborative efforts to develop
\nsupply chains from mining to magnet manufacturing, from joint
\nventures between state-backed entities and mining companies
\nto government-facilitated offtake agreements and equity
\ninvestments by national resource agencies in foreign operations. In
\nJune 2026, Group of Seven (G7) member countries agreed to
\nreduce dependencies on rare earths and permanent magnets
\nfrom a single supplier to under 60% by 2030 in the G7 leaders\u2019
\ndeclaration on securing supplychains for critical minerals. These
\nexamples point to an emerging approach in which governments are
\nextendingmore directsupportto thesupplychain,in addition to
\ncreating enabling policyenvironments.
\nPrivate sector engagement sees a step change
\nFor decades, investment levels in rare earth companies in
\ngeographically diverse regions remained low due to a combination of
\nlow prices, small market sizes, price-sensitive end-use industries,
\nlack of market transparency and policy uncertainty. However,
\ndevelopments in 2025 highlighted the strategic importance of rare
\nearths, particularly magnet rare earths (neodymium [Nd],
\npraseodymium [Pr],dysprosium [Dy], terbium [Tb]),across a wide
\nrange of sectors from energy and transport to electronics, high-tech
\nmanufacturing for AI and data centres, aerospace and defence.
\nUnprecedented billion-dollar investment agreements in the rare
\nearths industry have come from both the public and private sectors in
\nthe last 12 months, with companies playing an increasingly active
\nrole in efforts to build diversified supply chains. The agreements have
\noften been cross-border, leveraging strengths in different regions,
\nwith many companies aiming to create \u201cmine-to-magnet\u201d value
\nchains.
\nIn July 2025, MP Materials, which operates one of the only integrated
\nrare earth facilities outside China, announced a landmark partnership
\nwith the US Department of War to expand domestic permanent
\nmagnet production, including support for its existing Independence
\nmagnet manufacturing facility and the development of the new largescale 10X magnet manufacturing campus. The US Department of
\nIEA. CC BY 4.0.
\nPAGE | 179
\n2.Outlook for key minerals GlobalCriticalMinerals Outlook 2026
\nWar committed to a floor price of USD 110 per kg for neodymiumpraseodymium products. The company also signed a
\nUSD 500 million agreement with Apple, under which Apple will
\npurchase magnets produced at the Independence facility using
\nrecycled feedstock. The two companies also agreed to establish a
\nrecycling line at Mountain Pass to recover and reprocess materials
\nfrom end-of-life products and scrap.
\nUSA Rare Earth has signed multiple agreements in less than a year,
\nincluding its acquisition of United Kingdom-based metallisation
\ncompany Less Common Metals with an equity investment of
\nUSD 125 million and Brazil\u2019s rare earth mining companySerra Verde
\nfor USD 2.8 billion. The company has also planned an all-stock
\npurchase of Texas Mineral Resources Corporation and announced a
\n12.5% equity stake in the French metal and alloy production facility
\noperated by Carester. In addition to an estimated USD 1.6 billion in
\nfinancing and equity support from the US government, USA Rare
\nEarths has also raised around USD2 billion from private sources to
\nhelp finance these deals.
\nLynas Rare Earths has signed a binding letter of intent with the US
\nDepartment of War to finalise a four\u2011year supplyagreement for light
\nand heavy rare earth oxides, under which approximately
\nUSD 96 million will be allocated for purchases, including a floor price
\nof USD 110 per kg for NdPr oxide. The company has also agreed to
\na 12-year supply arrangement with Japan for the same floor price.
\nBoth deals match the minimum level established last year in the
\nsupport agreement with MP Materials. The deal also allocates to
\nJapan around half of Lynas\u2019s future heavy rare earth oxide production,
\nsupported through the Japan Australia Rare Earths partnership
\ninvolving Sojitz and the Japan Organization for Metals and Energy
\nSecurity (JOGMEC). In March 2026, Lynas signed a co-operation
\ndeal with Korean company LS Eco Energy, with plans to build a metal
\nprocessing facility in Viet Nam. Last October, the company also
\npartnered with United States-based magnet manufacturer Noveon
\nMagnetics in an agreement that includes both light and heavy rare
\nearth materials.
\nPrivate companies also boosted efforts to scale up recycling. Neo
\nPerformance Materials and Cyclic Materials signed a non\u2011binding
\nMoU to develop a circular and traceable rare earth supply chain,
\ncentred on recycling magnet\u2011production scrap and end\u2011of\u2011life
\nmagnet\u2011bearing materials into mixed rare earth oxides that can be
\nreintegrated into Neo\u2019s alloy and magnet\u2011manufacturing operations
\nin Europe. Korea Zinc and Alta Resource Technologies formed a joint
\nventure to build a rare earth recycling facility in the United States by
\n2027, aiming to reach a production capacity of 100 tonnes of oxides
\nper year. ReElement Technologies will receive USD 80 million in
\nfederal loans to expand recycling and refining capabilities, supporting
\nclosed-loop production of neodymium-iron-boron magnets. Ionic
\nRare Earths signed an MoU with US Strategic Metals to develop a
\nrecycling plant in Missouri that will produce high-purity rare earth
\noxides. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 180
\n2. Outlook for key minerals
\nTimely realisation of all announced projects would nearly triple today\u2019s volumes of mined and
\nrefined production for magnet rare earths from diversified sources by 2035
\nMined and refined rare earth production outside the top producer in the high production case and share of top producer
\nIEA. CC BY 4.0.
\nNotes: REE = rare earth elements. For mining, the figures exclude China and Myanmar. The figures are for magnet rare earths (neodymium, praseodymium,
\ndysprosium and terbium) only.
\n25%
\n50%
\n75%
\n100%
\n20
\n40
\n60
\n80
\n2025 2035 2025 2035
\nRest of world
\nFrance
\nMalaysia
\nIndia
\nBrazil
\nUnited States
\nAustralia
\nShare of top producer
\n(right axis)
\nkt REE
\nMining Refining
\n2.8 x
\n2.7 x
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 181
\n2. Outlook for key minerals
\nWhile demand continues to grow steadily and supply remains sufficient at the global level,
\nsupply from diversified sources remains well below demand outside the top producer
\nDemand
\nAs described in the IEA\u2019s Rare Earth Elements special report,
\ndemand for magnet rare earths \u2013 neodymium, praseodymium,
\ndysprosium and terbium \u2013 continues to grow steadily. It has doubled
\nsince 2015, driven by rapid growth in the electrification of end uses
\nand industrial processes, as well as the deployment of new energy
\ntechnologies such as EV and wind turbines, whose powerful motors
\nrely heavily on permanent magnets. The two heavy magnet rare earth
\nelements, dysprosium and terbium, continue to play small but
\nsignificant roles in phosphors, displays, medical equipment, nuclear
\nreactors and metallurgy, but the strongest driver of their demand
\ngrowth has been their use as additives to enhance the performance
\nof modern permanent magnets.
\nIn the STEPS, global demand for magnet rare earths is set to expand
\nby a quarter between 2025 and 2030, approaching 120 kilotonnes
\nof rare earth elements (kt REE), and by over 80% to 2050, reaching
\n170kt REE. Driven by sustained growth in the deployment of EVs,
\nwind generation, industrial motors and automation, and other
\napplications in transport, appliances and electronics, permanent
\nmagnets, though of various sizes and performance specifications,
\naccount for the majority of magnet rare earth demand throughout the
\nprojection period. Demand from wind turbines, though still rising
\nthroughout the period, is lower by over 10% in 2030 and 15% in 2050
\ncompared with the projections in the Global Critical Minerals Outlook
\ntwo years ago. Emerging growth in automation, robotics and digital
\ntechnologies plays a larger role in driving total demand beyond 2030,
\nas permanent magnets enable precision motion control,
\nminiaturisation (through small motors with high power) and energy
\nefficiency for these applications.
\nMagnet rare earth demand by sector in the STEPS, 2021-2050
\nIEA. CC BY 4.0.
\nNotes: CPS = Current Policies Scenario; STEPS = Stated Policies Scenario;
\nHDS = High Demand Scenario; EV = electric vehicle; REE = rare earth
\nelements. The figures are for magnet rare earths only.
\n0
\n50
\n100
\n150
\n200
\n2021 2025 2030 2040 2050
\nkt REE
\nEV motors Wind turbines
\nOther magnets Industrial equipment
\nOther transport Non-magnet uses
\nDemand in the CPS Demand in the HDS
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 182
\n2. Outlook for key minerals
\nDemand for magnet rare earths outside China also rises steadily in
\nall scenarios, driven primarily by the rapid expansion of electrification,
\nenergy and automation technologies. The largest contribution comes
\nfrom EV deployment in both advanced economies and emerging
\nmarkets and developing economies. Major original equipment
\nmanufacturers expanding production across Japan, Korea,
\nNorth America, Europe and India rely on magnet rare earths most
\nprominently for EV traction motors, but also for many smaller
\nmagnetic components, such as actuators, speakers and sensors, in
\nconventional cars and other types of vehicles. Asia, excluding China,
\nremains the dominant centre of demand, accounting for roughly half
\nof global consumption outside China throughout the outlook period,
\nsupported by large manufacturing bases in Japan and Korea. Europe
\nand North America register notable increases, reflecting strong policy
\nsupport for electrification and renewed ambitions to scale up
\ndomestic manufacturing for high-tech supply chains. Nevertheless,
\nthe global share of demand outside China expands only gradually,
\nindicating that China continues to play a central role in magnet rare
\nearth consumption throughout the projection period.
\nAlthough magnet uses account for over half of total rare earth
\nelement demand, demand for non-magnet rare earths is also notable:
\ngadolinium (used in medical devices and nuclear control rods and as
\na substitute for dysprosium in magnets) and holmium (used in
\nphosphors, displays and ceramics) grow at an average rate of around
\n4% per year, while yttrium (used in medical devices, optic fibres, highfrequency applications and coatings in aviation parts) grows at 2.5%
\nper year to 2030.
\nSupply
\nFrom today\u2019s levels, mined supply for magnet rare earths rises by 30%
\nto reach 104kt REE in 2035 in the base case, and an additional
\n21kt REE is added in the high-production case, which includes
\nprojects at earlier stages of development. Refined supply also
\nincreases similarly, reaching 125kt REE in the high-production case
\nin 2035.
\nIn response to export controls and heightened supply risks, many
\nprojects have been announced in geographically diverse regions in
\nrecent years. In the high-production case, production outside the
\ndominant supplier triples for both mining and refining, reaching
\n57kt REE and 38kt REE, respectively, by 2035. While China
\nremains the dominant supplier throughout the projection period, it is
\nworth noting that the steady build-out of a diversified pipeline leads
\nto its share in mined supply of magnet rare earths declining from
\naround 60% in 2025 to 55% in 2035 in the base case and further to
\n45% in the high production case\u2013 falling below half of global mined
\nsupply for the first time in recent decades if all announced
\ngeographically diverse projects are delivered on time. Increase in
\ndiversified mined supply is led by Australia and the United States,
\nwith additional contributions from Brazil, Lao People\u2019s Democratic
\nRepublic (PDR), Tanzania, India and other smaller producers. For
\nrefining, China\u2019s share dropped from 90% to 85% between 2024 and
\n2025, with the majority of the lost share being claimed by the
\nUnited States and the rest by Malaysia, and is projected to decline to
\n73% in 2035 in the base case and further to 70% in the highIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 183
\n2. Outlook for key minerals
\nproduction case. Diversified refining activity is concentrated in
\nMalaysia and the United States, followed by Australia, Viet Nam,
\nJapan, the United Kingdom, France and Estonia.
\nDespite this progress, cumulative planned production of metals,
\nalloys and finished magnets from projects announced as of early
\n2026 amounts to around 57 kt of neodymium-iron-boron (NdFeB) in
\n2035, equivalent to 18 kt of magnet rare earth content, significantly
\nless than diversified rare earth mining and refining capacities. This
\nreflects a modest pipeline led by the United States, with notable
\ncontributions from Europe, Japan, Korea and Viet Nam. This
\npronounced tapering of diversified projects from upstream mining to
\ndownstream magnet manufacturing highlights the difficulty of
\nestablishing entire supply chains outside China. While resource
\ndevelopment is advancing in several regions, the comparatively
\nslower build-out of refining and magnet production suggests that
\ncritical midstream and downstream stages could remain bottlenecks.
\nWithout accelerated investment in these parts of the value chain,
\nmany regions may continue to depend on external processing and
\nmanufacturing, even as domestic extraction capacity expands.
\nSupply-demand balances
\nGlobal rare earth markets have been well supplied over the last
\ndecade, as supply, predominantly from the top supplier, has
\ncontinued to outpace demand growth, despite a slowdown in China\u2019s
\nproduction quota growth in 2024. Projected supply remains broadly
\nsufficient through to 2040. Global mined supply from announced and
\nplanned projects in the base case grows faster than demand in the
\nSTEPS and CPS, but satisfying demand after 2030 in the HDS
\nrequires at least half of the projected supply from less advanced
\nprojects in the high-production case to come online as planned.
\nDespite this global picture of well-supplied markets, the
\nannouncement of export controls from China and sustained social
\nand governance challenges in Myanmar have emerged as tangible
\nrisks to the reliable supply of these minerals for strategic industries in
\nthe rest of the world. Demand for magnet rare earth elements in
\nregions outside the dominant supplier is set to grow by 50% over the
\nnext decade. Production from current capacities and their planned
\nexpansions in regions outside China, and outside Myanmar for
\nmining, accounts for about 50% of the ex-China demand for mining,
\n25% for refining and well below 20% for magnets in 2035. Many new
\nprojects have been announced across geographically diverse regions,
\nbut even if these come online as scheduled, their sustained
\noperations will depend on consumer motivation to buy materials from
\ndiversified suppliers. Nurturing strategic manufacturing industries,
\nincluding EVs, energy technologies, electronics, data centres,
\nrobotics, aerospace and defence, can provide a solid demand base
\nfor diversified mined, refined and magnet supply sources. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 184
\n2. Outlook for key minerals
\nInnovation throughout the rare earths value chain is vital to closing existing gaps in
\ngeographically diverse projects and mitigating supply pressures
\nInnovation to build diversified ecosystems
\nRare earth separation and processing and permanent magnet
\nmanufacturing are complex and technically demanding processes
\nthat have been improved and perfected by the dominant supplier over
\na few decades. Diversification is therefore not simply a question of
\nplanning new projects. Technology, equipment and skills gaps need
\nto be addressed in parallel in order to nurture an entire-ecosystem
\napproach. Chapter 3 discusses these issues in more detail.
\nInnovation in magnet composition and design
\nDemand-side innovation represents a powerful complement to
\nsupply\u2011side efforts, providing a pathway to alleviate supply
\nconstraints. It can take three distinct forms: reducing the amount of
\nheavy rare earth elements (HREEs) required within existing magnet
\nchemistries, substituting one HREE for another that is less
\nsupply\u2011constrained, and developing entirely new technologies that
\ndrastically minimise or eliminate rare earth use altogether.
\nThe performance of NdFeB permanent magnets can be enhanced
\nthrough the addition of HREEs, notably dysprosium and terbium,
\nwhich improve coercivity and high\u2011temperature stability. However,
\nHREE production remains overwhelmingly concentrated in China
\nand Myanmar. This over-reliance heightens vulnerability to supply
\ndisruptions and export restrictions. One major avenue of innovation
\ntherefore focuses on reducing HREE intensity within NdFeB magnets
\nwithout sacrificing performance.
\nIndicative elemental composition of different types of magnets
\nIEA. CC BY 4.0.
\nNote: NdFeB = neodymium-iron-boron magnet; EV = electric vehicle; SmCo =
\nsamarium-cobalt magnet; AlNiCo = aluminium-nickel-cobalt alloy magnet.
\n20% 40% 60% 80%100%
\nAlNiCo
\nFerrite
\nSmCo (factory automation)
\nSmCo (high performance)
\nNdFeB (factory automation)
\nNdFeB (wind turbine)
\nNdFeB (EV)
\nNeodymium Dysprosium Samarium
\nCopper Aluminium Nickel
\nCobalt Iron Other
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 185
\n2. Outlook for key minerals
\nThe HREE content of magnets varies significantly by application:
\nhigh\u2011performance EV traction motors contain around 8.5-11% of
\nHREEs by weight (although the latest designs could have much lower
\ncontent of around 2%, but with performance trade-offs), while
\nmagnets used in industrial motors and wind turbines typically have
\nslightly lower ratios of heavy to light rare earths. Manufacturers are
\nimproving grain boundary engineering, motor cooling and system
\ndesign to achieve equivalent functionality with less dysprosium or
\nterbium.
\nTogether with continued improvement in materials science and
\nengineering, co-ordinated action across the value chain can
\naccelerate both reduction and substitution strategies. Collaboration
\namong motor manufacturers, magnet producers and public
\nauthorities is particularly effective in overcoming technical barriers
\nand scaling innovation. Following the rare earth supply shock of 2010,
\nfor example, Japan implemented government\u2011supported
\nprogrammes to redesign motors for vehicles, industrial equipment
\nand hard disk drives. Even though demand has risen again in recent
\nyears due to growing magnet applications, overall rare earth demand
\nin Japan has fallen significantly since the implementation of these
\nmeasures. Total rare earth demand in Japan, including heavy rare
\nearths, is currently nearly 30% below 2010 levels.
\nA more transformative pathway is the development of technologies
\nthat substitute rare earth\u2011based magnets entirely. Mature alternatives
\nsuch as ferrite and aluminium-nickel-cobalt (AlNiCo) magnets contain
\nlittle or no rare earth content and are already widely used where
\nperformance requirements are lower. These materials, based on
\nabundant iron alloys or ceramic oxides, can replace NdFeB magnets
\nin applications such as speakers, sensors and lower\u2011power motors,
\nthereby reducing overall rare earth demand and material costs.
\nEmerging rare earth\u2011free technologies are also progressing towards
\ncommercialisation. In the United States, Niron Magnetics has begun
\nconstruction of a permanent magnet manufacturing facility in
\nMinnesota based on iron nitride (FeN) technology with no rare earth
\nelements, aiming to serve the automotive and electronics sectors. In
\nparallel, research programmes are developing electric motors that
\navoid permanent magnets altogether by using alternative
\nelectromagnetic designs based on widely available materials such as
\niron and aluminium. Although many of these technologies remain at
\ndemonstration or early commercial stages, they illustrate a growing
\nstrategic shift towards reducing dependence on critical minerals.
\nFor new solutions to achieve widespread adoption, they must offer a
\ncompetitive combination of performance, cost and manufacturability
\nwithout introducing new supply constraints elsewhere in the value
\nchain. Innovations that merely shift dependency from rare earths to
\nother scarce or geopolitically concentrated materials would provide
\nlimited systemic benefit. Priority should therefore be given to
\ntechnologies based on abundant inputs, scalable production
\nprocesses and compatibility with existing industrialsystems.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 186
\n2. Outlook for key minerals
\nOther key materials
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 187
\n2. Outlook for key minerals
\nManganese: Battery-grade manganese sulphate remains a major potential chokepoint for
\nbattery supply chains, but the project pipeline is diversifying
\nBattery-grade manganese sulphate production capacity and demand, 2023-2035
\nIEA. CC BY 4.0.
\nNotes: CPS = Current Policies Scenario; STEPS = Stated Policies Scenario; HDS = High Demand Scenario. Production capacity is the nameplate capacity.
\nSource: IEA analysis based on data from Benchmark Mineral Intelligence.
\n200
\n400
\n600
\n800
\n1 000
\n1 200
\n2023 2024 2025 2030 2035
\nkt Mn
\nOther
\nBotswana
\nCzechia
\nCanada
\nUnited States
\nChina
\nCPS
\nSTEPS
\nHDS
\nDemand
\nProduction capacity
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 188
\n2. Outlook for key minerals
\nManganese: The United States and Canada are leading diversified battery-grade manganese
\nsulphate project announcements, but challenges remain in bringing these projects to reality
\nWhile manganese demand remains dominated by steel, its growing
\nimportance in battery chemistries is making it an increasingly
\nstrategic mineral. Conventional nickel-based and emerging battery
\nchemistries, namely manganese-rich and sodium-ion, require
\nbattery-grade manganese sulphate, which is emerging as a potential
\nchokepoint for battery supply chains. Production of battery-grade
\nmanganese sulphate is exceptionally concentrated, with China
\nproducing over 95% of global supplies in 2025, making it highly
\nvulnerable to potential future supply disruptions.
\nDespite China dominating current production, a number of projects
\nare being announced and developed in geographically diverse
\nregions, particularly the United States, Canada and Czechia. Despite
\nhaving no operating capacity in 2025, the United States is expected
\nto have over 140 kt of manganese sulphate production capacity (kt
\nmanganese contained) by 2035, amounting to almost 20% of global
\ncapacity if planned projects come online as scheduled. Canada also
\nplans for significant growth in production capacity, with almost 10%
\nof capacity in 2035, while Czechia accounts for 5%. However, reliable
\nproduction of battery-grade manganese sulphate at scale is
\ntechnically challenging, so new players may face considerable
\nchallenges in ramping up capacity. There may also be
\ncompetitiveness challenges relative to established Chinese players
\nin terms of limited economies of scale, limited production expertise
\nand stricter environmental requirements for handling by-products and
\nwaste. At present, there are only two operating refineries producing
\nbattery-grade manganese sulphate outside China, in Japan and
\nBelgium. Partnerships between existing and new players could help
\naccelerate learning and project development.
\nThe projected supply gap for manganese sulphate has narrowed to a
\ndeficit of almost 20% in 2035 compared with 45% in last year\u2019s Outlook.
\nWhile still significant, the demand outlook has moderated slightly due
\nto the strong growth of LFP batteries over nickel-based chemistries.
\nThe uptake of lithium manganese iron phosphate (LMFP) batteries has
\nalso been slower than expected due to the continued innovation and
\nimproved performance of the latest LFP chemistries. A potential
\nsource of demand upside in the medium term is the emergence of
\nhigh-energy-density lithium-manganese-rich (LMR) chemistries,
\nthough large-scale deployment is not expected until the 2030s. Given
\nthese developments, battery-grade manganese sulphate demand is
\nprojected to reach almost 1 Mt in 2035 under today\u2019s policy settings,
\namounting to 5% of total manganese demand, up from less than 1%
\ntoday. However, between 2035 and 2040, battery manganese demand
\nis set to almost double to close to 10% of total demand, reflecting the
\ngrowing deployment of manganese-rich chemistries.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 189
\n2. Outlook for key minerals
\nManganese prices, 2023-2026
\nIEA. CC BY 4.0.
\nNote: Mn sulphate 32%, Ex Works China. Manganese Ore Mn32%
\nFe20%,Tianjin-SA.
\nSource: IEA analysis based on data from Bloomberg.
\nFollowing a period of price volatility in 2024 from major supply
\ndisruptions, manganese ore prices eased in 2025. However, in 2026,
\nprices have started rising again. With the increase in oil prices from
\nthe conflict in the Middle East raising costs across the mining sector,
\nmanganese producers are among the most affected. Manganese
\nmining operations, primarily open-pit, typically have a strong
\ndependence on diesel for extraction, ore transport and the generation
\nof backup power. Leading production in South Africa and Gabon is
\nlocated deep inland, requiring significant diesel-dependent rail and
\nroad transport. Given the surge in diesel prices, manganese margins
\nare being compressed, adding pressure on manganese prices.
\nMoreover, a major weather-related supply disruption in Australia in
\nMarch 2026 added further pressure to prices. Prices for battery-grade
\nmanganese sulphate have broadly followed changes in manganese
\nore prices, but in early 2024, prices fell to historic lows, leading
\nseveral Chinese operations to halt production. These cuts flipped the
\nmarket from oversupply into deficit, leading to price recoveries
\nthroughout 2024. Prices fell slightly in the first part of 2025 but have
\nbeen increasing steadily due to increases in sulphuric acid prices in
\nthe latter half of 2025 and particularly in 2026 from the Middle East
\nconflict, with reports of manganese sulphate contracts recently being
\nsettled at over USD1 000\/tonne. Increased sulphuric acid costs, as
\nwell as higher ore prices, are key drivers.
\nSouth Africa still dominates mined manganese supply, with almost
\n40% of global production in 2025. Gabon is the second-largest
\nsupplier, with a quarter of global supply in 2025. Ghana and Australia
\nare the other major suppliers, with 10% and 8% of global production
\nin 2025, respectively. Supply disruptions have remained a major
\nsource of volatility in manganese markets. For example, the major
\ndisruption at South32\u2019s GEMCO mine, the second-largest
\nmanganese mine in the world, in Australia from cyclone damage in
\n2024 led to major manganese ore and sulphate price increases.
\nDespite resuming production in 2026, operations were paused again
\nin March 2026 due to a new cyclone, highlighting the risks to major
\nmanganese assets from weather incidents. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\n250
\n500
\n750
\n1 000
\n1 250
\nJan-23 Jan-24 Jan-25 Apr-26
\nUSD\/tonne
\nBattery-grade manganese sulphate Manganese ore
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 190
\n2. Outlook for key minerals
\nPhosphoric acid: Battery-grade purified phosphoric acid is a major chokepoint for battery
\nsupply chains, with little diversification on the horizon
\nLFP batteries have rapidly become the leading battery chemistry,
\naccounting for 55% of the global electric car market and 90% of the
\nbattery storage market in 2025, up from 15% and 30%, respectively,
\nin 2020. LFP battery production requires battery-grade purified
\nphosphoric acid (PPA), which is produced from phosphate rock and
\nsulphuric acid. China currently dominates global PPA supply, with 70%
\nof production in 2025. The rapidly growing deployment of LFP
\nbatteries, particularly in battery storage, and the high level of PPA
\nsupply concentration make PPA an increasingly important chokepoint
\nfor global battery supply chains.
\nUnlike manganese sulphate, there is limited diversification in the
\nproject pipeline for PPA. Based on current project announcements
\nand developments, China is projected to maintain 75% of global
\nproduction capacity in 2035, almost the same as today. Despite
\nhaving the world\u2019s largest phosphate rock reserves and plans to
\nexpand phosphate mining, Morocco is set to hold only 5% of global
\nPPA production capacity by 2035. The United States is set to have
\nthe third-largest capacity, with almost 5% by 2035, followed by
\nCanada. Together, Morocco, the United States and Canada account
\nfor over 55% of planned ex-China PPA capacity by 2035.
\nDevelopment of PPA production capacity outside China faces similar
\nchallenges to those facing battery-grade manganese sulphate. Key
\nchallenges include cost competitiveness stemming from economies
\nof scale and established phosphate production advantages in China,
\nas well as limited production expertise and equipment availability.
\nThere are also additional challenges related to waste and by-product
\ndisposal.
\nPurified phosphoric acid (PPA) production capacity, 2023-2035
\nIEA. CC BY 4.0.
\nNote: P2O5e = phosphorus pentoxide equivalent.
\nSource: IEA analysis based on data from Benchmark Mineral Intelligence.
\n5
\n10
\n15
\n2023 2024 2025 2030 2035
\nMt P\u2082O5e
\nOther
\nBelgium
\nCanada
\nUnited
\nStates
\nMorocco
\nChina
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 191
\n2. Outlook for key minerals
\nPrices for phosphoric acid have been increasing due to rising input
\ncosts, increasing by almost 4% to over USD1 500 per tonne in the
\nfirst quarter of 2026. PPA generally trades at a premium to
\nphosphoric acid and faces the same cost pressures. As sulphuric
\nacid is a key input for PPA production, rising prices for sulphur and
\nsulphuric acid from the conflict in the Middle East are providing
\nupward pressure on PPA prices. This is being compounded by higher
\nprices for phosphate rock, which also increased due to the disruption
\nto phosphate exports from Jordan following the closure of the Strait
\nof Hormuz. Phosphate rock prices have also increased on the back
\nof the announcement by Egypt\u2019s Ministry of Petroleum and Mineral
\nResources that it would not sign any new phosphate export contracts,
\nas the government tries to shift from exporting raw materials to
\nproducing higher value-added products, such as phosphate fertilisers.
\nTogether, these effects are increasing PPA prices, with likely knockon effects for LFP cathodes and batteries. However, the higher prices
\nmay support diversified project development.
\nDespite having the world\u2019s largest reserves of phosphate rock, with
\n70% of global reserves, Morocco currently accounts for less than 15%
\nof global mined supply. China, on the other hand, leads mined
\nphosphate rock supply, with 45% of global production in 2025,
\ndespite holding only 5% of global reserves. The United States is the
\nworld\u2019s third-largest producer, with almost 10% of global supply in
\n2025. In recent years, there has been a surge in Chinese battery
\nsupply chain investment in Morocco, including from Gotion, BTR,
\nHuayou and CNGR, with its major phosphate reserves a key driver.
\nMorocco\u2019s trade agreements with the European Union and its free
\ntrade agreement with the United States also provide these Chinesebacked battery supply chain projects with preferential access to EU
\nand US markets compared with direct exports from China.
\nPhosphate rock mining and reserves, 2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from US Geological Survey (2026).
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\nProduction Reserves
\nOther
\nEgypt
\nRussia
\nUnited
\nStates
\nChina
\nMorocco
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 192
\n2. Outlook for key minerals
\nTin: Strong demand growth driven by high-tech and energy applications has met constrained
\nsupply, although supply conditions have begun to ease in recent months
\nOver the past few years, tin prices have continued to rise as strong
\ndemand growth, fuelled by the AI investment boom and related
\nsemiconductor demand, has coincided with supply constraints in
\nmajor producing countries such as Indonesia and Myanmar,
\nstemming from mining permit issues and crackdowns on illegal
\nmining.
\nTin prices, 2024-2026
\nIEA. CC BY 4.0.
\nNote: LMEtin 99.85% cash prices.
\nSource: IEA analysis based on data from Bloomberg.
\nThe largest tin mining country is China (24%), followed by Indonesia
\n(21%) and Peru (11%). China is also the largest tin refining country,
\naccounting for about 50% of global supply. Recent data indicate that
\nrefined tin supply is recovering from the supply disruptions in 2025,
\nas reflected in rising inventory levels. While this is helping to ease
\nmarket tightness, strong underlying demand is expected to keep
\nprices above historical norms.
\nMore than half of global tin consumption is used as solder for bonding
\ncircuit boards. Beyond traditional uses in consumer electronics,
\ndemand for tin is expanding in strategic applications such as AI and
\nEVs. Tin also plays a crucial role in solar PV through soldering and
\nelectrical interconnections.
\nHistorically, tin-lead solder was widely used, but lead-free solders are
\nnow more common due to environmental regulations such as the EU
\nRestriction of Hazardous Substances Directive. Currently, tin-silvercopper solder is the most prevalent type, where tin provides strong
\nwettability, conductivity and reliable connections.
\nTin is not easy to substitute, although epoxy resins could partially
\nreplace it in certain applications. Like copper, tin is a highly recyclable
\nmaterial that can be reused without loss of quality. In 2023, recycled
\ntin accounted for about one-third of total tin supply.
\n50
\n100
\n150
\n200
\n250
\n2024 2025 2026
\nIndex (Jan 2024 = 100)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 193
\n2. Outlook for key minerals
\nPlatinum group metals: Prices have strengthened again due to constrained mine supply and
\nimproving demand prospects
\nThe six platinum group metals (PGMs) \u2013 platinum, palladium,
\nrhodium, ruthenium, iridium and osmium \u2013 are highly geographically
\nconcentrated in production. South Africa accounted for around 70%
\nof global mined platinum supply in 2025, followed by Russia at 12%.
\nFor palladium, Russia is the leading mined output supplier at around
\n45%, followed by South Africa. Zimbabwe and North America also
\nproduce PGMs, but at smaller shares.
\nPrice trend for key platinum group metals (monthly average)
\nIEA. CC BY 4.0.
\nSources: IEA analysis based on data from Bloomberg and Johnson Matthey.
\nPGM markets experienced renewed price strength in 2025 and early
\n2026. Platinum prices doubled throughout 2025 and reached an alltime high in January 2026. Palladium prices rose by around 90%
\nyear-on-year in January 2026. Rhodium prices also soared, reaching
\nUSD 11 000 per ounce in March 2026, their highest level since 2023.
\nThese price developments were driven by a combination of
\nconstrained mine supply and improving demand prospects.
\nMined PGM output declined in 2025 across key producing regions,
\nreflecting persistent structural challenges. In South Africa, production
\nwas affected by rising production costs and electricity supply
\nconstraints. For example, ore mining and milling operations at the
\nBokoni platinum mine were suspended in June 2025 due to cost
\npressures. PGM output in Russia also edged lower compared with
\n2024, reflecting declining ore grades, equipment replacement and
\nmaintenance at Norilsk Nickel facilities. Secondary supply from
\nrecycling registered strong growth in 2025, increasing by about 17%
\nyear-on-year. In China, continued incentive schemes to encourage
\nthe scrappage of older vehicles have increased volumes of end-oflife autocatalyst scrap, contributing to recycling growth. However, this
\ngrowth only partially offset primary supply constraints. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nAt the same time, continued demand growth from the automotive
\nsector supported consumption. Broader macroeconomic uncertainty
\n3 000
\n6 000
\n9 000
\n12 000
\n1 000
\n2 000
\n3 000
\n4 000
\nPlatinum Palladium Rhodium (right axis)
\nUSD\/ounce
\nUSD\/ounce
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 194
\n2. Outlook for key minerals
\nand geopolitical tensions also boosted investor interest in precious
\nmetals, contributing to increased price volatility.
\nIn the near term, PGM markets are expected to remain relatively tight.
\nMine supply is expected to decline, reflecting persistent cost
\npressures, operational challenges and limited new production growth.
\nThe expansion of commercial operations at Ivanhoe\u2019s Platreef mine
\nand stable supply from Implats\u2019 PGM operations are expected to
\nsupport production volumes, while Russia is projected to see a slight
\ndecline in output due to changes in the metal composition of
\nprocessed feedstocks. While recycling supply is expected to continue
\nincreasing, it is unlikely to fully offset constraints in primary production.
\nDemand from autocatalysts is expected come under pressure from
\nthe growth of EVs, although continued sales of internal combustion
\nengine and hybrid vehicles, are expected to support PGM
\nconsumption in the near term.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 195
\n2. Outlook for key minerals
\nSilver: Strong industrial demand and persistent supply constraints are set to support elevated
\nprices despite a narrowing supply deficit
\nSilver prices increased sharply in 2025, rising from around USD 29
\nper troy ounce (toz) to approximately USD 72\/toz, an annual increase
\nof about 150%. Prices continued to rise into 2026, with spot prices
\nbriefly surpassing USD 100\/toz for the first time in January 2026.
\nThese price increases were driven by accumulated multi-year supply
\ndeficits and a strong industrial demand outlook. In particular,
\nexpectations of rising industrial silver demand from the expansion of
\nsolar PV, growing investment in AI and data centres, and power grid
\nupgrades provided support to prices. The pace of supply growth also
\nremained limited, reflecting the nature of silver production as a byproduct of copper, gold, lead and zinc mining, as well as declining ore
\ngrades, delays in new project development and tighter environmental
\nand permitting regulations. Uncertainty surrounding US tariff reviews
\nand expectations for Federal Reserve policy also contributed to
\nheightened market volatility.
\nSilver supply increased to around 1.1 billion toz in 2025, supported
\nby recovering production in South America and growth in recycled
\nsupply. Global mine production rose by 3% year-on-year. Higher byproduct output from Peru\u2019s Antamina mine and expanded production
\nat Russia\u2019s Prognoz mine contributed to supply growth. By contrast,
\nproduction in Mexico, the world\u2019s largest silver producer, declined
\npartly due to lower ore grades at the Pe\u00f1asquito mine, while
\nIndonesia experienced production disruptions at the Grasberg mine.
\nRecycled silver supply also increased strongly, reaching around
\n200 million ounces, its highest level in more than a decade,
\nsupported by increased scrap recovery amid higher silver prices.
\nSilver market balance and price trends, 2018-2025
\nIEA. CC BY 4.0.
\nNotes: Moz = million ounces; toz = troy ounce.
\nSource: IEA analysis based on data from the Silver Institute (2026).
\n0
\n5
\n10
\n15
\n20
\n25
\n30
\n35
\n40
\n45
\n0
\n200
\n400
\n600
\n800
\n1000
\n1200
\n1400
\n2018 2019 2020 2021 2022 2023 2024 2025
\nUSD\/toz
\nMoz
\nSupply Demand Price (right axis)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 196
\n2. Outlook for key minerals
\nMeanwhile, silver demand fell by 2% in 2025, marking its lowest level
\nsince 2021. Industrial demand declined for the first time after four
\nconsecutive years of growth. In particular, weaker demand from the
\nsolar PV sector was a key factor behind the broader slowdown in
\nsilver demand growth. Although global solar installations continued
\nto expand, reductions in silver usage per cell partially offset the
\nimpact of installation growth. This reflected manufacturers\u2019 efforts to
\nreduce silver usage (thrifting) and adopt alternative materials in
\nresponse to higher silver prices.
\nHowever, expanding investment in AI and data centres, together with
\nthe expansion of EVs, charging infrastructure and power grid
\nupgrades, is set to support resilient silver demand in the coming years.
\nOwing to its high electrical conductivity and durability, silver is widely
\nused in semiconductors, servers, power electronics, EVs and energy
\ninfrastructure. By contrast, supply constraints are likely to persist,
\nkeeping market conditions relatively tight in the near term.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 197
\n2. Outlook for key minerals
\n2. Outlook for key minerals
\nPart 2
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 198
\n2. Outlook for key minerals
\nStrategic minor minerals
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 199
\n2. Outlook for key minerals
\nStrategic minor minerals: small market sizes, high supply concentration, outsized economic
\nimpacts
\nMarket size and top refining country share for selected minerals
\nIEA. CC BY 4.0.
\nNotes: Titanium refers to titanium metal. Rare earths refer to magnet rare earths only.
\n0
\n1
\n10
\n100
\n1 000
\n30% 40% 50% 60% 70% 80% 90% 100%
\nBillion USD
\nBase metals Battery materials Strategic minor minerals Magnet rare earths
\nLead
\nCopper
\nZinc
\nAluminium
\nTitanium
\nAntimony
\nGermanium
\nTungsten
\nGallium
\nIndium
\nLithium
\nCobalt
\nNickel
\nRare earths
\nTellurium
\nTantalum
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 200
\n2. Outlook for key minerals
\nDespite their high supply concentration, strategic minor minerals offer an area where targeted
\npolicy measures can deliver rapid improvements in supply security
\nBeyond key energy minerals, there is a strong case for greater policy
\nattention on a broader group of materials that play a vital role across
\nstrategic sectors such as high-tech, aerospace and defence. These
\nmaterials, referred to here as \u201cstrategic minor minerals\u201d, typically
\nhave small market sizes but face extremely high levels of supply
\nconcentration compared with other minerals. They also carry
\ndisproportionate economic consequences in the event of a disruption.
\nRare earths are a prominent example, but the list extends beyond
\nthem to include antimony, gallium, germanium, indium, titanium and
\ntungsten, among others. The market size for many of these minerals
\nis often below USD 10 billion. Like rare earths, China is the leading
\nsupplier of almost all these minerals, and a growing number are
\nbecoming subject to export controls or other trade restrictions. Given
\ntheir limited substitutability and vital role in advanced manufacturing,
\ndisruptions could have significant economic consequences across
\nthe automotive, high-tech, defence and energy sectors.
\nHowever, counter-intuitively, these minerals offer one of the most
\npromising opportunities to deliver visible improvements in supply
\nsecurity at a reasonable cost, if accompanied by strong policy support.
\nMany strategic minor minerals do not require the massive scale of
\ninvestment typically needed for bulk commodities. In some cases,
\nbringing a small number of key projects online could materially
\nstrengthen supply security and improve diversification. For example,
\nthe planned refinery by Korea Zinc, with annual production capacity
\nof 54 tonnes of germanium and 44 tonnes of gallium, has the
\npotential to double diversified germanium supply and increase
\ndiversified gallium supply fivefold.
\nIn many instances, this can be achieved without developing new
\nmines. A large share of these minerals are produced as co-products,
\nrecovered as secondary outputs during the extraction or processing
\nof primary commodities such as aluminium, copper, zinc and lead.
\nGallium, for example, is contained in small quantities in bauxite and
\nzinc ores. Typically, less than 10% of the gallium contained in mined
\nores is recovered. Substantially higher global supply outside the
\ndominant refiner would be possible if gallium were recovered more
\nsystematically. This creates a clear opportunity for governments to
\nimprove supply security at relatively modest cost through targeted
\nsupport for recovery, refining and processing capacity.
\nIn this section, we explore the broad landscape of strategic minor
\nminerals, focusing on the key materials used in the high-tech,
\naerospace and defence sectors and assessing their risk profiles. The
\nIEA plans to publish deeper analysis on these minerals in the coming
\nmonths, examining their market dynamics, risk exposure and
\ndiversification potential. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 201
\n2. Outlook for key minerals
\nA wide range of critical metals and minerals form the backbone of many strategic high-tech
\nindustries, such as semiconductors, robotics, servers and telecommunications
\nIndicative list of strategic minerals used across selected high-tech industries
\nIEA. CC BY 4.0.
\nNote: Materials only serving secondary or tertiary applications in one sector were excluded from the chart: semiconductors (cadmium, cerium, chlorine, europium,
\nfluorine, gadolinium, helium, krypton, lanthanum, neon, nitrogen, tellurium, xenon and yttrium); robotics (terbium); and servers and storage (barium and platinum).
\nLi Be B Al Si P Ti Cr Mn Fe Co Ni Cu Zn Ga Ge As Nb MoRu Pd Ag In Sn Sb Pr Nd Sm Dy Hf Ta W Au Bi
\nServers and
\nstorage
\nRobotics
\nSemiconductors
\nTelecommunications
\nLithium
\nBeryllium
\nBoron
\nAluminium
\nSilicon
\nPhosphorus
\nTitanium
\nChromium
\nManganese
\nIron
\nCobalt
\nNickel
\nCopper
\nZinc
\nGallium
\nGermanium
\nArsenic
\nNiobium
\nMolybdenum
\nRuthenium
\nPalladium
\nSilver
\nIndium
\nTin
\nAntimony
\nPraseodymium
\nNeodymium
\nSamarium
\nDysprosium
\nHafnium
\nTantalum
\nTungsten
\nGold
\nBismuth
\n83 79 74 73 72 66 62 60 59 51 50 49 47 46 44 42 41 33 32 31 30 29 28 27 26 25 24 22 15 14 13 5 4 3 Atomic number
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 202
\n2. Outlook for key minerals
\nAs semiconductors, robotics and artificial intelligence chart new frontiers in innovation, supply
\nsecurity for the minerals that underpin them is becoming increasingly important
\nModern economies are increasingly moving towards electrified,
\ndigitalised and automated systems, and the industries that underpin
\nthis transformation are mineral-intensive. This section explores some
\nstrategic high-tech industries and assesses which minerals are most
\ncritical for them.
\nSemiconductors
\nThe semiconductor industry relies on a wide range of metals and
\nminerals. The main materials that form the semiconducting layers
\ninclude silicon, gallium, germanium, indium, arsenic, phosphorus and
\nboron, while other materials such as antimony, tantalum, tungsten,
\ncopper, gold, silver, aluminium, nickel, cobalt, palladium, platinum,
\nhafnium, titanium, certain rare earth elements, tin and zinc play
\nimportant roles in soldering, electrical contact formation, coating and
\npackaging. Among these, silicon is by far the most important, forming
\nthe substrate of most integrated circuits. Compound semiconductors
\nsuch as gallium arsenide (GaAs) and gallium nitride (GaN) have
\ntaken on increasingly important roles for high-frequency,
\noptoelectronic and power applications, where GaN, in particular,
\nenables more efficient operation at high voltages and temperatures,
\nmaking it a critical material for data centre power management.
\nGermanium improves transistor performance in advanced chips.
\nCopper and aluminium are essential for electrical interconnections,
\nand gold, silver and palladium are widely used in contacts and
\nbonding due to their excellent conductivity and resistance to
\ncorrosion. Tantalum and hafnium are critical for capacitors and
\nadvanced transistor gate materials, helping to improve device
\nefficiency and miniaturisation.
\nRobotics
\nAs the robotics industry combines several technologies, including
\nactuators, sensors, motors, batteries and electronic systems, it relies
\non a very large number of materials. The main materials used include
\nsteel, aluminium, copper, nickel, cobalt, lithium, manganese, graphite,
\nmagnet rare earths (neodymium, praseodymium, dysprosium and
\nterbium), silicon, gold, silver, tantalum, tungsten, titanium, platinum
\ngroup metals and tin. Among these, bulk materials such as steel and
\naluminium are important structural components, providing the
\nstrength, durability and weight characteristics required for robotic
\nsystems. Copper is essential for motors, wiring and power
\ntransmission, while lithium, nickel, cobalt and manganese play key
\nroles in rechargeable batteries for mobile and autonomous robots.
\nSilicon underpins the semiconductors that enable sensing, control
\nand AI functions, while gold, silver and tantalum are widely used in
\nelectronic components due to their superior conductivity and
\nreliability. Rare earth-based permanent magnets are particularly
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 203
\n2. Outlook for key minerals
\nimportant because they enable compact, lightweight and energyefficient motors with high torque and precision. While some materials
\ncan be substituted in specific applications, replacing the most critical
\nmaterials \u2013 particularly rare earth elements in high-performance
\nmagnets and copper in electrical systems \u2013 often results in lower
\nperformance, larger component sizes, reduced energy efficiency or
\nhigher costs.
\nServers and data storage
\nServers and data storage systems depend on metals and minerals
\nfor processors, memory, storage devices, power systems and
\nnetworking equipment. The main materials include silicon, copper,
\naluminium, iron and steel, gold, silver, palladium, tantalum, tungsten,
\nnickel, cobalt, tin, gallium, germanium, indium, hafnium, titanium,
\nplatinum group metals, graphite and certain rare earth elements such
\nas neodymium, dysprosium and yttrium. Among these, silicon is the
\nmost important material, forming the basis of processors, memory
\nchips and other integrated circuits. Copper is essential for electrical
\ninterconnections, power distribution and networking infrastructure,
\nwhile aluminium and steel provide structural support for servers and
\ndata centre equipment. Gold, silver and palladium are widely used in
\nconnectors and contacts because of their conductivity and resistance
\nto corrosion, and tantalum, tungsten and hafnium are critical for
\nadvanced semiconductor components.
\nTelecommunications
\nTelecommunications networks, including 5G infrastructure, require
\nmaterials for semiconductors, antennas, fibre-optic systems, power
\nequipment and network hardware. The main materials include silicon,
\ncopper, aluminium, gallium, germanium, indium, arsenic, tantalum,
\ngold, silver, nickel, cobalt and certain rare earth elements such as
\nneodymium, praseodymium and dysprosium. Among these, silicon
\nforms the basis of the semiconductors used in network equipment,
\nbase stations and communication devices. Copper is essential for
\nelectrical wiring, power distribution and telecommunications cables,
\nwhile gallium-based compounds, particularly GaN and GaAs, are
\ncritical for the high-frequency and high-power performance required
\nby modern 5G networks. Rare earth elements are used in magnets,
\nsignal processing equipment and specialised electronic components,
\nwhile gold and silver provide reliable electrical contacts and
\nconnections.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 204
\n2. Outlook for key minerals
\nA range of materials are critical to the aerospace and defence sectors, with major applications
\nincluding aircraft components, jet engines, drones, radars, armed vehicles and munitions
\nIndicative list of strategic minerals used across aerospace and defence applications
\nIEA. CC BY 4.0.
\nNote: MREE = magnet rare earth elements.
\nJet bodies
\nJet engines
\nAvionics
\nDrones
\nRadars
\nArmed vehicles
\nMunitions
\nAtomic number
\nBismuth
\nRhenium
\nTungsten
\nTantalum
\nHafnium
\nGadolinium
\nMREE
\nTellurium
\nAntimony
\nTin
\nIndium
\nMolybdenum
\nNiobium
\nZirconium
\nYttrium
\nArsenic
\nGermanium
\nGallium
\nZinc
\nCopper
\nNickel
\nCobalt
\nIron
\nManganese
\nChromium
\nVanadium
\nTitanium
\nScandium
\nAluminium
\nMagnesium
\nCarbon
\nBeryllium
\nLithium
\nHelium
\nBi Re W Ta Hf Gd Te Sb Sn In Mo Nb Zr Y As Ge Ga Zn Cu Ni Co Fe Mn Cr V Ti Sc Al Mg C Be Li He
\n83 75 74 73 72 64 59+ 52 51 50 49 42 41 40 39 33 32 31 30 29 28 27 26 25 24 23 22 21 13 12 6 4 3 2
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 205
\n2. Outlook for key minerals
\nThe aerospace and defence sectors rely on critical minerals for specific high-performance
\nrequirements
\nA wide range of materials are critical to the aerospace and defence
\nsectors. These are used typically as high-performance materials with
\nhigh strength and resistance to high temperatures, in energy
\napplications in the sector, as well as in radars and sensors. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nAerospace
\nIn aerospace and defence, aluminium and titanium alloys are key
\nstructural materials, along with steel and composites. For example,
\naluminium-copper alloys are used in aircraft fuselages and
\naluminium-zinc alloys in upper-wing skins, stringers and stabilisers,
\nboth of which are sometimes replaced by aluminium-lithium alloys to
\nachieve weight reductions. Titanium alloys are used for parts
\nrequiring a high strength-to-weight ratio, such as landing gear
\nassemblies, or moderate temperature resistance. These materials
\nalso play a key role in gas turbines, which are used both as aircraft
\nengines and to produce electricity in gas-fired power plants.
\nThe main elements of gas turbines are the compressor, the
\ncombustion chamber and the turbine. The temperature profile in
\nthese sections is key for selecting materials: in the compressor,
\ntemperatures increase to around 500 \u00b0C, a range that is too high for
\naluminium but below the range requiring superalloys, and in which
\ntitanium-based alloys can be used.
\nTemperature profile and materials used in turbine engine stages
\nIEA. CC BY 4.0.
\nNote: YSZ = yttria-stabilised zirconia.
\nIn the combustion chamber, however, much higher temperatures are
\nreached, as higher turbine inlet temperatures directly influence the
\nefficiency of the machine, and are typically between 1 250 \u00b0C and
\n1 800 \u00b0C. To withstand these extreme temperatures, nickel- and
\ncobalt-based superalloys are used up to around 1 200 \u00b0C, after which
\n500
\n1 000
\n1 500
\n2 000
\nCompressor
\nCombustion
\nTurbine
\nTitanium
\nalloys
\nNickel-based
\nsuperalloys
\nYSZ and other
\ncoatings
\n1 200
\nTemperature (\u00b0C)
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 206
\n2. Outlook for key minerals
\nceramics and thermal barrier coatings become necessary. Typical
\ncoating materials include yttria-stabilised zirconia or other rare earth
\nzirconates such as gadolinium zirconate, nickel-chromiumaluminium-yttrium alloys, advanced multilayer ceramic coating
\nsystems and platinum group metals.
\nVarious other elements, such as hafnium, rhenium, tungsten,
\nmolybdenum, vanadium and zirconium, are also used to enhance the
\nhigh-temperature strength, creep resistance, and oxidation
\nresistance of superalloys in aircraft and gas turbines. Rhenium is
\nparticularly important for turbine blades operating at high
\ntemperatures. Around 80% of global rhenium demand is for
\nsuperalloys, particularly for turbine blade applications.
\nDefence
\nAn important set of critical minerals for the defence sector overlaps
\nto some extent with energy applications. Lithium-ion batteries are
\nwidely used in aircraft and unmanned aerial and ground vehicles
\n(UAV and UGV), as well as in guided munition systems and onboard
\nequipment for armed vehicles. Magnet rare earth elements are key in
\ndefence applications for motors and actuators in aircraft, unmanned
\nsystems, missiles and smart munitions, naval propulsion and ground
\nvehicles. Nuclear propulsion also contributes a distinct application,
\nwith naval reactors in submarines and aircraft carriers requiring
\nenriched uranium fuel, typically at higher enrichment levels than in
\nthe civilian sector and designed for long operational lifetimes.
\nMilitary jets use materials similar to those used in civilian aircraft, but
\nin different proportions. Titanium is typically used in higher shares
\n(around one-third of total weight in some advanced military aircraft,
\ncompared with around 10-15% in passenger planes), due to its higher
\ntolerance to damage, corrosion resistance and low weight, with lower
\nshares of aluminium (often around 10-20%, compared with higher in
\ncommercial aircraft).
\nRadar-absorbing materials are used in defence to achieve stealth
\nproperties. These can be magnetic materials such as nickel-zinc and
\nmanganese-zinc ferrites, which are heavy but effective. Lighter
\ncarbon-based materials include carbon fibre composites, nanotubes
\nand graphite, making graphite a critical mineral for these applications.
\nPolymers and ceramics are also used where mechanical strength,
\nlight weight and thermal resistance are needed.
\nThere is a wide intersection between the minerals used for high-tech
\napplications and defence. In most cases, these minerals, whose
\ndemand is mostly driven by their civilian uses, remain critical to
\ndefence contexts, in which they are rarely substitutable. Radars,
\ninfra-red detectors and night vision equipment rely on high-tech
\nmaterials. Gallium arsenide is used in high-frequency radiofrequency chips and gallium nitride in high-power radar modules.
\nIndium gallium arsenide is used for short-wave infra-red detectors,
\nwhile modern-generation night vision uses gallium arsenide in
\nphotocathodes. Germanium is key for infra-red optical lens materials
\nand fibre optics. Indium antimonide is typically used for mid-wave
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 207
\n2. Outlook for key minerals
\ninfra-red detectors, which capture thermal images for night vision.
\nTellurium-based semiconductors are also key for infra-red equipment.
\nElectronic equipment relies on silicon as a base semiconductor
\nmaterial and copper for wiring.
\nMunitions and missiles use critical minerals and materials for
\nstructural elements, guidance systems, thermal stability and
\nmechanical strength. Aluminium is used in structures for propellant
\ntanks and casings, where it can be replaced by titanium or carbon
\nfibre when high strength, light weight, thermal resistance or a specific
\nfragmentation pattern is needed, and also as a solid propellant in the
\nform of powdered aluminium. Carbon-based composites derived from
\ngraphite are used as heat shields and re-entry systems, thanks to
\ntheir thermal stability and mechanical strength. Tungsten is
\nfundamental for kinetic energy penetrators and fragmentation
\napplications, primarily because its exceptionally high density and
\nhardness enable effective penetration of hardened targets at high
\nspeed. Bismuth is part of the binder in explosive mixtures and is used
\nas a non-toxic substitute for lead in bullets and shot, driven by
\nenvironmental regulations and the phase-out of lead-based
\nammunition in several North Atlantic Treaty Organization (NATO)
\ncountries.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 208
\n2. Outlook for key minerals
\nMinerals are essential enablers of high-tech, aerospace and defence technologies
\nKey critical minerals in the high-tech, aerospace and defence sectors
\nIEA. CC BY 4.0.
\nHigh-tech industries Aerospace and defence
\nRobotics
\nand
\nservers
\nSensors
\nSuperalloys
\nSilicon
\nTitanium
\nSilver
\nGermanium
\nGallium
\nTungsten
\nCobalt
\nMagnet rare earths
\nNickel
\nGraphite
\nYttrium
\nRhenium
\nMolybdenum
\nAntimony
\nNiobium
\nTellurium
\nIndium
\nTungsten
\nBeryllium
\nTin
\nArsenic
\nTantalum
\nMagnet rare earths
\nGermanium
\nSemiconductors
\nand
\ntelecommunications
\nLight weight
\nHigh-performance
\nAntimony
\nBismuth
\nCobalt
\nVanadium
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 209
\n2. Outlook for key minerals
\nThe risk assessment considers a range of factors, including supply risk, the availability of
\nalternative supply sources and strategic importance
\nRisk assessment framework
\nIEA. CC BY 4.0.
\nAlternative
\nsupply routes
\nPrice transparency
\nNumber of suppliers
\nEase of substitution
\nBy-product dependence
\nStrategic
\nimportance
\nNational security
\nStrategic applications
\nSupply risk
\nExport restriction
\nConcentration (refining)
\nConcentration (mining)
\nSupply-demand balance
\nPrice volatility
\nShare of top 1 supplier
\nPrice standard deviation since 2014
\nExistence of active restriction on any form of the material
\nProjected market tightness in 2030
\nNumber of producers accounting for at least 5% of supply
\nAssessment of substitutability in strategic applications
\nShare of production relying on by-products
\nExistence of price indexes
\nNumber of strategic applications relying on the material
\nPresence of the material in strategic materials lists
\nShare of top 1 supplier
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 210
\n2. Outlook for key minerals
\nMany strategic materials essential to high-tech, aerospace and defence applications face
\nelevated supply risks
\nRisk assessment results
\nIEA. CC BY 4.0.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 211
\n2. Outlook for key minerals
\nGallium, magnet rare earths, yttrium, graphite, tungsten, cobalt and germanium exhibit some of
\nthe highest levels of supply risk
\nRisk assessment methodology
\nTo assess the risk exposure of materials essential for high-tech,
\naerospace and defence applications, we developed a framework
\nbased on key criteria, including supply risk, the availability of
\nalternative supply routes and strategic importance. This allows
\nmaterials to be ranked according to their overall exposure across
\nmultiple dimensions of risk. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nWhen evaluating supply risk, the first risk dimension, the level of
\nsupply concentration in both mining and refining, is a critical measure.
\nRelying on a few dominant suppliers means that any disruption can
\nquickly push markets into shortfall. For gallium, graphite, manganese
\nand rare earths, the top refiner, China, accounts for over 90% of
\nglobal supply. High price volatility further complicates the
\ndevelopment of new supply: for example, lithium, vanadium, rare
\nearths and cobalt have exhibited significantly higher volatility than oil
\nand gas. Many high-risk minerals are already affected by some form
\nof export restriction, such as rare earths, gallium, and tungsten,
\nstraining their supply chains.
\nThe availability of alternative supply routes is the second key risk
\ndimension. For some materials, there are limited options for
\nsubstitute materials, such as chromium for corrosion-resistant
\nstainless steel, titanium for alloys requiring a high strength-to-weight
\nratio and germanium for high-performance fibre optics, heightening
\nthe risks from supply disruptions. Additionally, many materials are
\nproduced as co-products or by-products (see Annex) alongside other
\nminerals, making their supply less responsive to demand or price
\nsignals. For example, gallium is mainly recovered as a by-product of
\nzinc and aluminium production, tellurium from copper and lead
\nprocessing, and germanium from zinc and coal.
\nThe strategic importance of each material depends on the sectors in
\nwhich it is used. When materials have applications in strategic
\nsectors such as semiconductors or defence, their security of supply
\nbecomes a crucial factor for economic and national security. While
\nstrategic importance can be assessed at the global level, each
\ncountry should also consider domestic vulnerabilities and
\ndependencies to assess the potential impact on its overall security
\nand resilience.
\nRisk assessment results
\nThe results of the risk assessment show that some of the highest-risk
\nmaterials include gallium, magnet rare earths, yttrium, graphite,
\ntungsten, germanium, tellurium and cobalt. Most of these materials
\nare characterised by high supply concentration, limited availability of
\nsubstitutes and strategic applications, and many are already subject
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 212
\n2. Outlook for key minerals
\nto some form of export restriction. Several of them, such as gallium,
\nmagnet rare earths, graphite, cobalt and germanium, play essential
\nroles across a wide range of strategic applications.
\nMany high-tech materials are characterised by high exposure to
\nsupply risks, including high supply concentration and dependence on
\nby\u2011product supply, as well as limited substitution options. These
\nminerals, such as gallium, magnet rare earths, cobalt, germanium,
\nnickel, indium and silicon, are widely used across multiple technology
\ndomains, underscoring their systemic importance and creating strong
\ncross\u2011sector dependencies. Many of these minerals\u2019 markets are also
\nrelatively small\u2011scale, making their supply more vulnerable to
\ndisruption and market volatility. At the same time, the parallel
\nexpansion of these sectors, driven by rapid growth in electrification,
\nautomation and AI\u2011related technologies, would simultaneously
\nincrease competition between sectors, leading to additional pressure
\non supply chains and an increased risk of market tightness and
\nimbalances.
\nInherently, most materials critical for the aerospace and defence
\nsectors have high strategic importance given the national security
\nimplications. Beyond this, many are already subject to export
\nrestrictions targeting military applications through \u201cdual-use\u201d
\ndesignations, are highly concentrated in supply and are very
\nchallenging to substitute, making them high-risk materials. Given the
\nchallenging operating temperatures and conditions, the range of
\nmaterials that are critical for these sectors is wide. The highest-risk
\nmaterials for the aerospace and defence sector can be split into four
\nbroad categories of primary applications: high-performance materials,
\nlightweight materials, superalloys and sensors. Most of the key
\nmaterials used in high-performance applications are challenging to
\nsubstitute and already subject to export restrictions, including yttrium,
\ntungsten, magnet rare earths and lithium. Superalloy applications
\nalso present high risk, particularly where they are challenging to
\nsubstitute and have by-product dependencies, such as vanadium and
\ncobalt. Lithium and graphite are critical for defence, as they are used
\nin batteries needed for drones and portable electronics for soldiers\u2019
\nequipment. There are also some materials that have key lightweight
\napplications, in particular titanium, which is highly difficult to
\nsubstitute. Finally, many high-tech materials are also key for
\naerospace and defence, including gallium, germanium, tellurium and
\nantimony, which are utilised in radar and sensing applications.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 213
\n2. Outlook for key minerals
\n2. Outlook for key minerals
\nPart 3
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 214
\n2. Outlook for key minerals
\nNuclear supply chains
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 215
\n2. Outlook for key minerals
\nNuclear power is making a strong comeback, with uranium prices rising and reactor capacity
\nadditions reaching record highs
\nTotal nuclear capacity additions and capacity under construction (left) and uranium price development (right)
\nIEA. CC BY 4.0.
\nNotes: tU3O8 = tonne of triuranium octoxide. Capacity is reported on a gross basis and shown as annual average additions for each period.
\nSources: IEA analysis based on data from the International Atomic Energy Agency\u2019s PRIS database (2026), and UxC and TradeTech for uranium prices (2026).
\n20
\n40
\n60
\n80
\n100
\n’05-’09 ’10-’14 ’15-’19 ’20-’25 2025
\nGW
\nCapacity additions In construction
\n50 000
\n100 000
\n150 000
\n200 000
\n250 000
\n2019 2020 2021 2022 2023 2024 2025 2026
\nUSD\/tU3O8
\nUranium long-term Uranium spot
\nNuclear capacity additions Uranium price
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 216
\n2. Outlook for key minerals
\nStrong growth in nuclear capacity requires a new wave of uranium supply
\nNuclear capacity currently under construction, at around 78 GW, is at
\nits highest level in 30 years. Nuclear power has entered a renewed
\nphase of expansion in recent years, marking a clear shift from the
\nstagnation observed in the early 2000s. Global installed nuclear
\ncapacity has increased steadily, reaching close to 420 GW by 2025,
\ncompared with around 390 GW in the early 2000s. China has been
\nthe main driver of this growth, adding close to 35 GW since 2015 and
\nbringing its total fleet to nearly 65 GW by 2025, while India, Korea,
\nT\u00fcrkiye and the United Kingdom have also continued to expand
\ncapacity. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIn parallel, tightening uranium market conditions reflect changing
\ndemand expectations, renewed contracting activity and dwindling
\nsecondary supply. After several years of subdued prices, uranium
\nmarkets strengthened significantly from 2020 onwards, with spot
\nprices of uranium concentrate rising from around USD 60 per kg of
\noxide content to peaks above USD 200 per kg of oxide content in
\n2024, before moderating in 2025.
\nLooking ahead, in the STEPS, global nuclear generation doubles by
\n2050 while maintaining a relatively stable share of close to 10% of
\ntotal electricity generation. Installed capacity rises from close to
\n420 GW in 2025 to nearly 800 GW by 2050, with even higher levels
\nin the HDS. This expansion reflects sustained policy support across
\nan increasing number of countries, driven by energy security
\nconsiderations and decarbonisation objectives.
\nChina is set to have the world\u2019s largest nuclear fleet in the early 2030s,
\naccounting for roughly one-third of global capacity additions through
\n2050, with its fleet expanding by more than 2.5 times over the next
\ndecade. The United States also sees renewed growth, increasing
\nfrom around 100 GW in 2025 to about 140 GW in 2040, supported by
\nboth reactor life extensions and new builds. Shares of nuclear in
\npower generation also rise in India, Japan, Korea and Russia, while
\nremaining stable in Brazil and the UnitedArab Emirates. At the same
\ntime, deployment is expanding into a broader set of emerging
\nmarkets beyond traditional markets, including T\u00fcrkiye, but also
\nBangladesh, Egypt, Kazakhstan, Poland, Uzbekistan and Viet Nam.
\nThis widespread expansion points to sustained growth in nuclear fuel
\nrequirements and the need for significant capacity additions across
\nuranium supply chains.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 217
\n2. Outlook for key minerals
\nNuclear fuel types vary depending on the reactor and technology design
\nSelected nuclear fuel characteristics
\nIEA. CC BY 4.0.
\nNotes: Natural uranium demand includes reactors with fuel enriched below 2%. MOX combines recycled uranium and plutonium.
\nSources: IEA analysis based on data from the International Atomic Energy Agency\u2019s PRIS database (2026); World Nuclear Association (2025), World Nuclear Power
\nReactors and Uranium Requirements.
\nType Lattice Associated reactors
\nCurrent reactor
\nshare
\nExisting fuels
\nNatural uranium Cylindrical Pressurised heavy water reactor (PHWR) 7%
\nLow-enriched uranium
\n(LEU, 2% to 5%)
\nSquare
\nPressurised water reactor (PWR) 62%
\nBoiling water reactor (BWR) 13%
\nLight water graphite reactor (LWGR) 2%
\nCylindrical Gas-cooled reactor 1%
\nHexagonal VVER (ex-Soviet designed PWR) 14%
\nEmerging fuels
\nLow-enriched uranium plus
\n(LEU+, 5% to 8%)
\nor
\nHigh-assay low-enriched uranium
\n(HALEU, 8% to 20%)
\nSquare or hexagonal PWR, VVER, BWR Next-generation
\nPebble or prismatic
\nSodium-cooled fast reactor
\nNext-generation Lead-cooled fast reactor
\nHigh-temperature gas-cooled reactor
\nCirculating liquid molten salt Molten salt reactor Next-generation
\nSecondary fuels
\nMixed oxide fuel (MOX, 2% to 5%) or
\nReprocessed uranium (RepU, 2% to 5%)
\nPWR, fast breeder reactor Marginal
\nPWR, LWGR Marginal
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 218
\n2. Outlook for key minerals
\nThe emergence of advanced nuclear reactors is diversifying the nuclear fuel cycle
\nIllustrative nuclear fuel cycle value chain
\nIEA. CC BY 4.0.
\nNotes: BWR = boiling water reactor; HALEU = high-assay low-enriched uranium (8-20%); LEU = low-enriched uranium (2-5%); LEU+ = low-enriched uranium plus
\n(5-8%); MOX = mixed oxide fuel; PHWR = pressurised heavy water reactor; Pu = plutonium; PUREX = plutonium uranium reduction extraction; PWR = pressurised
\nwater reactor; RepU = reprocessed uranium; SMR = small modular reactor; TRISO = tri-structural isotropic; U = uranium;U3O8 = triuranium octoxide; UF4 = uranium
\ntetrafluoride; UF6 = uranium hexafluoride; UO2 = uranium dioxide. This figure illustrates a simplified, generalised flowsheet and does not capture the full complexity of
\nreal-world circuits, which frequently require customisation for specific mined ores, enrichment needs, and nuclear fuel requirements.
\nMining & milling
\nOpen-pit \/
\nunderground
\nIn-situ
\nleaching
\nYellowcake (U3O8
\n)
\nConversion
\nUO2\uf0e0UF4\uf0e0UF6
\nNatural (UF6
\n)
\nU3O8
\nEnrichment
\nGas
\ncentrifuge
\nLaser
\ndiffusion
\nLow enriched UF6
\nUF6
\n0.7%
\nLEU fuels
\nLEU
\n2-5% UF6\uf0e0UO2
\npowder
\n\uf0e0pellets \uf0e0rods
\nFuel assemblies
\nNuclear reactors
\nEnriched U fuel
\nPWR, BWR
\nNuclear reactors
\nNatural U fuel
\nPHWR
\nU3O8
\nHigher enrichment
\nGas
\ncentrifuge
\nLaser
\ndiffusion
\nHigh enriched UF6
\nAdvanced fuels
\nTRISO \/ metallic \/
\nmolten-salt fuels
\nVarious fuel forms
\nHALEU
\n8-20%
\nNuclear reactors
\nNext generation fuels
\nSMRs, Gen IV, etc
\nLEU 2-5%
\nLEU+
\n5-8%
\nReprocessing
\nReprocessed fuel
\nPu + RepU, RepU
\nMOX, RepU
\nFinal disposal
\nDeep geology
\nLong-term isolation
\nInterim storage
\nWet (pool)
\nCooled spent fuel
\nDry (cask)
\nOncethrough
\nNatural U fuels
\nU3O8\uf0e0UO2
\npowder \uf0e0pellets \uf0e0bundle
\nFuel assemblies
\nMetallic U-Pu-Ma, metallic nitride
\nFast reactor fuels
\nSpent nuclear fuel
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 219
\n2. Outlook for key minerals
\nWhat types of fuels and uranium requirements are associated with different reactor types?
\nNuclear power generation is currently dominated by light water
\nreactors, notably pressurised water reactors and boiling water
\nreactors, which account for close to 90% of global capacity and rely
\non low-enriched uranium (LEU), typically enriched to 2-5%
\nuranium-235. Some reactor types, such as Russian water-water
\nenergetic reactors (VVERs), require specific fuel assembly designs,
\nlimiting substitutability across suppliers (see section below on supply
\nconcentration).
\nLattice structure of selected nuclear fuels
\nIEA. CC BY 4.0.
\nNote: The figure illustrates simplified fuel rod designs used in reactor cores
\nand does not capture the full complexity of customised and real-world fuels.
\nPressurised heavy water reactors (PHWRs), deployed in Argentina,
\nCanada, India, and Romania and accounting globally for a 7% market
\nshare in 2025, consume specific fuel types containing natural
\nuranium (around 0.7% uranium-235) that do not require enrichment.
\nNew advanced PHWRs, such as those under construction in India,
\ncan require slightly enriched uranium of up to 1.1% to achieve
\nimproved burnup.
\nGrowing role of small modular reactors
\nLarge-scale reactors continue to dominate new nuclear deployment,
\nbut momentum behind small modular reactors (SMRs) is building.
\nChina already operates a land-based SMR and has an additional
\n125 MW commercial SMR under construction, while Russia operates
\na marine-based SMR and is building a further 300 MW unit.
\nAdditional SMR projects are planned or being developed in Argentina,
\nCanada, Korea, Sweden, the United Kingdom and the United States,
\nnecessitating reactor manufacturing and fuel services. In the STEPS,
\nSMRs grow from the early 2030s, reaching close to 40 GW by 2050,
\nor around 5% of total capacity.
\nSMRs include both small-scale pressurised water reactors and a
\nrange of advanced designs using alternative fuels. Many of the
\nprojects under development are expected to rely on low-enriched
\nuranium plus (LEU+), enriched to between 5% and 8%, or high-assay
\nlow-enriched uranium (HALEU), enriched up to 20%, enabling higher
\nburnup and longer operating cycles. In some cases, specific fuel
\ngeometries may be required, as opposed to the more conventional
\nsquare lattice pellets used in current light water reactors, such as tristructural isotropic particles. Enrichment specifications vary
\naccordingly. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nSquare lattice Hexagonal lattice Cylindrical bundle
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 220
\n2. Outlook for key minerals
\nAlongside the expanding global nuclear fleet, uranium requirements are set to increase
\nstrongly, with new fuel types needed for emerging next-generation fleets
\nMining
\nAnnual uranium demand is close to 70 kilotonnes of natural uranium
\nequivalent (ktU) today, and this is set to increase strongly as global
\nnuclear generation expands. While uranium requirements generally
\nincrease with nuclear generation, improvements in fuel utilisation and
\nreactor performance may reduce uranium demand per unit of
\nelectricity generated.
\n40% of this growth is concentrated in China and 20% in other
\nemerging markets, including in India, the Middle East and Africa as
\nnew programmes mature. Demand in the European Union is
\nexpected to grow moderately.
\nEnrichment
\nGlobal enrichment requirements are close to 49 million separative
\nwork units (SWU) today and are set to rise significantly. The
\nemergence of LEU+ and HALEU and the broader shift towards higher
\nenrichment levels introduce additional requirements beyond the
\ncurrent supply chain configuration, including industrial facilities and
\nspecific cascade technologies. For a given amount of fuel, higher
\nenrichment grades imply greater requirements for mined uranium and
\nenrichment work units, making the front end of the nuclear fuel cycle
\nmore resource-intensive and reinforcing pressure on both uranium
\nand enrichment work unit supplies. Greater development of nextgeneration reactors and stronger demand for HALEU could push
\noverall enrichment requirements higher.
\nFuel
\nThe composition of reactor technologies also reshapes fuel
\nrequirements. Global uranium oxide fuel fabrication requirements are
\naround 11.5 kilotonnes of heavy metal today and are also set to
\nincrease in line with nuclear capacity expansions. Among
\nconventional large-scale reactors, pressurised water reactors and
\nboiling water reactors are set to continue to dominate uranium
\nconsumption. VVER designs, which operate with a hexagonal fuel
\nlattice, maintain a significant market share: current global
\nconsumption of close to 11 ktU is expected to grow further. PHWRs
\nin Canada and India also currently retain an important regional role,
\nrequiring about 3.4 ktU of dedicated fuel supply.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 221
\n2. Outlook for key minerals
\nNew projects are needed to meet growing demand for nuclear fuels
\nMined uranium
\nThe market for mined uranium remains tight. Existing capacity and
\nthe project pipeline suggest that the gap between requirements and
\nlikely available output is expected to widen over the next decade,
\nmaking accelerated project development and access to higher-cost
\nor undiscovered resources necessary. While identified uranium
\nresources are generally sufficient to support projected nuclear growth,
\nmaintaining adequate supply will require timely investment in new
\nmining projects and fuel-cycle infrastructure. Long-term supply risks
\nare therefore driven primarily by the pace of investment and project
\ndevelopment rather than by physical resource availability.
\nRecent project developments present a mixed picture, highlighting
\nboth new sources of supply and emerging structural constraints. The
\nrestart of the Langer Heinrich mine in Namibia is expected to
\ncontribute additional volumes, but these gains are partly offset by
\ndisruptions in traditional supply corridors. In Canada, the restart of
\nCameco\u2019s McArthur River-Key Lake operation has brought significant
\ncapacity back into production after suspension, with potential for
\nfurther expansion to full licensed capacity. New projects are also
\nbeing developed in Mongolia (France\u2019s Orano), Uzbekistan (domestic
\noperator Navoiyuran), Tanzania (Russia\u2019s Uranium One) and
\nMauritania (Australia\u2019s Aura Energy).
\nHowever, several large legacy mines are progressively approaching
\ndepletion, with Canada\u2019s Cigar Lake mine, which accounts for close
\nto half of the country\u2019s production capacity, facing decline from the
\nmid-2030s and McArthur River about a decade later. Supply
\nadditions are also exposed to geopolitical and logistical complications.
\nProduction in Kazakhstan, the leading producer of uranium, is
\nincreasingly limited by sulphuric acid supply constraints, declining ore
\ngrades and rising costs, prompting a pivot towards higher-value
\ncontracts. Without new expansion or greenfield developments, the
\nlonger-term supply outlook is likely to tighten.
\nHigher uranium prices in recent years have supported a revival of
\nexploration and development activity, initially focused on restarting
\nidled capacity before extending to new greenfield investment
\ndecisions across Central Asia, Africa and North America. However,
\ndelivering sufficient new supply remains challenging: mine
\ndevelopment timelines typically span 10-15 years, reflecting
\nincreasingly stringent regulatory requirements. Producers are also
\nfacing rising input costs, supply chain disruptions and increasing
\noperational complexity. In addition, supply remains vulnerable to
\ngeopolitical disruptions, as illustrated by the loss of around 1 000
\ntonnes of production in Niger, which previously supplied about 23%
\nof EU demand. This underscores the continued exposure of uranium
\nmarkets to concentrated supply risks.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 222
\n2. Outlook for key minerals
\nUranium conversion: new projects needed rapidly
\nUranium conversion, the first step that prepares mined concentrate
\nfor enrichment, remains structurally fragile. The process involves
\ntransforming uranium concentrate into uranium hexafluoride. Global
\nuranium hexafluoride capacity, totalling 62 ktU, leaves little margin to
\nabsorb disruptions and volatility. Conversion prices recorded historic
\nhighs, with prices increasing by close to 30% over the year. These
\nincreases were driven by shifting trade flows and stronger demand
\nexpectations, although long-term fuel procurement strategies and the
\nuse of commercial inventories provide a buffer against short-term
\nsupply disruptions.
\nRising demand is expected to require a major expansion of
\nconversion capacity. While new projects and capacity expansions are
\nplanned in Canada, France, the United Kingdom and the
\nUnited States, including by new players, long development timelines
\nmay delay their impact. In parallel, recently launched facilities are still
\nramping up, and it may take time for new projects to make a
\nsignificant contribution in the near term. In this context, inventory
\nmanagement and long-term contracting practices complement efforts
\nto diversify supply sources, helping to mitigate short-term market
\ntightness.
\nEnrichment capacity: sufficient today, but additions
\nneeded for the future
\nEnrichment capacity remains sufficient in the near term but may face
\na bottleneck with rising demand over the medium term. This
\ntightening outlook is already reflected in market signals, with spot and
\nterm enrichment prices rising respectively by more than 10% and 6%
\ncompared with 2024. Given the long lead times associated with new
\nfacilities, additional projects will be needed to prevent emerging
\nconstraints, as no major greenfield commercial capacity is expected
\nbefore 2030.
\nIn China, the ongoing expansion of enrichment capacity is primarily
\noriented towards strengthening domestic supply security rather than
\nincreasing export availability. The recent commissioning of the
\nEmeishan plant has increased national enrichment capacity to
\n10.8 million SWU. Nevertheless, the current pipeline remains limited
\nin its ability to expand the country\u2019s role as an exporter of enriched
\nuranium.
\nIn Europe, enrichment capacity is broadly aligned with domestic
\ndemand. However, the region imports enriched uranium from Russia
\nfor domestic consumption while exporting its domestically enriched
\nproduction to other regions, including Japan, Korea and the
\nUnited States. Planned capacity increases are expected in 2028,
\nincluding the addition of around 750 000 SWU at Urenco\u2019s Almelo
\nplant and approximately 2.5 million SWU through the expansion of
\nOrano\u2019s Georges Besse II facility. However, these additions are
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 223
\n2. Outlook for key minerals
\nprimarily aimed at maintaining supply balance and may offer limited
\nheadroom if existing external supply sources are reduced.
\nIn the United States, enrichment capacity is expanding, with the
\nDepartment of Energy committing USD 2.7 billion to domestic
\nenrichment initiatives, supporting projects led byAmerican Centrifuge
\nOperating, General Matter and Orano Federal Services, including
\nProject IKE. In parallel, Urenco USA announced an expansion of its
\nEunice enrichment plant by 2036, adding 2.1 million SWU and
\nincreasing total capacity to more than 7 million SWU. HALEU projects
\nare also emerging but remain at an early stage of development.
\nCurrent activities include the operation of Centrus Energy\u2019s HALEU
\npilot facility in Piketon, Ohio, and Global Laser Enrichment\u2019s
\ndemonstration test loop in Wilmington, North Carolina. Both
\ncompanies are also advancing plans for larger commercial facilities
\nin Kentucky. Despite this progress, the scale and timing of these
\nprojects suggest a gradual build-up of capacity, implying a limited role
\nin serving short-term demand.
\nFuel fabrication capacity is sufficient for conventional
\nfuel types, but not for next-generation fuels
\nGlobal fuel fabrication capacity remains adequate to meet
\nrequirements, supported by utilisation rates below 70%. This
\nprovides a buffer to accommodate short-term increases in demand.
\nHowever, fuel fabrication remains highly reactor-specific, with limited
\ninterchangeability across designs, which may create bottlenecks for
\ncertain fuel types and reactor technologies. Long-term fuel
\nprocurement strategies and commercial inventories provide an
\nadditional layer of resilience against short-term disruptions in mining,
\nconversion, enrichment or fuel fabrication services, complementing
\nefforts to diversify supply sources. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 224
\n2. Outlook for key minerals
\nThree countries account for almost three-quarters of uranium mining, while 70% of both
\nconversion and enrichment capacity is concentrated in three countries
\nGeographical and ownership distribution of the nuclear fuel cycle, 2025
\nIEA. CC BY 4.0.
\nNotes: Conversion, enrichment and fuel fabrication distributions are calculated based on project capacities. Mining ownership is calculated based on project shares.
\nSources: IEA analysis based on Nuclear Energy Agency (2025), Uranium 2024: Resources, Production and Demand; Kazatomprom (2026), Operating and Financial
\nReview for 2025; World Nuclear Association (2024), Conversion and Deconversion; World Nuclear Association (2026), Nuclear Fuel and Its Fabrication; World
\nNuclear Association (2025), Uranium Enrichment; International Atomic Energy Agency (2026), List of Nuclear Fuel Cycle Facilities; Zang et al. (2015), China\u2019s
\nUranium Enrichment Capacity.
\n0%
\n20%
\n40%
\n60%
\n80%
\n100%
\nMining Conversion Enrichment Fuel fabrication
\nRussia China Kazakhstan Canada Namibia Australia France United Kingdom United States Others Top 3 share
\nRegion
\nMining Conversion Enrichment Fuel fabrication
\nOwnership
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 225
\n2. Outlook for key minerals
\nConcentration and new fuel requirements are emerging as key constraints on nuclear fuel
\nsupply security
\nMining
\nThree countries, Canada, Kazakhstan and Namibia, currently
\naccount for around 70% of global mining output. Concentration is
\neven more pronounced from an ownership perspective, with six
\ncompanies controlling 88% of global supply. This reflects an industry
\nin which national champions, such as Kazatomprom, Cameco, Orano
\nand China National Nuclear Corporation, coexist with majors
\noperating multinationally, although upstream supply remains more
\naccessible than in subsequent stages of the fuel cycle. This level of
\nconcentration reflects muted exploration and development activity
\nduring the decade following 2011, when uranium prices were
\nhistorically low.
\nThe security of mined uranium supply is shaped less by the
\ndistribution of resources than by the concentration of transport routes
\nlinking production to conversion plants. Kazakhstan and Uzbekistan,
\ntwo landlocked countries accounting for close to 45% of global mined
\noutput, rely entirely on external conversion and enrichment services,
\nmaking export corridors a potential chokepoint. Historically, uranium
\nflows were oriented towards Russia by land, for transit or conversion,
\naccounting for about 23% of mined uranium transit in 2015. Over time,
\ntrade patterns have increasingly shifted towards China, now the
\nlargest end market for Kazakh uranium, reflecting both long-term
\nsupply contracts and growing Chinese participation in upstream
\nassets in Kazakhstan. Between 2015 and 2025, about half of uranium
\nmined globally transited through Russia or China. This high reliance
\non a limited number of corridors is compounded by constraints further
\ndownstream, highlighting the limited flexibility of alternative primary
\nmined supply under today\u2019s market conditions. In parallel, efforts to
\ndiversify transport routes have gained momentum since 2022.
\nOne possible export channel is the Trans-Caspian corridor, shipping
\nthrough the CaspianSea and the Caucasus to Europe. In addition to
\nproviding access to European and North American markets, this
\ncorridor is increasingly viewed as a strategic alternative to traditional
\nroutes, particularly in the context of shifting geopolitical dynamics.
\nHowever, this route remains constrained by limited capacity, and the
\nnecessary transshipment adds operational complexity and cost.
\nAdding to these challenges, uranium transport is governed as much
\nby regulatory constraints as by physical logistics, as radioactive
\nmaterials require country-specific licences that are not mutually
\nrecognised. This creates incentives to minimise transit jurisdictions
\nand channel flows through a few specialised routes and ports, a trend
\nreinforced by the declining willingness of some carriers and terminals
\nto handle nuclear cargo.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 226
\n2. Outlook for key minerals
\nLooking beyond conventional uranium-based fuels, thorium is
\nattracting renewed interest in some countries, notably India and
\nChina, due to their abundant domestic resources and its potential to
\nenhance long-term fuel supply security. However, commercial
\ndeployment remains limited to India\u2019s Advanced Heavy Water
\nReactor and China\u2019s Molten Salt Reactor programme.
\nConversion
\nCommercial-scale conversion can only be carried out in five major
\nfacilities operated and owned by Rosatom, Cameco, Orano,
\nConverDyn and China National Nuclear Corporation, creating
\nsignificant exposure to logistical bottlenecks. The top three countries
\naccount for around 70% of global output, increasing exposure to
\npotential disruptions while remaining slightly better distributed than
\nenrichment capacity, both by geography and ownership. However,
\nwhen excluding the two largest suppliers, Russia and China,
\navailable conversion capacity is estimated to cover only 80% of
\nrequirements, highlighting emerging constraints in supplying
\ndiversified markets in an already tight conversion market.
\nEnrichment
\nThe geographic distribution of enrichment facilities creates significant
\nchallenges, with the share of the top three countries reaching close
\nto 70%. Among key producers, Urenco operates across Germany,
\nthe Netherlands, the United Kingdom and the United States.
\nCombined with Rosatom (Russia), Orano (France) and China
\nNational Nuclear Corporation (China), four companies handle 92% of
\nthe enrichment step. While nominal global capacity appears sufficient
\nin 2025, available enrichment capacity outside the two largest
\nsuppliers\u2013 Russia, whose supplier role to the United States is to be
\nphased out by 2028, and China\u2013 is estimated to meet only around
\n90% of requirements under an N-2 configuration. Effective supply
\ncould be even lower given utilisation rates remain below full capacity.
\nN-2 enrichment requirements and capacity by geography, 2025
\nIEA. CC BY 4.0.
\nNote: The N\u20112 balance excludes the two largest supplying countries from both
\ndemand and capacity.
\nSources: IEA analysis based on Nuclear Energy Agency (2025), Uranium 2024:
\nResources, Production and Demand; World Nuclear Association (2025), World
\nNuclear Power Reactors and Uranium Requirements; World Nuclear
\nAssociation (2025), Uranium Enrichment; International Atomic Energy Agency
\n(2026), Nuclear Fuel Cycle Facilities Database (2026); Zang et al. (2015),
\nChina\u2019s Uranium Enrichment Capacity.
\nThe deployment of SMRs at commercial scale is set to challenge the
\nfront end of the nuclear fuel cycle. Depending on the enrichment level,
\nHALEU fuel fabrication can require up to four times more uranium
\n0 20 40 60 80
\nDemand
\nCapacity
\nM SWU
\nN-2 supply (excluding supply from top suppliers)
\nN-2 demand (excluding demand from top suppliers)
\nTop suppliers
\n91%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 227
\n2. Outlook for key minerals
\ninput and five times greater enrichment effort per tonne of fuel. This
\nimplies structurally higher demand intensity for both uranium and
\nenrichment services, amplifying pressure on upstream stages.
\nCommercial-scale HALEU production remains geographically limited,
\nwith Russia and China currently the only established commercial
\nsuppliers through downblending. The 2024 US ban on Russian
\nuranium imports has reinforced policy efforts to establish alternative
\nsupply chains. Outside these suppliers, Centrus Energy\u2019s Piketon
\nfacility in the United States is the only operating pilot cascade, with
\ncumulative deliveries of less than 1 tonne between late 2023 and
\nmid-2025. Expansion plans target around 12 tonnes per year,
\nsupported by recent public funding and private investment. Additional
\nprojects are under development, such as Urenco USA\u2019s and Orano\u2019s
\nenrichment expansions, as well as proposed facilities in Oak Ridge
\nand Paducah. However, most projects are not expected to deliver
\nmaterial volumes before the early 2030s, indicating a potential timing
\ngap between HALEU availability and SMR deployment needs.
\nIn the United States, the Department of Energy\u2019s HALEU Availability
\nProgram, launched in 2020, is designed as an interim supply
\nmechanism for early advanced reactor projects. Federal stockpiles are
\nprojected to reach about 21 tonnes by mid-2026, with approximately
\n15 tonnes potentially available for temporary allocation. While
\nconditional allocations began in April 2025, government-held
\ninventories under the HALEU Availability Program are expected to play
\na critical role for first-mover projects, pending the emergence of
\ncommercial-scale HALEU production towards the end of the decade.
\nFuel fabrication
\nFuel fabrication capacities are more geographically distributed, with
\nthe top three regions accounting for 47%, as dedicated assembly
\nlines are typically located close to reactor fleets. However, while
\nglobal fabrication capacity generally exceeds demand, effective
\ndiversification is constrained by reactor-specific designs and
\nqualification requirements, which limit substitutability between
\nsuppliers. As a result, ownership remains relatively concentrated,
\nwith Westinghouse (United States), Framatome (France), TVEL
\n(Russia), GNF (United States) and KEPCO (Korea) together holding
\naround 65% of global fabrication capacity.
\nRecent developments highlight reliability and technological progress
\nas key near-term priorities. In 2025, operational performance and
\ninnovation remained areas of attention at key facilities. Following
\ntechnical difficulties, some plants are currently planning works before
\nresuming production. Framatome advanced the qualification of
\naccident-tolerant fuels for European reactors, including at facilities in
\nFrance and Germany. At the same time, investment is increasingly
\ndirected towards advanced fuel types rather than expanding
\nconventional output, with projects such as X-energy\u2019s TRISO-X
\nfacility and BWXT\u2019s expansion in Lynchburg in the United States. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 228
\n2. Outlook for key minerals
\nReactor-specific and fuel-lattice design requirements are particularly
\nbinding for VVER reactors, which account for around 14% of the
\nglobal nuclear fleet and rely on a limited pool of qualified fuel designs.
\nHistorically, Russia\u2019s TVEL, which remains outside EU sanctions, has
\nbeen the primary supplier. Since the early 2020s, Westinghouse has
\nsecured offtake agreements for its new VVER-440-compatible fuels,
\nin addition to existing VVER-1000 supply contracts. Framatome,
\nsupported by the APIS initiative, is also advancing plans in France
\nand Germany for a new VVER fuel fabrication facility, alongside
\nWestinghouse-linked projects in Spain and Ukraine. While most
\nEuropean VVER operators have taken steps to diversify procurement,
\nonly a limited share of fuel requirements is currently covered by
\nalternative suppliers. Westinghouse\u2019s V\u00e4ster\u00e5s 200-tHM plant has
\nthe capacity to supply about half of the demand outside China and
\nRussia. Although diversification efforts are progressing, fuel
\nqualification, licensing and reactor-specific certification requirements
\nremain binding constraints, with available fabrication capacity not
\nimmediately translating into usable supply. The pace of diversification
\nis therefore likely to vary across operators and reactor types.
\nGeographical distribution of VVER fuel demand and supply, 2025
\nIEA. CC BY 4.0.
\nSource: Westinghouse (2026), Press release; International Atomic Energy
\nAgency (2026), Nuclear Fuel Cycle Facilities Database.
\nFor VVER-1200 reactors, there are currently no alternative fuel
\noptions, with continued reliance on TVEL representing a particular
\nchallenge for countries such as Bangladesh, Hungary andT\u00fcrkiye.
\nAs a result, replacement capacity is expanding but is not yet sufficient
\nto provide meaningful alternatives in the near term. Near-term
\nsecurity of supply therefore continues to rely on a combination of
\nexisting inventories, legacy supply chains and ongoing efforts to
\nadvance diversification.
\n250 500 750 1 000 1 250 1 500
\nCapacity
\nDemand
\nSweden Czechia Ukraine
\nSlovak Republic Bulgaria Hungary
\nFinland India Armenia
\nRussia Belarus China
\nIran
\ntHM
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 229
\n2. Outlook for key minerals
\nShifting contracting dynamics and prospects for secondary supply
\nContracting dynamics
\nIn recent years, contracting dynamics have increasingly shifted in
\nfavour of producers, reinforcing sustained price tightness. During the
\ndecade following 2011, characterised by persistently low uranium
\nprices, contracts were predominantly structured as fixed-price or
\nbase-escalated agreements, often including volume flexibility at the
\ndiscretion of utilities. Demand-side utilities previously relied on lowpriced fixed or base-escalated contracts, leaving producers exposed
\nto prolonged market weakness.
\nSince 2020, however, a combination of reduced secondary supply and
\nrecovering demand has led to a marked tightening of market conditions.
\nContracts are now market-indexed, often incorporating higher floor
\nprices and, in some cases, more flexible or uncapped pricing structures,
\nwith producers seeking to benefit from rising market prices. Utilities have
\nlimited bargaining power under today\u2019s market conditions, and
\nproducers\u2019 willingness to lock in volumes several years ahead at prices
\nwell above current levels signals strong expectations of continued
\ntightness. Concurrently, these utilities are increasingly turning to longerterm contracting strategies and building inventories to hedge against
\nmarket and geopolitical uncertainty. The February 2026 long-term
\nagreement between Kazakhstan and India\u2019s Department of Atomic
\nEnergy, securing a significant share of future production volumes,
\nunderscores the shift towards secured state-backed demand.
\nThe evolving market structure is also reflected in the growing
\npresence of financial actors. Physical uranium investment vehicles,
\nsuch as exchange-traded funds, are accumulating uranium
\nconcentrate for storage purposes, effectively removing material from
\nthe market and contributing to tighter supply conditions.
\nThe evolving role of alternative and secondary supply
\nSecondary supply can partially offset primary uranium requirements,
\nsupplementing freshly mined material with existing inventories and
\nrecycled fuels. This includes (i) drawdowns of stockpiles, (ii) recycling,
\n(iii) enrichment underfeeding practices that reduce primary uranium
\ndemand by extracting more value from available material at the cost
\nof additional enrichment effort, (iv) re-enrichment of tails, and (v) the
\ndownblending of secondary materials. These supplies have
\nhistorically played a significant role, at times meeting more than onequarter of global uranium demand, but their contribution has declined
\nto around one-tenth in recent years. As inventories tighten and
\nunderfeeding opportunities diminish, the role of secondary supply is
\nexpected to decline further, increasing reliance on mining.
\nUsed fuel remains a stable but limited contributor to fuel supply in the
\nform of mixed oxide fuel, a blend of uranium and plutonium, the latter
\ngenerated during reactor operation. In France, recycled fuel accounts
\nfor around 10% of nuclear feed today, with a target for recycled
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 230
\n2. Outlook for key minerals
\nplutonium to contribute roughly 25% alongside enriched reprocessed
\nuranium, before rising towards 40%. Orano\u2019s Melox plant is ramping
\nback up and undergoing modernisation, while longer-term projects at
\nthe La Hague nuclear waste treatment plant aim to replace ageing
\nfacilities and increase recycling flexibility beyond 2040. Elsewhere,
\nprogress remains uneven. Despite advances such as Russia\u2019s
\nREMIX pilot completion in 2026, delays at key facilities such as
\nJapan\u2019s Rokkasho plant continue to constrain expansion. In parallel,
\ndiscussions on the potential revival of reprocessing in the
\nUnited States, including for future SMR applications relying on
\nspecific plutonium streams, illustrate renewed policy interest,
\nalthough concrete deployment pathways remain uncertain. As a
\nresult, near-term trends point to consolidation rather than a structural
\nincrease in the global role of recycled fuel.
\nLooking ahead, while current recycling activity remains centred on
\nmixed oxide fuel and reprocessed uranium, alternative reprocessing
\napproaches capable of recovering a broader range of actinides are
\nunder consideration for fast-spectrum reactors, such as sodium- and
\nlead-cooled designs. These could expand the role of recycled
\nmaterials over the longer term, although commercial deployment
\nremains uncertain. Future deployment of fast reactors and advanced
\nclosed fuel-cycle technologies could expand the role of recycled
\nmaterials beyond current commercial applications, potentially
\naffecting long-term uranium requirements.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 231
\n2. Outlook for key minerals
\nBox 2.2 Nuclear supply chains require more than uranium
\nEven though nuclear power plants consume relatively marginal
\nvolumes of non-uranium minerals compared with other energy
\ntechnologies, they nonetheless rely on a range of specialised
\nminerals, including zirconium, niobium and hafnium, whose supply
\nchains are often highly concentrated and offer limited alternatives.
\nFuel cladding tubes, which encase uranium fuel pellets inside
\nreactor cores, depend almost exclusively on nuclear-grade
\nzirconium alloyed with small additions of niobium, tin, chromium and
\nnickel. These materials are subject to single-country supply
\nreliance, creating supply chain risks. Australia and South Africa
\naccount for roughly 60% of global zircon mining, while China
\ncontrols about 38% of global zirconium refining. Niobium is even
\nmore concentrated, with three Brazilian mines providing around
\n90% of global output, one of which accounts for 80% on its own.
\nBrazil exports niobium primarily as an alloy that is not directly usable
\nin fuel cladding, but the transformation of niobium into nuclear-grade
\nmaterial is less concentrated and closer to demand centres.
\nReactor control rods rely on boron carbide, hafnium and silverindium-cadmium alloys, while gadolinium is used as a burnable
\npoison in nuclear fuel. These minerals face highly concentrated
\nsupply and co-production constraints, posing vulnerabilities in
\nnuclear-related mineral supply chains.
\nHafnium is obtained only as a co-product of zirconium refining, with
\nChina being the leading refiner, while France, India, Russia and the
\nUnited States also produce nuclear-grade zirconium. Indium, a byproduct of zinc refining, is similarly dominated by China, which
\naccounts for close to 70% of refined output. VVER fuel rods are also
\nreliant on refined rare earths supplied by China. In addition, the
\ndeployment of advanced reactor designs and next-generation fuel
\nsystems may increase the importance of other specialised inputs,
\nincluding nuclear-grade graphite, yttrium and beryllium, whose
\nsupply chains may also present structural concentrationrisks. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nShare of the top producer of refined nuclear-related minerals,
\n2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on USGS (2026), Mineral Commodity
\nSummaries; European Commission (2025), RMIS – Raw Materials\u2019 Profiles;
\nInstitute for International and Strategic Affairs (2022), Critical Minerals in the
\nNuclear Industry.
\n50% 100%
\nNiobium
\nTin
\nTantalum
\nChromium
\nZirconium
\nBrazil
\nChina
\nFrance
\nT\u00fcrkiye
\n50% 100%
\nIndium
\nHafnium
\nBoron
\nCadmium
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 232
\n3. Pathways to resilient and diversified supply chains
\n3. Pathways to resilient and
\ndiversified supply chains
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 233
\n3. Pathways to resilient and diversified supply chains
\nEmergency preparedness
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 234
\n3. Pathways to resilient and diversified supply chains
\nSignificant increases in critical mineral prices have a limited impact on the prices of final
\ndownstream products
\nShare of critical minerals in the final price of battery, rare earth and copper products
\nIEA. CC BY 4.0.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 235
\n3. Pathways to resilient and diversified supply chains
\nEffective emergency preparedness starts with understanding the economic impact of supply
\ndisruptions; rare earth export controls put USD6.5 trillion of downstream production at risk\u2026
\nEconomic value of downstream production at risk from full export controls of rare earths by region and sector, 2025
\nIEA. CC BY 4.0.
\nNotes: Economic value of downstream production at risk outside China. The full methodology is detailed in the next section.
\n1 2 3 4 5 6 7
\nRegion
\nUnited States Europe Japan and Korea Canada Australia Other
\nTrillion USD
\n1 2 3 4 5 6 7
\nSector
\nAutomotive Electronics Defence Aviation, trucks and trains Data centre servers Wind Other
\nTrillion USD
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 236
\n3. Pathways to resilient and diversified supply chains
\n\u2026 and over USD 300 billion of downstream production at risk from graphite export controls
\nEconomic value of downstream production at risk from full export controls of battery-grade graphite by region and sector, 2025
\nIEA. CC BY 4.0.
\nNotes: Economic value of downstream production at risk outside China. Electric vehicles production includes both battery electric vehicles and plug-in hybrid electric
\nvehicles. Battery storage includes all battery storage systems. Batteries include both batteries produced for electric vehicles and storage applications. The full
\nmethodology is detailed in the next section.
\n100 200 300 400
\nRegion
\nUnited States Europe Japan and Korea Other Asia Other
\nBillion USD
\n100 200 300 400
\nSector
\nElectric vehicles Battery storage Batteries
\nBillionUSD
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 237
\n3. Pathways to resilient and diversified supply chains
\nUnderstanding strategic risk exposure and the potential economic impact of disruption
\nIn recent years, there has been a surge in both announced and
\nimplemented critical mineral export controls. Understanding a
\ncountry\u2019s strategic vulnerabilities and economic exposure has never
\nbeen more important. Assessing the potential economic impact of
\nexisting, announced or possible future export controls, as well as
\nother supply disruptions, is a crucial first step in strengthening
\nemergency preparedness. Identifying the most vulnerable sectors
\nhelps countries develop effective response strategies and build the
\ncapacity to mitigate impacts quickly in the event of a disruption.
\nEconomic impact of disruption assessment methodology
\nEstimating the economic value of downstream production at risk from
\na major critical mineral supply disruption involves several steps.
\n\u2022 First, it requires an understanding of the import volumes of the
\ndisrupted material, together with as much information as possible
\non how it is consumed across sectors.
\n\u2022 Second, it is necessary to identify the products in each sector that
\ndepend on the disrupted material and lack immediate substitutes,
\nalong with their material intensities.
\n\u2022 Third, imported material volumes and product intensity data are
\ncombined to validate the estimated number of downstream
\nproducts reliant on the exposed material.
\n\u2022 Fourth, product price and independent product sales data are
\nused to calculate the economic value at risk by multiplying the
\nproduct prices by the number of material-dependent products sold.
\nSales data provide an additional layer of validation.
\n\u2022 Finally, the results can be aggregated by sector or region,
\ndepending on the focus of the analysis.
\nUsing this approach, we assess the economic impact of two major
\nexport controls announced by China \u2013 on rare earth elements and
\nbattery-grade graphite \u2013 under a scenario in which trade flows are
\nfully disrupted.
\nRare earth element export controls
\nFor magnet rare earths, the economic value of downstream
\nproduction at risk was estimated based on the export controls
\nannounced by China in October 2025 (suspended until November
\n2026), as if they were implemented in full. If implemented, companies
\nwould need to obtain a licence from China to export any domestic or
\ninternationally made \u201cparts, components and assemblies\u201d containing
\nChina-sourced rare earth materials or produced using Chinese
\ntechnologies. In a scenario in which the relevant licences are not
\ngranted, the production and trade of final end-use products
\ncontaining Chinese rare earth elements would be severely
\nconstrained. As a result, downstream manufacturers would face
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 238
\n3. Pathways to resilient and diversified supply chains
\neconomic losses stemming from their inability to produce, sell and
\nexport the affected products.
\nTo estimate the economic value of downstream production at risk
\noutside China from full export controls, the assessment first utilises
\ndata on rare earth magnet demand in end-use products across the
\neconomies, covering both neodymium-iron-boron (NdFeB) and
\nsamarium-cobalt magnets. These data are combined with data from
\nthe IEA database of rare earth intensities for downstream products in
\neach sector to determine the number of magnet-dependent products.
\nThese sales numbers are then combined with product price
\ninformation to calculate the exposed revenue if licences are not
\ngranted, thereby quantifying the economic value of downstream
\nproduction at risk from the loss of sales. Twenty-four specific product
\ncategories were analysed. Independent product sales data are also
\nused to validate the estimates derived from rare earth intensities. The
\nresulting economic value of downstream production at risk by product
\nis then aggregated by region and by sector.
\nEconomic impact results \u2013 rare earths
\nIf the rare earth export controls are implemented in full, the economic
\nvalue of downstream production at risk would reach USD 6.5 trillion
\nper year for countries outside China. For context, this economic
\nexposure amounts to around 7% of the combined annual gross
\ndomestic product of these countries. The United States and Europe
\nface the largest potential economic value at risk, with over
\nUSD 1.5 trillion in direct economic losses each. Japan and Korea
\ntogether face over USD 500 billion in potential economic losses,
\nunderlining the severity of the impact these controls could have on
\nmajor economies if fully implemented.
\nIn terms of sectoral exposure, the automotive sector accounts for the
\ngreatest economic value of downstream production at risk, with over
\nUSD3 trillion in direct losses for countries outside China, followed by
\nelectronics and other transport sectors (aviation, trucks and trains),
\nwith over USD1 trillion in losses each. These three sectors together
\nare responsible for almost 85% of the economic value of downstream
\nproduction at risk, demonstrating their economic importance and
\nvulnerability. The defence sector also faces losses of almost
\nUSD 600 billion, while losses in the data centre sector exceed
\nUSD 350 billion.
\nAcross all major economies, the automotive sector accounts for the
\nlargest economic losses, representing over 40% of losses in the
\nUnited States and over 50% in other economies. However,
\nvulnerabilities in other sectors vary considerably by region. In the
\nUnited States, data centre servers and defence applications are more
\nexposed, accounting for 15% of losses each, while Europe, Japan
\nand Korea have high exposure to electronics, at around 20% of
\nlosses. Data centres currently represent a smaller source of
\neconomic exposure for countries outside the United States, but their
\nsignificance could increase over time as new facilities are deployed
\nmore widely across other economies.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 239
\n3. Pathways to resilient and diversified supply chains
\nGraphite export controls
\nThe same analysis was conducted for battery-grade graphite, based
\non the battery supply chain export controls also announced by China
\nin October 2025, which were also suspended until November 2026.
\nThis analysis builds on previous battery-grade graphite export
\ncontrols from 2023. Previously limited to natural flake graphite and
\nsynthetic graphite with properties above a set threshold, the newly
\nannounced export controls extended controls to all graphite anode
\nmaterials, both natural and synthetic. Given the central role of
\ngraphite anode materials in global battery supply chains, if fully
\nimplemented, this control would severely affect battery production
\noutside China, with major constraints on the production of dependent
\nhigh-value electric vehicles (EVs) and storage systems.
\nTo estimate the economic value of downstream production at risk, the
\neconomic value of battery production outside China was first
\ncalculated by combining 2025 battery production data by country with
\nthe corresponding battery prices. To calculate the impact on EVs, the
\nnumber of battery electric vehicles (BEVs) and plug-in hybrid electric
\nvehicles (PHEVs) that could not be produced due to the inability to
\nproduce batteries outside China was calculated. Using our data on
\naverage battery sizes by country and powertrain, together withBEV
\nand PHEV sales shares by country, the number of affected vehicles
\nwas estimated. This was then multiplied by average vehicle sales
\nprices in each country to derive the associated economic value. The
\nsame was calculated for battery storage systems that could not be
\nproduced due to the inability to produce batteries outside China.
\nEconomic impact results \u2013 battery-grade graphite
\nIf the battery-grade graphite export controls are implemented in full
\nand trade flows are disrupted, the economic value of downstream
\nproduction at risk would be over USD 300 billion per year for
\ncountries outside China. This is over 20 times smaller than for rare
\nearths, demonstrating the criticality of rare earths for a multitude of
\nmajor economic sectors. Nevertheless, as demand for batteries,
\nstorage systems and EVs continues to expand rapidly, the economic
\nvalue at risk is set to rise considerably over time.
\nEurope faces the largest potential economic losses from the export
\ncontrols, accounting for over half of global losses, with more than
\nUSD 150 billion exposed. The United States faces the second-largest
\nexposure with over USD90 billion in potential losses, while Japan
\nand Korea together are exposed to over USD 50 billion in potential
\nlosses. The economic impacts of battery-grade graphite supply
\ndisruptions are almost entirely concentrated in these four major
\nmarkets, amounting to over 95% of economic exposure, compared
\nwith just 60% for rare earths. This demonstrates the concentration of
\nEV and battery production in these regions.
\nBy sector, over 85% of exposure comes from EV production with USD
\n275 billion at risk. BEVs comprise almost 70% of EV economic
\nexposure compared with PHEVs, given their significantly larger share
\nof sales, at 65-80% in all major markets outside China. Only USD 5
\nbillion is exposed for battery storage systems as the vast majority of
\nbattery storage deployment outside of China relies on LFP batteries
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 240
\n3. Pathways to resilient and diversified supply chains
\nproduced in China. However, almost USD 40 billion of battery
\nproduction is exposed outside of China due to the significant battery
\nproduction capacity in the United States, Europe, Japan and Korea.
\nOne important nuance regarding the economic impact of the graphite
\nrestrictions is that the graphite controls do not include the same
\nrestrictions on \u201cparts, components, and assemblies\u201d as the rare earth
\ncontrols. Therefore, affected automakers could potentially mitigate
\nthe loss of diversified battery supply by purchasing additional
\nbatteries from Chinese suppliers. However, this would further
\nincrease the concentration of global battery supply, increasing
\nexposure to future supply risks. One example is the broader battery
\nsupply chain export controls announced in 2025, which covered
\nmultiple battery supply chain chokepoints. These measures were
\nsuspended for one year in November 2025.
\nIndirect economic impacts
\nIn practice, the impacts of a disruption extend far beyond the loss of
\ndirect product sales. A wide range of high-value services depend on
\nsales of critical mineral-dependent products. For example, many
\nhigh-value services, such as artificial intelligence (AI), e-commerce,
\nfintech and cloud computing, rely on data centre servers, which
\ndepend on rare earths. If data centre servers cannot be sold for the
\ninstallation of new data centres due to rare earth export controls,
\nthere could be a major economic multiplier effect beyond the loss
\nfrom data centre sales. The same is true for the plethora of high-value
\noperations that depend on industrial motors containing rare earths,
\nsuch as automated and advanced manufacturing, robotics, and
\napplications in energy, mining, and oil and gas production. There is a
\ncascading economic effect from the inability to trade critical mineraldependent products. These economic losses could be several times
\nlarger than the direct economic losses estimated in this analysis.
\nStrategic impacts
\nSome sectors may have lower economic impacts in some regions but
\nstill pose major strategic vulnerabilities, such as defence or medical
\napplications that rely heavily on rare earths or batteries. Future
\neconomic and strategic value is also a key consideration, even where
\ncurrent exposure appears modest today. For example, data centre
\nservers, which are critical for AI development, underpin a sector
\nwidely regarded as one of the most strategically and economically
\nsignificant for the future. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 241
\n3. Pathways to resilient and diversified supply chains
\nCritical minerals comprise just 3% of the price of an average electric vehicle but almost 20% of
\nthe battery pack price
\nShare of critical minerals in the price of battery cells, battery packs, storage systems and EVs
\nIEA. CC BY 4.0.
\nNotes: Other materials include manganese sulphate. Lithium refers to lithium carbonate and lithium hydroxide, graphite to battery-grade graphite, nickel to nickel
\nsulphate and cobalt to cobalt sulphate. Prices utilised are the 2025 global average material prices. Storage systems refer to the global average price for two-hour
\nutility-scale storage. The EV price refers to the average of the European and United States BEV prices in 2025.
\nSources: IEA analysis based on BloombergNEF and Global EV Outlook 2026.
\n0%
\n25%
\n50%
\n75%
\n100%
\nBattery cells Battery packs Storage systems EVs
\nOther
\nOther materials
\nCopper
\nGraphite
\nCobalt
\nNickel
\nLithium
\n26%
\n18%
\n3% 2%
\nCritical minerals
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 242
\n3. Pathways to resilient and diversified supply chains
\nA tripling of critical mineral prices would increase batterypack prices by over 35%, but electric
\nvehicle and storage system prices would only increase by 5%
\nBattery pack, storage and EV price impact of tripling the prices of critical minerals
\nIEA. CC BY 4.0.
\nNotes: 3x refers to the product price impact from tripling the price of all critical minerals. Other materials include manganese sulphate. Lithium refers to lithium
\ncarbonate and lithium hydroxide, graphite to battery-grade graphite, nickel to nickel sulphate and cobalt to cobalt sulphate. Storage systems refer to the global
\naverage price for two-hour utility-scale storage. Prices used are the 2025 global weighted average material prices. The EV price refers to the average of the
\nEuropean and United States BEV prices in 2025.
\nSources: IEA analysis based on Bloomberg, BloombergNEF and Global EV Outlook 2026.
\n200
\n400
\n600
\n800
\n2025 3x
\nUSD\/kWh
\nStorage systems
\n50
\n100
\n150
\n200
\n2025 3x
\nUSD\/kWh
\nLithium Nickel Cobalt Graphite Copper Other materials Other
\nBattery packs
\n20 000
\n40 000
\n60 000
\n80 000
\n2025 3x
\nUSD
\nEVs
\n+4%
\n+36%
\n+5%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 243
\n3. Pathways to resilient and diversified supply chains
\nRare earth elements make up 40% of the value of permanent magnets but less than 1% of the
\nvalue of electric vehicles and conventional cars
\nShare of rare earth elements in the final price of magnets, motors, EVs, ICE cars and aircraft
\nIEA. CC BY 4.0.
\nNotes: EV = electric vehicle; ICE = internal combustion engine. Magnet refers to a rare earth element permanent magnet for a midsize BEV, motor refers to a
\n100 kW EV motor, EV refers to an average BEV, ICE refers to an average internal combustion engine vehicle. Utilises the 2025 average material and product prices.
\nSources: IEA analysis based on Bloomberg and Argus.
\n0%
\n25%
\n50%
\n75%
\n100%
\nMagnets Motors EVs ICE cars Wide-body aircraft
\nOther
\nTerbium
\nDysprosium
\nNeodymiumPraseodymium
\n40%
\nRare earth elements
\n5%
\n0.2% 0.05% <0.001%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 244
\n3. Pathways to resilient and diversified supply chains
\nA tripling of rare earth element prices would almost double the price of permanent magnets but
\nincrease the price of a car by just 0.1%
\nProduct price impact of a tripling of rare earth element prices
\nIEA. CC BY 4.0.
\nNotes: 3x refers to the final product price impact from tripling the price of rare earth elements. ICE = internal combustion engine. Magnets refer to rare earth element
\npermanent magnets for a midsize BEV, motors to 100 kW EV motors, EVs to average BEVs and ICE cars to average ICE cars. Prices are the 2025 average material
\nand product prices.
\nSources: IEA analysis based on Bloomberg and Argus.
\n500
\n1 000
\n1 500
\n2 000
\n2 500
\n3 000
\n2025 3x
\nUSD
\nMotors
\n50
\n100
\n150
\n200
\n250
\n300
\n2025 3x
\nUSD\/kg
\nNeodymium-praseodymium Dysprosium Terbium Other
\nMagnets
\n10 000
\n20 000
\n30 000
\n40 000
\n50 000
\n60 000
\n2025 3x
\nUSD
\nICE cars
\n+10% +80%
\n+0.1%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 245
\n3. Pathways to resilient and diversified supply chains
\nCopper comprises 10% of transformer prices and 15% of power cable prices
\nShare of copper in the price of transformers and cables, and price impact of a higher copper price
\nIEA. CC BY 4.0.
\nNotes: MVA = mega volt-ampere. Subsea cables refer to 400-575 kV cables. Transformers refer to 66-154 kV power transformers. The 2026 price uses the peak
\n2026 copper price in May 2026.
\n0%
\n25%
\n50%
\n75%
\n100%
\nTransformers Subsea cables
\nCopper Other
\n10%
\n15%
\n10
\n20
\n30
\n40
\nBase
\n(2023)
\nAt 2026
\nprice
\nThousand USD\/ MVA
\nTransformers
\n1
\n2
\n3
\n4
\nBase
\n(2023)
\nAt 2026
\nprice
\nMillion USD\/km
\nSubsea cables
\n+10%
\n+7%
\nPrice share
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 246
\n3. Pathways to resilient and diversified supply chains
\nUnderstanding the downstream product cost implications of critical mineral price increases
\nAn important element, often missing in critical mineral policy
\ndiscussions, is a quantitative assessment of the cost share of critical
\nminerals in downstream products and the impact of changes in critical
\nmineral prices on the prices of these products. The implications of
\nthis relationship can be significant. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nFirst, understanding price impacts is essential for emergency
\nresponse strategies. It helps identify where disruption risks are most
\nsevere, where downstream impacts could be critical and where
\ntemporary emergency support may be required to prevent broader
\neconomic spillovers.
\nSecond, it is crucial for the design of policy tools aimed at supply
\nchain diversification. Projects in geographically diverse regions
\ngenerally have higher cost structures than incumbent suppliers,
\nmeaning that the additional cost of diversification needs to be borne
\nby someone, whether governments, consumers or actors across the
\nvalue chain. Understanding the magnitude of the price impact can
\ntherefore inform the design of appropriate policy instruments and
\nburden-sharing mechanisms.
\nThe relationship between material prices and downstream costs
\nvaries significantly across materials. For some materials, the material
\ncost share in the downstream product is small. In such cases, higher
\nmaterial prices may have onlya limited impact on final product prices.
\nHowever, the reverse can also be true. If the material price share is
\nhigh, the downstream product price can be sensitive to changes in
\nmaterial prices, making it more difficult to absorb higher material
\ncosts. These dynamics are highly relevant for the design of policy
\ntools to support diversification. In this context, we evaluate the price
\nshare and cost implications of material price changes for three major
\ncritical mineral markets: batteries, rare earths and copper.
\nBattery materials
\nBatteries require a range of critical minerals to operate, including
\nlithium hydroxide and lithium carbonate, several metal sulphates
\n(nickel, cobalt and manganese), graphite and copper. In 2025, these
\nmaterials comprised a quarter of the price of battery cells and almost
\n20% of the price of battery packs. Lithium and graphite are the largest
\nmaterial cost components, each comprising over 4% of the pack price,
\nfollowed by nickel sulphate and copper, at over 3% each. Cobalt
\nsulphate comprises around 2%, while manganese sulphate accounts
\nfor just 0.1% of the pack price due to its significantly lower price than
\nother materials. Despite accounting for a relatively high share of the
\nprice of cells and packs, critical minerals comprise only a small share
\nof EV and storage system prices, accounting for just 3% of an
\naverage EV price. This is even lower for storage systems, where just
\n2% of the price is attributable to critical minerals, predominantly due
\nto the dominance of lithium iron phosphate chemistries for storage,
\nwhich require no nickel or cobalt.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 247
\n3. Pathways to resilient and diversified supply chains
\nBattery material prices have seen high volatility in recent years,
\nparticularly for lithium, cobalt and nickel. The lithium price increased
\nninefold from January 2021 to December 2022 alone. Tripling the
\nprice of all critical minerals in batteries would increase the price of
\nbattery packs by over a third, a major increase that would have
\nsignificant consequences for the competitiveness of batteries, with
\nlikely consequences for storage system and EV producers in terms
\nof downsizing and demand destruction. The competitiveness of
\nbattery manufacturers in geographically diverse regions can be
\nsignificantly affected by increases in material prices, particularly as
\nthey compete with established, low-cost incumbent producers.
\nHowever, a tripling of mineral prices would increase the final price of
\nEVs and storage systems by only around 5%, a notable but much
\nmore limited impact. For end users, EV consumers and grid
\ndevelopers, the price impacts may be manageable. However, original
\nequipment manufacturers (OEMs), storage system producers and
\nbattery purchasers would face a significant increase in input costs as
\nbattery pack prices rise. In the case of non-vertically integrated
\nproducers, the impact on final product prices could be higher due to
\nadditional margins along the value chain, or lower if upstream and
\nmidstream suppliers absorb part of the increase in material costs.
\nRare earth elements
\nThe case is more pronounced for rare earth elements. Rare earth
\nelements comprise 40% of the final price of neodymium-iron-boron
\n(NdFeB) permanent magnets. Dysprosium represents the largest
\nshare, at almost 20% of the magnet price, followed by neodymiumpraseodymium, at almost 15%. Terbium is used in very small
\namounts in many NdFeB permanent magnets to improve hightemperature performance and resistance to demagnetisation.
\nHowever, as the price of terbium is over ten times higher than that of
\nneodymium-praseodymium, it is responsible for around 10% of the
\nvalue of a permanent magnet. For an EV motor, rare earths comprise
\naround 5% of the total price, a significantly smaller share due to the
\nhigh value added of the motor and the small volumes of rare earth
\nelements used. Further downstream, rare earths account for an
\nalmost negligible fraction of the value of the products. Rare earths
\naccount for less than 1% of the value of an EV, less than 0.1% of the
\nvalue of an internal combustion engine (ICE) vehicle and less than
\n0.001% of a wide-body aircraft, despite being critical to all of these
\ndownstream products.
\nTripling the price of all magnet rare earths would almost double the
\nprice of permanent magnets, with significant impacts on prospective
\nmagnet manufacturers competing against incumbent producers. The
\nhigher magnet prices would also create challenges for motor
\nproducers, which typically operate with thin margins. Tripling rare
\nearth prices would increase motor prices by 10%. The impact on
\nmotor prices is significant and may incentivise carmakers and OEMs
\nto increase research into technologies that reduce rare earth intensity
\nin magnets and motors. However, it is unlikely to be cost prohibitive
\nfor automakers and would not stop OEMs from being able to
\npurchase rare earth-based motors. The impact on final consumer
\nprices would be minimal. Even a tripling of rare earth prices would
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 248
\n3. Pathways to resilient and diversified supply chains
\nincrease the price of an ICE vehicle by only around 0.1%, making the
\neffect largely imperceptible to consumers. Therefore, the impacts are
\nmore acute for magnet and motor producers, but the costs could be
\nmore easily absorbed downstream.
\nCopper
\nIn today\u2019s electricity system, two of the major products that are highly
\ndependent on copper are transformers and power cables. Prices for
\npower transformers have almost doubled since 2019, predominantly
\ndue to manufacturing bottlenecks and insufficient production capacity
\nto meet surging demand from grid development. Copper has also
\nseen exceptional price rises to record highs from the end of 2025
\nthrough 2026. Therefore, we assessed the share of copper in the
\nprice of transformers and subsea power cables based on 2023 data
\nto reflect typical circumstances. In 2023, copper comprised around
\n10% of the power transformer price and 15% of the subsea highvoltage power cable price, a significant but not dominant cost
\ncomponent. However, when considering these costs with 2026 peak
\nprices from May 2026, representing a 66% increase from the 2023
\naverage price, this increases the transformer price by 7% and the
\nsubsea cable price by 10%, representing significant cost increases
\nfor grid developers and providers. This price increase is significant
\nbut not prohibitive, suggesting some scope for transformer and cable
\nprices to absorb changes in copper prices. While sustained periods
\nof high copper prices could place upward pressure on grid investment
\ncosts, they are unlikely to fundamentally undermine the economic
\nviability of transmission and distribution projects.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 249
\n3. Pathways to resilient and diversified supply chains
\nA mineral security premium could be an insurance policy for strategic and economic security
\nSome important conclusions can be drawn by combining the analysis
\nof risk exposure with the downstream cost implications. Major
\nstrategic and economic losses are at stake from critical minerals
\nexport controls and disruptions, given the wide range of high-value
\nproducts and strategic sectors that depend on these materials. While
\nsupply diversification remains the only durable solution to these
\nstructural risks, projects in geographically diverse regions generally
\nhave higher cost profiles than incumbent producers. In many cases,
\noperating costs can be around 50% higher than in established supply
\nbases, which can materially affect investment decisions (refer to the
\nfollowing Policy and market frameworks section in Chapter 3).
\nThis creates a central policy challenge: diversified supply is needed
\nby both governments and consumers, but it is less clear who should
\nbear the additional cost or how this cost gap can be addressed.
\nRecent efforts have often focused on introducing a \u201csustainability
\npremium\u201d linked to environmental, social and governance
\nperformance. However, such premiums have not emerged at
\nmeaningful scale in practice.
\nIn the current context, characterised by rising geopolitical tensions,
\nthe additional cost of diversification may instead be viewed as aform
\nof economic insurance against major security risks. In this context, a
\n\u201cmineral security premium\u201d may be a more appropriate framing. Such
\na premium reflects the idea that societies already pay for risk
\nmanagement across multiple domains, including energy security,
\ninfrastructure resilience and financial risk. Given the rising frequency
\nof export controls and geopolitical disruptions, this form of insurance
\nis becoming increasingly relevant and is something consumers and
\npolicy makers may need to price in to enhance economic and
\nbusiness security.
\nIn the case of rare earths, fully implemented export controls could
\nresult in an estimated USD 6.5 trillion of downstream economic value
\nat risk per year for countries outside China, whereas a tripling in rare
\nearth prices would increase the price of a conventional car by just
\n0.1%. Against this backdrop, the estimated downstream price impact
\nof around 0.1% appears to be a relatively modest cost for enhanced
\neconomic security.
\nBecause downstream price impacts are generally modest in end-use
\napplications, a large share of the diversification cost can be absorbed
\nwithout significant effects on consumers. However, it is important to
\nnote that diversification may also entail additional costs beyond
\nhigher material prices, including supplier qualification, product testing
\nand certification processes, and other switching costs associated with
\nestablishing new supply relationships.
\nThe price impacts are more pronounced in specific intermediate
\nsegments, such as motor manufacturing and battery production,
\nwhere input cost sensitivity is higher. In these cases, targeted policy
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 250
\n3. Pathways to resilient and diversified supply chains
\nsupport may be required. More broadly, the appropriate financing of
\na security premium could be shared across governments, industry
\nand consumers, depending on where in the value chain the cost
\nburden can be most effectively absorbed.
\nA clearer understanding of the cost implications is therefore essential
\nto inform policy design. Governments need to consider how best to
\nstructure policy tools and burden-sharing mechanisms, and at which
\npoint in the value chain intervention would be most effective. In this
\ncontext, quantifying downstream impacts helps clarify how costs and
\nrisks are distributed across governments, industry and consumers.
\nUltimately, the issue is one of strategic risk management, and framing
\nit as such through a security premium may help unlock the investment
\nneeded to accelerate the development of diversified supply. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 251
\n3. Pathways to resilient and diversified supply chains
\nEmergency response measures protect against elevated risks of supply disruptions
\nDeveloping diversified sources of supply for critical minerals is a clear
\npriority to increase the long-term resilience of supply chains. However,
\nit inevitably takes time to develop new projects in both mining and
\nrefining. Emergency preparedness measures can provide short-term
\nprotective and mitigative actions to safeguard countries from supply
\nshocks while they develop new, diversified sources of supply.
\nAt the centre of emergency preparedness, response measures
\nprovide relief to disrupted supply chains, acting on the supply and\/or
\ndemand side. On the supply side, unlocking spare production
\ncapacity and commissioning new projects in an accelerated time
\nframe can help make up for lost supply in the event of a disruption.
\nFor countries with existing stockpiling systems, the release of
\nstockpiled material is also a key option, providing a temporary buffer.
\nOn the demand side, temporary allocation of available supply to
\nstrategic industries, incentives for efficiency and substitution, and
\nrationing could also help withstand supply shortages.
\nRedirecting available supply to priority industries could help reduce
\nthe economic impact of disruptions, but countries would need to
\nconduct a prioritisation exercise ahead of a crisis. Many countries
\nhave experience in conducting similar exercises for the oil sector,
\nproviding lessons that can be adapted to different industry structures.
\nBeyond the selection of possible response measures, emergency
\npreparedness includes close market monitoring to promptly identify
\ndisruptions and react in time, the development of protocols for the
\nrapid implementation of emergency response measures, and
\nexercises to stress-test systems and identify vulnerabilities and
\npotential responses.
\nTabletop exercises can simulate a realistic supply disruption and help
\ncountries develop co-ordinated response measures. These exercises
\noffer opportunities to improve common understanding of domestic
\nand global risk exposure, test emergency procedures, and
\nco-ordinate the management and exchange of available supply. The
\nprocess of simulating supply disruptions through exercises may also
\nhelp build domestic data-gathering capabilities and strengthen
\nemergency response capacity.
\nEmergency procedures
\nAn essential element of emergency preparedness is the ability to
\nidentify and quickly react to acute market disruptions. The
\nestablishment of emergency procedures is key to achieving this goal
\nand involves several steps:
\n1. Establishing market monitoring systems with access to
\ninformation such as supply, demand and trade of high-risk
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 252
\n3. Pathways to resilient and diversified supply chains
\nmaterials. This would enable the creation of early-warning
\nsystems to provide signals of potential supply shocks.
\n2. Setting up government-industry monitoring groups to exchange
\ninformation on market developments. This would include
\ndesignated contact points that centralise information and
\ncommunicate the implementation of security measures through
\nsecure channels.
\n3. Playing an active role in international platforms, such as the IEA
\nCritical Minerals Security Programme, that facilitate information
\nexchange and the co-ordination of response measures.
\nIn preparation for potential supply disruptions, governments can plan
\nmeasures that would increase readiness for emergencies:
\n1. Mapping industrial players supplying or using high-risk materials
\nand improving data quality and monitoring efforts.
\n2. Identifying critical sectors that would need to be prioritised in case
\nof supply shortages.
\n3. Preparing a set of measures that would be considered in case of
\nan emergency. These can act on the supply side, such as
\nstockpile releases, production ramp-up or quick commissioning of
\nnew projects, or on the demand side, such as the prioritisation of
\nspecific sectors and incentives for efficient material use.
\n4. Creating, through specific agreements, an international network
\nof partner countries that would be able to support, if possible, with
\nadditional supply or diplomatic engagement.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 253
\n3. Pathways to resilient and diversified supply chains
\nStockpiling governance models should leverage government financing and industry expertise
\nto ensure cost-efficient systems tailored to specific materials
\nCritical mineral stockpiling governance models
\nIEA. CC BY 4.0.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 254
\n3. Pathways to resilient and diversified supply chains
\nThe cost of stockpiling materials exposed to the highest risk is less than USD 900 million at the
\nglobal level
\nOperating cost of stockpiling materials for countries outside the largest supplier
\nIEA. CC BY 4.0.
\nNotes: CAM = cathode active material. The cost of stockpiling is equivalent to one year of imports from the largest supplier. Graphite includes artificial and spherical
\ngraphite; rare earths include magnet rare earth oxides and metals, neodymium-iron-boron powder and alloy, permanent magnetic sheets and permanent magnets;
\nlithium includes lithium hydroxide and lithium carbonate; cobalt refers to unwrought cobalt; titanium includes titanium powder, shapes, sponge, tubes and pipes, and
\nunwrought titanium; tungsten includes ammonium paratungsten, tungsten carbides, oxides and hydroxides, powders, trioxides, and wrought and unwrought
\ntungsten; molybdenum includes molybdenum powders and roasted molybdenum; antimony includes antimony hydrides, sulphide, wrought antimony and oxides;
\ngermanium includes wrought and unwrought germanium; and gallium includes wrought and unwrought gallium.
\n100
\n200
\n300
\nGraphite CAM Rare earths Lithium Cobalt Titanium Tungsten MolybdenumAntimony Germanium Gallium
\nMillion USD
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 255
\n3. Pathways to resilient and diversified supply chains
\nThe feasibility of stockpiling varies by material, but warehousing challenges can be overcome
\nthrough temperature control, packaging and stock rotation
\nAssessment of material properties and stockpiling warehousing requirements for selected strategic minerals
\nIEA. CC BY 4.0.
\nNotes: Magnet rare earth oxides and metals include neodymium, dysprosium, praseodymium and terbium. The scores assigned to material properties and
\nwarehousing requirements indicate how each material compares with the others, based on materials\u2019 safety data sheets and industry interviews. Hygroscopicity is
\nthe material\u2019s sensitivity to humidity, reactivity refers to its tendency to react with air, hazardousness indicates potential physical and health hazards, and fragility
\nreflects the risk of damaging the material when handling it. Temperature refers to the need for delicate temperature control in the warehouse, packaging indicates the
\nneed for advanced packaging, such as storage in inert gas, transport reflects the need for special caution when transporting the material, and stock rotation refers to
\nthe frequency at which stocks need to be replaced because of their short shelf lives.
\nAntimony trioxide
\nCathode active material
\nChromium (ferrochromium)
\nCobalt sulphate
\nCobalt (unwrought)
\nCopper cathode
\nGallium metal
\nGermanium metal
\nGraphite (coated spherical)
\nIndium ingot
\nLithium hydroxide
\nManganese sulphate
\nMolybdic oxide
\nNickel sulphate
\nNiobium pentoxide
\nMagnet rare earth oxides
\nMagnet rare earth metals
\nRare earth magnets
\nSilicon metal
\nTantalum metal
\nElemental tellurium ingots
\nTitanium ingots
\nTungsten ingots\/rods
\nVanadium pentoxide
\nZirconium ingots
\nLithium carbonate
\nMaterial properties Warehousing requirements
\nHygroscopicity Reactivity Hazardousness Fragility Temperature Packaging Transport Stock rotation
\nBlack mass
\nAnode material
\nHigh
\nMedium
\nLow
\nHigh
\nMedium
\nLow
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 256
\n3. Pathways to resilient and diversified supply chains
\nStrategic stockpiling provides a supply buffer to gain time in case of sudden disruptions
\nStrategic stockpiles of critical minerals, held specifically for
\nemergency purposes with the involvement of the government, can
\nplay an important role in providing emergency supply in case of
\nsevere supply disruptions. Even when they are not used, they send
\na signal to markets that sudden supply shocks or export restrictions
\nneed not immediately cripple the system. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIn the oil market, strategic stocks have been proven effective over
\nmany decades as a tool to prevent and respond to supply disruptions.
\nSince the creation of the IEA, there have been six collective actions.
\nThe sixth and largest collective action was implemented on 11March
\n2026 in response to disruptions stemming from the conflict in the
\nMiddle East. Critical mineral markets operate in a very different
\ncontext from oil markets. However, stockpiles can still play an
\nimportant role in providing emergency supply and protecting
\nindustries and jobs. Some countries, such as Japan, Korea and the
\nUnited States, hold strategic stockpiles of critical minerals that have
\nprotected industries during past supply disruptions.
\nOne of the key steps in emergency preparedness is the identification
\nof possible vulnerabilities, typically through risk assessments. A
\nfundamental risk assessment involves classifying minerals according
\nto the risks associated with them. The IEA Critical Minerals
\nStockpiling Assessment Framework was developed to analyse the
\nrisks and challenges for each material across multiple dimensions:
\nsupply risk, availability of alternative supply routes, strategic
\nimportance and feasibility of stockpiling.
\nThe feasibility of stockpiling varies by material, as each mineral takes
\ndifferent forms along its supply chain. The form most suitable for
\nstockpiling is generally the imported form, which is most exposed to
\ndisruption risks and can be used directly domestically in case of a
\ndisruption, without the need for further processing abroad. A broad
\nassessment of the properties of strategic materials imported by IEA
\nMember countries highlights a number of warehousing challenges for
\ncertain minerals, such as hygroscopicity (sensitivity to humidity),
\nreactivity, hazardousness and fragility. For example, lithium
\nhydroxide is highly sensitive to humidity and degrades quickly in air,
\nreducing its shelf life to around six months, while lithium carbonate
\ncan be stored for much longer. Gallium has a melting point of around
\n30 \u00b0C. These warehousing challenges can be overcome, for example,
\nby controlling warehouse temperature and humidity, using advanced
\npackaging to minimise contact with air and moisture, and rotating
\nstocks of materials with short shelf lives. However, these additional
\nrequirements increase the cost and complexity of stockpiling.
\nStockpiling governance
\nStrategic stockpiling systems can follow a spectrum of governance
\nmodels that can be grouped into two broad categories based on
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 257
\n3. Pathways to resilient and diversified supply chains
\nwhere the minerals are physically stored: government-held models
\nand industry-held models, each with two main options. For
\ngovernment-held (centralised) stockpiling models, the government
\nowns and manages the stockpiles, either directly or through a public
\nagency acting on its behalf. Industry-held (decentralised) models
\nrequire companies to store strategic stocks in addition to their existing
\ncommercial inventories. A public-private partnership that owns and
\nmanages the stocks can also be established, combining the
\nadvantages of government-held stocks, such as lower financing costs,
\nand industry-held stocks, such as a close relationship with the private
\ncompanies that ultimately use the materials.
\nThe appropriate stockpiling governance model varies by material
\nand depends on the domestic context and supply chain structures.
\nIn the case of rare earths, for example, the storage of more
\nupstream materials such as rare earth oxides or metals, which could
\nbe used by multiple downstream magnet manufacturers, could
\nbenefit from stronger government involvement and centralised
\nstockpiling. When stockpiling materials that are closer to
\ndownstream products, such as rare earth permanent magnets,
\nindustry-held models may be better suited, as each company can
\nstore the specific materials it needs and rotate stocks more
\nefficiently. Stockpiled materials should be imported materials that
\nare capable of being rapidly deployed. For example, if there are no
\ndomestic magnet manufacturing facilities, it would be beneficial to
\ndirectly stockpile the permanent magnets required domestically.
\nStockpiling costs
\nThe total cost of stockpiling comprises both the initial purchase cost
\nand the operating cost. However, the investment to purchase the
\nmaterial is transformed into an asset that is later sold, either for stock
\nrotation or for a stock release. The real cost is therefore the operating
\ncost of stockpiling, which comprises the financing cost, warehousing
\ncost, logistics cost, material losses and discount. The discount cost
\nis associated with the need to refresh stocks by selling them at a
\ndiscount before they reach the end of their shelf life.
\nThe net annual cost of stockpiling the 11 high-risk materials identified
\nby the IEA Critical Minerals Stockpiling Assessment Framework
\namounts to less than USD900 million. The purchase cost, which is
\nconverted into the stockpile\u2019s asset value, is USD 9.2 billion. This
\namount, while significant, is quickly dwarfed by the potential direct
\neconomic impact of supply disruptions, which can be as high as
\nUSD 6.5 trillion in the case of rare earth disruptions and over
\nUSD 300 billion for graphite disruptions.
\nInternational co-ordination
\nWhile the objective of stockpiles is to strengthen the security of
\ndomestic supply, co-ordination with international partners can help
\nachieve greater security more efficiently and quickly. Alignment on
\nthe timing of stockpile purchases and the establishment of principles
\nfor releases can help ensure that markets are not distorted. When
\nprocuring stocks, countries could also agree to support strategic
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 258
\n3. Pathways to resilient and diversified supply chains
\nprojects that would increase global diversification or aggregate
\ndemand. When compatible with domestic policies, countries might
\nco-locate stocks for greater efficiency, particularly for low-volume
\nmaterials, or reserve production in countries with production
\ninfrastructure for emergency use. Close dialogue among partners
\nalso facilitates the transfer of knowledge on efficient stockpile
\nmanagement.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 259
\n3. Pathways to resilient and diversified supply chains
\nPolicy and market frameworks to
\ndiversify supply chains
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 260
\n3. Pathways to resilient and diversified supply chains
\nMeeting demand through diversified supply sources requires major new capacities across
\nmineral value chains
\nDemand and production from existing and announced projects outside the top producer, 2035
\nIEA. CC BY 4.0.
\nNotes: REE = rare earth elements. Recycling has the potential to reduce the remaining gaps. Rare earths are for magnet rare earths only (neodymium,
\npraseodymium, terbium and dysprosium).
\n25
\n50
\n75
\n2035 Mining Refining Magnets
\nExisting production Base case High-production case Remaining gap
\nMagnet uses Non-magnet uses Battery uses Non-battery uses
\nktREE equivalent
\nSupply:
\nDemand:
\n2
\n4
\n6
\n2035 Mining Batterygrade
\nMt
\nRare earths Graphite
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 261
\n3. Pathways to resilient and diversified supply chains
\nIn the case of rare earthsand graphite, closing the supply gaps requires just under
\nUSD 90 billionin investmentoutside the dominant supplier
\nInvestmentrequirementsto 2035 to meetprojecteddemand outside the top producer
\nIEA. CC BY 4.0.
\nNotes: Investment requirements are estimated by multiplying the gap between projected supply and primary supply requirements by capital intensity. Capital
\nintensities are estimated using reported capital expenditure and production capacity.
\nSources: IEA analysis based on data from company reporting, Wood Mackenzie and S&P Capital IQ.
\n20
\n40
\n60
\n80
\nExpansion of
\nexisting
\nPlanned new
\nprojects
\nRemaining
\ngap
\nTotal
\nBillion USD
\nMining Refining Magnet
\n10
\n20
\n30
\nExpansion of
\nexisting
\nPlanned new
\nprojects
\nRemaining
\ngap
\nTotal
\nBillion USD
\nMining Refining
\nRare earths Graphite
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 262
\n3. Pathways to resilient and diversified supply chains
\nAn essential first step towards long-term supply chain security and diversification is
\nunderstanding the required scale of supply additions and investment
\nDeveloping diversified critical mineral supply chains requires a clear
\nunderstanding of current and future needs. Without this, it is difficult
\nto assess the need for capacity expansion, estimate investment
\nrequirements and co-ordinate policy targets effectively. While
\ndemand is relatively well understood in large markets, such as copper
\nand battery metals, many smaller strategic minerals, including rare
\nearths and graphite, have more limited data visibility on future
\nrequirements. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nAn \u201cN-1\u201d assessment of demand and supply can provide a useful way
\nofassessing the required capacity additions. For example, in both
\nrare earths and graphite, the largest global supplier is also the largest
\nconsumer. It is therefore valuable to examine demand and production
\ncapacity excluding this supplier (and consumer). Outside this market,
\nexisting supply remains insufficient to meet demand, leaving
\ncountries dependent on large-scale imports. This dependence
\nexposes strategic downstream industries to supply risks, as
\nhighlighted by recent export controls.
\nFor rare earths, current supply outside the dominant supplier
\naccounts for approximately 50% of mining, 30% of refining and 15%
\nof magnet demand. Although capacity expansions and new supply
\nare expected to emerge in geographically diverse regions over the
\nnext decade, they remain insufficient to meet growing demand. By
\n2035, a gap of over 40% for mining, 50% for refining and just over
\n80% for magnet manufacturing persists.
\nA similar dynamic is observed in graphite. Despite emerging demand
\noutside the dominant supplier, current diversified supply meets only
\nabout 50% of mined and battery-grade graphite demand. Announced
\nprojects will expand capacity but are not sufficient to close the gap by
\n2035.
\nClosing these gaps requires just over USD 60 billion in rare earth
\ninvestment and almost USD 30 billion in graphite investment over the
\nnext decade, including financing for announced projects and for the
\nadditional capacity needed to close the remaining supply gap.
\nRefining requires the largest amount of investment across rare earths
\nand graphite. For rare earths, magnet manufacturing also requires
\nsubstantial investment of USD 21 billion.
\nDespite the strategic importance of diversification, persistent cost and
\nfinancing challenges have impeded investment in diversified supply
\nchains. The most fundamental constraint is the structural cost
\ndifferential between projects in incumbent regions and those in
\ngeographically diverse jurisdictions.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 263
\n3. Pathways to resilient and diversified supply chains
\nCapital costs for critical mineral refining projects range from 20% to over 150% higher in the
\nrest of the world compared to the dominant supplier, driven by facilities and equipment costs
\nCapital cost differentials between the top producer and the rest of the world
\nIEA. CC BY 4.0.
\nNotes: Plant costs refer to the cost of process facilities and the associated equipment directly involved in transforming ore, concentrate, intermediates or chemicals
\ninto the final product. Other capital costs refer to contingency, indirect costs and other expenses. The dominant supplier is Indonesia for nickel and China for all other
\nmaterials. The aggregate capital cost figures are for refining.
\nSources: IEA analysis based on data from company reporting, S&P Capital IQ and Wood Mackenzie.
\n50%
\n100%
\n150%
\n200%
\nBattery-grade
\ngraphite
\nCopper Nickel Cobalt
\n50%
\n100%
\n150%
\n200%
\nBattery-grade graphite
\nOther capital costs
\nInfrastructure
\nConstruction
\nLand acquisition
\nCoating
\nShaping
\nPurification
\nCost mark-up over the dominant supplier
\nAggregate Decomposed
\nPlantcosts
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 264
\n3. Pathways to resilient and diversified supply chains
\nOperating costs are 50% higher in the rest of the world compared to the dominant supplier,
\nlargely driven by feedstock, energy and process input costs
\nOperating cost differentials between the top producer and the rest of the world
\nIEA. CC BY 4.0.
\nNotes: Process inputs refer to reagents, reactants and consumables. Other costs include general and administrative, tailings, and royalty costs.
\nSources: IEA analysis based on data from company reporting; S&P Capital IQ; Wood Mackenzie; and Bhuwalka, K. et al. (2026), Securing the Supply of Graphite for
\nBatteries.
\n– 75%
\n– 25%
\n25%
\n75%
\n125%
\n175%
\nCobalt sulphate Nickel sulphate Natural graphite Synthetic graphite Lithium hydroxide
\nOther
\nProcess inputs
\nLabour
\nEnergy
\nFeedstock
\nBy-product credit
\nNet Cost mark-up over the dominant supplier
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 265
\n3. Pathways to resilient and diversified supply chains
\nCosts of capital for critical mineral projects tend to be higher than those for other energy
\nsectors due to higher market volatility and a low leverage ratio
\nCost of capital and average investment attractiveness in selected industries and minerals
\nIEA. CC BY 4.0.
\nNotes: The cost of capital for each sector is calculated as the average for relevant companies operating in the United States and Europe, with the full list of
\ncompanies included in each industry available from Damodaran (2026). Investment indexes are calculated by weighting investment attractiveness indexes from the
\nAnnual Survey of Mining Companies by country-proven reserves, as in Vespignani and Smyth (2024).
\nSources: IEA analysis based on data from Damodaran (2026), Cost of Capital by Industry Sector; and Vespignani and Smyth (2024), Artificial Intelligence
\nInvestments Reduce Risks to Critical Mineral Supply.
\n0%
\n2%
\n4%
\n6%
\n8%
\n10%
\n2015 2017 2019 2021 2023 2025
\nPower Renewable energy
\nMetals and mining US interest rate
\nCost of capital
\n0
\n16
\n32
\n48
\n64
\n80
\nRare earths
\nPlatinum
\nGraphite
\nTungsten
\nBarite
\nManganese
\nAntimony
\nCobalt
\nLithium
\nBauxite
\nCopper
\nZinc
\nNickel
\nCoal
\nIron ore
\nGold
\nAverage investment attractiveness index
\nKeyenergy minerals
\nOthers
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 266
\n3. Pathways to resilient and diversified supply chains
\nHigher costs and market conditions are constraining investment in diversification
\nMultiple factors have hampered investment in diversification, but one
\nof the most persistent barriers is economic. Across critical mineral
\nvalue chains, projects in geographically diverse regions face
\nstructurally higher costs than incumbent producers, both in terms of
\nupfront investment and ongoing operational costs. These
\ndisadvantages are compounded by volatile prices, demand
\nuncertainty in smaller markets and weak downstream ecosystems,
\nall of which undermine project bankability and make diversification
\ndifficult to achieve through market forces alone. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA analysis indicates that capital costs for refining projects in the
\nrest of the world are significantly higher than in today\u2019s leading
\nproducing countries, ranging from 20% to over 150%. Decomposing
\nthe factors driving this difference for battery-grade graphite, the
\nlargest are the over 100% higher plant costs, reflecting the benefits
\nthat incumbent producers derive from larger industrial bases, more
\nstandardised plant designs and better access to technology.
\nConstruction costs are also over 20% more expensive, due in part to
\nthe lack of supporting infrastructure and specialised engineering
\ncapabilities, and contingency and indirect capital costs, which are 50%
\nhigher.
\nOperating costs are also significantly higher outside the leading
\nproducer, averaging around 50% above incumbent levels, with the
\nmain drivers varying significantly depending on the mineral and
\nprocessing route. Feedstock costs are a major component across all
\nminerals and an important source of cost differentials in several
\ncases. For graphite and lithium hydroxide, greater reliance on
\nimported intermediates and less-integrated processing ecosystems
\noutside the dominant supplier, China, contribute to higher feedstock
\ncosts. By contrast, feedstock costs for cobalt sulphate and nickel
\nsulphate are lower on average outside China, reflecting the ability of
\nother major producing regions to secure domestic feedstock. Higher
\nprocess input costs, including reagents and consumables, also play
\nan important role in driving the cost differential, particularly for lithium
\nrefining, which relies on sulphuric acid, soda ash and other
\npurification reagents. Economies of scale, plant utilisation rates and
\nprocess efficiencies in incumbent processing hubs can further
\nreinforce these advantages.
\nThe differences are particularly important in refining, where margins
\nare often thin and competitiveness depends heavily on access to lowcost inputs, scale and process optimisation. The result is that even
\nwhere projects can secure financing and reach production, sustaining
\noperations may remain challenging in the face of low-cost incumbent
\nsupply.
\nBeyond individual cost components, incumbent producers often
\nbenefit from integrated industrial clusters in which by-products and
\nwaste streams from one industry serve as inputs for another, lowering
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 267
\n3. Pathways to resilient and diversified supply chains
\noverall operating costs and improving system efficiency. These
\necosystems benefits can also include shared infrastructure, such as
\nwater treatment facilities, logistics networks and waste management
\nsystems, which reduce costs for individual operations.
\nMarket structure further worsens these cost disadvantages. In many
\nmineral markets, limited price transparency makes it difficult to form
\nreliable revenue expectations or design effective support
\nmechanisms. At the same time, demand uncertainty remains high,
\nespecially for smaller strategic minerals where future consumption
\ndepends on the pace of downstream industrial development,
\ntechnology choices and policy commitments. Relatively small
\nphysical market sizes can also mean that a limited number of new
\nprojects can lead to excess supply, raising downside price risks and
\nweakening project bankability. In highly concentrated markets, prices
\nare often set by the lowest-cost producers, limiting the ability of
\nhigher-cost diversified projects to recover their full costs.
\nTaken together, these factors contribute to an elevated risk profile for
\ncritical mineral projects. Opaque pricing and uncertain offtake
\nweaken confidence in future cash flows and make it more difficult to
\nsecure long-term contracts or debt financing. Additional uncertainties
\naround resource and product quality, offtaker creditworthiness,
\ninterdependencies across the supply chain and project development
\nrisks, such as cost overruns, further erode investor confidence.
\nAs a result, access to debt financing is often constrained, leading to
\nlower leverage ratios and greater reliance on equity. This raises the
\noverall cost of capital for critical mineral supply chain investments,
\nresulting in much higher financing costs than in traditional energy
\nsectors. Over the past ten years, metals and mining companies
\nheadquartered in Europe and the United States have paid an almost
\n50% premium on raising capital relative to companies operating in
\npower generation. Challenges in raising debt financing also force
\ncompanies to rely on a much higher share of expensive equity
\nfinancing, pushing up their costs of capital.
\nBuilding diversified critical mineral supply chains will require the
\ncultivation of an ecosystem that addresses the key structural barriers
\npreventing competitive supply from coming and staying online. This
\nwill require a co-ordinated package of policies that addresses market
\nand financing challenges, including investment risk, market structure,
\nlack of technology and operational know-how, and co-ordination gaps,
\nwhile balancing incentives for both supply-side and demand-side
\ndevelopment. No single instrument will be sufficient on its own; rather,
\nmeasures need to reinforce each other to shift supply chains in a
\nmeaningful way.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 268
\n3. Pathways to resilient and diversified supply chains
\nA combination of targeted supply- and demand-side measures is required to de-risk projects
\nand crowd in private capital in order to build diversified critical mineral supply chains
\nSupply- and demand-side policy tools to support diversification
\nIEA. CC BY 4.0.
\nNotes: CAPEX = capital expenditure; OPEX = operating expenditure.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 269
\n3. Pathways to resilient and diversified supply chains
\nTargeted capital expenditure and operating expenditure support can de-risk projects and crowd
\nin private capital
\nSupport measures on the supply side can improve project viability by
\neasing upfront financing needs or operational risks. These measures
\nbroadly fall into three groups: capital expenditure (CAPEX) measures,
\nsuch as equity, grants, concession loans and loan guarantees;
\noperating expenditure (OPEX) support, which can reduce operating
\ncost drivers such as through facilitating access to competitively priced
\nfeedstock or energy cost reductions; and risk-mitigation measures
\nthat reduce price and volume risks, such as contracts for difference
\nor volume-based tools such as offtake backstops. CAPEX and OPEX
\nsupport can help improve bankability, crowd in private capital and
\naccelerate final investment decisions, while risk mitigation measures
\ncan improve financing conditions by reducing price and volume risks.
\nCAPEX support
\nGovernments can support strategic projects through a variety of capital
\nsupport mechanisms, such as equity, concessional loans, guarantees
\nand grants, to ease upfront capital constraints and improve bankability.
\nEquity investments allow governments to take a direct stake, which
\nmay be particularly relevant for strategic projects. Public equity
\nparticipation can strengthen project balance sheets, reduce the
\namount of private capital needed at the outset and signal strong
\ngovernment backing, which can help attract additional investors. This
\ncan be particularly valuable for high-risk, capital-intensive projects with
\nlong return horizons. However, such investments require clear and
\nrobust governance frameworks, including well-defined shareholder
\nrights and obligations, robust conflict-of-interest safeguards,
\nindemnification clauses, arbitration mechanisms and pre\u2011agreed
\ndispute resolution procedures to ensure transparency, avoid conflicts
\nof interest and allocate risk appropriately. Measures should clearly
\nspecify who absorbs any losses, how cost overruns or delays are
\nmanaged and the terms under which private co-investment is
\nstructured. Mechanisms should also be designed in a way that ensures
\nthe recouping of upside returns, which can help align incentives and
\nensure that support delivers long-term public value.
\nGovernments can also provide concessional loans, loan guarantees
\nor grants to reduce early-stage risks and unlock commercial lending,
\nparticularly in regions with weaker financial ecosystems.
\nConcessional loans featuring below-market interest rates, longer
\ntenors or grace periods can significantly improve project economics
\nand help de-risk capital-intensive phases. Loan guarantees can
\nunlock commercial lending by reducing lenders\u2019 credit exposure,
\nmaking them particularly useful in jurisdictions with less mature
\nfinancial markets or high political risks. Grants, while more fiscally
\ndemanding, can be used in targeted ways to support pre-commercial
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 270
\n3. Pathways to resilient and diversified supply chains
\nstages, such as feasibility studies, pilot plants and technology
\nqualification, or to lower the cost of installing strategic infrastructure
\nto enable multiple projects. These forms of support can be tailored to
\nproject needs and deployed in combination to maximise impact.
\nProject eligibility for capital support can be determined through a
\nstrategic assessment of priority segments, taking into account where
\nsupply gaps are most acute and where diversification benefits are
\ngreatest. Alternatively, support can be allocated via competitive
\nauctions to ensure transparent and efficient allocation. Governments
\ncan also prioritise projects in nascent industries, such as magnet
\nmanufacturing, or those adopting less mature technologies.
\nOPEX support
\nWhile CAPEX support measures can help bring forward new projects,
\nsustaining their operations may require complementary OPEX
\nmeasures that work more directly on operating cost drivers to
\nimprove project competitiveness. Key operating cost components
\ninclude feedstock, energy, reagents, labour, logistics and
\nenvironmental management.
\nTargeted measures can reduce the cost gaps faced by diversified
\nplayers by lowering input costs, improving access to infrastructure
\nand enabling operational efficiencies. These measures could include
\nfacilitating access to competitively priced feedstock through
\nintegration or offtake agreements; reducing energy costs via
\npreferential tariffs, long-term power contracts or access to low-cost
\nrenewable electricity; supporting the domestic supply of key reagents
\nand process inputs; and investing in shared infrastructure, such as
\ntransport, utilities and waste treatment.
\nRiskmitigation
\nBuilding diversified supply also requires reducing both price and
\nvolume risks, enabling projects to operate through periods of market
\nvolatility. This can be particularly useful for materials with small
\nmarket sizes, high levels of concentration and significant potential
\neconomic impacts in the event of disruptions, although their use must
\nbe carefully assessed against the potential fiscal costs.
\nRisk mitigation: Revenue stabilisation mechanisms
\n(price-based)
\nPrice-based mechanisms are designed to reduce revenue uncertainty
\nby ensuring that operators receive a guaranteed minimum revenue for
\ntheir output. These can be implemented through a two-sided contract
\nfor difference, or a price cap-and-floor mechanism, where there is an
\nagreed strike price and reference price. These mechanisms provide
\nsupport to an operator when market prices fall below the strike price
\nand require repayment to the government when prices exceed it,
\nthereby reducing revenue volatility while limiting fiscal exposure. The
\noperator then sells its products at regular market prices and settles the
\ndifference between the strike price and the reference price, improving
\nbankability and allowing sustained production in volatile markets, with
\nlimited distortion to downstream pricing as products continue to be sold
\nat market prices. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 271
\n3. Pathways to resilient and diversified supply chains
\nContracts for difference have been used widely in European
\nrenewable electricity markets, where they have helped finance 33%
\nto 50% of new offshore wind capacity since the late 2000s. More
\nrecently, they have started to be used in some mineral markets,
\nparticularly in small, nascent markets such as rare earths.
\nHowever, effective design is critical to ensure success, including
\nsetting the strike and reference prices (see box 3.1 for more
\ninformation) and determining the length and allocation of contracts.
\nContract allocation can be undertaken through bilateral negotiation
\nor competitive auctions. In auction-based approaches, governments
\nset a budget or capacity target and award contracts to the lowest bids,
\nwith successive rounds used to bring forward additional projects as
\nmarket conditions, price dynamics and project developments evolve.
\nContracts are typically time-bound, with durations in the power
\ngeneration sector often around 15 years.
\nIt is also crucial to ensure that markets remain competitive. To
\nincentivise cost reductions over time, eligibility for price-based
\nmechanisms could be linked to performance targets, or strike prices
\ncould be adjusted progressively, including through successive
\nallocation rounds, to encourage projects to narrow the cost gap with
\nincumbent producers while limiting fiscal costs.
\nRisk mitigation: Demand assurance mechanisms
\n(volume-based)
\nIn addition to price, predictable and bankable demand is critical for
\ninvestment decisions. Even when prices are favourable, uncertainty
\naround future offtake can prevent projects from reaching final
\ninvestment decisions or scaling to commercially viable levels. Volumebased mechanisms address this by providing demand certainty,
\nreducing revenue risk and improving bankability, typically by
\nguaranteeing a minimum level of sales rather than a minimum price.
\nIn practice, these can be operationalised through contractual clauses
\nsuch as offtake backstops, where a public entity guarantees minimum
\npurchases or payments if commercial demand falls short. This
\nprovides producers with an assured market while allowing
\ngovernments to support supply chain deployment and, in some cases,
\nbuild strategic reserves. Recent examples include government
\nagreements with MP Materials and Nouveau Monde Graphite.
\nThese tools have long been used in infrastructure, electricity and
\ncommodity markets. In some export projects for liquefied natural gas,
\nstate-backed utilities or buyers commit to long-term minimum volumes
\nthrough take-or-pay contracts, effectively underwriting project viability.
\nWhile often commercial rather than purely governmental, similar
\nstructures could be publicly backed in strategic sectors.
\nDesign considerations include determining guaranteed volumes,
\neligibility criteria, contract duration and risk-sharing arrangements,
\nwhile balancing improvements in investment attractiveness against
\nfiscal exposure and risks of oversupply. As with other instruments,
\nco-ordination across countries can strengthen demand signals,
\nexpand the pool of eligible projects and improve overall effectiveness.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 272
\n3. Pathways to resilient and diversified supply chains
\nBox 3.1 Price support measures require appropriate strike and reference prices
\nEffective design of strike and reference prices is crucial to ensure
\nthe success of price-based mechanisms. Strike prices must balance
\nproject viability with fiscal cost: if set too low, they fail to support
\ninvestment; if set too high, they create excessive public liabilities.
\nFor example, under the United Kingdom\u2019s contract for difference
\nsystem for renewable energy, no offshore wind developer bid for
\nsupport during Allocation Round 5 in 2023, as industry actors
\njudged that the strike price was too low and did not account for
\ninflation in input costs.
\nThe strike price can be determined in several ways. Cost-based
\nmethods can use production costs over a defined period of time,
\nadding a margin for profit or using a percentile of the global cost
\ncurve. Market-based approaches can also be used, such as
\nhistorical multi-year average prices or forward-looking price
\nforecasts, potentially adjusted for regional cost differences. These
\ncan be simpler, though they may be uncertain in markets with low
\nprice transparency and may fail to support high-cost entrants if
\npriced do not reflect current market conditions. Finally, a competitive
\nbid process or bilateral negotiation can allow operators to bid their
\nrequired price. Competitive bids can reveal true costs through
\ncompetition but require sufficiently large project pools. Bilateral
\ncontracts can allow for flexibility but risk less efficient outcomes.
\nThe reference market price determines whether the operator is
\nentitled to fiscal support or must repay the government. It can be set
\nin several ways. The actual realised sale price is the most accurate,
\nas it reflects the actual price received by the producer, but it requires
\nverification through reporting or auditing. Safeguards, such as
\ncross-checking sales prices against independent indices or
\nrequiring evidence of competitive marketing, are also necessary to
\nensure that there are still incentives to secure the highest possible
\ncontract prices.
\nAnother option is to use a published market price or index that would
\napply regardless of the individual negotiated price. This would
\ndepend heavily on market transparency and the credibility of
\navailable indexes, and would be more difficult in thin, opaque
\nmarkets where many transactions occur off-exchange and
\npublished prices may not reflect actual traded values. Reference
\nprices could also use a weighted average of global prices over a
\ndefined period of time, anchoring them in broader market trends.
\nMany critical mineral markets face heterogeneity in product quality
\nand specifications, which can lead to significant variation in realised
\nprices. Price mechanisms should therefore be designed to account
\nfor grade, purity or performance differences to ensure appropriate
\nincentives and avoid mispricing.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 273
\n3. Pathways to resilient and diversified supply chains
\nPotential approaches to determining the appropriate strike and reference prices
\nApproach How it is calculated Key data requirements Considerations
\nStrike price
\nCost-based Operating cost per unit + return
\nIndividual project-level CAPEX,
\nOPEX, output and cost of capital
\nEnsures project viability, but causes
\ninformation asymmetry and depends on cost
\nassumptions
\nCost curve
\nbenchmark
\nCost of marginal (e.g. nonincumbent) producer
\nGlobal projects\u2019 CAPEX, OPEX,
\noutput and cost of capital
\nRequires robust cost data and may not
\nreflect project-specific risks
\nHistorical price Average past prices, with possible
\nadjustments
\nHistorical price series, ex-China
\npremiums
\nTransparent and simple, but may reflect
\nunrepresentative market conditions
\nForwardlooking price
\nExpected future market price Price forecasts Highly uncertain
\nAuction-based Lowest price bid by developers Bids from competing projects Requires sufficient competition and credible
\nbids
\nNegotiated Agreed price based on costs and
\nmarket benchmarks
\nProject costs, benchmarks Potentially inconsistent
\nReference market price
\nRealised sales
\nprice
\nActual price received by producer Contract prices, reporting\/audit data High accuracy, but limited transparency and
\nhigher administrative burden
\nPublished price
\nindex
\nExternal benchmark price at time
\nof sale
\nPrice reporting agency\/index data Transparent and simple; may not reflect
\nrealised contract prices
\nAverage price Average of market prices over a
\ndefined period
\nTime series of prices Reduces volatility, but introduces timing
\nmismatches with realised sales
\nAuction-based Proposed adjustment factor to
\nexternal benchmark price
\nPrice reporting agency\/index data and
\nbids from competing projects
\nRequires sufficient competition and credible
\nbids; may not reflect realised contract prices
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 274
\n3. Pathways to resilient and diversified supply chains
\nDemand-side policies can help shift sourcing decisions towards diversified supply
\nSupply-side tools can help bring diversified projects online, but in
\ncompetitive markets dominated by low-cost producers, downstream
\nusers often lack incentives to switch suppliers. Demand-side policies
\ncan address this by generating predictable demand for diversified
\nsupply, helping projects secure long-term offtake agreements and
\ninvestment. These tools are most effective when applied in contexts
\nwhere cost gaps are moderate and there is access to refining
\ntechnology or where such technology is being developed. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nDiversified sourcing obligations
\nDiversified sourcing obligations require or incentivise manufacturers
\nto source a share of inputs from non-dominant suppliers, shifting
\ndemand towards diversified supply. They can be implemented
\nthrough regulations, such as minimum local content requirements
\nthat mandate a minimum share of inputs to be sourced domestically
\nor from diversified suppliers. They can also be combined with fiscal
\nincentives, such as tax credits or deductions conditional on a
\nminimum percentage of inputs being sourced locally or from
\ndiversified sources. In strategic sectors, such measures may also
\nextend to restrictions on sourcing from designated foreign entities of
\nconcern across supply chains.
\nObligations can be applied to specific downstream products, such as
\nEVs or data centres, or to various segments of the supply chain.
\nTo remain effective and manageable, obligations should be phased
\nin over time in line with project pipelines, allowing downstream
\nmanufacturers to gradually adapt to the sourcing requirements. While
\nsuch measures may increase costs, impacts on downstream product
\nprices are typically small and could be mitigated through targeted
\nincentives that aim to offset any cost burdens, such as tax credits.
\nDemand aggregation and facilitated offtake
\nDemand aggregation and facilitated offtake can help create a
\nconsistent, sizeable and growing demand base. This is particularly
\nrelevant in value chains or segments where downstream supply
\nchains are more nascent, such as EVs, new energy technologies and
\nhigh-tech manufacturing. In the absence of growth in downstream
\ncapabilities in diversified regions, upstream and midstream projects
\nmay face weak or uncertain offtake, limiting investment and
\nincreasing exposure to price volatility. Policy measures that nurture
\nstrategic downstream industries in energy, automotive and high tech,
\nand aggregate their demand, can underpin long-term contracts and
\nsupport financing decisions. Countries with established
\nmanufacturing bases can also strengthen partnerships with regions
\nthat have significant end-use demand, reinforcing market confidence,
\nenabling economies of scale and supporting the long-term
\ncompetitiveness of emerging supply chains.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 275
\n3. Pathways to resilient and diversified supply chains
\nTrade-based measures
\nTrade-based mechanisms could shift demand by altering price
\ncompetitiveness at the border, for example through tariffs, price
\nbands or origin-based charges. By narrowing the price gap between
\nlow-cost incumbent supply and higher-cost diversified supply, these
\nmeasures can help redirect demand towards diversified supply.
\nTheir effectiveness depends on careful calibration of design elements.
\nFor measures such as price bands, if prices are set too low, they will
\nfail to shift demand, whereas if they are too high, they can raise costs
\nand fiscal risks. For measures such as tariffs, designing an effective
\napproach would require detailed cost analysis across the value chain
\nto determine appropriate tariff rates and assess where tariffs would
\nbe most applicable. Design must also account for downstream
\nimpacts, as higher input costs can affect the competitiveness of
\ndownstream manufacturing, potentially requiring mitigation measures
\nsuch as revenue recycling.
\nSelected policy instruments and disbursements, 2025-2026
\nType of
\ninstrument
\nCountry Amount Description
\nDirect
\nequity
\ninvestment
\nUnited
\nKingdom
\nGBP 26.8
\nmillion
\nNational Wealth Fund\u2019s direct
\nequity investment in Cornish
\nLithium to support domestic tin
\nextraction.
\nConcessional loan
\nAustralia AUD 1.65
\nbillion
\nConcessional loan to Iluka
\nResources for the Eneabba rare
\nearth refinery.
\nLoan
\nguarantee
\nUnited
\nStates
\nUp to
\nUSD 250
\nbillion
\nLoan guarantee authority
\nextended to the Department of
\nEnergy\u2019s Energy Dominance
\nFinancing Office through FY2028.
\nGrant Canada CAD 1.5
\nbillion
\nNon\u2011repayable, repayable and
\ngrant funding for critical minerals
\nprojects, including mining,
\nprocessing, transport and energy
\ninfrastructure, plus mine\u2011site
\ndevelopment and Indigenous
\nengagement.
\nOfftake\/
\nprice floor
\nJapan Undetermined
\nAgreement to purchase annual
\ntonnage of neodymiumpraseodymium until 2038 with an
\nagreed market-linked floor price.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 276
\n3. Pathways to resilient and diversified supply chains
\nDifferent policy support options have varying impacts on the levelised cost of production\u2026
\nImpact of different policy support measures on the levelised cost of an average rare earth refining project
\nIEA. CC BY 4.0.
\nNotes: The levelised cost of production and the impact of cost reductions are estimated using a cash\u2011flow model for an average diversified rare earth refining project.
\nPolicy support levels are set to have a fiscal cost of USD 100 million over the life of the project for CAPEX support, OPEX support and revenue stabilisation, while
\nthe tax incentive is a 5% reduction in the tax rate (USD 15 million gross fiscal cost).
\n-12%
\n-12%
\n-4%
\n-3%
\n25
\n50
\n75
\n100
\nBaseline cost CAPEX support OPEX support Revenue
\nstablisation
\nTax incentive After policy
\nLevelised cost of production
\n(baseline cost = 100)
\n-68%
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 277
\n3. Pathways to resilient and diversified supply chains
\n\u2026and different impacts on project economics and fiscal costs
\nImpact of different policy support measures on the internal rate of return versus gross annual fiscal cost
\nfor an average rare earth refining project
\nIEA. CC BY 4.0.
\nNotes: pp = percentage points. The change in the internal rate of return and the impact on gross fiscal costs are estimated using a cash\u2011flow model for an average
\ndiversified rare earth refining project. All results depend on assumptions used for the project and policy measures. For this analysis, the life of the processing facility
\nis assumed to be 25 years. The price floor is set at USD 112 000\/tonne of neodymium-praseodymium oxide; take or pay is set at 10% of annual volume; corporate
\ntax rate is reduced from 25% to 15%; the refundable tax credit is 10% of operating costs; and the forgivable loan and upfront cash grant are set at 15% of initial
\nupfront capital expenditure.
\n1
\n2
\n3
\n2 4 6 8 10 12 14 16 18 20
\nChange in internal rate of return (pp)
\nGross annual fiscal cost (million USD)
\nFloor price
\nTake or pay
\nCorporate tax reduction
\nRefundable tax credit
\nForgiveable loan
\nUpfront cash grant
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 278
\n3. Pathways to resilient and diversified supply chains
\nPolicy support design matters for both fiscal impact and policy effectiveness
\nCap-and-floor mechanism and fiscal cost to support half of refining demand outside the dominant supplier, 2026-2035
\nIEA. CC BY 4.0.
\nNote: NdPr = neodymium (Nd) and praseodymium. Fiscal cost refers to the cost of supporting ex-China projects to meet half of the remaining ex-China demand over
\nthe period to 2035, based on historical price movements over the last 10 years.
\nNet fiscal cost under different floor levels
\n(10-year annual average)
\n20 000
\n60 000
\n100 000
\n140 000
\n180 000
\nNdPr price (USD\/tonne)
\nNdPr price Floor Cap
\nIndicative price cap-and-floor
\n– 400
\n– 300
\n– 200
\n– 100
\nCap: USD 110 000\/t
\nFloor: USD 85 000\/t
\nCap: USD 110 000\/t
\nFloor: USD 65 000\/t
\nMillion USD
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 279
\n3. Pathways to resilient and diversified supply chains
\nEffective policy design requires aligning instruments with specific market contexts, including
\nmarket structure, scale and value chain characteristics
\nDifferent policy instruments affect project economics through distinct
\nchannels, and their impacts depend on the structure of each mineral
\nmarket and value chain segment. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIn small, opaque and volatile mineral markets (e.g. rare earths and
\ngallium), supply chains are highly concentrated, with dominant pricesetting producers and limited price transparency. Cost gaps between
\nincumbent and diversified producers tend to be pronounced,
\nreflecting factors such as scale, co-product economics,
\nenvironmental compliance costs and technology lock-in. Price signals
\nare often weak, limiting the ability of markets to incentivise new entry.
\nWe evaluated the impact of different policy tools on the levelised cost
\nof production and returns for a representative rare earth refining
\nproject outside the incumbent producer, using financial cash flow
\nmodelling. The results suggest that, for the same level of gross fiscal
\ncosts to governments, direct cost-reduction measures, particularly
\nCAPEX and OPEX support, are among the most efficient instruments
\nfor lowering the levelised cost of production. By reducing either
\nupfront investment requirements or ongoing operating costs, these
\nmeasures directly improve the cost competitiveness of new refining
\nprojects, narrowing the competitiveness gap with incumbent
\nproducers.
\nBy contrast, in large, liquid markets (e.g. copper and nickel),
\ninvestment in diversified production is typically constrained by
\nstructural factors such as cost competitiveness, permitting,
\ninfrastructure availability and discoveries of new resources. In these
\ncases, ongoing operating cost support is often less effective and can
\nbecome fiscally prohibitive if applied at scale, given large volumes.
\nUpfront capital support, such as concessional loans and loan
\nguarantees, is generally better suited to addressing investment risk.
\nMeasures to accelerate permitting and support the build-out of
\nenabling infrastructure (e.g. rail and power) can further support
\ninvestment.
\nBattery metals markets (e.g. cobalt, lithium and graphite) are not as
\nlarge and liquid as base metal markets but are more advanced than
\nminor mineral markets. These markets are characterised by rapid
\ndemand growth, medium levels of concentration and strong linkages
\nto downstream industries such as batteries and EVs. Competition is
\ndriven by a combination of energy and reagent costs, financing costs
\nand integration with downstream offtake. Cost gaps for diversified
\nproducers may be relatively smaller than for strategic minor minerals,
\nbut bankability remains a constraint given project risks and price
\nvolatility. In this context, a blended approach may be better suited,
\ncombining upfront CAPEX support, such as grants or concessional
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 280
\n3. Pathways to resilient and diversified supply chains
\nfinance, with targeted price or volume support, which can help de-risk
\ninvestments, particularly in the early stages, allowing support to
\ndecline over time as technologies mature and cost gaps narrow.
\nAcross the value chain, mining is typically capital-intensive and
\nexposed to geological and development risk, making upfront capital
\nsupport particularly relevant. Refining projects are more sensitive to
\ncosts and margins; in this case, operating cost tools may support
\ncompetitiveness.
\nDemand-side measures can be applied across all markets, as they
\ncan provide volume guarantees or preferential market access that
\nenable structural shifts in demand towards diversified supply. They
\nmay be particularly useful in large mineral markets, where capital
\nsupport may be fiscally burdensome if applied at scale.
\nPublic support must be carefully calibrated to reduce risk, crowd in
\nprivate investment and enable bankability while ensuring that it does
\nnot sustain structurally uncompetitive production or create long\u2011term
\nfiscal liabilities. Policy makers need to assess capital and operating
\ncosts, cost gaps with incumbent producers and market-specific
\nchallenges, balancing policy effectiveness and fiscal cost, as different
\ninstruments have varying impacts on both the internal rate of return
\nand public expenditure. For example, for an average rare earth
\nrefining project outside the incumbent producer, price cap-and-floor
\nmechanisms produce a 2.4 percentage point change in the internal
\nrate of return but an average annual gross fiscal cost of almost
\nUSD 18 million when applied during the first 15 years of repayment.
\nFor strategic minerals and materials markets, the scale of support
\nacross the sector may not be overly fiscally burdensome given
\nrelatively small market sizes. We evaluated the fiscal cost of
\nsupporting rare earth refining projects located outside today\u2019s
\nincumbent producer through a cap\u2011and\u2011floor contract for difference
\nmechanism. Historical rare earth prices over the past decade were
\nused to estimate support requirements, evaluating the impact of two
\ndifferent floor prices of USD 85 000 and USD 65 000 per tonne of
\ntotal rare earth oxides, and a cap of USD 110 000 per tonne. The
\ndifference between market prices and this corridor defines the annual
\nprice gap that governments would either bridge or recover.
\nProjected supply outside China, including existing operations,
\nexpansions and planned projects, is compared with ex-China
\ndemand to estimate the volume of capacity requiring support. The
\nanalysis assumes that the mechanism covers the production needed
\nto meet half of this demand by 2035. Multiplying this supported
\nvolume by the estimated price gap yields the fiscal cost.
\nUnder these assumptions, the gross fiscal cost of such a
\ncap\u2011and\u2011floor mechanism is estimated at around USD 3.7 billion
\nthrough to 2035, equivalent to approximately USD 370 million per
\nyear under a floor price of USD 85 000 per tonne. Actual costs would
\ndepend on future price trajectories and the specific design of the
\nsupport mechanism.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 281
\n3. Pathways to resilient and diversified supply chains
\nCross-cutting enabling measures are required for a whole-of-ecosystem approach
\nWider pool of accessible financing sources
\nHigh capital intensity, long lead times and specialised processing
\ntechnology can limit critical minerals projects\u2019 ability to access
\ntraditional export credit agency and development finance institution
\nfinancing. To address this, countries could create dedicated funding
\nwindows within existing institutions with terms tailored to critical
\nmineral projects, including longer repayment periods, lower collateral
\nrequirements and co-financing for processing infrastructure.
\nCo-ordinated approaches across countries could further scale
\nfinancing by pooling balance sheet capacity and applying a shared
\nrulebook for eligibility, risk mitigation and due diligence. This could
\nreduce duplication and ensure that financing is targeted at projects
\nwith the highest strategic value globally.
\nRegulatory permitting reforms
\nPermitting complexity and fragmentation remain key barriers to
\nproject development. Greater co-ordination across countries, through
\ncommon principles, harmonised standards and shared best practices,
\ncan improve predictability for investors operating across multiple
\ncountries and help avoid fragmented regulatory approaches that slow
\nproject development. Joint efforts with partner governments,
\nincluding model legislation, technical guidance and capacity-building,
\ncould also help address these bottlenecks.
\nPrice transparency and market development
\nLimited price transparency in many critical mineral markets
\nconstrains investment by reducing confidence in future revenues.
\nEnhancing price discovery, particularly outside the dominant supplier,
\nis therefore critical for stimulating diversified supply. Measures could
\ninclude strengthening price reporting systems, leveraging alternative
\ndata and increasing transparency on long-term contracts. In some
\ncases, state-backed exchanges or disclosure requirements can help
\nestablish more credible benchmarks. These approaches are already
\nbeing utilised in some mineral markets, such as uranium.
\nCross-border public-private partnerships
\nGiven the global nature of supply chains, cross-border public-private
\npartnerships can help develop integrated value chains linking
\nupstream resources, processing capacity and end-use downstream
\nmanufacturing bases. Governments can facilitate this through
\nco-ordinated project pipelines, shared financing packages and
\nmulti-country support agreements for integrated projects. Regional
\nprocessing hubs, where processing or waste management
\ninfrastructure is jointly funded, can reduce duplication and lower
\nbarriers. Such partnerships would allow a bloc to leverage
\ncomplementary strengths and create end-to-end supply chains that
\ncan compete with incumbent producers.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 282
\n3. Pathways to resilient and diversified supply chains
\nBox 3.2 Standards-based markets and traceability
\nThe development of sustainable and responsible supply chains has
\na role to play in reducing concentration and enhancing
\ndiversification: not only can it unlock supply in diversified countries
\nwith high sustainability standards, but it can also mitigate the risk of
\nsupply chain disruptions associated with poor practices, such as
\nlabour strikes, government investigations and community backlash.
\nAny of the mechanisms outlined here could be adapted to
\nincorporate standards-based criteria. For standards-based markets
\nto emerge and function effectively, countries would need to
\nestablish clear and transparent criteria regarding what counts as
\n\u201cresponsible\u201d extraction, processing and trade. There are two broad
\ncategories of criteria that can be used: (1) performance-based
\nindicators, which rely on measurable outcomes (e.g. GHG
\nemissions intensity, water consumption and the rate of safety
\nincidents); and (2) process- or policy-based indicators, which
\nrequire the presence of specific corporate systems or policies (e.g.
\nanti-bribery policies and safety audit protocols).
\nExisting voluntary industry initiatives, such as the Initiative for
\nResponsible Mining Assurance or the Responsible Minerals
\nAssurance Process, can be leveraged to create standards-based
\nmarkets, for example by using certification under one of these
\ninitiatives as an indicator of good performance.
\nHowever, utilising these initiatives may also bring challenges.
\nExisting initiatives do not consistently require clear and comparable
\ndisclosure of environmental or social metrics, instead sometimes
\nfocusing on wider due diligence efforts. Most voluntary mining
\nstandards were developed for large, consolidated sectors and are
\nless applicable in smaller market contexts. Many of the smaller
\nsupply chains also involve highly specialised separation and refining
\nsteps for which robust, comparable indicators are still emerging.
\nThus, while existing voluntary standards can provide useful
\nguidance, significant adaptation and targeted criteria\u2011setting would
\nbe required for market access mechanisms to function credibly.
\nIn addition to establishing common criteria for what counts as
\nresponsible production, standards-based markets also require a
\nmethod to collect, report and verify data. When operators disclose
\nverified data on performance, regulators and buyers can confirm
\nthat purchased material meets the criteria. Traceability systems,
\nwhich can enable the collection and sharing of performance-related
\ndata, are thus a crucial bedrock for building standards-based
\nmarkets. However, they require careful design and implementation
\nto ensure interoperability, supported by international co-ordination
\nand common standards, such as those being developed by the
\nUnited Nations Transparency Protocol. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 283
\n3. Pathways to resilient and diversified supply chains
\nTechnology, equipment and
\nworkforce
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 284
\n3. Pathways to resilient and diversified supply chains
\nDiversified project development needs to be viewed through an ecosystem lens, paying special
\nattention to technology, equipment and workforce bottlenecks
\nIndicative summary of the impact of different ecosystem bottlenecks on diversified project timelines and costs
\nIEA. CC BY 4.0.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 285
\n3. Pathways to resilient and diversified supply chains
\nFor diversification efforts to succeed, existing gaps in technology, equipment and knowledge
\nneed to be addressed through innovation and policy support
\nThe concentration of critical mineral processing and refining capacity
\nhas emerged as one of the most significant vulnerabilities in global
\nsupply chains. While mineral resource endowments are often
\ngeographically diverse, the intermediate processing and refining
\nstages required to produce materials that conform to strict industry
\nspecifications for the manufacturing of batteries, magnets or
\nsemiconductors remain highly concentrated. This pattern is evident
\nacross minerals such as lithium, graphite, rare earth elements and
\ngallium, where a single country has established dominant positions
\nacross several steps of the value chain.
\nIn many cases, access to mineral feedstock is not the only hurdle to
\novercoming the high level of geographical concentration in
\nprocessing and refining. In each mineral supply chain,
\ncompetitiveness depends on a whole ecosystem comprising
\nspecialised technology, machinery, equipment, reagent availability,
\nprecise process control and optimisation, waste and environmental
\nimpact management, scientific and engineering expertise and
\nintegration with downstream manufacturing sectors. As a result,
\nmany of the barriers facing new entrants are complex and
\nmultifaceted. They arise from accumulated operating experience,
\nindustrial clustering and economies of scale.
\nIn many cases, there are very few suppliers of specialised machinery
\nand equipment outside China, making them more expensive and
\nincreasing the time required to acquire them. Even once the
\nequipment is procured, process optimisation, a prerequisite for
\nproducing materials with low defect density that pass certification for
\nhigh-tech industries, is often time-consuming. Given the presence of
\nwell-established chemical industries in many regions, reagents are
\noften much more widely available than machinery, but still tend to be
\nmore expensive outside the dominant supplier, and infrastructure for
\ntheir proper handling, storage and disposal adds to overall costs. In
\nthe current context, affected by events in the Middle East and the
\nsubsequent export control announcement from China, sulphuric acid,
\nwhich serves as a reagent for the pre-processing of several critical
\nminerals, including copper, lithium and rare earths, has emerged as
\nan important bottleneck (see Chapter 1).
\nThis section dives deeper into the essential ingredients for midstream
\nprocessing of critical minerals, including technology, equipment,
\nreagents and knowledge, using examples from rare earth elements,
\nbattery-grade lithium and graphite, and semiconductor-grade gallium.
\nIEA. CC BY 4.0.
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\nPAGE | 286
\n3. Pathways to resilient and diversified supply chains
\nThe value chain for rare earth elements remains among the most geographically concentrated,
\nand supply diversification calls for nurturing the entire ecosystem
\nEcosystem bottlenecks for creating diversified magnet rare earth supply chains
\nIEA. CC BY 4.0.
\nNote: REE = rare earth element.
\nSeparation Metallisation Alloy production Magnet production
\nEquilibrium data for
\nprocessing different
\nfeeds
\nEquipment\/machinery\/reagent bottleneck
\nMagnet sintering
\nempirical knowledge
\nPrecision cutting of
\nmagnet blocks
\nProducing single
\nelement oxides
\nfrom mixed REE
\ncompounds
\nRefining the
\noxides to produce
\nrare earth metals
\nProduce rare earth
\nmetal alloy
\npowders for
\nmagnet production
\nKnowledge bottleneck
\nProduce rare earth
\npermanent magnets
\npredominantly
\nthrough sintering
\nElectrolysis cells
\nwith high energy
\nefficiency
\nStrip casters
\nAlignment presser
\nGrain boundary
\ndiffusion equipment
\nRefining Magnet production
\nProcess
\nDescription
\nBottlenecks
\nLegend:
\nMining
\nHeap\/in-situ
\nleaching
\nProducing mixed
\nREE compounds
\nfrom ionic clay
\ndeposits
\nMethods that avoid
\nhighly contaminating
\nstrong acids
\nStainless steel cells
\nand tanks for nitric
\nacid routes
\nHigher reagent
\ncosts
\nIEA. CC BY 4.0.
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\nPAGE | 287
\n3. Pathways to resilient and diversified supply chains
\nProcesses for the separation of rare earth elements and magnet manufacturing face significant
\nbottlenecks in the form of technology, equipment and knowledge gaps
\nWhile there has been a marked increase in announced rare earth
\nmining projects across geographically diverse regions in recent years,
\nthe pipeline for separation and refining, alloy production and magnet
\nmanufacturing is much narrower and insufficient to meet projected
\nindustrial requirements outside China, making it a critical bottleneck
\nto the development of diversified supply chains. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nRare earth refining and magnet production rely on a multitude of
\ncomplex technical production processes, requiring specialised
\nequipment, machinery, skills and training to produce magnets that
\nconform to strict industry specifications. There are very few suppliers
\nof rare earth refining and magnet production equipment and
\nmachinery outside China, and the time required to obtain the
\nequipment can often span several years. There is an urgent need to
\nnurture this industry in parallel with project development. China\u2019s
\n2023 export controls, which covered a wide range of rare earth
\nprocessing equipment and technologies, highlighted the importance
\nof addressing this issue.
\nMining technologies and equipment are generally less of a bottleneck,
\nalthough certain gaps remain, for example in the extraction of heavy
\nrare earths from ionic adsorption clay(IAC) deposits without relying
\non the acid leaching methods commonly used in China and Myanmar.
\nHowever, significant technology gaps remain in the separation,
\nmetallisation and magnet production stages.
\nSeparation
\nThere is a significant gap in knowledge and equilibrium data for
\nsolvent extraction used for rare earth separation, which is a complex
\nprocess due to the similar chemical properties of many rare earth
\nelements found together. This concern is particularly relevant for
\nmixed feeds, such as monazite and bastnaesite. Another issue at the
\nseparation stage is that China predominantly uses chloride routes
\n(hydrochloric acid) that require polyvinyl chloride (PVC) tanks and
\ncells, whereas most suppliers outside China have favoured the nitric
\nroute (nitric acid), which requires stainless steel tanks and cells that
\nare more expensive to produce. The nitric acid route also requires
\nvery strong wastewater management systems and land-use planning
\nregulations, and there is limited experience in tackling this issue
\nsystematically outside China and Japan.
\nAside from machinery and equipment, reagents could also be a
\nbottleneck for diversified projects, as they account for 15-25% of
\nconversion costs depending on the route used (chloride or nitric), and
\nthe acids are usually sold at lower prices in China than in most other
\nregions.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 288
\n3. Pathways to resilient and diversified supply chains
\nAlloying, metallisation and magnet manufacturing
\nThe priority areas where there is a stark deficiency of competitive
\nequipment and machinery that meet industry specifications are alloy
\nproduction, metallisation and magnet production. Equipment for
\nthese supply chain steps outside China could be 5-12 times more
\nexpensive and often has two to three times longer lead times than
\nequipment from China. The increased costs and lead times are due
\nto the limited number of equipment manufacturers outside China,
\nwhich typically produce this equipment for other applications and
\nhave not optimised it for rare earth processing, which often requires
\nsome resizing and re-specification. Moreover, they have not yet
\nachieved economies of scale, have not secured long-term
\nestablished customers, and need time to customise and ramp up
\nproduction. In some cases, there is only a single supplier of
\nequipment and machinery outside China, meaning that a competitive
\nlandscape for efficient scaling does not exist.
\nFor metallisation, particularly for light rare earth metals, there is a
\nbottleneck in the design of energy-efficient equipment for the
\nelectrolysis step. Light rare earth metals typically use molten salt
\nelectrolysis, and to achieve competitive costs, the design of the
\nelectrolysis cells must be highly energy efficient. This is because
\nenergy is one of the largest cost factors in the metal conversion
\nprocess. The design of highly energy-efficient electrolysis equipment
\nremains closely held and is not widely available outside China. For
\nheavy rare earth metals, vacuum induction chambers are used for
\ncalcination\/reduction. This equipment is made by very few producers
\nnd needs to be highly customised to scale the metals to size.
\nTherefore, the design and development of energy-efficient
\nelectrolysis cells and vacuum chambers need to be a priority to
\nachieve viable, economically competitive metallisation to support
\ndiversified projects.
\nIn the production of alloys, a key process is strip casting to produce
\nrare earth alloys with additives such as iron, gallium or zirconium
\n(which make up less than 1% of the alloy by weight). Strip casters are
\nanother key piece of equipment with few suppliers available outside
\nChina. Jet milling equipment, used to produce alloy powder, has
\nsuppliers outside China but is more expensive.
\nHowever, some of the most critical equipment challenges are in
\nmagnet production. In the production of sintered magnets, the
\navailability and quality of alignment pressers is a source of concern.
\nThere are a few suppliers outside China, but their pressers can be
\naround ten times more expensive, and the technology and design are
\nnotably less advanced. Finally, the technology for grain boundary
\ndiffusion processes, used to apply heavy rare earth molecules as a
\ncoating to magnets, is subject to Chinese technology and equipment
\nexport controls. There is currently a single equipment supplier outside
\nChina, whose equipment is around 12 times more expensive and has
\na longer lead time. Grain boundary diffusion is also a highly patented
\nprocess, with many ongoing litigation disputes, providing another
\nbarrier to successful development for emerging producers.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 289
\n3. Pathways to resilient and diversified supply chains
\nBeyond equipment and machinery, there are several areas with skill
\nand knowledge bottlenecks. In the separation process, there is a
\nconsiderable lack of equilibrium data for processing various feeds.
\nThe same is true for sintering furnaces for magnet production, where
\nthere are major empirical and heuristic knowledge gaps in the
\nprotocols needed to produce sintered magnets with the required
\nspecifications. This also extends to the high-precision cutting of
\nmagnet blocks, where, while the equipment needed exists outside
\nChina, limitations exist in process knowledge to achieve results at
\nscale and speed. These are areas that require training, practice and
\ntime to hone techniques and build a skilled workforce.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 290
\n3. Pathways to resilient and diversified supply chains
\nProduction of refined battery-grade lithiumin geographically diverse regions hinges on honing
\nprocess optimisation and operational know-how
\nEcosystem bottlenecks for creating diversified battery-grade lithium supply chains
\nIEA. CC BY 4.0.
\nNote: Mg = magnesium; Ca = calcium; Na = sodium; K = potassium; Al = aluminium; B = boron.
\nHigher reagent costs
\n(lime, soda ash, sodium
\nhydroxide)
\nMaintaining battery-grade
\npurity levels
\nOperating data for
\nachieving high recovery
\nrates
\nDifferent processes for
\ndifferent feedstocks
\nRoasting and conversion Purification Crystallisation
\nConstruction of
\nstandardised designs;
\nfurnace optimisation and
\noperating data
\nEquipment\/machinery\/reagent bottleneck
\nProducing crystals with strictly controlled
\nparticle size distributions, morphology and
\nimpurity profiles
\nSulphuric acid roasting to
\nobtain lithium sulphate
\nsuitable for extraction
\nRemoval of impurities (Mg,
\nCa, Na, K, Al and B)
\nKnowledge bottleneck
\nConversion of purified lithium solutions into
\nbattery-grade lithium carbonate or lithium
\nhydroxide
\nRefining Battery-grade lithium precursor production
\nProcess
\nDescription
\nBottlenecks
\nLegend:
\nHeat integration and
\nthermal efficiency strongly
\ninfluence operating costs
\nAccess to and cost of
\nsulphuric acid
\nOperating data as product quality is highly
\nsensitive to operating conditions
\nCosts related to testing and pilot operations to
\nachieve battery-grade qualification
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 291
\n3. Pathways to resilient and diversified supply chains
\nReagent costs and process optimisation play a more defining role than machinery in achieving
\nimpurity control and crystallisation for battery-grade lithium production
\nIn the case of lithium, mining does not face significant technology and
\nequipment bottlenecks. For hard-rock projects, mining and
\nbeneficiation produce spodumene concentrate, typically through
\ncrushing, grinding, dense media separation and flotation circuits. The
\nrequired equipment, including crushers, grinding mills, flotation cells,
\nthickeners and filtration systems, is supplied by a broad range of
\ninternational companies, including Metso, FLSmidth and Weir Group.
\nAlthough permitting, infrastructure and project financing can delay
\nmine development, the technologies involved are mature and widely
\ndeployed. Unlike hard-rock operations, brine projects do not require
\nmining and mineral beneficiation. Instead, lithium-bearing brines are
\npumped from underground aquifers and concentrated through a
\ncombination of evaporation, chemical treatment and refining. Brines
\nvary significantly in lithium concentration and impurity composition,
\nparticularly in terms of the magnesium-to-lithium ratio. High
\nmagnesium concentrations can substantially increase reagent
\nconsumption and processing complexity. Process optimisation
\ntherefore requires extensive site-specific knowledge and long
\noperating histories. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nChemical conversion and battery-grade refining stages face the most
\nsignificant supply chain bottlenecks in the development of diversified
\nsupply chains.
\nRoasting and conversion
\nThe first stage of hard-rock lithium refining converts naturally
\noccurring alpha-spodumene into the more reactive beta-spodumene
\nphase before sulphuric acid roasting converts lithium into lithium
\nsulphate suitable for extraction. This stage determines downstream
\nrecovery rates and is one of the most energy-intensive steps in the
\nrefining process. The principal equipment includes rotary kilns,
\nfluidised-bed roasters, acid dosing systems, gas-cleaning systems
\nand heat-recovery units. Major suppliers include Metso, FLSmidth
\nand thyssenkrupp Uhde.
\nThe equipment itself is generally available internationally and is not
\nsubject to significant supply constraints. The bottleneck lies in the
\nability to operate these systems efficiently. Heat integration, thermal
\nefficiency and furnace optimisation have a major influence on
\noperating costs. Chinese engineering firms have commissioned
\ndozens of lithium conversion facilities and have accumulated
\nsubstantial operational knowledge that reduces energy consumption
\nand commissioning risks.
\nSulphuric acid is the principal reagent consumed during conversion.
\nChina benefits from one of the world\u2019s largest sulphuric acid
\nindustries, supported by extensive copper and zinc smelting sectors
\nIEA. CC BY 4.0.
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\nPAGE | 292
\n3. Pathways to resilient and diversified supply chains
\nthat generate the acid as a by-product. This provides refiners with
\nlower reagent costs and greater supply security.
\nEngineering, procurement and construction capability also
\nrepresents an important advantage. Chinese contractors have
\nrepeatedly delivered lithium conversion facilities and benefit from
\nstandardised designs, specialised subcontractor networks and
\nextensive operating data. This frequently results in lower capital costs
\nand shorter commissioning periods than for equivalent projects
\nelsewhere. The concentration of lithium refining reflects both scale
\nand accumulated expertise that give rise to competitive prices.
\nPurification
\nFollowing acid leaching, lithium-bearing solutions need to be purified
\nto remove impurities, including magnesium, calcium, sodium,
\npotassium, aluminium and boron. These contaminants can affect
\ncathode active material (CAM) production and battery performance if
\nnot reduced to extremely low concentrations.
\nPurification circuits employ reactors, precipitation vessels, thickeners,
\nfilters and solid-liquid separation systems supplied by companies
\nsuch as Andritz Group, Metso and FLSmidth. The principal reagents
\ninclude lime, sodium hydroxide and soda ash. China possesses one
\nof the world\u2019s largest chlor-alkali and soda ash industries, enabling
\nrefiners to access these inputs at lower cost and with shorter supply
\nchains than many competitors.
\nRecent research highlights the importance of impurity management
\nin battery-grade lithium production and notes that the largest cost
\ncomponent of lithium production comes from the impurity elimination
\nprocess to satisfy battery-grade purity requirements of over 99.5%.
\nHowever, refining specifications continue to evolve as battery
\ntechnologies advance.
\nOnce again, at this step, the primary bottleneck is process
\noptimisation rather than equipment availability. Different feedstocks
\nrequire different purification strategies, and achieving high recovery
\nrates while maintaining battery-grade specifications requires
\nexperienced metallurgists and extensive operating data.
\nCrystallisation
\nCrystallisation converts purified lithium solutions into battery-grade
\nlithium carbonate or lithium hydroxide. The purpose of crystallisation
\nis not simply to recover lithium but to produce crystals with strictly
\ncontrolled particle size distributions, morphology and impurity profiles.
\nThese characteristics influence cathode production, filtration
\nbehaviour and downstream battery performance.
\nThe process uses evaporators, crystallisers, centrifuges and drying
\nsystems supplied by firms such as GEA Group, Veolia Water
\nTechnologies and Andritz.
\nResearch on lithium carbonate crystallisation demonstrates that
\nproduct quality is highly sensitive to operating conditions, and the lack
\nof operating data makes optimising these conditions a significant
\nIEA. CC BY 4.0.
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\nPAGE | 293
\n3. Pathways to resilient and diversified supply chains
\ntechnical challenge. As with the previous steps, the bottleneck is
\noperational know-how. Several lithium projects outside China have
\nexperienced commissioning delays because battery-grade
\nspecifications proved more difficult to achieve than expected. Product
\nqualification by cathode manufacturers can further extend the
\ntimeline to commercial production. Qualification can take months or
\neven several years, particularly for automotive battery supply chains.
\nOverall, the principal bottlenecks in lithium processing are
\nconcentrated in purification and crystallisation. Unlike rare earth
\nelements, equipment availability is generally not the major constraint,
\nand most key processing equipment can be sourced internationally.
\nThe more significant challenges relate to reagent costs, process
\noptimisation, impurity control and battery-grade product consistency.
\nEfforts to diversify lithium refining capacity should focus on
\ndeveloping refining expertise alongside physical infrastructure. Pilot
\nplants, demonstration facilities and workforce development
\nprogrammes can accelerate the accumulation of operational
\nknowledge. Closer integration with chemical producers may reduce
\nreagent costs, while partnerships with cathode and battery
\nmanufacturers can support and accelerate product qualification. Over
\ntime, operational experience is likely to be as important as capital
\ninvestment in determining competitiveness for battery-grade lithium
\nproduction in geographically diverse regions.
\nIEA. CC BY 4.0.
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\nPAGE | 294
\n3. Pathways to resilient and diversified supply chains
\nBattery-grade graphite production is one of the most energy-intensive steps in battery supply
\nchains, and diversified producers face high energy and environmental barriers
\nEcosystem bottlenecks for creating diversified battery-grade graphite supply chains
\nIEA. CC BY 4.0.
\nNote: HF = hydrofluoric acid.
\nJet mills, impact mills, air
\nclassifiers and specialised
\nspheronisation systems
\nYield optimisation
\ncontrolled by proprietary
\nknowledge
\nPurification
\nMicronisation and
\nspheronisation
\nGraphitisation
\nMethods that avoid highly
\ncontaminating acids
\nEquipment\/machinery\/reagent bottleneck
\nNovel graphitisation
\ntechniques to reduce
\nenergy intensity
\nRemoval of silica and
\nother impurities using
\nhydrofluoric acid
\nConversion of graphite
\nflakes into spherical
\nparticles
\nKnowledge bottleneck
\nImproving conductivity
\nand crystalline
\nstructure by heating
\nspheronised graphite
\nto 3000 \u2070C
\nRefining Battery-grade graphite production
\nProcess
\nDescription
\nBottlenecks
\nLegend:
\nFluoropolymer-lined
\nreactors, corrosionresistant pumps and
\nwaste-treatment
\ninfrastructure
\nHandling and
\nprocurement costs for HF
\nFurnaces with high
\nenergy efficiency and
\nutilisation rate
\nCarbon coating
\nCoating with carbon to
\nimprove battery
\nperformance, cycle life
\nand coulombic efficiency
\nSpecialised thermal
\ntreatment systems,
\ncarbon precursor
\nmaterials
\nOperating data to
\nachieve uniform coating
\nthickness and surface
\nproperties
\nCosts related to testing
\nand pilot operations to
\nachieve battery-grade
\nqualification
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 295
\n3. Pathways to resilient and diversified supply chains
\nExtremely high energy intensity, limited equipment suppliers and relatively high reagent costs
\nare key challenges faced by battery-grade graphiteproducers in geographically diverse regions
\nNatural graphite mining and beneficiation remain concentrated in
\nChina, although not to the same extent as midstream refining and
\ndownstream anode production. The strongest concentration,
\nhowever, is seen in spherical graphite and anode material production.
\nMining is followed by crushing, grinding and flotation to produce
\ngraphite concentrate. The required equipment, including crushers,
\ngrinding mills, flotation cells, thickeners and filtration systems, is
\nsupplied by some international companies, including Metso,
\nFLSmidth, Eriez and Weir Group. The mining and beneficiation
\ntechnologies themselves are mature. However, concentrate quality
\ncan significantly influence downstream purification costs and anode
\nperformance, meaning that access to high-quality flake graphite
\ndeposits remains commercially important. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nSynthetic graphite production represents an additional and
\nstrategically important component of the graphite supply chain.
\nSynthetic graphite is most commonly produced through the
\ncalcination and graphitisation of petroleum coke or needle coke at
\ntemperatures approaching 3 000\u00baC. The process relies on
\ncalcination systems, high-temperature graphitisation furnaces and
\ncarbon-processing equipment supplied by very few non-Chinese
\nfirms, such as Mersen and ECM Technologies. Synthetic graphite
\nproduction is highly energy-intensive and depends on access to
\npetroleum coke, needle coke and competitively priced electricity.
\nChina has developed substantial advantages in synthetic graphite
\nproduction due to its large furnace capacity, integrated hydrocarbon
\nproduction industry and lower processing costs. Synthetic graphite is
\nbecoming increasingly important in EV batteries, particularly for highperformance anodes.
\nChina\u2019s strong presence in purification, spheronisation, graphitisation
\nand synthetic graphite production reinforces its advantage in graphite
\nmining.
\nPurification
\nBattery-grade graphite generally requires purity levels exceeding
\n99.95% carbon. The dominant industrial route uses hydrofluoric acid
\nto remove silica and other mineral impurities.
\nThe process relies on fluoropolymer-lined reactors, corrosionresistant pumps, filtration systems and waste-treatment infrastructure.
\nThe limited number of diversified suppliers includes De Dietrich
\nProcess Systems and Pfaudler. The principal reagent is hydrofluoric
\nacid, which requires infrastructure for safe handling, transport and
\ndisposal, as it is extremely corrosive. China benefits from one of the
\nworld\u2019s largest fluorochemical industries, providing cost advantages
\nIEA. CC BY 4.0.
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\nPAGE | 296
\n3. Pathways to resilient and diversified supply chains
\nand extensive waste-treatment infrastructure. Environmental impact
\nand waste treatment can be major challenges for new entrants.
\nAlternative thermal purification routes could reduce dependence on
\nhydrofluoric acid but require significantly higher energy consumption
\nin an already energy-intensive value chain, creating a
\ncompetitiveness challenge.
\nMicronisation and spheronisation
\nNatural graphite flakes must be converted into spherical particles
\nbefore they can be used in lithium-ion battery anodes. This process
\nuses jet mills, impact mills, air classifiers and specialised
\nspheronisation systems supplied by a few specialised equipment
\nproducers, including NETZSCH Grinding & Dispersing and B\u00fchler
\nGroup, increasing the time required to acquire the equipment in
\ngeographically diverse regions.
\nIn addition to the equipment bottleneck, there is also a knowledge
\ngap in yield optimisation. During particle shaping, a substantial
\nproportion of feed material can be lost. Small improvements in yield
\ncan significantly improve project economics, but much of the
\nindustrial knowledge remains proprietary, creating barriers for new
\nentrants.
\nGraphitisation
\nGraphitisation improves conductivity and crystalline structure by
\nheating the spheronised graphite to temperatures approaching
\n3 000\u00baC. This step is identical to the one needed for the production
\nof synthetic graphite.
\nThe bottlenecks are related to limited equipment suppliers but, more
\nimportantly, the very high energy intensity of the process.
\nGraphitisation is among the most electricity-intensive stages in the
\nentire battery supply chain and is therefore highly sensitive to
\nelectricity prices, furnace efficiencies and utilisation rates. Chinese
\nproducers benefit from extensive installed furnace capacity, lower
\nelectricity costs and a mature ecosystem of furnace suppliers and
\nmaintenance providers.
\nNovel graphitisation technologies, such as induction furnaces and
\nbio-graphite production, were described in last year\u2019s Global Critical
\nMinerals Outlook, but most of these alternatives require significant
\ninvestment and research to reach maturity.
\nCarbon coating
\nFollowing graphitisation, graphite particles are coated with carbon to
\nimprove battery performance, cycle life and coulombic efficiency.
\nThis stage uses specialised thermal treatment systems and carbon
\nprecursor materials, including petroleum pitch and coal-tar pitch.
\nChina benefits from large domestic supplies of these precursor
\nmaterials and from integration with broader carbon materials
\nindustries.
\nThe bottlenecks for diversified players here are both precursor
\navailability and process control, including maintaining consistent
\nIEA. CC BY 4.0.
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\nPAGE | 297
\n3. Pathways to resilient and diversified supply chains
\nprecursor quality. Variations in coating thickness and surface
\nproperties can significantly affect battery performance.
\nFinally, qualification by battery manufacturers is often one of the
\nlongest stages of market entry for graphite products. New suppliers
\nmust demonstrate consistent performance through extensive testing
\nprogrammes before materials can be incorporated into commercial
\nbatteries. This process can take several years and requires stable
\nproduction quality throughout.
\nChinese producers benefit from proximity to battery manufacturers,
\nestablished commercial relationships and continuous quality
\nfeedback from downstream users. Furthermore, China\u2019s export
\nlicensing requirements for certain graphite products and processing
\ntechnologies, introduced in 2023, further highlight the strategic
\nimportance of graphite processing capabilities within battery supply
\nchains.
\nOverall, principal bottlenecks in graphite processing are hydrofluoric
\nacid management, yield optimisation during spheronisation,
\ngraphitisation economics, carbon coating consistency and customer
\nqualification. Equipment is available internationally but from only a
\nhandful of suppliers, and process performance depends heavily on
\naccumulated expertise and industrial integration.
\nDiversification efforts should focus on building complete anode
\nmaterial ecosystems rather than standalone processing facilities.
\nAlternative purification technologies may help reduce environmental
\nconstraints, while access to competitively priced electricity will be
\nessential for project feasibility. Closer collaboration with battery
\nmanufacturers can accelerate the qualification process, and
\ninvestment in building stronger workforces skilled in materials
\nengineering can improve competitiveness over the longer term. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 298
\n3. Pathways to resilient and diversified supply chains
\nSemiconductor-grade gallium production is almost entirely concentrated in one country, and
\ndiversified producers must address significant gaps in technology and operational know-how
\nEcosystem bottlenecks for creating diversified semiconductor-grade gallium supply chains
\nIEA. CC BY 4.0.
\nNotes: LEC = liquid-encapsulated Czochralski; VGF = vertical gradient freeze; MOCVD = metal-organic chemical vapour deposition. 6N to 8N indicate purity levels
\nfrom 99.9999% to 99.999999%.
\nUltra-high-purity refining Gallium arsenide crystal growth
\nOperating data and expertise
\nEquipment\/machinery\/reagent bottleneck
\nExtremely precise thermal
\nmanagement, pressure control
\nand impurity control to minimise
\ncrystal defects, dislocations and
\ncompositional variations
\nRemoval of impurities to achieve
\npurity levels ranging from 6N to 8N
\nKnowledge bottleneck
\nCrystal growth using LEC and VGF
\nfurnaces
\nRefining Semiconductor-grade material production
\nProcess
\nDescription
\nBottlenecks
\nLegend:
\nVacuum distillation systems, zonerefining systems and ultra-cleanhandling equipment
\nAdvanced analytical laboratories,
\nspecialised mass spectrometers to
\ndetect extremely small
\nconcentrations of impurities
\nHighly specialised and customised
\nfurnaces
\nGallium nitride epitaxial growth
\nDeposition of atomically controlled
\nlayers from precursor gases onto
\nwafers in MOCVD reactors
\nAccess to precursor galliumcontaining gases
\nExtremely precise temperature
\nuniformity, gas flow distribution,
\nchamber pressure and precursor
\ndelivery to minimise defects
\nIEA. CC BY 4.0.
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\nPAGE | 299
\n3. Pathways to resilient and diversified supply chains
\nTechnically demanding processes, equipment and reagent constraints, and knowledge gaps
\nmake the galliumvalue chain one of the most specialised among high-tech materials
\nMost primary gallium production occurs through recovery from Bayerprocess alumina refining streams, although smaller quantities are
\nalso recovered as by-products from zinc processing and zinc refinery
\nresidues. Recovery from alumina production remains the dominant
\nsource because gallium becomes concentrated in Bayer liquor during
\nthe refining of bauxite into alumina. The dominant recovery
\ntechnologies are ion exchange and solvent extraction. Ion exchange
\nsystems employ specialised resins that selectively remove gallium
\nfrom Bayer liquor. The handful of suppliers outside China include
\nLanxess and DuPont Water Solutions.
\nDespite the limited number of equipment suppliers for gallium
\nrecovery in geographically diverse regions, access to large Bayer
\nliquor streams is a more important determinant of production
\neconomics than access to equipment. Nearly all refined production of
\ngallium today occurs in China, as the country benefits from being the
\nworld\u2019s largest alumina producer and therefore possesses the largest
\npotential source of gallium-bearing Bayer liquor. In addition,
\nspecialised ion exchange resins also represent a bottleneck for
\ndiversification. Performance depends on selectivity, resistance to
\nfouling and long-term stability, characteristics that are often
\nsupported by proprietary formulations and accumulated operational
\nknow-how. China\u2019s export licensing requirements imposed on
\ngallium-related products in 2023 and 2024 further underscore the
\nstrategic importance of these supply chains.
\nUltra-high-purity refining
\nSemiconductor-grade gallium typically requires purity levels ranging
\nfrom 6N up to 8N (99.9999% to 99.999999%), depending on the
\napplication and device requirements. Manufacturing of gallium
\narsenide and gallium nitride, the downstream products of gallium that
\nplay central roles in applications relying on semiconducting materials,
\nis particularly sensitive to trace metallic and oxygen impurities,
\nmaking contamination control and analytical capability critical. The
\npurification process relies on vacuum distillation systems, zonerefining systems and ultra-clean handling equipment supplied by a
\nfew specialised firms, such as PVA TePla and ECM Technologies.
\nTo achieve such purity levels, trace contaminants at parts-per-million,
\nparts-per-billion or even parts-per-trillion levels can affect crystal
\ngrowth, epitaxy and semiconductor device performance. Advanced
\nanalytical laboratories equipped with inductively coupled plasma
\nmass spectrometry and glow discharge mass spectrometry to detect
\nextremely small concentrations of impurities therefore become
\nessential components of the production process, as does the
\nexpertise required to operate these facilities and maintain rigorous
\ncontamination control standards. Very few suppliers exist globally for
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 300
\n3. Pathways to resilient and diversified supply chains
\nthis ultra-specialised laboratory equipment, and the time required for
\nequipment procurement can be a significant component of the total
\nfabrication time.
\nGallium arsenide wafer production
\nGallium arsenide (GaAs) is used in high-frequency and highperformance electronic and optoelectronic applications, including
\nradio frequency chips, satellite communications, solar cells, lightemitting diodes and defence systems.
\nGallium arsenide production begins with crystal growth using liquid
\nencapsulated-Czochralski (LEC) and vertical gradient freeze(VGF)
\nfurnaces. These systems create large, defect-free single crystals that
\nare subsequently sliced, polished and processed into semiconductor
\nwafers. Liquid-encapsulated Czochralski furnaces produce large
\nsingle-crystal gallium arsenide ingots by slowly pulling a crystal seed
\nfrom molten gallium arsenide while the melt is covered by a boron
\noxide encapsulant. The encapsulant suppresses arsenic evaporation,
\nwhich would otherwise destabilise the melt at the high temperatures
\nrequired for crystal growth. Vertical gradientfreeze furnaces instead
\nsolidify the melt under carefully controlled temperature gradients,
\nreducing thermal stress and improving crystal uniformity. Both
\nsystems require extremely precise thermal management, pressure
\ncontrol and impurity control to minimise crystal defects, dislocations
\nand compositional variations.
\nThe process becomes more complex when producing compound
\nsemiconductors that incorporate indium, such as indium gallium
\narsenide (InGaAs) or indium gallium phosphide (InGaP). These
\nmaterials require stricter compositional control because small
\nvariations in indium concentration can significantly alter electronic
\nand optical properties. Maintaining uniform alloy composition during
\ncrystal growth therefore introduces additional process-control
\nchallenges and increases sensitivity to temperature fluctuations and
\nprecursor purity. Specialised equipment suppliers are, once again,
\nfairly limited, and furnace settings often need to be customised for
\nthe exact composition needed. PVA TePla is one of the few notable
\nspecialised crystal growth equipment manufacturers outside China.
\nThe key challenge is defect control. Crystal quality depends on
\nprecise thermal management, impurity control and process stability,
\nand achieving commercially competitive yields requires significant
\noperational expertise. Wafering and polishing also require
\nspecialised equipment and process knowledge to achieve the surface
\nquality demanded by semiconductor manufacturers. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nGallium nitride epitaxy
\nGallium nitride (GaN) is increasingly used in power electronics, fast
\nchargers, electric vehicles, radar systems and advanced
\ntelecommunications infrastructure because of its ability to operate at
\nhigh voltages, frequencies and temperatures.
\nIEA. CC BY 4.0.
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\nPAGE | 301
\n3. Pathways to resilient and diversified supply chains
\nGallium nitride manufacturing is predominantly carried out in metalorganic chemical vapour deposition (MOCVD) reactors, which
\ndeposit atomically controlled semiconductor layers onto wafers.
\nPrecursor gases such as trimethylgallium and ammonia decompose
\nat elevated temperatures and react on the wafer surface to form
\ngallium nitride layers with highly controlled thickness and composition.
\nThe reactors must maintain precise temperature uniformity, gas flow
\ndistribution, chamber pressure and precursor delivery in order to
\nminimise crystal defects and achieve high device performance. As
\nwith gallium arsenide, the process becomes more complex for mixed
\nsemiconductors, such as indium gallium nitride (InGaN), which are
\nwidely used in light-emitting diodes and advanced optoelectronic
\ndevices. Incorporating indium requires tighter control of growth
\ntemperature and precursor flow. Maintaining uniform composition
\nacross the wafer while avoiding crystal defects represents a major
\nprocess-engineering challenge. The market for MOCVD reactors
\noutside China is concentrated among a very small number of
\nsuppliers, particularly Aixtron and Veeco Instruments. The supply of
\nsemiconductor-grade trimethylgallium is also concentrated among a
\nlimited number of specialist chemical manufacturers, creating
\nadditional supply chain dependency.
\nThe bottlenecks for semiconductor-grade gallium production in
\ngeographically diverse regions encompass equipment, reagents and
\nknowledge. Specialist expertise, process recipes, yield optimisation,
\nand equipment and reagent procurement lead times are all concerns.
\nUnlike many stages in lithium and graphite processing, equipment
\nconcentration itself constitutes a significant barrier. Gallium arsenide
\nand gallium nitride manufacturing also require highly controlled
\ncleanroom facilities to minimise particulate contamination and
\nairborne impurities during wafer fabrication and epitaxial growth. The
\nconstruction and operation of these facilities significantly increase
\ncapital costs and operational complexity. Semiconductor cleanrooms
\nalso require ultra-high-purity gases, specialised chemical-delivery
\nsystems and continuous contamination monitoring. The
\nconsiderations extend beyond infrastructure alone. Maintaining
\ncleanroom performance requires highly trained operators, rigorous
\nprocess discipline and extensive operational experience.
\nAn additional concern is the safe handling of substances: arsenicbased compounds are highly toxic and require strict handling,
\nventilation and waste management systems during crystal growth,
\nwafer fabrication and semiconductor processing. Metal-organic
\nprecursors used in epitaxy, including trimethylgallium, are pyrophoric
\nand highly reactive, requiring specialised gas-handling systems and
\ntightly controlled operating environments.
\nOverall, diversification efforts should focus on expanding materials
\nscience capabilities and strengthening downstream manufacturing.
\nInvestment in specialist workforce development, pilot-scale facilities
\nand partnerships with equipment suppliers can accelerate progress.
\nGiven the technical complexity of the value chain, successful
\ndiversification is likely to require sustained industrial investment over
\nan extended period.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 302
\n3. Pathways to resilient and diversified supply chains
\nClosing existing technology, equipment and knowledge gaps in geographically diverse regions
\nrequires a holistic approach encompassing innovation, policy and co-operation
\nThe gaps in costs and lead times observed today are a function of
\nthe high levels of supply chain concentration and the lack of major
\nindustrial bases outside China. As efforts to diversify supplies ramp
\nup, there is potential for competitive markets for equipment and
\nmachinery to emerge.
\nInnovation is a critical enabler of efforts to diversify supply chains, as
\nnew entrants face substantial technical, economic and environmental
\nbarriers across mining, separation and refining. Tracking the scale of
\npatents across mineral value chains reveals that progress in supplyside innovation has been concentrated in one country over the last
\ndecade (Box 3.3). To develop successful mineral production
\necosystems in geographically diverse regions, the first and highest
\npriority is to address gaps in knowledge, equipment costs and lead
\ntimes. Providing targeted subsidies and incentives to existing and
\nemerging equipment and machinery producers can be effective in
\nreducing both lead times and equipment and machinery costs
\nthrough economies of scale. Building a consortium of domestic or
\ninternational equipment producers to co-ordinate the production of
\ncomponents and equipment can also realise scale advantages more
\neffectively, leveraging technology and skills transfer between
\npartners and facilitating product certification.
\nSecond, providing financial support both at the direct capital cost and
\noperating cost levels, or through other de-risking measures, such as
\nloan guarantees or lowered interest rates, can help diversified
\nequipment producers and new entrants to secure and scale their
\noperations. These measures strengthen the business case for
\nproducers and also incentivise private investment in the sector by
\nreducing perceived risks. Unlocking private investment can
\naccelerate the development of diversified ecosystems, where scale
\nand speed are both key drivers for building competitive businesses.
\nFinally, even if the whole ecosystem is successfully created, longterm operations can only be sustained if there is demand for these
\ndiversified players. It is therefore critical to simultaneously stimulate
\ndemand, for example by introducing incentives or mandates to use
\nmagnets or batteries produced using a share of materials, processing
\ntechnology and equipment originating from diverse sources.
\nNurturing downstream manufacturing industries or partnering with
\nlike-minded countries that have strong industrial demand bases will
\nbe a major factor in sustaining operations for diverse upstream
\nplayers. Co-ordination among key diversified players may also
\nimprove negotiating positions in the event of patent disputes.
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\nPAGE | 303
\n3. Pathways to resilient and diversified supply chains
\nBox 3.3 Patents across critical mineral value chains reveal remarkable progress in
\ninnovation but high geographical concentration
\nGlobal patenting trends in critical mineral technology areas, 2000-2024
\nIEA. CC BY 4.0.
\nNotes: IPFs = international patent families, based on fractional counts. As a first attempt, the IEA defines critical minerals sectors using Cooperative Patent
\nClassification codes combined with keyword searches for extraction, processing and materials technologies, as well as digital and automation applications linked
\nto critical minerals. Data for 2020-2024 have been nowcast based on historical data, with a variable factor for the main patenting countries and a fixed factor for
\nthe rest of the countries.
\nSource: IEA analysis based on European Patent Office PATSTAT patents database (Spring 2025 edition, accessed through the OECD Micro-data Lab:
\nIntellectual Property Database).
\n5
\n10
\n15
\n20
\n25
\n2000 2005 2010 2015 2020 2024
\nThousand IPFs
\nUnited States Europe Japan Korea China Rest of world
\nExploration, extraction and processing
\n2
\n4
\n6
\n8
\n10
\n2000 2005 2010 2015 2020 2024
\nRefining
\nIEA. CC BY 4.0.
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\nPAGE | 304
\n3. Pathways to resilient and diversified supply chains
\nThe dynamism of the technology innovation landscape for critical
\nminerals is reflected in increased patenting activity across the
\nsector. The trends appear in several regions at every stage of the
\nvalue chain: exploration, extraction, refining and recycling. Since
\n2021, the level of patenting globally has been around three times
\nhigher than the level seen prior to 2010. These patents mostly relate
\nto exploration and extraction technologies, demonstrating a
\ncontinued commercial interest in new ways to tap into mineral
\nresource endowments. However, the marked increase in China\u2019s
\ncontributions to the total patent pool since the 2010s mirrors the role
\nthe country has played as the leading producer of a wide range of
\nminerals over the last 15 years. As of 2024, China accounted for
\nmore than 35% of patents within international patent families and
\nfiles the highest number of national patent families. Moreover, as
\nhighlighted in the section above, innovation in the midstream has
\nalso been predominantly concentrated in China over the last
\ndecade, while Japan has maintained a consistently high share of
\nthe total since 2000. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nA recent joint report published by the European Patent Office and
\nthe IEA, Battery Circularity, shows that there has also been rapid
\nincrease in patenting for battery recycling technologies, at 42% per
\nyear on average since 2017, growing faster than any other category
\nof patents related to batteries. This follows a growing focus on
\ndiversifying supply chains to reduce mineral supply risks in
\nimporting regions and improving environmental performance.
\nHowever, China also represents two-thirds of all patents relating to
\nbattery recycling.
\nDespite having limited domestic extraction or refining, Japan\u2019s
\ncontribution to innovation in critical minerals is noteworthy. This
\nindicates that major Japanese battery manufacturers seek to
\nmanage their supply chains to mitigate supply risks and remain
\ncompetitive.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 305
\n4. Special focus on Latin America and the Caribbean
\n4. Special focus on Latin
\nAmerica and the Caribbean
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 306
\n4. Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean holds significant reserves of multiple critical minerals, with
\nconsiderable scope for further development
\nShares of global reserves and production for selected minerals inLatin America and the Caribbean
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from the United States Geological Survey (2026), Mineral Commodity Summaries 2026.
\n0% 25% 50% 75% 100%
\nArgentina
\nBolivia
\nBrazil
\nChile
\nJamaica
\nMexico
\nPeru
\nOther
\nShare of world reserves
\n0% 25% 50% 75% 100%
\nShare of world production
\nNiobium
\nLithium
\nSilver
\nCopper
\nRare earths
\nGraphite
\nMolybdenum
\nManganese
\nAntimony
\nZinc
\nBauxite
\nNickel
\nTin
\nRhenium
\nIEA. CC BY 4.0.
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\nPAGE | 307
\n4. Special focus on Latin America and the Caribbean
\nThe region combines established mining capabilities with emerging opportunities in critical
\nminerals, particularly for key energy materials such as lithium, copper, graphite and rare earths
\nLatin America and the Caribbean\u2019s shares of global reserves and mining output for selected minerals, 2025
\nIEA. CC BY 4.0.
\nSource: IEA analysis based on data from the United States Geological Survey (2026), Mineral Commodity Summaries 2026.
\n20%
\n40%
\n60%
\n80%
\n100%
\nReserves Mining production
\nOpportunities Strengths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 308
\n4. Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean is expected to maintain its global market share in the mining
\nof key minerals such as copper and lithium, but faces strong competitive pressures in refining
\nCopper and lithium output in Latin America and the Caribbean in the base case, 2025-2040
\nIEA. CC BY 4.0.
\nNote: Lithium mining covers extraction from hard-rock ores and brines.
\n3
\n6
\n9
\n12
\n’25 ’30 ’35 ’40 ’25 ’30 ’35 ’40
\nkt
\nMt
\nChile Argentina Peru Mexico Brazil Share of global (right axis)
\n10%
\n20%
\n30%
\n40%
\n50
\n100
\n150
\n200
\n’25 ’30 ’35 ’40
\nCopper Lithium
\nMining Refining Mining
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 309
\n4. Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean is a leading global mineral producer with significant untapped
\nresources
\nLatin America and the Caribbean (LAC) is a major supplier of critical
\nminerals, supported by a large and diverse resource base. The region
\nholds significant shares of global resources of lithium, copper, silver
\nand graphite, alongside important reserves of molybdenum and tin,
\nand established production of specialty minerals such as niobium and
\nrhenium. This endowment underpins LAC\u2019s strategic importance for a
\nwide range of technologies, including those central to the energy
\ntransition as well as high\u2011technology, aerospace and defence
\napplications.
\nLAC also has significant potential to help diversify highly concentrated
\nglobal mineral supply chains while strengthening its own economic
\ndevelopment. Expanding processing and downstream activities could
\nenable the region to capture greater value from its mineral resources.
\nCurrent production landscape
\nThe production of base metals is a key strength for the region,
\naccounting for at least one-fifth of global production of copper,
\nmolybdenum, tin and zinc. Chile, Peru and Mexico together
\naccounted for almost 40% of global mined copper supply in 2025.
\nFor molybdenum, a by-product of copper production, LAC countries
\naccount for just under 40% of global production, mainly from Chile
\nand Peru.
\nLAC also hosts significant production of speciality minerals. Brazil
\naccounts for more than 90% of global production of niobium, a
\nmineral used mainly as an alloying material for steel, but with growing
\napplications in superconductors and electronics. Chile produces over
\none-third of the world\u2019s rhenium, another by-product of copper that is
\nessential for specialised heat-resistant steels. The region is also a
\nmajor producer of silver, accounting for more than half of global
\nsupply, mainly from Mexico, Peru, Bolivia and Argentina, despite
\nholding one-third of global reserves.
\nLithium resources are concentrated in the so-called \u201clithium triangle\u201d,
\ncomprising Argentina, Bolivia and Chile. However, these resources
\nhave not been developed equally across the three countries: Chile is
\nan established lithium producer, while Argentina is rapidly emerging as
\na major producer, with several projects at the production stage or in
\nthe early stages of development. The two countries together account
\nfor more than one-third of global lithium reserves and one-quarter of
\ntotal production. Bolivia, by contrast, has not yet fully exploited its
\nlithium resources, despite large, estimated resources. Several earlystage projects are underway, aiming to develop lithium production in
\nthe country. Beyond lithium, the region also offers additional
\nopportunities to expand mineral production, including sizeable
\nresources of graphite, nickel and rare earths, predominantly in Brazil. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 310
\n4. Special focus on Latin America and the Caribbean
\nOutlook
\nLooking ahead, the copper project pipeline suggests mounting
\ndifficulties in sustaining current production levels, with constraints
\nvisible in Chile and Peru and major implications for the global copper
\nmining industry. Lithium mining, by contrast, benefits from a strong
\npipeline of investment in Argentina, as well as scope to increase
\nproduction in Chile and Brazil. Overall, regional output is expected to
\ngrow by close to 50% between today and the end of the decade. The
\nregion\u2019s share in global copper and lithium mining, currently 40% and
\n25%, respectively, is projected to remain broadly stable to 2040.
\nAdditional production, especially if combined with investment in
\nrefining facilities, would support economic diversification and
\nincrease global supply security, which remains highly concentrated in
\na small number of countries.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 311
\n4. Special focus on Latin America and the Caribbean
\nExports of critical minerals account for a large share of total exports in many Latin America and
\nthe Caribbean economies
\nShares of selected critical minerals exports in total export value in Latin America and the Caribbean, 2024
\nIEA. CC BY 4.0.
\nNotes: The chart shows the share by value of minerals exports over total value of exports of each country. The share of mined output indicates the share of value of
\nmined material over total export value. Total values include mined and refined materials. Aluminium includes bauxite. \u201cOther\u201d includes chromium, cobalt, titanium,
\ngraphite, niobium, platinum group metals and vanadium.
\nSource: IEA analysis based on data from Harvard University (2026), Growth Lab Trade Data (database), accessed 15 June 2026.
\n10% 20% 30% 40% 50% 60%
\nColombia
\nMexico
\nArgentina
\nEcuador
\nVenezuela
\nJamaica
\nCuba
\nBrazil
\nBolivia
\nPeru
\nChile
\nShare of exports
\nCopper
\nLithium
\nMolybdenum
\nIron
\nSilver
\nZinc
\nAluminium
\nLead
\nManganese
\nNickel
\nSilicon
\nTin
\nTungsten
\nAntimony
\nOther
\nShare of mined output
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 312
\n4. Special focus on Latin America and the Caribbean
\nRaw materials remain central to LAC\u2019s exports, resulting in lower economic complexity than in
\nother regions where exports have increasingly diversified towards higher value-added products
\nEconomic complexity index in selected regions
\nIEA. CC BY 4.0.
\nNote: The economic complexity of a country is calculated based on the diversity and sophistication of a country’s exports. Countries that export a wide range of
\nproducts that few other countries can produce tend to have higher economic complexity.
\nSource: IEA analysis based on data from Harvard University (2026), Growth Lab Trade Data (database), accessed 15 June 2026.
\n– 0.5
\n0.5
\n1.0
\n1.5
\n2000 2008 2016 2024
\nEconomic complexity index
\nLAC
\nHigher complexity
\nLower complexity
\n2000 2008 2016 2024
\nSoutheastAsia
\n2000 2008 2016 2024
\nIndia
\n2000 2008 2016 2024
\nChina
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 313
\n4.Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean currently refines a low share of the minerals it produces
\nProduction of mined and refined material in the Latin America and the Caribbean region, 2025
\nIEA. CC BY 4.0.
\n26%
\n2
\n4
\n6
\n8
\n10
\nMiningRefining
\nMt
\nCopper
\n84%
\n20
\n40
\n60
\n80
\n100
\nMiningRefining
\nkt Li
\nLithium
\n63%
\n40
\n80
\n120
\n160
\n200
\nMiningRefining
\nkt
\nNickel
\n10%
\n2
\n4
\n6
\n8
\n10
\nMiningRefining
\nkt
\nCobalt
\n0%
\n20
\n40
\n60
\n80
\n100
\nMiningRefining
\nkt
\nGraphite
\n7%
\n1
\n2
\n3
\n4
\n5
\nMiningRefining
\nkt
\nRare earths
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 314
\n4. Special focus on Latin America and the Caribbean
\nProgress along the critical minerals value chain would increase economic benefits for the
\nregion
\nSeveral LAC countries rely on critical minerals for a substantial share
\nof their export revenues. In Chile and Peru, these minerals account
\nfor 55% and 40% of export revenues, respectively. However, exports
\nremain concentrated in raw or minimally processed forms, limiting
\ndomestic value addition and participation in higher-value segments
\nof global supply chains. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nThis export structure is reflected in relatively low levels of economic
\ncomplexity. The Economic Complexity Index (ECI), which reflects the
\nproductive capabilities of an economy, inferred from the diversity of
\nits export basket and the ubiquity of the products it exports globally,
\nremains below that of other emerging markets and developing
\neconomies, including in Southeast Asia, India and China.
\nOver the period from 2000 to 2023, economic complexity in LAC
\ndeclined, largely driven by an increasing concentration of exports in
\nunprocessed commodities, including mineral and energy products.
\nDespite a modest improvement in complexity in 2024, the region
\ncontinues to face structural constraints in moving up mineral value
\nchains. In 2025, countries in the region refined just 26% of the
\ncopper they extracted, 10% of cobalt and 7% of rare earths, and
\nthere are no graphite refining facilities in LAC countries. The lithium
\nvalue chain is slightly different, as full chemical transformation is
\nonly needed when lithium is extracted from spodumene rocks,
\nwhereas lithium from brines is already in ionic form. Most lithium
\nextracted in LAC comes from brine.
\nWhile opportunities for value addition vary across countries
\ndepending on their resource base and existing industrial capabilities,
\nfurther development of refining, processing and manufacturing of
\nintermediate and finished products would enable higher local value
\nadded and strengthen linkages with domestic industry. In
\nresource\u2011rich regions with polymetallic deposits, expanding the
\nrecovery of by\u2011products from existing operations represents an
\nimportant option. Such efforts would also enhance resilience to
\ncommodity price volatility and position LAC more favourably within
\nrapidly expanding energy supply chains.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 315
\n4. Special focus on Latin America and the Caribbean
\nLocal refining of regional mining output would increase sectoral economic benefits by one-fifth
\nEconomic value of critical minerals production in the base case and the Latin America and the Caribbean local refining case
\nIEA. CC BY 4.0.
\nNotes: The Latin America and the Caribbean local refining case assumes that all of the mined output from the region in 2035 in the base case is refined locally. For
\ncopper, the share of mined output refined locally is set at two-thirds of the mined output. For nickel, cobalt, graphite and rare earths, values are the sum of both
\nmining and refining.
\n50 100 150 200 250
\n2035
\n2035
\n2025
\nBillion USD
\nCopper mining
\nCopper refining
\nLithium mining
\nLithium refining
\nNickel
\nCobalt
\nGraphite
\nRare earths
\nLAC local
\nrefining
\ncase
\nBase
\ncase
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 316
\n4. Special focus on Latin America and the Caribbean
\nExpanding to downstream processing and beyond
\nThere is a clear opportunity for the region to move beyond extraction
\ninto higher-value activities. Recently, policy attention has turned to
\nsmelting and refining, lithium hydroxide processing, cathode and
\nprecursor production, and stronger domestic manufacturing and
\nmining-service industries. Chile is looking into expanding local
\nrefining and greater value addition in both the lithium and copper
\nsectors, including through partnerships between the state-owned
\nCodelco and private companies. Brazil\u2019s Nova Ind\u00fastria policy targets
\nbatteries, electric vehicles (EVs) and strategic mineral processing as
\npriority sectors. Brazil has undertaken efforts to move up the mineral
\nvalue chain into the midstream and downstream segments through
\nstrategic initiatives. The MagBras Project aims to establish a
\ncomplete domestic value chain for rare earth permanent magnets,
\nsecuring technological autonomy and mastering the entire production
\ncycle from mineral extraction to manufacturing and recycling. The
\nstate-owned company CEITEC is upgrading its industrial
\ninfrastructure to produce power components based on silicon carbide,
\ndirectly linking advanced materials processing to high-tech industrial
\napplications. In Argentina, the new Incentive Regime for Large
\nInvestments seeks not only to support mining-related activities but
\nalso to support infrastructure for mining project development, as well
\nas the technology sector, including clean energy technologies.
\nPotential benefits for LAC economies
\nBased on the distribution of the base case project pipeline, the LAC
\nregion has the opportunity to capture around USD 185 billion of
\neconomic value by 2035. Of this, only one-fifth is expected to come
\nfrom refining, as most extracted material is exported for processing
\nabroad. An analytical case study that assumes all mined lithium,
\nnickel, cobalt, graphite and rare earths and two-thirds of mined
\ncopper are refined locally suggests that local refining can significantly
\nincrease benefits for local economies. If local refining were to be
\nexpanded to its full potential, the economic benefit would rise to
\naround USD 220 billion in 2035.
\nPotential benefits for global supply security
\nIncreasing regional refining capacity for critical minerals extracted in
\nLAC could also strengthen global supply security and reduce
\nexposure to highly concentrated supply chains. In the base case,
\ntoday\u2019s leading refining country, China, is projected to account for 91%
\nof battery-grade graphite production in 2035, alongside 66% of
\nlithium and 50% of nickel refining. This high degree of concentration
\npoints to persistent global imbalances. For graphite, nickel and
\nlithium, refined material available outside the dominant supplier
\ncovers around 28%, 36% and 82% of demand, respectively, in
\nregions outside the dominant suppliers (see the N-1 analysis in
\nChapter 2).
\nIn the LAC local refining case, global supply imbalances would
\nimprove. Additional regional refining capacity could contribute around
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 317
\n4. Special focus on Latin America and the Caribbean
\n10 kt of lithium, 55 kt of nickel and close to 70 kt of graphite to
\ndiversified supply sources by 2035. While modest, these additions
\nwould help narrow projected supply gaps and enhance resilience
\nagainst disruptions.
\nGlobal N-1 supply-demand balance for selected critical minerals,
\n2035
\nIEA. CC BY 4.0.
\nNotes: The N-1 supply excludes production volumes from the largest producer
\nfrom total global supply, and N-1 demand excludes consumption by that
\ncountry from total global demand. The LAC local refining case assumes a
\nmajor expansion of regional refining capacity, enabling local processing of
\nbase-case mined production by 2035. LAC: Latin America and the Caribbean.
\n20% 40% 60% 80% 100%
\nGraphite
\nNickel
\nLithium
\nDemand
\nDemand Supply: Base case LAC local refining case
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 318
\n4. Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean has structural advantages that enable lower emissions
\nintensity compared with other producing regions, but growing water demand poses a rising
\nchallenge
\nGHG emissions reduction
\nMining and processing activities are energy intensive activities that
\ncan generate substantial greenhouse gas (GHG) emissions,
\nparticularly where operations rely on fossil fuel-based energy sources.
\nWith renewables accounting for more than 60% of electricity
\ngeneration, driven primarily by hydro-rich countries such as Brazil
\nand Colombia, and an increasing contribution from solar and wind in
\nChile, the LAC region holds structural advantages, with mineral
\nproduction involving notably lower emissions intensity than in other
\nproducing regions. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nSeveral mining companies in the region are increasingly integrating
\nrenewable energy into their operations as part of their
\ndecarbonisation strategies. Recent examples include projects by
\nVale in Brazil and by Codelco in Chile. Chile\u2019s Atacama region, with
\nsome of the world\u2019s highest solar irradiation levels, offers particularly
\nstrong conditions for low-emissions electricity and more sustainable
\npractices. In Argentina, at the Lindero mine, the integration of solar
\npower generation and battery storage into the existing energysystem
\nhas succeeded in reducing annual diesel consumption by
\napproximately 40%. Beyond the electrification of facilities, further
\nemissions reduction measures in the mining sector include the
\nelectrification of vehicles such as heavy-duty trucks, energy-efficient
\ncrushing technologies and the optimisation of processing. However,
\nthe deployment of these solutions remains uneven, as many mining
\noperations are located in remote areas with limited grid access and
\ntherefore continue to rely heavily on fossil fuels for operational
\nreliability.Continued infrastructure investment and supportive policy
\nframeworks will be essential to further reduce the region\u2019s emissions
\nintensity. In particular, expanding access to renewable electricity,
\nstrengthening transmission infrastructure and facilitating long-term
\npower purchase agreements will be critical.
\nWater usage
\nIn LAC, water demand in mining is increasing due to a combination
\nof structural factors. Declining ore grades have led to higher volumes
\nof ore being processed, which in turn increases water demand. A
\nrising share of sulphide ores in copper production is further increasing
\nthe water requirements associated with flotation processes. For
\ninstance, total water demand from copper mining in Chile is projected
\nto increase notably, reaching over 650 million m\u00b3 by 2035.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 319
\n4. Special focus on Latin America and the Caribbean
\nWater consumption in copper production in the high-production
\ncase in Chile, 2015-2030
\nIEA. CC BY 4.0.
\nNote: The high-production case considers projects at a reasonably advanced
\nstage of development.
\nSource: IEA analysis based on data from the Chilean Copper Commission.
\nWhile mining is becoming more water\u2011intensive, many mines in the
\nregion are located in arid deserts and mountainous areas, where
\nwater resources are already scarce and essential for local
\ncommunities, agriculture and ecosystems. This makes securing a
\nsufficient water supply an urgent challenge and raises concerns
\naround competing uses. In response, some companies are
\nimplementing measures to reduce dependence on freshwater. For
\nexample, the Quellaveco copper project in Peru has achieved lower
\nwater-use intensity through high recirculation rates of approximately
\n85%. The project is also supported by multipurpose water storage
\ninfrastructure, which contributes not only to mining operations but
\nalso to local water management, including flow regulation and the
\nsupply of water for agricultural use, developed through a multistakeholder dialogue involving government authorities and local
\ncommunities. In Chile, there has been a pronounced shift towards the
\nuse of desalinated seawater for mining operations, helping to reduce
\nfreshwater consumption. This transition is being supported by public
\npolicy, with a recently established framework that regulates the use
\nof seawater for desalination. However, desalination and longdistance water transport are both capital and energy intensive,
\nhighlighting the close linkages between water use, energy
\nconsumption and GHG emissions.
\nIn lithium extraction from brine, concerns persist regarding
\ngroundwater depletion and impacts on ecosystems. Brine extraction
\nin high-altitude salt flats can affect interconnected water systems
\nthat support local biodiversity and communities, highlighting the
\nneed for careful resource management and improved monitoring. In
\nChile\u2019s Atacama salt flats, around 70% of the water footprint per
\ntonne of lithium product is associated with concentrated brine
\nproduction, while in the conversion to lithium carbonate, the final
\nstage of lithium production, the use of desalinated water helps
\nmitigate pressures on scarce freshwater resources. In recent years
\nin Atacama, operational improvements, including higher brine
\n200
\n400
\n600
\n800
\n’15 ’20 ’24 ’30 ’15 ’20 ’24 ’30
\nFreshwater Seawater On-site Concentrator Refining Services
\nBy type
\nMillion cubic metres
\nBy processing step
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 320
\n4. Special focus on Latin America and the Caribbean
\nrecovery rates and lower energy consumption in processing stages,
\nhave contributed to reducing water intensity.
\nWater scarcity remains one of the most significant constraints on
\nmining expansion in the LAC region. Addressing this challenge will
\nrequire a combination of infrastructure investment, technological
\ninnovation, such as through further adoption of direct lithium
\nextraction technologies, and strengthened governance frameworks
\nto ensure sustainable water use. Promoting dialogue and
\nco-ordination with other water-intensive sectors such as agriculture,
\nas well as with local communities, is also essential. Comprehensive
\napproaches to ensure the long-term sustainability of water use will
\nreduce project-level uncertainty and strengthen the social
\nacceptance of mining projects in the region.
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 321
\n4. Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean countries have policy tools to overcome the risks and
\nchallenges that hinder the development of critical minerals projects, but stronger
\nimplementation efforts are needed
\nIEA. CC BY 4.0.
\nNote: ECLAC = Economic Commission for Latin America and the Caribbean; RD&I = research, development and innovation.
\nChile\u2019s centralised
\npermittingsystem
\nPeru\u2019s updated mine
\nclosure law
\nArgentina\u2019s Incentive Regime for
\nLarge Investment
\nChile\u2019s Northern District
\ndesalinationproject
\nPeru\u2019s VAT incentives
\nfor exploration
\nColombia\u2019s Minerals
\nTraceabilitySystem
\nArgentina, Brazil, Paraguay and
\nChile\u2019s bi-oceanic corridor
\nArgentina, Bolivia, Brazil, Chile and
\nMexico\u2019s Permanent Forum for Technical
\nDialogue on Lithium,organised by ECLAC
\nMexico\u2019s simplification of patent
\nregistration in its National Plan
\nPolicy tools in the region target
\nkey risks and challenges:
\n\u2022 Cost of capital
\n\u2022 Market and price risks
\n\u2022 Environmental management
\n\u2022 Regulatory uncertainty
\n\u2022 Infrastructure
\n\u2022 Technology gaps
\nBrazil\u2019s funding of RD&I
\nprojects from development
\nbank and innovation agency
\nPeru\u2019s Digital Single
\nWindow one-stopshop
\nMexico\u2019s reform for
\nwater management
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 322
\n4. Special focus on Latin America and the Caribbean
\nPolicy pathways to address market, regulatory andtechnological barriers
\nA broad set of risks creates challenges for expanding the critical
\nminerals value chain in LAC. These range from regulatory uncertainty
\nto technology gaps and affect both the timing and scale of private
\ninvestment. Enhanced policy frameworks can reduce uncertainty,
\nlower financing costs and improve project bankability. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nCost of capital. Reducing the cost of capital is critical for scaling up
\ninvestment in critical mineral projects, as elevated risk perceptions,
\nparticularly in emerging regions or new segments of the value chain,
\noften translate into high financing costs. Policy instruments such as
\npublic credit guarantees can lower lender risk and improve project
\nbankability, while public-private partnerships allow governments to
\nshare risks with private investors, especially for large or strategic
\nprojects, helping to crowd in private capital. For example, Argentina\u2019s
\nIncentive Regime for Large Investments offers tax reductions and
\nother benefits to facilitate the realisation of long-term investment,
\nwhile Chile\u2019s Novandino Litio is an example of how public-private
\npartnership can support financing for mineral development projects.
\nMarket and price risks. Managing market and price risks is essential
\nfor the viability of critical mineral projects, as commodity price
\nvolatility and uncertain demand, particularly for downstream
\nprocessing, can weaken investment incentives. The development of
\nprocessing hubs in the region, including by leveraging existing
\nregional and international collaboration platforms, can create
\neconomies of scale, lower unit costs and improve resilience to price
\nswings. Regional and international traceability systems in support of
\ndiversification and sustainability would also be beneficial for projects
\nin the region, especially if they are extended beyond mining to
\nsupport the development of refining and processing facilities. For
\nexample, Colombia\u2019s Mining Traceability System introduced a digital
\nplatform to track mineral origins and could be used to foster
\ndiversified projects and incentivise sustainable practices.
\nEnvironmental management. While the region has extensive
\nexperience in large-scale mining, particularly for bauxite, iron, gold
\nand copper, new critical mineral projects may emerge in new
\nlocations, requiring careful environmental planning and management
\nof impacts related to water, emissions, noise, dust, and mine closure
\nand rehabilitation. LAC countries already have environmental
\nregulations applicable to mining, and some have recently updated
\ntheir policy frameworks. Mexico\u2019s 2023 mining reform increased
\nwater and socio-environmental scrutiny in the awarding of mining
\nconcessions, and Peru\u2019s updated mine closure law makes mine
\nclosure and rehabilitation a continuous legal obligation, requiring
\nupfront financial guarantees and regular updates of mine closure
\nplans. Brazil\u2019s National Policy on Critical and Strategic Minerals
\nembeds environmental criteria into the selection of priority projects.
\nColombia, Chile and Brazil are also advancing emissions trading
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 323
\n4. Special focus on Latin America and the Caribbean
\nsystems, creating incentives to reduce emissions across industrial
\nsectors. Industry standards complement regulatory measures.
\nChile\u2019s mining sector is targeting carbon neutrality, while its two
\nlargest lithium producers, Albemarle and Novandino, have completed
\nindependent audits of their Salar de Atacama operations against the
\nInitiative for Responsible Mining(IRMA) standard, lending a higher
\ndegree of transparency to environmental and social performance.
\nPermitting and regulatory uncertainty. Unpredictable and
\nfragmented regulatory frameworks can delay the development of new
\nprojects and undermine investor confidence. The total time for
\npermitting and project development in Chile can span between 54
\nand 139 months for exploration, mining and desalination projects,
\ndepending on project complexity, with the longest time frames
\nassociated with desalination plants and tailings storage facilities.
\nGovernments, however, have access to a range of policy instruments
\nto help reduce permitting times. Establishing centralised permitting
\nauthorities, one-stop shops or dedicated agencies to co-ordinate
\nregulatory approvals can reduce institutional fragmentation and
\naccelerate permitting timelines by limiting duplication across
\ninstitutions. At the same time, efforts to streamline permitting
\nprocesses need to ensure that environmental and social safeguards
\nare upheld, as insufficient consultation or impact assessment can
\nlead to project delays, social opposition and cost escalation over the
\nproject life cycle. Examples in this direction include the Environmental
\nImpact Assessment System centralised permitting system in Chile. In
\naddition, permitting processes are often structured sequentially,
\nmeaning that delays or bottlenecks at a single stage can slow overall
\nproject progress. Allowing key regulatory and administrative
\nprocesses to proceed in parallel, where appropriate, can accelerate
\ndecision-making while maintaining robust regulatory oversight.
\nPeru\u2019s Digital Single Window serves as a one-stop shop, integrating
\nnine public entities involved in mining permitting and helping to
\nstreamline processing times.
\nInfrastructure. Transport, energy, water and logistics infrastructure
\ncan constrain the development of critical mineral projects, as weak
\nconnectivity and limited access to resources raise costs and project
\nrisks. Regional integration through cross-border infrastructure
\nplanning and harmonised standards can help LAC countries improve
\nconnectivity and facilitate trade. Co-ordinated and targeted public
\ninvestment via direct financing or co-financing of enabling
\ninfrastructure, such as roads, ports and power supply, can reduce
\nupfront risks, attract private capital and ensure reliable access to the
\nnecessary infrastructure for mining and processing operations. New
\ninfrastructure projects can be designed to deliver tangible benefits for
\nlocal communities, including employment and skills development,
\nwhile strengthening the foundation for broader regional economic
\ndevelopment. Examples of shared infrastructure include Brazil\u2019s
\nCaraj\u00e1s corridor, including railway and port development, and Chile\u2019s
\nsolar-powered ENAPAC desalination project.
\nTechnology gaps. While the region is in some cases at the forefront
\nof deploying new mining technologies, technology gaps could still
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 324
\n4.Special focus on Latin America and the Caribbean
\nconstrain the development of midstream refining and processing
\nprojects. For metal refining and product manufacturing, advanced
\nprocessing operations are required, such as the production of battery
\nprecursors and cathodes, rare earth separation and magnet
\nmanufacturing. These generally require advanced manufacturing
\nknow-how, access to specific material inputs and proprietary
\nknowledge. Addressing these gaps will require sustained investment
\nin research and development, skills and innovation ecosystems,
\nalongside stronger collaboration with chemical and processing
\ncompanies.
\nPublic investment in research and development (R&D). Support
\nfor applied research, pilot projects and demonstration plants can help
\nde-risk emerging technologies and accelerate their adoption.
\nInternational collaboration with advanced economies, multilateral
\ninstitutions and industry partners can also facilitate technology
\ntransfer, skills development and institutional learning. The Brazilian
\nDevelopment Bank and the Brazilian Innovation Agency have
\nprovided funding for R&D and innovation activities, including in
\nmidstream and downstream supply chain segments. In 2026, the
\nChilean Production Development Corporation awarded three R&D
\nprojects focused on recovering cobalt and rare earths from tailings
\nand mine waste as part of the programme \u201cR&D Challenges for
\nSustainable Productive Development\u201d. The IDB LAC Minerals by the
\nInter-American Development Bank (IDB) aims to mobilise financing,
\nknowledge and connections in the region to support the innovation
\ncycle of critical mineral projects from early stages to scale-up,while
\nalso providing a linkto the IDBInvestfinancing scheme.
\nPotentialforregionalsynergies
\nChile and Peru have mature copper industries supported by
\nspecialised suppliers, geological expertise and export infrastructure.
\nBrazil combines diversified mining output with metallurgical
\ncapabilities, while Mexico\u2019s automotive and electronics
\nmanufacturing base could support deeper downstream integration.
\nThese advantages, if combined, could help reduce barriers to
\ninvestment in critical mineral projects, although transport, power and
\nwater infrastructure will still need to expand in key mining corridors.
\nRegional co-ordination and partnerships are becoming more
\nimportant as countries seek finance, technology and market access.
\nInstitutions such as the IDB, Economic Commission for Latin America
\nand the Caribbean(ECLAC), the Development Bank of Latin America
\nand the Caribbean, and the Latin American and Caribbean Energy
\nOrganization can facilitate co-ordinated mining and industrial
\nstrategies across the region. For example, the Permanent Forum for
\nTechnical Dialogue on Lithium, established and operated by ECLAC
\nsince 2022, promotes sustainable extraction and industrial activities
\nthrough regional integration, technical exchange and lesson sharing.
\nIt brings together state-owned enterprises and technical agencies
\nfrom Argentina, Bolivia, Brazil, Chile and Mexico, while regularly
\ninviting subnational authorities and private actors and fostering
\ndialogue with countries outside the LAC region. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
\nGlobal Critical Minerals Outlook 2026
\nPAGE | 325
\n4. Special focus on Latin America and the Caribbean
\nLatin America and the Caribbean countries are developing dedicated critical mineral policy
\nstrategies and updating policy frameworks to attract investment and better integrate into global
\nsupply chains
\nCountries in the region exhibit diverse critical mineral policy
\nstrategies, reflecting differences in resource endowments and
\npositions in value chains. Many producers are seeking to strengthen
\ninternational partnerships to attract investment and improve
\nintegration into global value chains. This section provides an
\noverview of recent policy developments in the region, with a focus on
\ninvestment promotion, as well as on key regional and international
\npartnerships. Risks and challenges to policy implementation are
\ndiscussed in more detail later in the chapter.
\nArgentina
\nSince 1993, Argentina\u2019s Mining Investment Regime has provided
\nincentives such as a 30-year guarantee of fiscal and foreign
\nexchange stability for new projects. In 2024, Argentina launched the
\nIncentive Regime for Large Investments, aimed at attracting
\ninvestment in large projects, including in the mining sector. Building
\non existing incentives, the initiative progressively eliminates the
\nrequirement to repatriate export proceeds and sets a maximum
\ncorporate income tax rate of 25%, in addition to providing benefits
\nincluding accelerated depreciation and exemptions from import and
\nexport duties. It will remain open for applications until July 2027,
\nproviding additional opportunities compared with the existing mining
\ninvestment framework. It also establishes minimum investment
\nthresholds for eligible projects. As of June 2026, nine mining projects
\nhad been approved for a total of USD 10 billion, mainly for lithium,
\ncopper and gold.
\nArgentina is also actively advancing bilateral co-operation aimed at
\nintegrating its critical mineral production into global supply chains.
\nSince 2023, Argentina has signed memoranda of understanding
\n(MoUs) with a diverse set of partners, including Canada, the
\nEuropeanCommission, India and the United Arab Emilates (UAE),
\nhighlighting its multi-regional engagement strategies. In February
\n2026, it also concluded a landmark framework with the United States
\non mining and refining. Co-operation among provincial governments
\nhas also been strengthened; in April 2026, the governors of Salta,
\nCatamarca and Jujuy signed a joint agreement to enhance
\ngovernance, infrastructure and the development of the lithium value
\nchain under the current regulatory framework.
\nBolivia
\nBolivia has sought to promote investment in mineral exploration by
\nadjusting its regulatory framework and signing bilateral agreements.
\nIn April 2026, the government convened regional dialogues on lithium
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\n4. Special focus on Latin America and the Caribbean
\ndevelopment in Potos\u00ed, Uyuni, and Oruro which informed a strategic
\nroadmap emphasising environmental safeguards, water resource
\nprotection and inclusive regional development, alongside efforts to
\nstrengthen the legal framework governing the sector. At the end of
\n2025, a supreme decree established that investment in the mining
\nsector qualifies as a strategic priority, granting eligible projects
\naccess to incentives including a 15-year fiscal stability period,
\nreduced taxes and a fast-track approval procedure.
\nBrazil
\nBrazil aims to further develop domestic supply chains, including by
\nofficially launching its National Mining Policy Council, which sets
\nlong-term guidelines for the mining sector and strives to position the
\ncountry as a key global supplier of critical minerals. In 2026, the
\ngovernment is updating its National Mining Plan 2050, following
\npublic consultation. The Ministry of Mines and Energy and the
\nBrazilian Geological Survey also launched the 2026 edition of the
\nOverview of Critical and Strategic Minerals Potential of Brazil to
\npresent Brazil\u2019s potential for critical minerals with up-to-date data on
\nproduction, reserves, national programmes and thematic studies. In
\nMay 2026, the Critical and Strategic Minerals Bill, which establishes
\nthe country\u2019s first National Critical and Strategic Minerals Policy, was
\nsent to the Senate. The policy focuses on accelerating supply chain
\ndevelopment through nine policy instruments. In June 2026, Brazil\u2019s
\nMinistry of Mines and Energy, in partnership with the Inter-American
\nDevelopment Bank, launched a technical study to support the
\ndevelopment of a national rare earth strategy.
\nTo promote foreign direct investment, the Ministry of Mines and
\nEnergy launched Brazil\u2019s Critical Minerals: A Guide for Foreign
\nInvestors 2026, providing an overview of administrative processes,
\nregulatory frameworks, public support for new mining projects, and
\nenvironmental, social and governance considerations.
\nChile
\nOngoing reforms of Chile\u2019s regulatory framework aim to attract
\nprivate investment while promoting value addition and sustainability
\nin mining. Its National Mining Policy 2050 from 2022 targets a halving
\nof environmental and sector-specific permitting times by 2050. Its
\n2024 National Lithium Strategy includes special provisions to ensure
\nthat a portion of lithium produced is sold at a preferential price when
\nused by refining and battery industries. The 2025 Framework Law on
\nSectoral Authorizations aims to reduce permitting times between 30%
\nand 70%. In January 2026, Chile launched its National Critical
\nMinerals Strategy to consolidate its role in global supply chains
\nthrough five strategic pillars, one of which includes attracting
\nresponsible investment. In April 2026, the National Reconstruction
\nand Economic Development Bill, which includes a proposed
\nreduction in corporate taxes along with employment incentives and
\nfaster environmental permitting, was submitted to Congress for
\napproval. In May 2026, a bill was introduced to reform Chile\u2019s mining
\nconcession maintenance regime, simplifying compliance
\nrequirements and expanding eligibility for reduced mining licence
\nfees to provide greater legal certainty and support mining project
\ndevelopment.
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\n4. Special focus on Latin America and the Caribbean
\nAt the regional level, Chile has advanced three major corridor
\nprojects to strengthen regional connectivity, reduce transport costs
\nand enhance access to global markets. These include three
\nbi-oceanic corridors, Capricorn, Central and Northern Patagonian,
\nwhich connect the Atlantic and Pacific Oceans through a network of
\nroads and infrastructure, facilitating the movement of critical minerals
\nacross participating countries such as Argentina, Bolivia, Brazil and
\nPeru. In 2026, Chile and Argentina agreed to reactivate the
\nAdministrative Commission of the Chile-Argentina Mining Integration
\nand Complementation Treaty to foster mining co-operation. At the
\ninternational level, since 2025, Chile has signed MoUs with India and
\nthe United States to promote investment, exploration, value-added
\nprocessing and technology transfer.
\nColombia
\nColombia\u2019s critical minerals strategy is framed by its National Mining
\nDevelopment Plan 2024-2035, which identifies copper, nickel,
\nphosphates and manganese as priority strategic minerals and
\npromotes their development through streamlined permitting
\nprocedures, competitive bidding rounds and enhanced traceability. In
\n2025, the country launched its first tender round, offering 14 strategic
\nmining areas for the development of copper, gold and polymetallic
\nminerals.
\nColombia is seeking to improve the efficiency and transparency of its
\nmining governance framework through a combination of regulatory
\nreforms and institutional initiatives. In 2026, the National Mining
\nAgency introduced two draft regulatory resolutions to streamline
\npermitting procedures, including shortening consultation periodsfrom
\n216 to 90 days, while maintaining inclusive stakeholder engagement,
\nand revising the assessment of financial viability for mining
\nconcessions. In parallel, in May 2026, Colombia launched the Mineral
\nTraceability Platform to strengthen compliance and transparency
\nmechanisms across the value chain. In 2025, the Colombian
\nCommission of Mineral Resources and Reserves updated the
\nColombian Standard for the Public Reporting of Exploration Results,
\nMineral Resources and Reserves (ECRR), strengthening
\nsustainability requirements for mining projects.
\nMexico
\nStated policy objectives in Mexico focus on reinforcing critical
\nminerals as a strategic and sovereign resource while promoting
\nstronger environmental and social requirements. Amendments to the
\nMining Law approved in May 2023 expand consultation rules and
\nprocesses, prioritise water for domestic use, and require all mining
\nconcessions to be allocated through public bidding following approval
\nof necessary environmental, social and labour permits. Originally
\nestablished in 1992 as a structural reform of the sector\u2019s governance
\nframework, the Mining Law seeks to enhance environmental and
\nsocial safeguards. It introduces consultation and compensation
\nrequirements for Indigenous communities, prioritisation of water use
\nfor human consumption and requirements to recycle at least 60% of
\nconcessioned water. Downstream processing developments are also
\nencouraged under Mexico\u2019s National Plan 2025-2030, which
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\n4. Special focus on Latin America and the Caribbean
\npromotes increased investment in scientific and technological
\nresearch and reduced patent registration times. Mexico seeks to
\nstrengthen international co-operation, with the aim of consolidating
\nmining-related value chains to foster greater regional integration
\nbeyond the national level. These efforts aim to address supply chain
\nrisks while promoting value creation and retention in both Mexico and
\nthe North American region.
\nPeru
\nPeru\u2019s current efforts are focused on promoting investment in mining
\nexploration. In 2022, the VAT refund for mining exploration was
\nextended until 2027 to attract new investment. To reduce uncertainty
\nduring the exploration phase, Peru is finalising its National Geological
\nMap, which will provide complete coverage of its territory by the end
\nof 2026. It has also established international partnerships to support
\nthe mining sector. In 2025 and 2026, Peru signed MoUs with Canada,
\nthe United States (one in the context of the Critical Minerals
\nMinisterial and another with Proinversion) and Chile to advance
\ninvestment and access to technology, information and expertise
\nexchange. Furthermore, the Ministry of Foreign Affairs, along with the
\nCanada-Peru Chamber of Commerce, published Peru\u2019s Mining &
\nMetals Investment Guide 2025\/2026 with an updated overview of the
\nsector, its potential and the applicable tax and legal frameworks.
\nVenezuela
\nVenezuela enacted the new Ley Org\u00e1nica de Minas [Organic Mining
\nLaw] in April 2026, opening the mining sector to foreign and private
\ninvestment while maintaining state ownership of mineral resources.
\nThe law grants strategic mineral ownership to the state and allows
\ndomestic and international companies to operate through
\nconcessions and joint ventures, with renewable mining rights granted
\nfor up to 30 years. It also introduces clearer licensing procedures,
\nroyalty regimes and international arbitration mechanisms to
\nstrengthen investor confidence.
\nCaribbean countries
\nCountries in the Caribbean region are intensifying international
\nco-operation to attract investment in critical minerals and strengthen
\ntheir role in emerging supply chains. In the Dominican Republic,
\nefforts are focused on exploring rare earth potential as a key
\neconomic opportunity. The country is strengthening mining
\ngovernance with the creation of the Dominican Mining Company,
\nEmidom, in 2024 and plans to adopt new mining legislation to support
\ncritical mineral investment. Jamaica approved an Industrial Minerals
\nPolicy in 2024 to attract investment into its mining sector. In addition
\nto supporting investment in its established bauxite and alumina
\nindustries, the policy has helped attract major international partners
\nexploring for gold and copper. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nIEA. CC BY 4.0.
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\n4. Special focus on Latin America and the Caribbean
\nAchieving social acceptance and delivering high-quality projects require sustained, transparent
\nand inclusive engagement with local stakeholders
\nThe importance of involving local communities when developing new
\nprojects is at the centre of regional frameworks such as the Escaz\u00fa
\nAgreement, a treaty supporting the rights of individuals and
\ncommunities to access environmental information and participate in
\ndecision-making processes. In many countries across the region,
\npublic participation is embedded within environmental impact
\nassessment processes, with a strong emphasis on the rights of
\nIndigenous peoples. The United Nations and the International Labour
\nOrganization also recognise the principle of free, prior and informed
\nconsent for Indigenous communities in relation to authorisation for
\nmineral exploration and project development.
\nSpecific consultation and stakeholder engagement frameworks vary
\nacross the region in terms of legal requirements, implementation
\ncapacity and conflict intensity. The Escaz\u00fa Agreement, built on
\nbinding principles of access to information, public participation and
\nenvironmental justice, is progressively reshaping how LatinAmerican
\nstates govern stakeholder engagement, including in extractive
\nindustries. Chile\u2019s Senate ratification in June 2022 strengthened
\npublic consultation requirements in environmental licensing
\nprocesses. Colombia\u2019s Pollutant Release and Transfer Register,
\nphased in from 2025, provides affected communities with the right to
\naccess data on industrial emissions for the first time. Colombia\u2019s Law
\n2273, upheld as constitutional by the Constitutional Court in August
\n2024, makes treaty obligations directly enforceable in national courts.
\nCutting across all pillars, Mexico\u2019s SEMARNAT implementation
\nroadmap and the regional 2024-2030 Action Plan on Environmental
\nDefenders establish protective mechanisms for environmental
\ndefenders.
\nCountries in the region have specific frameworks supporting the
\nparticipation of Indigenous or Native Peoples. In 2011, Peru enacted
\nthe Law on the Right to Prior Consultation of Indigenous or Native
\nPeoples, which provides guidelines for structured dialogue between
\nthe state and Indigenous communities. In Mexico, the National
\nInstitute of Indigenous Peoples launched guidelines in 2019 for
\nimplementing the right to the free, prior and informed consent of
\nIndigenous peoples. In 2018, Paraguay enacted the Protocol for the
\nProcess of Consultation and Free, Prior and Informed Consent with
\nthe Indigenous Peoples Living in Paraguay.
\nMining companies play a significant role in shaping stakeholder
\nengagement practices. For instance, some have developed their own
\ncommunity consultation frameworks and defined how the views of
\naffected communities are incorporated into operational
\ndecision-making. The Somos Choapa programme in Chile
\ndemonstrates the efforts that the private sector can make to facilitate
\nmulti-stakeholder dialogue.
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\n4. Special focus on Latin America and the Caribbean
\nThere are still areas for improvement, alongside accumulated
\nlessons on effective stakeholder engagement in the region. In
\nparticular, engagement as a first step and greater accessibility of
\ninformation, covering not only project benefits but also environmental
\nrisks, are essential for enabling local communities to make informed
\ndecisions. Best practices, which can be grounded in the principle of
\nfree, prior and informed consent, should ensure that information is
\ntransparent, culturally appropriate and available in the native
\nlanguages of affected communities, with clear and accessible
\nexplanations of technical aspects. Strengthening these elements can
\nenhance the effectiveness of consultation processes and positively
\ninfluence project viability and continuity. Such practices include
\nsustained engagement, not only prior to project initiation but
\nthroughout the entire project life cycle, including post-closure, and
\nmay entail participatory monitoring mechanisms during project
\nimplementation and the delivery of tangible benefits to local
\ncommunities. Social inclusion in projects is crucial to support the
\nsustainable growth of the sector in the region.
\nBeyond consultation and participation mechanisms, ensuring that
\nlocal communities benefit from mining activities is another important
\narea of policy action. Across LAC, governments have established a
\nrange of legal and fiscal frameworks to channel a share of mining
\nrevenues to subnational authorities and affected communities. While
\napproaches vary, these mechanisms aim to strengthen the local
\nvalue generated by mining projects and help align community
\ninterests with project outcomes. This is the case in Peru, where
\nmining revenues including royalties are allocated to subnational
\ngovernments based on production levels. However, challenges can
\nremain in ensuring that benefits are distributed equitably and
\neffectively, highlighting the need for continued improvements to
\nbenefit-sharing frameworks.
\nOverall, meaningful engagement with local communities requires
\nboth public and private actors to strengthen sustained, transparent,
\ninclusive, culturally appropriate and genuine mechanisms that enable
\ncommunities to exercise their rights while supporting stable and
\nresilient mineral supply chains.
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\n4. Special focus on Latin America and the Caribbean
\nNew exploration, mining, refining, manufacturing and recycling technologies can be key drivers
\nof economic development in the region, if supported by enabling policies
\nFrom upstream exploration and mining to refining, manufacturing and
\nrecycling, a range of emerging technologies can enhance efficiency,
\ndeepen value addition and promote economic development.
\nSupportive policies will be crucial for deploying these innovations.
\nUpstream
\nDirect lithium extraction (DLE) is among the most promising
\ntechnologies for delivering new projects and production in the region.
\nExisting projects extract lithium from brines in evaporation ponds,
\nwhere the brine is allowed to evaporate and the resulting solution is
\nthen refined into lithium carbonate or lithium hydroxide. In contrast, in
\na typical DLE process, lithium ions are extracted from brine through
\nadsorption, ion exchange, solvent extraction, or membrane and
\nelectrochemical methods. Once lithium ions are recovered, they are
\nconverted into lithium carbonate or lithium hydroxide. DLE
\ntechnologies aim to achieve over 90% recovery, significantly higher
\nthan the 40-60% recovery typically achieved in conventional brinebased extraction. Additionally, DLE offers the potential to access
\nlithium deposits that were previously hard to reach or too costly to
\nextract. However, new DLE projects will need to overcome cost and
\noperational challenges that have slowed adoption to date.
\nLithium production in LAC by project type
\nIEA. CC BY 4.0.
\nGlobally, DLE accounts for almost 10% of lithium supply, although in
\nmost cases it is combined with traditional evaporation ponds. The
\nmain large-scale DLE projects outside China are currently located in
\nArgentina. The F\u00e9nix facility, acquired by Rio Tinto in 2025, has been
\noperating for more than 30 years, combining adsorption DLE with
\nconventional pond evaporation. Two new DLE projects are being
\ndeveloped in Argentina: Eramet\u2019s Centenario (planning 24kt Li
\nproduction capacity by 2027) and Rio Tinto\u2019s Rinc\u00f3n (planning
\n60kt Li production capacity when fully expanded). In Bolivia, a
\nconsortium including CATL and Uranium One Group aimed to build
\n50 100 150
\n2035
\n2025
\nkt Li
\nConventional brine Spodumene Direct lithium extraction
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\n4. Special focus on Latin America and the Caribbean
\nDLE plants in the Salar de Uyuni region, but the project has been
\nsuspended following a court order. In Chile, Albemarle has started
\nthe environmental review for a DLE project in the Antofagasta region,
\nand the Novandino partnership between Codelco and SQM is
\nplanning new projects in the Atacama Desert.
\nIonic adsorption clay is a method used to extract rare earth
\nelements from ionic adsorption deposits. Brazil is at the forefront of
\nthe development of ionic adsorption clay projects, as Serra Verde
\naims to produce 6.4 kt of rare earth oxides from the Pela Ema deposit
\nby the end of 2027 using ionic adsorption clay technology and lowemissions electricity. Further potential has been identified in the
\ncountry, with projects in the advanced permitting or feasibility stages.
\nIntegration of renewables and advanced water management is
\nkey for the region to leverage its comparative advantages and
\ndevelop shared infrastructure that would contribute to countries\u2019
\ndevelopment and economic growth. The region already hosts
\ninnovative facilities that integrate mining operations with renewable
\nenergy production and advanced water management systems, such
\nas Teck Resources\u2019 Quebrada Blanca Phase2 copper mine in Chile.
\nAmong other innovative technologies, the University of Concepci\u00f3n
\nis developing hydrogen-based processes for copper concentrate,
\nwhich have the potential to significantly reduce emissions.
\nDigitalisation and the integration of artificial intelligence (AI) in
\ncritical mineral development can bring significant benefits along the
\nvalue chain. AI can support mineral exploration by creating mineral
\nperspective maps based on geology. The Instituto de Tecnolog\u00edas
\nLimpias in Chile is developing digital twins and modular water
\nsolutions to optimise mining operations and resource use. The
\nChilean National Mining Society is also working on district-level digital
\nmapping to integrate information on ownership and facility type with
\ninfrastructure data. In Brazil, a project developed in collaboration with
\nCanada is using AI to model nickel deposits, with initial findings
\nexpected by 2027. AI-optimised drilling can lift output, reduce costs
\nand enable the development of deeper or lower-grade deposits.
\nAutomation improves operational safety by reducing manual work in
\nhazardous tasks. Innovative technologies also have the potential to
\nimprove tailings management, unlocking new resources and reducing
\nenvironmental impacts. The emergence of a digitally educated
\nworkforce is likely to support a gradual expansion in the adoption of
\ndigital solutions. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a>
\nMidstream
\nAdvanced hydrometallurgical routes, including new heap leaching
\ntechniques, pressure leaching and bioleaching, are particularly
\nrelevant for LAC producers facing declining ore grades and rising
\ncosts. In Chile and Peru, where copper production is increasingly
\nconstrained by lower grades and water stress, such methods can
\nsupport the economic processing of low-grade sulphide ores and
\nhistoric tailings while reducing reliance on energy-intensive smelting.
\nIn Brazil and Colombia, where nickel laterite deposits are present,
\nbioleaching has potential applications for nickel laterites and
\npolymetallic residues, supporting higher recovery rates and
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\n4. Special focus on Latin America and the Caribbean
\nextending mine life. The successful deployment and commercial
\nviability of these technologies will depend on market conditions, as
\nwell as progress in scaling up deployment and reducing costs.
\nNew rare earth separation technologies, including alternative
\nsolvent systems, ion exchange processes and membrane-based
\ntechniques, could lower environmental impacts, improving the
\nfeasibility of local or regional rare earth processing hubs. One key
\nchallenge in rare earth separation is the concentration of
\ntechnological knowledge, machinery manufacturing and skilled
\nworkforces in incumbent producing regions (see Chapter 3).
\nInvestment in technological development programmes can play a
\ncritical role in building local capabilities, supporting the development
\nof domestic knowledge and manufacturing bases, and facilitating the
\ngradual localisation of separation and processing activities.
\nMicrowave-assisted calcination and heating is an emerging
\ntechnology with potential applications in selected mineral processing
\nsteps. While these technologies are still at the early stages of
\ncommercial readiness, they could contribute to incremental energy
\nefficiency gains for LAC producers operating in power-constrained
\nsystems or regions with high electricity costs, such as parts of the
\nCaribbean and remote mining regions in SouthAmerica.
\nDownstream
\nInnovative anode technologies could be particularly relevant for
\nLAC, where resource endowments and low-emissions power sources
\ncreate opportunities for value-added battery supply chains. In Brazil,
\ncollaborative efforts between domestic and international firms have
\nexplored alternative anode chemistries, including lithium-ion batteries
\nbased on niobium-containing materials, illustrating the potential for
\nleveraging the country\u2019s unique mineral base.
\nBeyond niobium, Brazil hosts established production of graphite and
\nsilicon, highlighting potential for the development of silicon-carbon
\nanode composites. These materials are attracting growing interest as
\nbattery manufacturers seek higher energy density and improved
\nperformance. In addition, Brazil\u2019s relatively low-emissions electricity
\nmix adds to the advantages of domestic graphite processing and
\nanode manufacturing, particularly as battery manufacturers seek
\nlower life cycle emissions and higher sustainability standards.
\nRecycling
\nRecycling can offer significant opportunities in the region. The
\ne-waste collection rate is currently at just 3%, lower than the global
\naverage of 22%, with some high-performing regions reaching 58%.
\nInnovative technologies can also support additional recovery: battery
\nrecycling through hydrometallurgical processes, which recover
\nlithium, cobalt and nickel through acid leaching and selective
\nseparation, has the potential to achieve high recovery rates with
\nlower energy intensity than traditional smelting. Pyrometallurgical
\nroutes are still relevant where there is smelting infrastructure, as in
\nChile and Peru, but are more energy-intensive and prone to material
\nlosses, while emerging direct recycling approaches aim to restore
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\n4. Special focus on Latin America and the Caribbean
\ncathode material with minimal processing. Urban mining of e-waste
\ncan tap into growing electronic waste streams, such as portable
\nelectronics, EV batteriesand motors, and wind turbines, where
\nvaluable materials, including battery minerals, rare earths and other
\nminerals, are often present at higher concentrations than in extracted
\nores.
\nPolicy tools to support innovation
\nTargeted policy instruments are essential to support innovation in
\ncritical mineral production and processing in LAC, particularly when
\ndeployed as part of co-ordinated industrial and innovation strategies.
\nFinancial tools play a central role, including direct R&D funding,
\nco-financing through public innovation agencies and blended finance
\nmechanisms from development banks, which help de-risk early-stage
\ntechnologies and crowd in private investment.
\nCountry experiences highlight how these instruments can translate
\ninto innovation outcomes. In Brazil, the SENAI-led lithium-ion battery
\nproject (2024-2027), supported by funding of around
\nUSD 12.5 million, combines applied research funding with industry
\nco-investment to establish pilot production lines and develop
\ndomestic technological capabilities. The programme brings together
\na consortium of industrial partners, enabling knowledge transfer
\nacross the battery value chain and supporting the development and
\ntesting of locally adapted technologies.
\nSimilarly, development finance institutions are supporting innovation
\nby linking funding with technical assistance and capability building.
\nThe IDB, through initiatives such as LAC Minerals, provides blended
\nfinance and technical support to improve project design,
\nenvironmental standards and local supplier integration. In Argentina,
\nfor example, IDB-supported financing for the Rinc\u00f3n DLE project is
\ncoupled with measures to strengthen local supply chains and
\noperational capabilities, contributing to the diffusion of knowledge
\nand innovation across the sector.
\nBeyond funding, a strong focus is needed on enabling firms to
\ninnovate by improving capabilities and the broader ecosystem.
\nThis includes investments in skills and human capital, the
\ndevelopment of research and technology institutions and expansion
\nof existing programmes, and policies that encourage collaboration,
\nsuch as cluster initiatives and regional innovation programmes.
\nFinally, LAC countries can leverage demand-side policies and
\ninternational collaboration to accelerate innovation uptake and
\ndiffusion. Public procurement, standards and lead market initiatives
\ncan create early demand for new technologies, while foreign direct
\ninvestment, participation in global value chains and collaboration
\nwithin the region can foster knowledge transfer and skills
\ndevelopment.
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\n4. Special focus on Latin America and the Caribbean
\nFrom innovation to industry
\nInnovation could be a major source of value creation for LAC, but only
\nif it is embedded in broader industrial, infrastructure and skills
\nstrategies. The region benefits from strong foundations: major mining
\ncompanies already originate from the continent, including Chile\u2019s
\nCodelco and Brazil\u2019s Vale, and mining technology and service
\nproviders can help directly deploy solutions in operations. This
\nprovides a platform to scale technologies that raise recovery rates,
\nimprove water and energy management, enhance safety and reduce
\nenvironmental impacts. However, the scope to innovate in other parts
\nof the value chain varies by segment. In areas where domestic
\ncapabilities are more limited, including advanced battery materials,
\nrare earth separation, specialised equipment and some digital and
\nautomation technologies, attracting partners and firms with advanced
\ntechnological expertise can be valuable to complement local
\ninnovation. Policy has a crucial role to play. Building capacity in
\ngeological services and technology centres, targeted R&D support,
\nactions to support technology transfer and demonstration projects,
\ninvestment in education and international partnerships can help
\nstrengthen innovation capabilities and enhance operational efficiency. Download: Global Critical Minerals Outlook 2026.pdf<\/span><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"