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.
Table of contents
Executive summary …………………………………………………………………………….5
Introduction …………………………………………………………………………………….. 14
1. Market review ………………………………………………………………………………. 19
Mineral market trends …………………………………………………………………… 20
Geopolitical developments and implications for supply security …………. 38
Downstream market trends …………………………………………………………… 58
Investment trends ………………………………………………………………………… 75
Latest policy developments …………………………………………………………… 91
Sustainability performance tracking ……………………………………………….. 96
2. Outlook for key minerals: Part 1 ……………………………………………………. 108
Outlook overview ……………………………………………………………………….. 109
Outlook for copper ……………………………………………………………………… 124
Outlook for lithium………………………………………………………………………. 138
Outlook for nickel ……………………………………………………………………….. 147
Outlook for cobalt ………………………………………………………………………. 155
Outlook for graphite ……………………………………………………………………. 163
Outlook for rare earth elements ……………………………………………………. 174
Other key materials ……………………………………………………………………. 186
Outlook for key minerals: Part 2 …………………………………………………….. 197
Strategic minor minerals ……………………………………………………………… 198
Outlook for key minerals: Part 3 …………………………………………………….. 213
Nuclear supply chains ………………………………………………………………… 214
3. Pathways to resilient and diversified supply chains …………………………. 232
Emergency preparedness …………………………………………………………… 233
Policy and market frameworks to diversify supply chains ………………… 259
Technology, equipment and workforce ………………………………………….. 283
4. Special focus on Latin America and the Caribbean ………………………… 305
Annex …………………………………………………………………………………………… 336
Acknowledgements …………………………………………………………………….. 337
Key projection results ………………………………………………………………….. 346
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Abstract
Critical minerals have rapidly moved to the heart of global
discussions on energy and economic security. Their indispensable
role across several energy technologies as well as other industries of
strategic importance such as high-tech manufacturing, AI and digital
systems, and aerospace and defence, have underlined the need to
enhance the resilience and diversity of their supply chains.
The 2026 edition of the IEA’s annual Global Critical Minerals Outlook
includes a detailed assessment of the latest market, investment and
technology trends, along with their implications for critical mineral
security. The report provides a snapshot of recent industry
developments and offers medium- and long-term projections for the
supply and demand of key energy minerals, taking into account the
latest policy and technology developments. This year’s report will
also include several areas of special focus: strategic minor minerals
with applications beyond energy, nuclear supply chains and the role
of Latin America in global mineral supply chains.
As countries increasingly call on the IEA to deepen its work on critical
mineral security and supply chain diversification – as reflected in the
declaration by IEA Ministers and G7 leaders – the 2026 Outlook will
include a new chapter examining the policy implications of building
resilient and diversified supply chains, including emergency
preparedness, policy and market frameworks, and technology,
equipment and workforce issues.
Executive summary
Critical minerals have moved to the forefront of energy,
economic and national security agendas in recent years. This
reflects growing concerns about supply chain concentration and the
expanding use of trade restrictions. Although the adequacy of supply
remains a major concern, notably for copper, governments are now
placing greater attention on resilience, diversification and the security
of supply in an increasingly complex geopolitical environment.
Critical mineral prices rebounded in 2025 and early 2026 after
declining in recent years. Driven by tight supply conditions, prices
for base metals such as aluminium, copper and tin rose by one-third
between January 2025 and April 2026, with copper prices reaching
record highs. Battery material prices also recovered following a
downturn in 2023 and 2024. Lithium prices more than doubled amid
strong demand from energy storage applications and constrained
supply, while cobalt prices rose by around 130%, largely due to
export restrictions imposed by the Democratic Republic of the Congo
(DRC). Prices for strategic minor minerals – those with relatively
small market sizes but critical roles across the energy, high-tech,
aerospace and defencesectors – had already started rising in 2024
and continued to rally through 2025 and early 2026 amid new export
controls and robust demand growth.Prices for these minerals more
than doubled, with prices for tungsten surging sixfold. Export controls
have also led to a sharp price divergence between Chinese markets
and those in other regions. In Europe, prices for gallium and heavy
rare earths(dysprosium and terbium) are currently around five times
higher than Chinese domestic prices, and germanium prices are
almost three times higher– highlighting the challenges of securing
supply outside the dominant supplier.
Supply concentration in refining continued to edge higher for
most minerals in 2025, with rare earths the notable exception.
Over the past two years, the top refining countries– Indonesia for
nickel and China for other key energy minerals – accounted for over
three-quarters of total growth in refined supply. In several markets,
including for manganese, nickel and graphite, virtually all supply
growth came from the dominant supplier. Rare earth refining was an
exception, with new projects in the United States and production
increases in Malaysia leading to a modest decline in concentration,
highlighting the role of targeted policy and investment support in
enabling diversification. Excluding rare earths, the average share of
the top refining country rose to 72% in 2025, up from 70% in 2023.
Gaps between projected demand and anticipated supply over
the next decade have narrowed for copper and lithium, but new
risks have emerged for cobalt due to policy shifts in major
producers. Based on the project pipeline, supply deficits for copper
and lithium are set to persist through 2035, although the outlook has
somewhat improved. For copper, the projected supply deficit in 2035. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
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Executive summary
has narrowed from around 30% in last year’s Outlook to 25% as new
projects advance, particularly in the DRC and Zambia. By contrast, a
projected supply gap has emerged for cobalt due to the DRC’s new
export quota. This development underscores how policy changes by
major producers can rapidly reshape the global supply outlook in
markets with high levels of geographic concentration.
New export controls have turned supply concentration risks into
reality. The number of mineral tariff codes subject to Chinese export
controls has tripled since 2023. Other countries also introduced new
restrictions, including the cobalt export quota by the DRC and trade
restrictions by Zimbabwe for lithium and Mozambique for graphite.
The recent proliferation of export controls has transformed concerns
around high supply concentration from a theoretical vulnerability into
an immediate economic security challenge.
2025 marked the year when the economic risks of highly
concentrated supply chains materialised at scale. In April 2025,
the Chinese government introduced major export controls on seven
heavy rare earth elements, with significant impacts across
downstream industries, forcingsome automakers to reduce utilisation
rates or temporarily halt operations. In October 2025, they were
further expanded, extending proposed restrictions to internationallymade products containing rare earths sourced from China or
produced using Chinese technologies. Although the expanded
measures were suspended for one year until November 2026, the
vulnerabilities remain. Their full implementation could put an
estimated USD 6.5 trillion per year of downstream production outside
China at risk across the automotive, high-tech, defence and energy
sectors. In October 2025, China also announced export controls on
key battery supply chain chokepoints, including cathode materials,
cathode precursors and graphite anode materials, as well as on
battery manufacturing equipment and technologies. If battery-grade
graphite trade were fully disrupted, over USD 300 billion per year of
downstream production outside China would be at risk. These
developments underscore how small volumes of critical minerals
underpin vast economic value and highlight the fragility of highly
concentrated supply chains.
Strategic stockpiles can provide an important short-term buffer
against supply disruptions. The largest-ever oil stock release by
IEA Member countries in March 2026 amid the Middle East conflict
helped mitigate market disruptions. While critical mineral markets
differ from oil markets, strategic stockpiles can still provide an
important emergency buffer, helping safeguard industrial activities
during supply shocks. For the 11 high-risk materials assessed by the
IEA, the net annual cost of stockpiling for countries outside the
dominant supplier is estimated at less than USD 900 million, modest
relative to the potentially major economic impacts of disruptions.
The conflict in the Middle East has provided another stark
reminder of the vulnerabilities affecting mineral supply chains.
While the key impacts of the conflict centred on oil and gas markets,
there has also been considerable impact on mineral and metal
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Global Critical Minerals Outlook 2026
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Executive summary
markets from the closure of the Strait of Hormuz, notably for
aluminium, sulphur and helium. The Middle East accounts for around
8% of global aluminium production, and production curtailments at
several regional smelters added strain to an already tight market. The
region also supplies around one-quarter of global sulphur and half of
global seaborne sulphur trade passes through the Strait of Hormuz.
Sulphur is a key feedstock for sulphuric acid, which is essential for
fertiliser production and the processing of a range of critical minerals
such as copper, lithium, cobalt, nickel and rare earths. Disrupted
sulphur supplies prompted China to curb sulphuric acid exports in
May 2026, creating ripple effects across both mineral and fertiliser
value chains. The resulting surge in acid prices increased production
costs for several critical minerals with acid costs overtaking energy
costs to become the largest cost component in some cases.
Critical mineral investment declined by 9% in 2025, ending
several years of growth. Amid rising geopolitical tensions and price
volatility, investors became more cautious despite strong underlying
demand. Battery metals saw the sharpest pullback, with capital
spending falling by more than 20%– the largest decline in over a
decade– and lithium companies cutting investment by around 40%.
By contrast, spending by copper-focused companies increased by
8%, reflecting confidence in copper’s long-term prospects.
Exploration spending also declined by more than 10%, with
modest growth in spending on uranium and steady spending on
copper offset by around 45% declines in lithium and nickel. Most
regions recorded lower exploration spending, although Asia Pacific
bucked the trend with a 20% increase. Merges and acquisitions
rebounded in 2025, with strong demand for high-quality copper
assets driving a 20% increase in overall deal value compared with
2024. Venture capital investment also recovered, increasingly
targeting artificial intelligence (AI) technologies that could improve the
efficiency of mineral exploration and resource extraction.
Public finance is increasingly being deployed to accelerate
critical mineral investment. Governments are taking a more active
role in reducing project risks and mobilising private capital. Public
finance commitments in advanced economies reached around USD
65 billion in 2025, over four times higher than in 2023. However, a
considerable gap remains between commitments and actual
disbursements, which will ultimately determine their impact on supply
diversification.
Analysis of project pipelines reveals a structural imbalance in
efforts to promote supply chain diversification, with refining and
downstream capacity lagging behind mining.Many projects are
being developed outside the dominant supplier, but investment
remains concentrated in upstream projects compared with refining
and manufacturing capacity. In rare earth supply chains, existing and
announced refining capacity in geographically diversified regions is
equivalent to around two-thirds of expected mined supply by 2035,
while planned magnet production represents only one-third. A similar
pattern is evident in battery materials, where planned cathode
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Global Critical Minerals Outlook 2026
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Executive summary
production capacity is only about one-third of projected lithium mining
capacity. These imbalances underscore the need for a more
balanced approach to development across value chains.
There is a strong case for greater policy attention to strategic
minor minerals. As semiconductors, robotics and AI drive the next
wave of innovation, securing supplies of minerals such as gallium,
germanium, indium and antimony is becoming increasingly important.
Similarly, the aerospace and defence sectors depend on minerals
including cobalt, titanium, tungsten and yttrium to meet stringent
performance requirements. Based on the IEA’s risk assessment
framework, gallium, magnet rare earths, yttrium, graphite, tungsten,
tellurium, cobalt and germanium rank among the materials most
exposed to supply vulnerabilities, due to their high supply
concentration, limited substitution potential and critical importance
across multiple end-use applications. Many of them are already
subject to some form of export restrictions. Download: Global Critical Minerals Outlook 2026.pdf
Despite extremely high supply concentration today, strategic
minor minerals offer promising opportunities to strengthen
supply security at a reasonable cost, if accompanied by strong
policy support. The markets for these minerals aresmall, but supply
disruptions can carry disproportionate economic consequences.
However, diversifying these supply chains typically does not require
investment on the scale needed for bulk commodities, and bringing a
limited number of high-quality projects online can substantially
improve resilience. For example, diversifying magnet rare earth
supply chains would require around USD 60 billion of investment over
the next decade– modest relative to the huge potential economic
cost of supply disruptions.
Greater attention is also needed on the strategic role of base
metal smelters. Many strategic minor minerals are recovered as byproducts of copper, zinc and lead processing, making base metal
smelters essential to the security of these materials. Modern copper
and zinc smelters are more than producers of refined base metals–
they are strategic processing hubs that enable the recovery of
numerous critical by-product minerals, support downstream
manufacturing and provide recycling capacity for scrap metal. As
such, they warrant greater policy attention as critical midstream
infrastructure to ensure supply chain resilience.
The base metal smelting sector is showing increasing signs of
stress. Despite rising base metal prices, smelter fees have fallen to
historic lows. Benchmark copper smelter fees were settled at
USD0 per tonne in 2026, the lowest level ever agreed in annual
negotiations, while spot charges have remained negative since 2024;
zinc and lead smelter fees have also turned negative. As this revenue
stream has effectively disappeared, smelters have become
increasingly reliant on by-product sales, which are inherently more
volatile. Tight concentrate supplies, combined with rapid smelter
capacity expansion in China, have driven this trend. Since 2005,
China has accounted for over 90% of growth in global copper
smelting, increasing its share of global capacity from around 15% to
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Global Critical Minerals Outlook 2026
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Executive summary
50% by 2025. Smelter utilisation rates have also diverged sharply
since 2020, falling below 70% outside China by 2025 while remaining
around 85% in China. If these conditions persist, many custom
smelters outside China could face growing economic pressure,
further increasing supply concentration in strategic midstream
capacity.
New projects in geographically diverse regions often face higher
costs than incumbent suppliers, complicating investment
decisions. Capital costs for refining projects are 20% to over 150%
higher outside the dominant supplier, due to higher equipment and
construction costs. Operating costs are, on average, around 50%
higher, driven by feedstock and energy prices. These cost
disadvantages are compounded by technical and skills constraints,
infrastructure gaps, and lengthy permitting processes, making it more
difficult for market forces alone to bring forward new projects.
Diversification requires well-designed policy tools to reduce
investment risks. Measures such as grants, equity participation,
concessional loans and loan guarantees can lower upfront financing
barriers for capital expenditures. Contracts for difference, price capand-floor, offtake backstops and strategic reserves can support
operating expenditures and boost project viability by reducing price
and volume risks. Price-based mechanisms are particularly well
suited to strategically important supply chains with a limited number
of viable projects, provided they are carefully designed to balance
investment incentives with fiscal exposure, such as through
competitive tenders and performance-based eligibility.
Policy tools should be tailored to the characteristics of each
mineral market and supply chain segment. Large, liquid markets
such as copper are generally best supported through measures that
reduce upfront investment risks, complemented by support for
enabling infrastructure. By contrast, small, opaque and highly
concentrated markets such as rare earths may require targeted
measures to mitigate price and volume risks. Across the value chain,
mining is typically capital-intensive, making upfront capital support
more relevant. Refining projects are more sensitive to cost and
marginpressures and may require operationalrisk-mitigation tools to
improve competitiveness.
Countries can combine supply-side support with demand-side
measures to strengthen the commercial viability of diversified
supply chains. While supply-side policies can help bring new
projects online, they may not by themselves create sufficient
incentives for manufacturers to source from these suppliers.
Demand-side measures can provide predictable demand, improving
the bankability of projects and incentive to invest in them. Available
tools include diversified sourcing requirements, potentially
complemented by fiscal incentives such as tax credits, to encourage
procurement from non-dominant suppliers; demand aggregation and
facilitated offtake arrangements to build a stable and sizeable
customer base; and trade-based measures to narrow price gaps
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Global Critical Minerals Outlook 2026
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Executive summary
between incumbent and diversified supply. Their effectiveness
depends on careful design to balance investment incentives, market
efficiency and trade considerations.
Critical minerals generally account for a small share of final
product prices, although their cost contribution varies significantly
across value chains, with important implications for policy design.
While higher mineral prices can substantially increase the cost of
intermediate products such as battery cells and permanent magnets,
the impact on final products is often limited. For example, critical
minerals account for around one-quarter of battery cell costs but only
about 3% of the price of an average electric vehicle(EV), while rare
earths represent around 40% of permanent magnet costs but less
than 1% of a vehicle’s value. By contrast, materials such as copper
represent a larger share of equipment costs, accounting for around
10-15% of transformer and power cable prices. These differences
suggest that, in some supply chains, downstream users may be able
to absorb higher material costs more readily, providing scope for
diversified sourcing without materially affecting end-product prices.
For example, a tripling of rare earth prices would increase the cost of
a car by just 0.1%, while a tripling of battery material prices would
increase the final price of EVs and storage systems by around 5%.
The additional cost of supply diversification can be viewed as a
mineral security premium – a form of economic insurance
against major supply risks. Diversified supply often comes at a
higher cost, raising the question of how these additional costs should
be addressed. These costs could be justified as the price of enhanced
economic resilience – a security premium that provides insurance
against the risks associated with concentration. As critical minerals
generally represent a small share of final product costs, much of the
additional cost of diversification could be absorbed with limited impact
on consumers, although some intermediate sectors may face greater
cost pressures and require targeted support. A shared approach
involving governments, industry and consumers could help finance
this premium and unlock the investment needed to build more
diversified and resilient supply chains.
Successful diversification requires addressing critical gaps in
technology, equipment and skilled workforce across the value
chain. Diversification is not simply a question of developing new
projects; it requires building a broader ecosystem of capabilities.
From lithium chemicals and graphite to rare earths and gallium,
processing and refining stages rely on complex technologies,
specialised equipment and highly skilled expertise that remain
concentrated in a small number of countries. Outside the dominant
supplier, equipment providers are limited, lead times can be lengthy,
and accumulation of technical know-how often takes time and
resources. For example, outside China, only a handful of suppliers
provide key battery-grade-graphite processing equipment, while
ultra-high-purity gallium refining and compound semiconductor
manufacturing rely on only one or two specialised equipment
suppliers. In rare earth magnet production, grain boundary diffusion
– a key technology to enhance magnet performance – is highly
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Global Critical Minerals Outlook 2026
PAGE | 12
Executive summary
patented, with only one equipment supplier outside China and
equipment costs that are reportedly more than ten times higher,
alongside longer lead times. Recent export controls targeting not only
critical minerals but also processing technologies and equipment
underscore the importance of closing these capability gaps.
Addressing these challenges will require a holistic approach
combining innovation, workforce development, policy support and
international co-operation to build the technological foundations for
diversified and resilient supply chains. Download: Global Critical Minerals Outlook 2026.pdf
Recycling could play an increasingly important role in easing
supply strains, with secondary supply potentially doubling its
contribution by 2040. Under today’s policy settings, average
recycling rates across key energy minerals could rise from around
10% today to close to 20% by 2040. Cobalt and copper already have
relatively established recycling streams, with rates expected to
increase further to 2040, while rare earth magnet recycling could
benefit from growing end-of-life volumes from early generations of
EVs and wind turbines. Lithium and nickel recycling remain at an
early stage but are expected to expand rapidly. Battery recycling
capacity has expanded significantly, but remains highly concentrated,
with China accounting for over three-quarters of global pre-treatment
capacity and 90% of material recovery capacity. Outside China,
Korea is the leading player in material recovery. Realising the full
potential of secondary supply will require continued investment in
collection and recycling infrastructure and sustained demand for
recycled materials.
The renewed expansion of nuclear power is driving a need for
significant investment across the uranium and nuclear fuel
cycle. Uranium markets have strengthened sharply since 2020,
reflecting expectations of substantial growth in demand for nuclear
fuel and the need to expand supply. As global uranium requirements
rise, new mine projects will need to be successfully developed and
brought online. However, the most immediate constraints are
emerging further downstream, particularly in uranium conversion,
where global capacity is already tight and additional investment will
be needed to avoid bottlenecks. Enrichment capacity will also need
to expand over the medium term, driven by both nuclear capacity
growth and rising demand for higher-assay fuels, such as high-assay
low-enriched uranium (HALEU), in some next-generation reactors.
Fuel fabrication capacity is generally adequate for conventional fuels,
although reactor-specific requirements could create challenges for
some technologies. Supply security risks are heightened by
concentration across the fuel cycle, with the top three countries
accounting for almost three-quarters of uranium mining and around
70% of conversion and enrichment capacity.
Latin America and the Caribbean is well positioned to play a
larger role in diversified global critical mineral supply chains.
The region is a major producer of base metals, accounting for over
20% of global tin and zinc production and around 40% of global
copper mine output. It is also a key producer of strategic minor
minerals such as molybdenum, niobium and rhenium. The region is
strengthening its position in energy minerals, producing around oneIEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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Executive summary
quarter of global lithium supply, with output expected to grow by
nearly 50% by the end of the decade. It also holds substantial
reserves of silver, graphite, rare earths and other strategic minerals.
However, the region refines only around one-fifth of its mined
output of key energy minerals, with the exception of lithium where
integrated chemical processing has developed. If lithium, nickel,
cobalt, graphite and rare earths were refined locally and two-thirds of
copper production were processed within the region, the economic
value generated could increase by nearly 50% from today, reaching
around USD 220 billion by 2035. Realising this opportunity requires
addressing high financing costs, infrastructure gaps in power and
water, technology and skills constraints, and strengthening
engagement with local stakeholders.
The IEA Critical Minerals Security Programme will continue to
serve as a key international platform for advancing global efforts
on mineral security. Recent market developments have elevated
mineral supply security, placing it at the forefront of energy and
economic policymaking. As the Agency’s flagship framework, the
Programme supports countries in strengthening emergency
preparedness and accelerating supply diversification. Building on
mandates from IEA Ministers in February 2026 and G7 Leaders in
June 2026, the IEA will continue to expand Programme activities to
help deliver more resilient and diversified supply chain.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 14
Introduction
Introduction
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 15
Introduction
Introduction
Critical minerals have rapidly risen to the top of the economic and
national security agenda, extending well beyond their role in energy
security. Over the past year, critical minerals have become an
increasingly prominent feature of geopolitical and industrial policy
debates, reflecting growing concerns about supply chain
concentration, strategic dependencies and the expanding use of
trade and export restrictions. While earlier discussions focused
primarily on whether supply could keep pace with rapidly rising
demand from energy technologies, the emphasis has increasingly
shifted towards the vulnerabilities created by concentrated supply
chains, particularly in processing and refining. Although supply
adequacy remains a major concern for some materials, notably
copper, governments are now placing greater attention on resilience,
diversification and security of supply in an increasingly complex
geopolitical environment.
Although the risks associated with high supply concentration have
long been recognised, the proliferation of export controls by dominant
suppliers in recent years has transformed these concerns from a
theoretical vulnerability into an immediate economic and industrial
security challenge. In particular, the rare earth and magnet export
controls introduced by the People’s Republic of China (hereafter,
“China”) in April and October 2025 marked a major turning point.
Many downstream manufacturers struggled to maintain operations as
they faced difficulties securing the magnets required for key
technologies and industrial equipment. Although the stricter export
controls announced in October 2025 were subsequently suspended
for one year, the episode demonstrated the scale of the risks
associated with concentrated supply chains and highlighted the
fragility of critical mineral markets.
The conflict in the Middle East in 2026 provided another stark
reminder of the vulnerabilities arising from geopolitical tensions and
dependence on a limited number of suppliers and trade routes. While
the immediate focus centred on risks to oil and gas markets,
significant impacts were also felt across mineral and metal supply
chains. Disruptions first affected commodities in which the region
plays a major role, including aluminium, sulphur and helium, but
quickly propagated through interconnected downstream value chains.
Sulphuric acid, for example, is a critical input into copper, cobalt and
nickel production, while helium is indispensable for semiconductor
manufacturing and a range of medical technologies.
These developments have firmly placed mineral supply security at
the centre of energy and economic policy making, reinforcing the
urgency of diversifying supply chains. Governments are increasingly
responding through a growing number of policy initiatives, strategic
partnerships and bilateral or plurilateral co-operation frameworks.
However, while there is broad consensus on the need for
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Global Critical Minerals Outlook 2026
PAGE | 16
Introduction
diversification, the question of how to achieve it remains far more
complex. New projects in geographically diverse regions often face
higher costs than incumbent suppliers, as well as a range of
challenges, including technical and skills constraints, infrastructure
gaps, lengthy permitting processes and more stringent environmental
requirements.
Against this backdrop, this year’s Global Critical Minerals Outlook
aims to provide a comprehensive assessment of evolving market
dynamics and the implications of recent geopolitical developments
for the future of critical mineral supply chains. The report analyses
the latest market, technology and policy trends; examines future
demand, supply and investment prospects for key minerals; and
assesses potential risks across different stages of the value chain.
In addition to the regular analysis of demand, supply, prices and
investment trends, this year’s edition places particular emphasis on
the actions needed to build resilient and diversified supply chains. It
explores short-term emergency preparedness measures, policy and
market frameworks to support investment in diversified supply chains,
and approaches to overcoming technology and industrial ecosystem
bottlenecks. Download: Global Critical Minerals Outlook 2026.pdf
The analysis also builds on activities under the IEA Critical Minerals
Security Programme, the Agency’s flagship framework designed to
help countries enhance emergency preparedness and accelerate
supply diversification. In February 2026, IEA Ministers adopted
the Declaration Supporting the IEA’s Work on Critical Minerals
Security. In June 2026, G7 leaders recognised the Programme’s
central role as a key platform for international co-operation on mineral
security.
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Global Critical Minerals Outlook 2026
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Introduction
Scope of the analysis, scenarios and chapter structure
Critical minerals play a vital role in a wide range of energy
technologies, but recent market and geopolitical developments have
underscored their strategic importance far beyond the energy sector.
Minerals and metals are increasingly recognised as foundational
inputs for a broad range of strategic industries, including energy,
semiconductors, advanced manufacturing, aerospace, defence and
other high-tech sectors. As a result, policy attention has expanded
beyond energy-related materials to a wider suite of strategic minerals
that underpin economic competitiveness and national security.
The report continues to place greater focus on “key energy minerals”,
notably such as copper, lithium, nickel, cobalt, graphite and rare earth
elements, for which we provide detailed demand and supply
projections based on bottom-up modelling. However, reflecting
recent developments, its scope has expanded to cover a broader
range of critical minerals that play an important role across strategic
industries. It examines key market trends for important materials such
as aluminium, manganese, phosphate, platinum-group metals,
silicon, silver, tin and uranium, as well as strategic minor minerals
such as gallium, germanium, antimony and tungsten. While these
minor minerals represent relatively small markets in terms of volume,
they carry significant economic and strategic importance.
Our assessment of mineral demand in the energy sector includes
demand for low-emissions power generation (solar photovoltaic, wind,
hydro, nuclear and other renewables), electric vehicle (EV) batteries
and battery storage, grid networks (transmission, distribution and
transformers), and hydrogen technologies (fuel cells and
electrolysers) based on detailed assessments of technology
deployment, sub-technology shares, mineral intensity and material
efficiency measures. Demand outside the energy sector is projected
using historical consumption by end-use application, relevant activity
drivers and material intensity trends.
Mineral supply projections are based on a detailed review of all
announced projects across the globe. We present two supply
scenarios: a base case and a high-production case. The base case
includes production from existing assets and those under
construction, along with projects that have a high chance of moving
ahead because they have obtained all necessary permits, secured
financing and/or established offtake contracts. The high production
case additionally considers projects at a reasonably advanced stage
of development that are seeking financing and/or permits. Neither
case considers projects that are in the very early stages of
development, nor does it include theoretical projects for which
resources might be adequate, but which have not been proposed.
For these reasons, our supply projections focus on the period to 2040.
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Global Critical Minerals Outlook 2026
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Introduction
Our forward-looking analysis is based on the main IEA scenarios
included in the World Energy Outlook 2025, updated for the latest
data on EVs from the Global EV Outlook 2026.
• The Current Policies Scenario (CPS) considers a snapshot of
policies and regulations that are already in place and offers a
cautious perspective on the speed at which new energy
technologies are deployed and integrated into the energy system.
• The Stated Policies Scenario (STEPS) is an exploratory
scenario that provides a sense of the prevailing direction of travel
for the energy system, based on today’s policy settings. Barriers
to the introduction of new technologies are lower than in the CPS,
but the STEPS does not assume that aspirational targets are met.
• The High Demand Scenario (HDS) assumes a higher level of
energy technology development, in line with the levels projected
in the Announced Pledges Scenario of the World Energy Outlook
2024. This scenario is included in the report to illustrate the upper
range of potential future demand.
All projection results are made available in the IEA Critical Minerals
Data Explorer, an interactive online tool that allows users to easily
access the IEA’s projection data.
Chapter 1 (Market review) offers a snapshot of industry
developments in 2025 and early 2026. It reviews major demand,
production, investment and price trends for key minerals. The chapter
also discusses the latest policy developments and insights based on
systematic tracking of the industry’s sustainability performance.
Chapter 2 (Outlook for key minerals) provides an outlook for
demand and supply of key minerals and related market and policy
issues. The chapter provides detailed projections for key energy
minerals, including copper, lithium, nickel, cobalt, graphite and rare
earth elements. It also reviews key trends for other important
materials and includes two special focus areas: (i) minerals critical to
high-tech, defence and aerospace industries and (ii) mineral supply
chain issues related to nuclear energy.
Chapter 3 (Pathways to resilient and diversified supply chains)
provides practical insights into some of the most pressing questions
about the development of resilient and diversified mineral supply
chains. The chapter is structured around three key themes: how
countries can strengthen preparedness against potential supply
disruptions; how effective policy and market frameworks can be
designed to support investment in diversified assets; and how
technology and broader ecosystem bottlenecks can be addressed.
Chapter 4 (Special focus on Latin America and the Caribbean)
highlights one of the world’s most important mineral-producing
regions, examining its current state of play, potential for value
addition, and the key challenges and opportunities associated with
developing mineral resources in a sustainable and responsible
manner. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 19
1. Market review
1. Market review
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 20
1. Market review
Mineral market trends
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 21
1. Market review
Critical mineral prices rebounded in 2025, while strategic minor minerals continued to rally on
export controls and robust demand growth
Price developments for selected critical minerals by category
IEA. CC BY 4.0.
Note: Base metals include aluminium, copper, lead, tin and zinc; alloy metals include chromium, molybdenum and vanadium; battery metals include lithium, nickel,
cobalt, graphite, high-purity manganese and purified phosphoric acid; rare earths include four magnet-related elements – neodymium, praseodymium, dysprosium
and terbium; strategic minor minerals include antimony, bismuth, gallium, germanium, indium, tantalum, tellurium, titanium and tungsten.
Sources: IEA analysis based on data from S&P Capital IQ, Bloomberg and KOMIS.
50
100
150
200
250
300
Jan-23 Jul-23 Jan-24 Jul-24 Jan-25 Jul-25 Jan-26
Index (January 2023 = 100)
Apr-26
Strategic
minor
minerals
Base metals
Alloy metals
Rareearths
Battery
materials
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 22
1. Market review
Battery materials and rare earth prices are recovering from recent downturns
Change in prices for selected critical minerals
IEA. CC BY 4.0.
Notes: HPM = high-purity manganese sulphate; PPA = purified phosphoric acid. Assessment based on London Metal Exchange cash prices for aluminium, copper,
zinc, tin, nickel and cobalt; China domestic or export prices for molybdenum, graphite, phosphoric acid, manganese sulphate, gallium, germanium, antimony,
bismuth, indium, magnet rare earths, tantalum, tellurium, titanium and tungsten; global average prices for lithium carbonate.
Sources: IEA analysis based on S&P Capital IQ, Bloomberg and KOMIS.
– 100%
– 50%
50%
100%
Aluminium Copper Lead Zinc Tin Molybdenum Chromium Vanadium Average
Jan 2023 -Jan 2025
Jan 2025 -Apr 2026
Base and alloy metals
– 100%
– 50%
50%
100%
Gallium Germanium Antimony Bismuth Indium Tantalum Tellurium Titanium Tungsten Average
Strategic minor minerals 620%
– 100%
– 50%
50%
100%
Lithium Nickel Cobalt Graphite HPM PPA Average Magnet rare
earths
Battery materials & rareearths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 23
1. Market review
Tungsten, tantalum, cobalt, lithium and rare earth elements have recorded the largest price
increases since 2025
Change in selected critical mineral prices, January 2025-April 2026
IEA. CC BY 4.0.
Notes: PPA = purified phosphoric acid. Manganese refers to manganese sulphate. Assessment based on London Metal Exchange cash prices for aluminium,
copper, zinc, tin, nickel and cobalt; China domestic or export prices for molybdenum, graphite, phosphoric acid, manganese sulphate, gallium, germanium, antimony,
bismuth, indium, magnet rare earths, tantalum, tellurium, titanium and tungsten; global average prices for lithium carbonate.
Sources: IEA analysis based on S&P Capital IQ, Bloomberg and KOMIS.
50%
100%
150%
200%
Tungsten
Tantalum
Cobalt
Neodymium
Lithium
Praseodymium
Indium
Bismuth
Tin
Chromium
Copper
PPA
Aluminium
Terbium
Molybdenum
Vanadium
Tellurium
Zinc
Antimony
Manganese
Nickel
Germanium
Dysprosium
Titanium
Graphite
Gallium
Lead
Base and alloy
metals
Battery
materials
Magnet rare
earths
Strategic
minor minerals
620%
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 24
1. Market review
Price divergence between Chinese and ex-China products has widened for several minerals
under export controls
Recent price development for selected minerals in China and Europe
IEA. CC BY 4.0.
Note: European prices – gallium 99.99%, germanium 99.999%; Rotterdam prices from Fastmarkets; average dysprosium and terbium oxide prices from Benchmark
Mineral Intelligence.
Sources: IEA analysis based on Bloomberg, Fastmarkets and Benchmark Mineral Intelligence.
100
200
300
400
500
600
Jan-25
Apr-25
Jul-25
Oct-25
Jan-26
Apr-26
Europe China
Gallium
Index (China prices in January 2025 = 100)
100
200
300
400
500
600
Jan-25
Apr-25
Jul-25
Oct-25
Jan-26
Apr-26
Germanium
100
200
300
400
500
600
Jul-25
Oct-25
Jan-26
Apr-26
Rare earths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 25
1. Market review
Despite rising base metal prices, treatment charges for smelters have fallen into negative
territory in recent years
Base metal prices and treatment charges
IEA. CC BY 4.0.
Note: TC = treatment charges.
Sources: IEA analysis based on S&P Capital IQ, Wood Mackenzie and Fastmarkets.
-225
-150
-75
0
75
150
3 000
6 000
9 000
12 000
15 000
Jul-23
Jan-24
Jul-24
Jan-25
Jul-25
Jan-26
Copper prices Spot TC (right axis)
Copper
USD per tonne
-270
-180
-90
0
90
180
1 500
2 000
2 500
3 000
3 500
4 000
Jul-23
Jan-24
Jul-24
Jan-25
Jul-25
Jan-26
Zinc prices Spot TC (right axis)
Zinc
USD per tonne
-225
-150
-75
0
75
150
1 600
1 800
2 000
2 200
2 400
2 600
Jul-23
Jan-24
Jul-24
Jan-25
Jul-25
Jan-26
Lead prices Spot TC (right axis)
Lead
USD per tonne
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 26
1. Market review
Demand for key energy minerals grew much faster than demand for other materials, driven
predominantly by energy sector applications
Annual change in demand for key energy minerals
IEA. CC BY 4.0.
Notes: Key energy minerals include copper, battery metals and rare earth elements. Rare earths refer to magnet rare earths only.
– 5%
5%
10%
15%
20%
25%
30%
’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 Aluminium
Zinc Lead
Energy Other uses Total Net growth
Copper Lithium Nickel Cobalt Graphite Rare earths
Sourceof demand growth:
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 27
1. Market review
Despite strong demand growth, robust supply expansion kept most key energy mineral markets
in surplus in 2025
Demand and refined supply growth for key energy minerals, 2024-2025
IEA. CC BY 4.0.
Note: Rare earths refer to magnet rare earths only.
– 15%
– 5%
5%
15%
25%
35%
Copper Lithium Nickel Cobalt Graphite Rare Earths
Demand Supply
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 28
1. Market review
Critical mineral markets turned upward in 2025, driven by tightening supply conditions, export
controls and resilient demand growth
Prices for critical minerals rebounded in 2025 following downturns in
recent years. Base metals such as aluminium, copper, zinc and tin
rose strongly, driven by tight supply conditions, particularly in copper
and aluminium markets. Copper prices reached record highs in early
2026, exceeding USD 14 000 per tonne in May. Aluminium prices
increased by over 10% in 2025 and rose a further 20% from February
2026 following the Middle East conflict, reflecting the region’s role as
a key supplier and the importance of shipping routes through the
Strait of Hormuz (see Geopolitical implications section). Tin prices
also increased sharply, by around 40% in 2025, driven by supply
disruptions in Myanmar, tight concentrate availability for smelters,
and resilient demand from the electronics and semiconductor sectors.
Prices for bulk alloy metals such as chromium, molybdenum and
vanadium also edged up, albeit to a lesser extent than base metals.
Battery metals and rare earth prices remained subdued in 2023-2024
as supply growth outpaced demand, reflecting capacity expansions
following the 2021-2022 price cycle. However, prices began to
recover in 2025. Lithium prices almost doubled between January
2025 and April 2026, supported by strong growth in battery demand,
particularly from energy storage applications, alongside constrained
supply conditions caused by Zimbabwe’s export restrictions and
tighter permitting in China’s Jiangxi region. Cobalt prices increased
by around 120% in 2025, largely driven by export restrictions
imposed by the Democratic Republic of the Congo (DRC). Policy
changes in Indonesia created uncertainty around future nickel supply,
contributing to a 20% increase in nickel prices since the end of 2025.
The conflict in the Middle East and associated disruptions to sulphur
and sulphuric acid supply added further upward pressure on prices,
particularly for purified phosphoric acid, which increased by around
50% following the crisis. However, not all battery metals followed this
trend: graphite prices remained subdued due to persistent oversupply
conditions. Download: Global Critical Minerals Outlook 2026.pdf
Rare earth markets also experienced strong price increases following
the introduction of export controls by China in 2025. In recent months,
yttrium prices have seen particularly sharp gains, driven by strong
demand from high-tech, aerospace and defence applications,
compounded by tighter export conditions.
For strategic minor minerals – those with relatively small market sizes
but critical roles across energy, high-tech, aerospace and defence –
prices had already been rising since 2024 due to robust demand and
a series of export controls imposed by China, the dominant supplier
for many of these materials. As export restrictions broadened and
tightened further, prices surged in 2025, with particularly strong
increases in indium and tungsten. Indium prices were supported by
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 29
1. Market review
growing demand from semiconductor, display and photovoltaic
applications, while tungsten prices rose on the back of strong
demand from the electronics, aerospace and defence sectors. The
expansion of export controls further tightened market conditions,
contributing to sharp price increases. Given the highly concentrated
nature of supply and the relatively small size of these markets, small
shifts in supply patterns or purchasing behaviour had an outsized
impact on prices. Between January 2025 and April 2026, tungsten,
tantalum, cobalt, lithium and rare earth elements have recorded the
largest price increases, with tungsten prices surging six-fold.
A widening divergence between Chinese domestic and ex-China
prices has emerged for several critical minerals. European prices are
currently around five times higher than Chinese domestic prices for
gallium and heavy rare earths, and around three times higher for
germanium. While ex-China price assessments are based on
relatively limited market liquidity and fewer transactions, the widening
premium highlights the growing challenges of securing supply outside
the dominant supplier.
Despite rising base metal prices, smelter fees, known as treatment
and refining charges (TC/RCs), have moved in the opposite direction,
falling to historic lows. Annual copper benchmark TC/RCs settled at
USD 0 per tonne in 2026, the lowest level ever agreed in annual
negotiations, while spot charges have remained negative since 2024;
zinc and lead smelter fees have also turned negative. Tight
concentrate supplies, combined with rapid smelter capacity
expansion in China, have driven this trend, placing increasing
pressure on the economic viability of base metal smelters, particularly
outside the dominant supplier.
For key energy minerals such as copper, lithium, nickel, cobalt,
graphite and rare earth elements, demand continued to grow strongly
in 2025, driven primarily by their increasing use in energy
technologies, including batteries for electric vehicles (EVs) and
energy storage, electricity infrastructure such as grids, wind turbines
and solar PV, and permanent magnets for high-performance
applications. Demand for these minerals has grown at close to 10%
per year on average in recent years, significantly outpacing demand
growth for base metals such as aluminium, lead and zinc, which
averaged around 1% annually. Lithium demand has been particularly
strong, increasing by around 25% per year on average over the past
two years. Across key energy minerals, the energy sector drove, on
average, around 75% of demand growth in 2025, up from 70% in
2024. Cobalt is an exception, where end uses such as portable
electronics, aerospace and defence have been accounting for an
increasing share of demand in recent years.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 30
1. Market review
The leading producer has led refined supply growth across almost all key energy minerals
Change in refined output of key energy minerals, 2023-2025
IEA. CC BY 4.0.
Notes: Manganese refers to manganese sulphate. The top producer is Indonesia for nickel and China for all others.
– 25%
25%
50%
75%
100%
Copper Lithium Cobalt Nickel Graphite Manganese Rare earths
Top producer Rest of world
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 31
1. Market review
As a result, concentration in refined material production edged higher again in 2025 across
most minerals, with rare earths being the exception
Share of refined material production by country in 2025 compared with the top producer’s share in 2023
IEA. CC BY 4.0.
Notes: DRC = Democratic Republic of the Congo. Graphite refers to battery-grade graphite, and rare earths to magnet rare earths.
0%
20%
40%
60%
80%
100%
Copper Lithium Nickel Cobalt Graphite ManganeseRare earths
Rest of world
DRC
India
Japan
Australia
Argentina
Chile
United States
Europe
China
Indonesia
Top producer’s
share (2023)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 32
1. Market review
Mining concentration shows a mixed picture across minerals, with lithium, graphite and rare
earths seeing modest improvement
Share of mined output by country in 2025 compared with the top producer’s share in 2023
IEA. CC BY 4.0.
Notes: DRC = Democratic Republic of the Congo. Graphite refers to mined natural graphite, and rare earths to magnet rare earths.
Lithium Nickel Cobalt
Rest of world
India
Japan
Chile
Australia
United States
Africa
Europe
China
Indonesia
DRC
Top producer’s
share (2023)
0%
20%
40%
60%
80%
100%
Copper Graphite ManganeseRare earths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 33
1. Market review
Refining concentration has again reached record levels, while mining has seen mixed progress
Mined and refined output growth has become increasingly
concentrated in recent years, driven by capacity expansions in a
small number of leading producers. For refined materials, this growth
was largely driven by the top producers – Indonesia for nickel and
China for most other key energy minerals – which together accounted
for over three-quarters of total supply growth between 2023 and 2025.
In several markets, including manganese, nickel and graphite, almost
all supply growth originated from the leading supplier. Rare earth
refining was a notable exception, with new projects in Malaysia and
the United States leading to a modest decline in supply concentration
between 2023 and 2025, highlighting the role of targeted policy and
investment support in enabling diversification.
As a result, refining concentration across energy minerals reached
new record levels. The average share of the top refined supplier
stood at around 72% in 2025, up from 70% in 2020. Lithium recorded
the largest increase, reflecting continued investment in refining
capacity in China and its dominant position in chemical conversion,
particularly for battery-grade lithium chemicals. Nickel also saw a
marked increase, driven by rapidly expanding integrated industrial
parks in Indonesia such as Morowali, Weda Bay and Pomalaa. For
graphite, China accounted for virtually all growth in battery-grade
supply in recent years, particularly through the expansion of synthetic
graphite anode production.
By contrast, changes in concentration were more mixed for mining,
with the top producer’s share declining for lithium, graphite and rare
earths between 2023 and 2025. For rare earths, this reflects new
projects in regions such as the United States (MP Materials) and
Australia-Malaysia (Lynas) coming online, while lithium and graphite
saw diversified projects come online in Latin America and Africa.
Copper concentration remained broadly stable. Nickel, however, saw
increased mining concentration: Indonesia expanded its share of
nickel output through growth in hubs such as Weda Bay, while
higher-cost projects elsewhere were curtailed or put under care and
maintenance amid weaker prices. For cobalt, the Democratic
Republic of the Congo (DRC) remained dominant despite policy
changes in the country that affect production, while Indonesia
continued to gain market share.
China not only dominates mined and refined output by geography,
but also by ownership, with Chinese firms holding major positions in
upstream mining in countries such as the DRC and Indonesia and
dominating midstream processing globally. Recent investments,
particularly in rare earths, have supported some diversification of
ownership (see Investment trends and Latest policy developments
sections). Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 34
1. Market review
Energy mineral reserves increased notably, particularly between 2020 and 2025, reflecting
rising interest in exploration and development activities
Changes in selected commodity reserves, 2010-2025
IEA. CC BY 4.0.
Notes: Graphite refers to natural graphite. Reserves are defined by the United States Geological Survey as the portion of an identified resource that can be
economically and legally extracted at the time of determination.
Source: IEA analysis based on data from the United States Geological Survey.
-100%
0%
100%
200%
300%
400%
Graphite
Lithium
Nickel
Copper
Cobalt
Rare earth
Lead
Zinc
Iron ore
Bauxite
Tin
Energy minerals Base metals Change during 2020-2025
Global Critical Minerals Outlook 2026
PAGE | 35
1. Market review
Reserves for energy minerals have increased notably in recent years, driven by increased
exploration activity
From 2010 to 2025, energy minerals, including copper, lithium, nickel,
cobalt, natural graphite and rare earth elements, recorded stronger
reserve growth than base metals, reflecting increased exploration
activity. Across key energy minerals, estimated reserves increased
on average by 120% between 2010 and 2025, compared with a much
more modest 7% increase for base metals.
This growth was not uniform across commodities. Natural graphite
recorded the largest increase in reserves among energy minerals.
China, the largest producer, steadily expanded its reserve base over
the period. Brazil also recorded strong growth, while Mozambique
saw a sharp increase following the discovery of significant new
deposits.
Lithium also recorded strong reserve growth, led by Chile, Australia
and Argentina. Nickel reserves increased significantly, particularly in
Indonesia, which increased its share of global reserves from around
5% in 2010 to more than 40% by 2025. Australia, which accounted
for around 40% of global reserves in 2010, maintained broadly stable
absolute volumes, although its global share declined to around 20%
by 2025.
Cobalt reserves increased notably during the 2020s, driven by
intensified exploration in copper-rich areas of the DRC. Traditional
producers such as Australia and Cuba saw relatively limited changes
in reserve volumes, while Indonesia emerged as a new contributor to
global cobalt reserves over the period.
Rare earths were the only major energy mineral group to record a
decline in reported reserves. China increased its reported reserves
over the period, while the United States saw decreases following the
restart of previously idle mines after 2012. Countries such as the
Russian Federation (hereafter, “Russia”) and Viet Nam also recorded
decreases in reserve estimates.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 36
1. Market review
Aluminium inventory trends diverged across regions, with stocks declining at the LME and
rising at the SHFE, while copper inventories have moved higher in recent months
Inventory levels of selected metals at major exchanges
IEA. CC BY 4.0.
Notes: LME = London Metal Exchange; SHFE = Shanghai Futures Exchange. Inventory levels indicate the monthly average of daily inventory volumes on major
metal exchanges: aluminium (LME, SHFE); copper (LME, SHFE); nickel (LME); and zinc (LME).
Source: IEA analysis based on data from Bloomberg.
750
1 500
2024 2025 2026
LME SHFE
kt
Aluminium
400
800
2024 2025 2026
LME SHFE
kt
Copper
150
300
2024 2025 2026
LME
kt
Nickel
150
300
2024 2025 2026
LME
kt
Zinc
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 37
1. Market review
Inventory levels remained highly volatile amid rapidly changing market conditions
Monitoring inventory levels is important from a supply security
perspective. A sharp decline in inventories may indicate potential
supply tightening, whereas a rapid build-up in inventories may signal
weakening demand or oversupply. Over the past two years, inventory
trends for aluminium, copper, nickel and zinc have reflected differing
regional market conditions and supply-demand balances.
Aluminium inventories at the London Metal Exchange (LME) and
Shanghai Futures Exchange (SHFE) have followed contrasting paths.
LME inventories generally declined, reflecting tighter availability in
international markets amid relatively robust demand and supply
constraints, including production challenges in Europe linked to high
energy costs. By contrast, SHFE inventories began to rise from
mid-2025 as domestic production in China increased and downstream
consumption softened. The divergence between LME and SHFE
inventories became particularly pronounced from late 2025,
highlighting growing regional imbalances in market fundamentals.
Copper inventories on both the LME and SHFE were highly volatile.
LME stocks declined through late 2024 and much of 2025 as
supply tightened and demand expectations improved. Anticipation
of US import tariffs under Section 232 measures also encouraged
the movement of copper inventories into COMEX warehouses in
the United States. However, from late 2025, inventories across
both the LME and SHFE began to increase, driven largely by shortterm demand weakness.
Nickel inventories on the LME followed a markedly different trajectory,
rising steadily throughout the period. This reflected persistent
oversupply in global markets, driven by rapid production growth in
Indonesia and the inclusion of intermediate products such as mixed
hydroxide precipitate into LME-deliverable nickel products. The
approval of additional nickel brands for LME delivery further
expanded the pool of eligible material, contributing to inventory
accumulation.
Zinc inventories on the LME generally trended downward, particularly
during 2025, supported by strong demand from galvanised steel
applications and some supply-side constraints. However, exchange
inventories may not fully reflect overall market conditions, as a portion
of metal appears to have remained outside the exchange system or
concentrated in China.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 38
1. Market review
Geopolitical developments and
implications for supply security
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 39
1. Market review
Export controls:In a year characterised by rising geopolitical tensions, new export controls
have been implemented on critical minerals and their processing technologies
Export controls announced, proposed or updated in 2025 and 2026
IEA. CC BY 4.0.
Note: LFP = lithium iron phosphate.
Material Technology
By Latest development Market share (2025)
China Tungsten Export licensing in Feb 2025 98% 76%
China Bismuth Export licensing in Feb 2025 98% 73%
China Indium Export licensing in Feb 2025 98% 86%
China Tellurium Export licensing in Feb 2025 98% 73%
China Molybdenum Export licensing in Feb 2025 98% 41%
China Batteries (LFP) Proposed controls on batteries, battery equipment and components suspended until Nov 2026 98% 99%
China Lithium refining Proposed technology export control in Jan 2025 98% 71%
China Gallium Suspended its ban on export to the United Statesuntil Nov 2026 98% 99%
China Germanium Suspended its ban on export to the United Statesuntil Nov 2026 98% 94%
China Antimony Suspended its ban on export to the United Statesuntil Nov 2026 98% 44%
DRC Cobalt Export quota system in Oct 2025 98% 66%
China Rare Earths Export licensing on seven rare earths in Apr 2025;further restrictions suspended until Nov 2026 98% 91%
China Rare Earths Proposedcontrols on related products, equipment and technologiessuspended until Nov 2026 91%
Philippines Nickel Proposed ban on raw mineral exports to start in 2030 11%
Mozambique Graphite (mined) Mandated local processing of mined material 4%
Lithium Suspended exports of lithium concentrate in Feb 2026, followed by potential export ban in 2027 Zimbabwe 10%
Gabon Manganese Proposed ban on raw mineral exports to start in 2029 22% 25%
Guinea Aluminium (Bauxite) Proposed new export control to be effective in Jun 2026 XX% 34%
China Graphite (refined) Proposed new restrictions, suspended until Nov 2026 98% 94%
China Sulphuric acid Halted exports from May 2026 until the end of the year 98% 34%
share of mining
share of refining
share of cell manufacturing
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 40
1. Market review
Export controls: The number of items under export control from China has tripled since 2023
Number of tariff codes under export control from China, 2023-2025
IEA. CC BY 4.0.
Notes: 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,
boron, cadmium, indium, molybdenum, tellurium and silver.
Source: IEA analysis based on Chinese Customs data. Download: Global Critical Minerals Outlook 2026.pdf
20
40
60
80
01-Aug-23 01-Dec-23 15-Sep-24 04-Feb-25 04-Apr-25
Number of controlled tariff codes
Other
Tungsten
Graphite
Rare earth elements
Antimony
Germanium
Gallium
x3
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 41
1. Market review
Export controls:The value of exports of all items under restriction from China increased to over
USD 11 billion in 2025
Value of exports from China for items under control by mineral, and exports of tungsten and antimony oxide by importing economy
IEA. CC BY 4.0.
Notes: Based on customs data for 8-digit tariff codes for items under export restriction from China. Tungsten articles include ammonium paratungstate (tariff code
28418010), carbides of tungsten (28499020), tungsten powders (81011000) and tungsten trioxides (28259012). Antimony oxide refers to tariff code 28258000.
4
8
12
’23 ’24 ’25
Billion USD
Graphite
Indium
Gallium
Tungsten
Germanium
Rare earths
Antimony
Other
Value of trade of minerals under control
5
10
15
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
’24 ’25 ’26
Other Canada Viet Nam Japan
Chinese Taipei Mexico Korea Thailand
India Russia United States
Antimony oxide
kt
1
2
3
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
’24 ’25 ’26
kt
Tungsten articles
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 42
1. Market review
Export controls:Risks from high supply chain concentration became reality in 2025, as
geopolitical tensions shaped markets and export controls surged
In recent years, a series of geopolitical events, such as trade tensions,
export controls and disruptions to maritime trade, have demonstrated
how strongly global economies depend on secure and resilient
mineral supply chains. Concerns around mineral supply security had
already been an important driver of investment, but developments in
2025 drove a stronger push for policies, measures and investment
aimed at strengthening resilience against future shocks.
Export controls
In 2025 and early 2026, a new wave of export controls was
announced by major producers. The most significant controls were
announced by China on rare earth elements and other materials such
as bismuth, tellurium and tungsten, but other countries also
introduced new restrictions, particularly in a number of African
countries. For example, in September 2025, the DRC, the world’s
largest mined cobalt supplier, introduced cobalt export quotas(see
Cobalt section in Chapter 2), and Zimbabwe and Mozambique
introduced trade restrictions on raw materials aimed at developing
local mineral processing industries for lithium and graphite,
respectively.
Focusing on China, the number of tariff codes that require a licence
increased threefold from December 2023 to April 2025, when the
latest wave of restrictions was implemented.
For most products, trade was not fully disrupted by the controls, but
they added frictions to exchanges and increased costs and prices.
For some items, trade volumes significantly decreased or stopped;
this was the case for some rare earth-related items, such as
permanent magnets, and for other dual-use elements, such as
antimony oxide and tungsten carbide and powder. In some cases,
trade flows were restricted to a specific number of countries. For
example, exports of antimony oxide to Japan, Chinese Taipei and the
United States have been halted since September 2024.
April 2025 rare earth export controls
On4 April 2025, the Chinese government introduced export controls
on seven heavy rare earth elements. Export volumes from China
dropped sharply in April and May, leaving many automakers in the
United States, Europe and beyond struggling to source permanent
magnets. Some were forced to reduce utilisation rates or temporarily
shut down production lines. Exports of dysprosium and terbium
oxides and metals were also affected by the restrictions, dropping in
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
May before slowly recovering in the following months, impacting the
supply of feedstocks for magnet manufacturing outside China.
October 2025 export controls on rare earths
On9 October 2025, the Ministry of Commerce of China announced
further export controls on rare earth elements and related products,
equipment and technologies. The new controls required foreign
companies to obtain a licence from China to export “parts,
components and assemblies” containing Chinese-sourced rare earth
materials or produced using Chinese rare earth technologies. The
announcement also included a clause implying that, from
1 December 2025 the Chinese government would require a licence
to trade “internationally made” products containing Chinese-sourced
materials or manufactured using Chinese technologies, even if traded
outside China.
The inclusion of “internationally made” products and “parts,
components and assemblies”, beyond the previous isolated controls
on selected rare earth magnets and materials, marked a major
escalation and considerable expansion of the scope of export
controls. A wide range of strategic sectors across the world rely on
products and components containing controlled Chinese rare earth
elements. If the October export controls had been fully enacted, the
consequences for many key strategic sectors and global economies
would have been exceptional, causing major economic impacts
across many sectors, given the vast range of downstream products
that rely on Chinese rare earths.
In November 2025, China announced a one-year suspension of the
export restrictions introduced in October 2025, providing relief to the
market. However, the underlying risks and potential for future
implementation remain. In January 2026, China tightened export
controls on dual-use goods destined for Japan. These developments
underscore the growing prominence of supply chain risks exposed by
recent export controls.
October 2025 export controls on battery supply chains
Rare earth elements were not the only materials affected. On
9 October 2025, China also announced major export controls on
lithium-ion battery supply chains. These controls expanded on
previous targeted controls on graphite and high-performance LFP
cathode material to cover a much broader range of battery materials,
technologies and equipment across multiple stages of the supply
chain. The controls targeted all critical chokepoints in global battery
supply chains simultaneously, where China holds the highest
concentration of supply, including LFP cathode materials, LFP
batteries, graphite anode materials, cathode material precursors, and
battery production equipment and technologies. The controls were
suspended for a year until November 2026, alongside the rare earth
controls.
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1. Market review
Given the scale of the impact faced across a range of sectors by the
export controls on rare earths, the potentially major consequences of
the export controls on battery supply chains may have been
somewhat overlooked in policy response development. However, if
fully enacted, the proposed export controls would severely restrict the
ability of the rest of the world to produce batteries in the nearterm,
with major economic consequences, given the range of strategic
sectors for which batteries have critical applications beyond transport
and energy storage, including defence, aerospace, artificial
intelligence (AI) data centres and even medical applications.
LFP batteries are a case in point, with markets expanding rapidly.
They represent over half of the global electric car battery market and
over 90% of the battery energy storage market. While China currently
dominates this segment, efforts are underway to develop LFP battery
production outside China. However, new restrictions on LFP cathode
materials could impede these initiatives, reinforcing China’s
dominance in this technology, with major implications for grids, which
increasingly depend on battery energy storage deployment. The
simultaneous restrictions on battery equipment and technologies
could also lead to even greater market concentration in China, as
they could significantly hinder countries’ efforts to produce batteries
overseas. Sustained restrictions could lead to major revenue and job
losses for producers of batteries and battery materials around the
world, with knock-on effects for the EV producers, grid developers,
data centre providers and defence contractors that depend on them.
While the focus on rare earths is imperative, this should not cloud the
major strategic risks posed by the battery supply chain export
controls. Strengthened emergency preparations and diversification
efforts are needed across both supply chains. Download: Global Critical Minerals Outlook 2026.pdf
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Global Critical Minerals Outlook 2026
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1. Market review
Middle East conflict: The war has sent shockwaves through critical mineral value chains
IEA. CC BY 4.0.
Notes: MRI = magnetic resonance imaging; PPA = purified phosphoric acid; REE = rare earth elements.
IEA. CC BY 4.0.
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1. Market review
Middle East conflict: Aluminium production facilities in the Middle East, among the largest in
the world, have reported major disruptions
Primary aluminium production plants in the Middle East
IEA. CC BY 4.0.
Emirates Global
Aluminium –Al Taweelah
Sohar Aluminium
Emirates Global
Aluminium –Jebel Ali
Qatalum
Aluminium Bahrain (Alba)
Ma’adenAluminium
400
1 600
Reported disruption
Capacity (kt/year)
Salco
Almahdi Aluminium
HormozalAluminium
IEA. CC BY 4.0.
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1. Market review
Middle East conflict: Further pressure on a tight aluminium market, where exchange stocks had
already been declining, has contributed to higher prices
Aluminium price and stocks at major exchanges
IEA. CC BY 4.0.
Note: LME = London Metal Exchange; SHFE = Shanghai Futures Exchange.
Sources: IEA analysis based on data from SHFE, LME and Bloomberg.
300
600
900
1 200
1 000
2 000
3 000
4 000
Jan-24 Oct-24 Jul-25 Apr-26
Stocks (kt)
Price (USD/tonne)
Price
SHFE stocks
(right axis)
LME stocks
(right axis)
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1. Market review
Middle East conflict: The Middle East accounted for 8% of global primary aluminium production
in 2025, one-third of which was lost during the conflict
Share of global production of primary aluminium, alumina and bauxite, and production from the Middle East
IEA. CC BY 4.0.
Note: CSAM = Central and South America.
Source: IEA analysis based on data from the International Aluminium Institute (2026) and United States Geological Survey (2026).
0%
25%
50%
75%
100%
Bauxite Alumina Aluminium
Unspecified
Africa
Australia
CSAM
North America
Other Asia
Europe
Middle East
China
Shareof supply by region
150
300
450
600
Apr-26 May-26
kt
Primary aluminium production in the Middle East
Jan-25 to Mar-26
average
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1. Market review
Middle East conflict: Already tight aluminium markets have been directly affected
The conflict that started in the Middle East on 28 February 2026 is
having major impacts on the energy market. Trade flows through the
Strait of Hormuz have been disrupted for months, causing the largest
supply disruption in the history of the global oil market and significant
disruptions to natural gas flows. However, the impact has also been
highly visible in mineral and metal markets. While trade in key energy
minerals such as copper, lithium and graphite was less directly
affected, the crisis has had important implications for a range of key
materials, such as aluminium and helium, as well as key feedstocks,
such as sulphur and needle coke, which are used in metal processing
and the production of precursor materials and synthetic graphite.
Aluminium
During the conflict, several aluminium production facilities in the
Middle East were directly hit. Direct damage, together with
disruptions to flows through the Strait of Hormuz, is affecting global
aluminium trade. The Middle East accounts for 8% of primary
aluminium production, a share that increases to one fifth when
excluding China. Exports from the region before the conflict
accounted for more than 10% of total aluminium supply for the
European Union, Japan, Korea and Mexico, and just under20% for
the United States. Moreover, aluminium smelters in the MiddleEast
are key producers of high-purity aluminium, particularly Emirates
Global Aluminium’s Al Taweelah plant. High-purity aluminium plays a
crucial role in aerospace and defence applications, making the
impacts of lost supply from the region a significant concern for
strategic sectors.
The disruptions hit the market after demand for aluminium had
increased by around 7% from 2023 to 2025. In addition to energy
technologies, aluminium is an essential input across multiple
strategic sectors, including transport and aerospace, construction,
infrastructure and defence.
On the supply side, concerns around a supply deficit have been
building, as China reached the 45 Mt production cap set in 2017 in
2025. The combination of resilient demand and constrained supply
led to a drawdown of LME aluminium inventories, which decreased
sharply from over 1 Mt in June 2024 to around 350 kt in June 2025.
At the same time, stocks at the SHFE have been increasing since the
start of 2026, reflecting softening demand in China. New trade and
regulatory policies in 2025 also came into play. The United States
increased tariffs to 50% on most imported aluminium products. At the
same time, China removed some export tax rebates on semi-finished
aluminium products on 1 December 2024, contributing to decreasing
aluminium exports.
Against this backdrop, the conflict in the Middle East quickly
escalated market pressures. Aluminium Bahrain (Alba), the world’s
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Global Critical Minerals Outlook 2026
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1. Market review
largest smelter outside China, with a capacity of 1.6 Mt, was
operating at 30% in April 2026 after declaring force majeure due to
logistical challenges around the Strait of Hormuz and shutting down
three smelting lines accounting for 19% of its capacity. Qatalum, a
smelter in Qatar with a capacity of 0.65Mt, also announced force
majeure due to a lack of gas supply linked to the Ras Laffan natural
gas processing facilities and was operating at 60% capacity in April
2026. In late March, Aluminium Bahrain’s Alba plant and Emirates
Global Aluminium’s Al Taweelah plant reported damage after being
hit by strikes. Following the strikes, the Al Taweelah plant had to halt
operations due to damage to its power facilities. The affected
capacity is likely to return only gradually, as restarting smelters after
shutdown can take 6-12 months. Logistical challenges around input
materials and energy supply may add further pressure. The loss of
Emirates Global Aluminium is particularly concerning for aluminium
supply to the aerospace sector.
Aluminium prices reached a four-year high of almost USD3 700 per
tonne in April 2026. Regional premiums were also on the rise, with
the Rotterdam premium up 60% from February to April 2026.
Insurance premiums and emergency freight surcharges are adding
to rising shipping costs. Aluminium users in Europe, Japan and the
United States are particularly exposed to high prices, and a
prolonged disruption threatens the production of finished products in
sectors such as automotive, construction and packaging.
In addition to direct effects on aluminium trade, the conflict is also
affecting the supply of feedstocks, such as green and calcined
petroleum coke, which are needed to manufacture anodes consumed
during the electrolysis of alumina to produce primary aluminium.
Prices of green petroleum coke increased by around 35% between
February and April 2026, a trend that is expected to be followed by
calcined petroleum coke, affecting global aluminium production.
In the near term, aluminium markets are expected to remain tight,
with the Middle East conflict adding further pressure. Supply growth
remains constrained by China’s production cap and rising energy
costs. Although some easing could occur with new smelting capacity
in Indonesia, aluminium prices are likely to remain elevated and
volatile in the short term. Download: Global Critical Minerals Outlook 2026.pdf
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Global Critical Minerals Outlook 2026
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1. Market review
Middle East conflict: Half of global seaborne sulphur trade passes through the Strait of Hormuz,
and the Gulf accounts for a quarter of global supply, affecting metals and fertilisers
Sulphur and sulphuric acid supply, and the sulphuric acid supply chain
IEA. CC BY 4.0.
Notes: HPAL = high-pressure acid leaching. SX/EW = solvent extraction and electrowinning.
Sulphur
Oil refining
Sour gas
processing
Metal smelting
Sulphuric
acid
Pyrite
Phosphoric
acid
Fertilisers
Phosphate
rock
Metal
leaching
Copper
SX/EW
Nickel HPAL 0%
20%
40%
60%
80%
100%
Sulphur Sulphuric acid
China
Middle East
United States
Russia
Morocco
Other
Supply by country
IEA. CC BY 4.0.
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1. Market review
Middle East conflict: Disruptions to sulphur supply have prompted China to curb exports of
sulphuric acid
Sulphuric acid exports from China, and sulphur and sulphuric acid prices, January 2025-April 2026
IEA. CC BY 4.0.
Source: IEA analysis based on Chinese Customs data.
1
2
3
4
5
6
100
200
300
400
500
600
Price index (Jan-25 = 1)
kt
Other
India
Morocco
Saudi Arabia
Indonesia
Chile
Sulphuric acid price
(right axis)
Sulphur price
(right axis)
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Global Critical Minerals Outlook 2026
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1. Market review
Middle East conflict: Ripple effects from sulphur markets are increasing risks in fertiliser and
metals value chains
Around half of global seaborne sulphur trade passes through the
Strait of Hormuz, while the Middle East accounts for a quarter of
global sulphur supply, which is produced as a by-product of oil and
gas production. Disruptions to sulphur exports from the region have
affected countries that rely on imported sulphur to produce sulphuric
acid, which is in turn used in fertiliser production and in the leaching
of key metals, such as copper, nickel and cobalt. China is particularly
exposed to sulphur disruptions, as 55% of its sulphur imports in 2025
originated in the MiddleEast.
Sulphur markets had already been structurally tight since mid-2024,
reflecting strong demand for sulphuric acid from fertiliser production
and Indonesia’s expanding nickel sector based on high-pressure acid
leaching (HPAL) operations, alongside some supply disruptions in
2025, such as Russia’s sulphur export ban and damage to its
refineries. In March 2026, disruptions to maritime trade flows in the
Strait of Hormuz led to sharp increases in global sulphur prices, with
sulphuric acid prices also doubling from USD 144 per tonne in
February 2026 to USD 283 per tonne in April 2026.
China is a net importer of sulphur and produces 40% of the world’s
sulphuric acid, followed by the United States, India, Russia and
Morocco. China accounts for around one third of global demand,
followed by North America, Africa, and Central and SouthAmerica.
In January 2026, as sulphuric acid prices were increasing, China
announced an export cap for January-April 2026 to safeguard
domestic supply, resulting in a year-on-year decrease in exports of
around 50%.
As sulphur supply has tightened following the conflict in the
Middle East, China halted exports of sulphuric acid from May 2026
until the end of the year, affecting almost a quarter of ex-China acid
needs, with major implications for the metals and fertiliser sectors.
The restrictions are expected to apply to both sulphur burner-based
sulphuric acid and smelter by-product sulphuric acid, with an
exemption only for electronic-grade sulphuric acid, typically used in
the production of semiconductors. In 2025, China exported 4.7 Mt of
sulphuric acid, with Chile and Indonesia importing half of the total.
Fertilisers
Rising sulphur prices have caused sulphuric acid prices to spike just
as the northern hemisphere enters the spring planting season, when
fertiliser consumption typically peaks. Sulphuric acid is a core input
for phosphoric acid and thus phosphate fertiliser, but it is also used
in potassium-based fertilisers and some nitrogen-based fertilisers.
China halted phosphate fertiliser exports in December 2025, citing
global sulphuric acid price spikes, a restriction that is expected to last
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Global Critical Minerals Outlook 2026
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1. Market review
until August 2026. This ban will put further pressure on the fertiliser
market, with the Philippines, Kenya and Myanmar particularly
vulnerable, accounting for 31%, 14% and 13%, respectively, of
exposed imports from China in 2025.
Fertiliser markets are already experiencing pressure on nitrogenbased products, as around one-quarter of ammonia and 40% of
global urea exports pass through the Strait of Hormuz. By affecting
the other two types of fertilisers, phosphate and potassium-based,
disruptions to sulphur and sulphuric acid supply effectively put the
entire fertiliser production chain at risk. Increased fertiliser costs are
likely to squeeze farmer margins and have a particularly significant
impact on developing countries, which could lead to reduced yields,
increased food prices and higher food security risks.
Metals and battery materials production
Sulphuric acid is critical for copper, nickel and cobalt leaching
operations, and disruptions to sulphur and sulphuric acid markets
pose risks of increased costs, tighter supply and potentially even
production cuts, with knock-on effects on downstream sectors.
Over 15% of global primary copper output is produced using
sulphuric acid leaching and is therefore affected by the conflict, with
the DRC and Chile the most vulnerable countries, as they have the
largest sulphuric acid-based operations. For nickel, Indonesia is
highly exposed, as it relies heavily on imports of sulphur from the
Middle East (75% of its sulphur imports) to produce the large volumes
of sulphuric acid required for nickel refining using the HPAL route.
Given that the majority of cobalt is produced as a by-product of
copper mining in the DRC or from nickel HPAL intermediate
production in Indonesia, cobalt production is also affected.
Copper production based on sulphuric acid leaching, 2025
IEA. CC BY 4.0.
Note: DRC = Democratic Republic of the Congo.
Around 60% of all battery-grade lithium chemicals currently rely on
sulphuric acid-based processing. Over 99% of hard rock lithium
processing relies on acid roasting processing, which requires
sulphuric acid. Due to the increase in acid prices, acid costs have
increased from 3% of the cost of producing lithium chemicals from
hard rock sources at the start of the year to over 11% as of the end
of May 2026, overtaking energy inputs to become the largest cash
cost component.
1 2 3 4
Mt Cu
DRC Chile United States Mexico Zambia Other
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Global Critical Minerals Outlook 2026
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1. Market review
Sulphuric acid is also critical to rare earth concentrate processing,
particularly the acid bake-and-leach route used for monazite,
xenotime and lower-grade bastnaesite concentrates. Higher acid
prices have caused sulphuric acid to increase to over 20% of rare
earth C1 costs up from just 5% before the conflict.
Finally, a number of critical battery precursors are affected by the
conflict in the Middle East. All the battery metal sulphates, including
nickel sulphate, cobalt sulphate and manganese sulphate, require
sulphuric acid in their processing and, therefore, higher input costs
are adding price pressure to these materials. Prices for all three have
increased since the start of the conflict. Purified phosphoric acid, a
critical precursor to LFP batteries, also requires sulphuric acid for its
production. Phosphoric acid prices increased by almost 30% in the
first quarter of 2026, reflecting the rise in sulphur and sulphuric acid
prices.
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1. Market review
Middle East conflict: Disruptions to helium and energy markets have created spillover risks for
semiconductor, metals and mineral supply chains
Helium
The Middle East conflict has also affected the global supply of helium,
a key material for semiconductor, fibre optics and medical supply
chains, as well as semiconductor-dependent downstream industries.
Helium production by country, 2025
IEA. CC BY 4.0.
Source: IEA analysis based on data from the United States Geological Survey
(2026).
Qatar is the world’s largest helium exporter, accounting for roughly
35% of global production. Helium production at Ras Laffan, currently
halted, accounts for most of Qatar’s helium supply. Helium prices
spiked from around USD 15 per cubic metre in late February to
almost USD 70 per cubic metre in April. This increase is not yet
causing major price spikes across the downstream supply chain, as
the helium price accounts for only minor shares of final product prices.
However, a prolonged disruption could lead to physical supply
shortages, prompting available supply to be prioritised for highermargin applications, such as AI chips, with major implications for
consumer electronics and industrial semiconductors.
Share of helium imports from Qatar in selected economies, 2025
IEA. CC BY 4.0.
Source: IEA analysis based on data from the World Integrated Trade Solution
and International Trade Administration.
Qatar accounts for more than half of helium imports in China, India,
Korea and Chinese Taipei, making these economies the most
50 100 150 200
mcm
United States Qatar Russia Algeria Canada Other
0%
20%
40%
60%
80%
India China Chinese
Taipei
Korea Japan
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1. Market review
exposed to the disruptions. Alternative sources have responded
differently to the crisis, with the United States increasing its exports
to some of the most exposed countries, while Russia introduced
export controls in April 2026.
Despite the significant disruptions, buffers and additional supply are
still available to global helium markets. Major helium producers hold
strategic inventories in Germany and the United States, with refining
capacity available globally to process them, and both China and
Russia are expected to add new production in 2026.
Other materials and feedstocks
Iran produces more than half of global strontium supply, which is key
to producing permanent ceramic ferrite magnets. These are used
widely in many sectors, from industrial motors to electronics and
healthcare, sometimes as an alternative to rare earth magnets.
Some effects of the conflict are also being felt in steel markets. Iran
accounts for 11% of global semi‑finished steel trade, particularly
low‑cost billet and slab. Two major Iranian steel plants, Khuzestan
Steel and Mobarakeh Steel, were hit by airstrikes, resulting in damage
to production infrastructure. Both facilities reported having shut down
operations and stated it could take up to one year to restart the units.
High crude oil prices in early 2026 had knock-on effects on the
availability and pricing of needle coke, a critical feedstock for
synthetic graphite production and a by-product of delayed coking
units in refineries. As a result, short-term volatility in upstream oil
markets translated into tighter conditions for segments of the graphite
supply chain, particularly for battery-grade synthetic graphite.
Implications of energy disruptions
The outsized impact on energy markets is generating significant
spillover effects in mineral supply chains. Mining operations are
particularly exposed to disruptions in refined fuel markets, as diesel
is a key input for heavy equipment, on-site power generation and
transport, especially in remote and off-grid locations.
Rising diesel prices have already translated into operational
challenges, especially for smaller mining producers, for which fuel
logistics are more constrained. Disruptions have been reported in
Australia, the DRC and Ethiopia. Large, diversified mining companies
report that higher fuel costs have increased operating expenses by
around 5%, though most have so far been able to maintain production
by absorbing costs or drawing on long-term fuel supply contracts.
Natural gas markets have also been affected by the crisis, notably
liquefied natural gas (LNG) exports from Qatar and the
UnitedArab Emirates. Sustained constraints on LNG supply could
have broader global repercussions through higher gas and electricity
prices. Experience from the 2022 energy crisis highlights the
vulnerability of energy-intensive metals production to such shocks,
particularly in Europe, where high gas and power prices led to
widespread curtailments of aluminium, zinc and other smelting
capacity. While current price levels remain below the peaks observed
in 2022, persistently higher energy costs may compress margins.
Several smelters have announced temporary shutdowns or reduced
operating rates, raising concerns about the resilience of midstream
mineral processing capacity.
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1. Market review
Downstream market trends
IEA. CC BY 4.0.
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1. Market review
Deployment of renewables, electric cars and battery storage demonstrated steady growth in
2025, with solar PV breaking new records
Annual capacity additions for selected energy technologies
IEA. CC BY 4.0.
Note: GW = gigawatt; GWh = gigawatt-hour.
120
240
360
480
600
720
2023 2024 2025
GW
Solar PV
27%
12%
30
60
90
120
150
180
2023 2024 2025
GW
Wind
-1%
39%
4
8
12
16
20
24
2023 2024 2025
Million
Electric cars
26%
20%
70
140
210
280
350
420
2023 2024 2025
GWh
Battery storage
69%
50%
IEA. CC BY 4.0.
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1. Market review
Solar PV and wind set new records across major markets, but China continues to lead global
capacity additions
In 2025, global annual renewable capacity additions increased by
16%, reaching 800 GW despite facing challenges linked to supply
chains, grid connection delays, financial pressures and policy shifts
in some regions. It was the 23rd consecutive year in which
renewables set new expansion records. Solar PV accounted for over
three-quarters of new renewable capacity additions globally, followed
by wind at 20%. China alone commissioned around 370 GW of
solar PV and 117 GW of wind capacity, notable increases from 2024.
India’s annual renewable capacity additions rose by almost 60%, the
fastest growth among major markets. The European Union added
around 85 GW of new renewable capacity, a record high and about
10% more than in 2024. The United States installed 49 GW of
renewable capacity in 2025, becoming the only major market to see
a decline, at 10% compared with the previous year.
Solar PV capacity additions in 2025 rose by around 12%, surpassing
600 GW for the first time. This expansion brought cumulative global
solar PV capacity to around 2 800 GW, making it the technology with
the largest installed power generation capacity. Thirty countries
installed over 1 GW of solarPV in 2025, almost twice as many as in
2020. China’s shift from long-term fixed tariffs to competitive auctions,
effective from June 2025, accelerated installations in the first half of
the year, followed by a slowdown in the second half. In the
European Union, solar PV led renewables growth, with almost
70 GW installed. Germany alone added 17 GW, accounting for
one-quarter of the region’s solar PV additions. Spain hit a record
14 GW, up 50% from 2024. India commissioned almost 50 GW of
solar PV in 2025, double the previous year. Installations also
continued to grow in Pakistan, with around 10 GW of additions in
2025, driven almost entirely by on‑ and off‑grid distributed systems.
South Africa installed over 3 GW of solar PV for the first time.
Saudi Arabia’s solar PV additions quadrupled to nearly 7 GW.
After a slowdown in 2024, annual wind capacity additions resumed
growth in 2025, rising by nearly 40% globally to a record level of
around 160 GW, despite ongoing supply chain challenges.
Installations continued to accelerate in China as large-scale projects
were completed. India’s wind additions doubled in 2025 to reach over
6 GW. In the European Union, onshore wind capacity additions rose
to about 13 GW. Offshore wind additions, however, fell to just 1 GW,
down from 1.7 GW in 2024, with only France and Germany installing
new capacity in 2025. The offshore wind industry faces multiple
challenges, with several developers reducing their 2030 deployment
targets. Lower expectations have been driven by the policy shift in
the United States and project cancellations and delays in Europe,
India and Japan due to cost and supply chain challenges. Download: Global Critical Minerals Outlook 2026.pdf
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Global Critical Minerals Outlook 2026
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1. Market review
As technology matures and scales to compete with traditional sources of power generation, the
solar PV industry also continues to make strides in material efficiency
Since 2020, solar PV deployment has expanded rapidly while the
intensity of key minerals has declined materially. Crystalline silicon
(c-Si) technology retained a dominant market share of around 98%
of global production, but manufacturers substantially reduced silicon
consumption per unit of capacity through thinner wafers, lower kerf
losses from improved diamond wire sawing and higher-efficiency cell
architectures. Silicon intensity declined from roughly 3.2grammes
per watt (g/W) in 2020 to around 2 g/W by 2024, continuing a longterm trend of declining polysilicon consumption at an average annual
rate of 10% between 2004 and 2024, despite rapidly increasing
module output. At the same time, average module power ratings
increased sharply, with mainstream utility-scale modules rising from
around 400 W to close to 700 W over the same period as larger wafer
formats and higher-efficiency tunnel oxide passivated contact
(TOPCon) designs became standard.
Silver intensity also declined significantly over the period, although
total silver demand from the solar sector continued to rise because
installation growth outpaced thrift gains. Despite making up just 0.14%
of a PV module’s weight, silver accounts for approximately 60% of
the cell cost and 10% of the module cost. The crucial importance of
silver in the PV industry is further amplified by the ongoing shift in the
dominant PV technology. Within the c-Si segment, passivated emitter
and rear contact (PERC) cells, which currently represent the
industrial standard, are expected to be gradually replaced by more
efficient c-Si sub-technologies, such as TOPCon cells and silicon
heterojunction (SHJ) cells, both of which involve higher silver
intensity. Nevertheless, advances in screen printing, multi-busbar
architectures and finer metallisation lines reduced silver consumption
in mainstream crystalline silicon cells from around 16milligrammes
per watt (mg/W) in 2020 to close to 10 mg/W in 2024. The industry is
increasingly pursuing copper substitution to mitigate exposure to
rising silver prices and potential supply constraints, particularly as
TOPCon technologies typically require higher metallisation loadings
due to contacts on both the front and rear sides of cells, compared
with the earlier single-face metallisation PERC cells. Fraunhofer ISE
reports that leading TOPCon and SHJ pilot designs are now
approaching 5 mg/W through silver-copper pastes and copper plating
technologies.
Tin intensity exhibited a more moderate downward trend over the
same period. Tin is primarily used in solder ribbons and
interconnection materials rather than within the solar cell itself, and
reductions were driven mainly by thinner ribbons, improved module
layouts and lower solder volumes associated with multi-busbar
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 62
1. Market review
technologies. Industry estimates indicate that tin intensity declined
from around 70 mg/W in 2020 to approximately 53 mg/W in 2024.
By contrast, copper intensity for solar PV increased steadily since
2020 as manufacturers increasingly substituted silver with copper for
cell metallisation and expanded the use of copper-intensive electrical
infrastructure associated with larger utility-scale installations. While
copper has long been used in module ribbons, cabling, inverters and
transformers, recent technology shifts have accelerated its role within
the solar cell itself. In particular, TOPCon and SHJ architectures have
prompted growing industry interest in copper electroplating and
silver-copper hybrid pastes to reduce reliance on silver amid rising
prices and concerns over long-term supply availability. Copper
substitution is emerging as one of the principal pathways for reducing
PV metallisation costs and lowering exposure to critical mineral
supply risks. Although industry-wide copper intensity data for
solar PV applications remain less standardised than for silicon or
silver, copper use per watt increased gradually over the period as
silver thrift strategies accelerated and module power ratings
continued to rise.
Overall, the technology has been characterised by a structural
decoupling between growth in deployment and mineral intensity per
unit of power delivered. However, because annual global solar
installations have consistently increased at remarkable pace,
absolute demand for silicon, silver, copper, aluminium and glass has
continued to rise strongly despite sustained efficiency improvements
in material usage.
Change in material intensity per unit of power (top) and evolution
of average module size and efficiency for c-Si modules (bottom),
2020-2024
IEA. CC BY 4.0.
Sources: IEA analysis based on data from Fraunhofer ISE and IEA-PVPS.
-60%
-40%
-20%
20%
40%
60%
Copper
Tin
Silver
Silicon
% change (index 2020)
15%
17%
19%
21%
23%
25%
350
450
550
650
750
850
2020 2021 2022 2023 2024
Average module size
Weighted average efficiency (right axis)
Watts
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
Global electric car sales reached 25% of global car sales, exceeding 20 million in 2025
Electric car sales by mode and region
IEA. CC BY 4.0.
Note: BEV = battery electric vehicle; PHEV = plug-in hybrid electric vehicle.
Source: IEA (2026), Global EV Outlook 2026.
BEV PHEV China Europe United States Rest of world Global
5
10
15
20
25
2020 2021 2022 2023 2024 2025
Million
10%
20%
30%
40%
50%
60%
2020 2021 2022 2023 2024 2025
Sales Sales share
Region Powertrain
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 64
1. Market review
Electric car sales resurged in Europe in 2025, reversing a stagnating trend
Global electric car sales reached new highs in 2025, exceeding
20 million, growing by 20% from 2024. One in four new cars sold
globally were electric in 2025, with around 5% of the global car stock
now electrified. Market developments again varied across regions,
with growth slowing slightly in China due to the temporary halt of a
trade-in scheme. However, the key story of 2025 was the major
resurgence of electric car sales in Europe. Europe experienced
strong sales growth following the step change in the
European Union’s carbon dioxide standards, with sales increasing 30%
to more than 4 million.
China remains by far the world’s largest electric car market, with more
than 13 million electric cars sold in 2025, over 60% of all global
electric car sales that year. Almost 55% of cars sold in China were
electric in 2025, up from around half in 2024. Sales grew by almost
20% in China, a slight decline from the previous year, as the trade-in
scheme introduced in 2024 was temporarily halted in several cities.
Europe was the standout story among major markets in 2025, with
electric car sales increasing by more than 30%, reversing the relative
stagnation seen since 2022. Europe’s electric car sales share was
almost 30%, and 24 out of 27 EU member states experienced an
increase in their electric car sales share. This strong resurgence was
the result of policy design, with the European Union’s carbon dioxide
standards coming into effect in 2025. In Germany, sales increased
strongly, by 50%, with wider availability of affordable models reducing
the average battery electric vehicle (BEV) price by 6% in 2025 and
preferential tax treatment for electric car companies. In France, BEV
sales increased by almost 15% while plug-in hybrid vehicle (PHEV)
sales decreased by 25%. There was impressive sales growth in Italy
(+65%), Poland (+125%) and Spain (+80%), supported by the
reintroduction or continuation of EV purchase subsidies in 2025.
Sales grew strongly in the United Kingdom, increasing by more than
25%, with electric cars sales now comprising more than one in three
new cars sold in 2025. Strong sales were supported by a subsidy for
lower-priced BEVs, with over a quarter of sales eligible. One of the
fastest-growing electric car markets in Europe in 2025 was Türkiye,
where sales more than doubled compared to 2024. Electric cars
represented over 20% of new car sales in 2025, up from just over 1%
in 2022, supported by tax support and growing domestic production.
As a result, Türkiye became the fourth-largest electric car market in
Europe last year, after Germany, the United Kingdom and France.
In the United States, sales of electric cars were slightly lower in 2025
than in 2024, at around 1.5 million, while the sales share of electric
cars remained relatively stable, at just below 10%. The stagnation
was due to several policy shifts, including the ending of tax credits
and removal of penalties for non-compliance with existing fuel
economy standards through the passage in July 2025 of the One Big
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
Beautiful Bill Act. The Act terminated tax credits for new and used
electric car purchases after September 2025, which resulted in sales
falling significantly in the last quarter of the year.
Outside these major markets, electric car sales increased steadily to
reach 2 million in 2025, growing by 50%, primarily driven by
increasing sales in key emerging markets. Rapid growth in these
markets was driven by the increasing availability of lower-cost electric
car models, primarily imported from China, which accounted for 60%
of sales in these markets. Several markets doubled in size compared
to 2024, with Southeast Asia experiencing the largest absolute sales
growth. In Southeast Asia, annual sales more than doubled to reach
a sales share of nearly 20%, led by Viet Nam, Indonesia and Thailand.
In Latin America, sales grew by 75%, led by Brazil and Mexico.
In the first quarter of 2026, global sales were 8% lower than in the
same period last year, mainly due to lower sales in China and the
United States, following key policy changes. However, this global
decline masks strong sales growth in many countries: in Europe,
Q1 2026 sales were up almost 30% year-on-year, with around
250 000 more cars sold than in Q1 2025; countries in Asia Pacific
outside China saw Q1 year-on-year sales growth of 80%; and Q1
sales across Latin America were up by 75%.
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Global Critical Minerals Outlook 2026
PAGE | 66
1. Market review
Global battery demand grew by over 35% in 2025, surpassing 1.5 TWh, with electric trucks the
fastest growing market
EV and storage battery demand by mode and region, 2020-2025
IEA. CC BY 4.0.
Notes: 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
vehicles manufactured in each region.
Source: IEA analysis based on data from EV Volumes.
200
400
600
800
1 000
1 200
1 400
1 600
2020 2021 2022 2023 2024 2025
GWh/year
LDVs Two/three-wheeler Bus Trucks Storage
200
400
600
800
1 000
1 200
1 400
1 600
2020 2021 2022 2023 2024 2025
China Europe United States Other
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
Lithium iron phosphate is now the dominant chemistry, supplying over half of the global
electric car market
Electric car battery cathode and anode chemistry sales shares, 2020-2025
IEA. CC BY 4.0.
Notes: LFP = lithium iron phosphate; Si-Gr = silicon-doped graphite, with the stated percentage of silicon content. Low-nickel includes NMC333 and NMC532, where
NMC refers to lithium nickel manganese cobalt oxide. High-nickel includes NMC622, NMC721, NMC811, nickel cobalt aluminium oxide and nickel manganese cobalt
aluminium oxide. Sales shares are based on capacity. LFP data include some lithium manganese iron phosphate.
Sources: IEA analysis based on data from EV Volumes, BloombergNEF and the China Automotive Battery Industry Innovation Alliance.
0%
20%
40%
60%
80%
100%
2020 2021 2022 2023 2024 2025
Low-nickel High-nickel LFP Other
Cathode
0%
20%
40%
60%
80%
100%
2020 2021 2022 2023 2024 2025
Graphite Si-Gr 5% Si-Gr 10%
Anode
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 68
1. Market review
Battery pack prices fell again in 2025, but critical minerals account for an increasing share of
costs
Global average lithium-ion battery pack price and share of critical mineral costs, 2015-2025
IEA. CC BY 4.0.
Notes: kWh = kilowatt-hour. Raw material costs include lithium, nickel, cobalt, manganese, graphite and copper. Other cell costs include electrolytes, separators and
other components, as well as costs associated with labour, manufacturing and capital depreciation. The percentages on the bars show the year-on-year total global
average battery pack price change. The analysis includes all cathode chemistries and global chemistry sales shares.
Source: IEA analysis based on data from BloombergNEF.
10%
20%
30%
40%
150
300
450
600
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
USD/kWh
Critical minerals Other cell cost Pack cost Share of critical minerals (right axis)
-23%
-25%
-13%
-8%
-18%
-13%
-11% -6%
+7%
-20%
-35%
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 69
1. Market review
China dominates both battery recycling pre-treatment and material recovery capacity, but
Korea is the current material recovery leader outside China
Pre-treatment and material recovery capacity, 2023-2035
IEA. CC BY 4.0.
Source: IEA analysis based on data from Benchmark Mineral Intelligence.
4
8
12
16
2023 2024 2025 2030 2035
Mt
2
4
6
8
2023 2024 2025 2030 2035
Mt black mass
China Europe United States Korea Lao PDR India Other
Pre-treatment Material recovery
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 70
1. Market review
Battery markets reached new heights in 2025, but supply chain risks became a stark reality with
new export controls targeting critical battery supply chain chokepoints
Global battery demand from EVs and storage surpassed 1.5 TWh in
2025, growing by over 35% year-on-year, up from 30% in 2024.
Growth was primarily driven by EV deployment, with electric car
battery demand alone surpassing 1 TWh. The fastest demand growth
came from electric trucks, where demand more than doubled for the
second year in a row, primarily driven by a sharp acceleration in sales
in China. Electric trucks accounted for over 6% of total EV and
storage battery demand in 2025, up from just 2% in 2023. China
again dominated battery deployment, with almost 60% of global
demand in 2025, at over 900 GWh, increasing its share from 2024.
Europe was the second-largest battery market, with 20% of global
deployment, while deployment in the United States stagnated, with
its global share falling to just over 10%. Download: Global Critical Minerals Outlook 2026.pdf
Battery storage market
Battery storage demand grew robustly in 2025, growing by over 70%
to reach 330 GWh (110 GW) and over 20% of the global battery
market. Battery storage is now a major driver of battery demand
growth. Utility-scale battery storage accounted for the majority of
capacity additions, at 80% in 2025. Deployment continued to be led
by China, the United States and Europe, but there was major growth
in other markets, particularly Australia and Saudi Arabia, showing a
broadening of the global battery storage rollout.
Battery storage additions by region, 2020-2025
IEA. CC BY 4.0.
Note: Includes both utility-scale and behind-the-meter battery storage.
Source: IEA analysis based on data from Benchmark Mineral Intelligence.
Additions in China grew by one-third in 2025, with utility-scale
installations accounting for around 90%, while behind-the-meter
additions continued to expand steadily alongside distributed solar.
The United States saw the strongest growth among major markets in
2025, growing by 75% year-on-year, with utility-scale systems
comprising around 85% of demand. In Europe, total battery storage
additions were slightly lower than last year falling by 20% but with a
20
40
60
80
100
120
2020 2021 2022 2023 2024 2025
GW
Rest of world
Middle East
Australia and
New Zealand
Europe
United States
China
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Global Critical Minerals Outlook 2026
PAGE | 71
1. Market review
clear structural shift towards utility-scale systems, which reached 75%
of additions. Australia stood out, with additions surging to nearly
8 GW, almost nine times higher than the previous year. This was
driven by the increasing use of storage to support renewables
integration. Behind-the-meter storage also grew strongly in Australia,
supported by federal and state incentives. The Middle East saw
significant growth in additions, reaching 3 GW, a threefold increase
in 2025. This was driven almost entirely by Saudi Arabia, where
battery storage has become a key source of system flexibility.
Battery pack price trends
In 2025, average battery pack prices fell by 8% to USD 108/kWh,
driven by continued improvements in manufacturing efficiency,
battery chemistries and technology developments, as well as intense
global market competition. The share of critical minerals in battery
prices increased in 2025 for the first time since 2022, reaching almost
20% of total pack costs, driven by major increases in lithium and
cobalt prices, with lithium doubling and cobalt increasing by 130%
from the start of 2025 to April 2026. Lithium prices increases were
driven by strong battery demand growth, particularly from energy
storage, alongside constrained supply from Australia and China and
uncertainty from Zimbabwe’s export restrictions. Cobalt price
increases were driven by export restrictions imposed by the DRC. If
these trends continue, there could be strains on battery producer
profitability or increasing upward pressure on battery prices. Regional
disparities in battery prices increased in 2025, with battery pack
prices in China 30% lower than in North America and 35% lower than
in Europe, compared with 20-25% in 2022.
Lithium iron phosphate (LFP) battery prices hit record lows in 2025
and were a major driver of global battery price reductions that year.
LFP battery packs were more than 40% cheaper on average than
lithium nickel manganese cobalt oxide (NMC) alternatives per kWh in
2025. LFP batteries benefit from structurally lower material costs than
nickel-based chemistries, but there are concerns that intense market
competition is driving prices too low. Many LFP cathode active
material producers are currently operating at a loss while still
increasing manufacturing capacity, raising the risks of excess
capacity and consolidation.
Battery chemistry trends
LFP is now the dominant battery chemistry, accounting for 55% of
global EV batteries sold in 2025, up from nearly half in 2024.
Deployment of LFP batteries remains concentrated in China, with a
sales share of 80% in 2025, but LFP batteries are rapidly increasing
their penetration in other emerging markets, accounting for two-thirds
of EV sales in these regions in 2025, up from 45% in 2024. This
remarkable growth has been driven by increasing imports of Chinese
vehicles and batteries. In the European Union, the share of LFP
increased slightly to almost 15%. Nearly all the batteries imported into
the region were from China, with the majority (70%) imported in LFPequipped EVs and a minority (30%) imported directly. In the
United States, the share of LFP in EVs deployed almost halved in
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 72
1. Market review
2025 to less than 5%. This decrease was driven by increased tariffs
on Chinese imports and more stringent tax credit sourcing
requirements.
Share of electric vehicle battery sales by chemistry and region,
2023-2025
IEA. CC BY 4.0.
Notes: EMDEs = emerging markets and developing economies. Two/threewheelers are excluded from the analysis. Low-nickel includes lithium nickel
manganese cobalt oxide (NMC) 333, NMC442 and NMC532. Mid- and highnickel includes NMC622, NMC721, NMC811, lithium nickel cobalt aluminium
oxide and lithium nickel manganese cobalt aluminium oxide. Lithium iron
phosphate also includes lithium iron manganese phosphate. Battery chemistry
sales shares are based on the battery capacity of new electric vehicles
registered.
Source: IEA (2026), Global EV Outlook 2026.
Sodium-ion batteries are on course for commercial success, and
2026 could prove to be a pivotal year for the technology’s scaling
efforts, with leading battery producers, such as CATL and BYD,
starting to commercialise the technology at scale. The significantly
improved low-temperature performance of sodium-ion batteries
compared to lithium-ion batteries has driven considerable attention in
China. Nevertheless, highly optimised and low-cost LFP technologies
continue to offer advantages in energy density, supply chain maturity
and cost. For sodium-ion batteries to compete more broadly, it is
likely that there would need to be sustained higher lithium prices or
technological advances. Solid-state battery research and investment
continue to attract attention and financing due to promised higher
energy density and safety, but these advantages have not yet been
demonstrated in real-world applications. Emerging markets, such as
humanoid robots, may become an early source of demand for solidstate battery manufacturers, supporting production scale-up and
optimisation to help reduce high manufacturing costs.
Battery supply chains
China currently dominates the midstream and downstream battery
supply chain and is particularly dominant in the LFP battery supply
chain. In 2025, China processed 70-95% of global lithium, cobalt,
phosphate, manganese and graphite and produced 98% of LFP
cathode materials, two-thirds of nickel-based cathode material, over
90% of anode material and 80% of global battery cells. It also
accounts for 95% of global cathode material precursor production
capacity.
0%
20%
40%
60%
80%
100%
202320242025202320242025202320242025202320242025
China EMDEs ex-ChinaEuropean Union United States
Low-nickel High-nickel LFP
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Global Critical Minerals Outlook 2026
PAGE | 73
1. Market review
China’s dominance in the production of LFP cathode materials and
batteries, graphite anode materials and cathode material precursors
makes these critical chokepoints in global battery supply chains.
Their vulnerabilities were highlighted by the battery export controls
introduced in October 2025, which are currently suspended and
covered all of these materials as well as battery manufacturing
equipment and technologies. Moreover, with the continued growth in
LFP battery deployment and emerging chemistries such as sodiumion and manganese-rich chemistries, the importance of battery-grade
manganese sulphate and purified phosphoric acid is rapidly growing.
As China also dominates the production of both materials, they are
emerging as additional chokepoints for global battery supply chains.
Efforts to develop diversified LFP battery production capacity are
gaining momentum. The United States is among the leaders, with
over 50 GWh of battery manufacturing capacity reallocated to LFP
production in 2025, notably from LG Energy Solution and Ford,
targeting the rapidly expanding battery energy storage market, which
accounted for one-third of battery deployment in the United States in
2025. Korean and Japanese producers are also investing in LFP
production, while new capacity is being developed in Indonesia.
These developments are an important first step towards
diversification. However, the LFP battery supply chain remains highly
concentrated in China, and there are major ecosystem barriers to
realising LFP production at scale, including production expertise,
equipment and technology gaps, which should not be underestimated.
Battery recycling
Global pre-treatment capacity has reached almost 4 Mt of spent
batteries, while material recovery has reached over 2 Mt of black
mass refining capacity, considerably exceeding available feedstock.
Currently, recycling plays an important role in battery supply chains,
primarily by recovering material from manufacturing scrap generated
during the production of battery cells and components. China
continues to dominate global battery recycling capacity, with over
three-quarters of pre-treatment capacity and almost 90% of material
recovery capacity. Some Chinese recyclers, such as Brunp, the
battery recycling subsidiary of CATL, benefit from direct links with the
top battery manufacturers, enabling preferential access to
manufacturing scrap feedstock. Many other recyclers face challenges
securing feedstock given the excess global recycling capacity.
Outside China, Europe holds the largest share of global pretreatment capacity, at almost 10%, but accounts for less than 2% of
global material recovery capacity. Korea is the leading country
outside China in material recovery, with 6% of global capacity. The
United States holds less than 5% of pre-treatment capacity and less
than 1% of material recovery capacity.
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Global Critical Minerals Outlook 2026
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1. Market review
Black mass payables, 2024-2026
IEA. CC BY 4.0.
Notes: Nickel and cobalt payables, CIF South Korea (% payable against LME
nickel and Fastmarkets standard-grade cobalt prices).
Source: IEA analysis based on data from Fastmarkets.
In August 2025, China started allowing imports of high-grade black
mass, which had previously been banned. There has been limited
short-term impact, as black mass flows were often being upgraded
elsewhere for final refining in China, but this policy shift could
increase direct flows to China. In March 2025, the European Union
formally classified black mass as hazardous waste, banning its export
to non-Organisation for Economic Co-operation and Development
(OECD) countries. Black mass leakage has been prevalent due to
the lack of material recovery capacity in Europe, but this policy aims
to reduce further outflows and incentivise domestic recovery capacity
development. At present, most black mass exported from the
European Union has been directed to Korea.
Black mass prices have surged through 2026, driven by tightening
supply across battery metals. Increased demand from China due to
the lifting of its black mass import ban and the reduction in import
tariffs has also been fuelling price rises. Black mass payables have
surged to over 100% in recent months, reflecting these compounding
factors.
Global recycling capacity is set to surge in anticipation of the
expected wave of end-of-life EVs in the 2030s. By 2030, pretreatment capacity is set to increase almost fourfold while material
recovery capacity is set to rise by more than threefold. However,
limited global diversification is anticipated based on the current
project pipeline. China dominates planned capacity expansions,
increasing its share of pre-treatment capacity to 85% and maintaining
a similar share of material recovery. Nevertheless, both Europe and
the United States are planning to expand their material recovery
capacity significantly by 2030, increasing sixfold and thirteen-fold,
respectively. It remains to be seen how much of this planned material
recovery capacity will materialise.
0%
20%
40%
60%
80%
100%
120%
‘2
4
‘2
5
‘2
6
2024 2025 2026
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 75
1. Market review
Investment trends
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 76
1. Market review
Financial performance improved across mineral producers in 2025, with copper companies
recording the strongest gains
Aggregate financial performance of major mining companies by type
IEA. CC BY 4.0.
Note: EBIT = earnings before interest and taxes.
Source: IEA analysis based on data from S&P Capital IQ.
-15%
15%
30%
45%
60%
– 150
150
300
450
600
2022 2023 2024 2025
Billion USD
Revenue EBIT as % of revenue (right axis) Free cash flow as % of revenue (right axis)
Diversifed mining majors
-15%
15%
30%
45%
60%
– 40
40
80
120
160
2022 2023 2024 2025
Billion USD
Copper players
-15%
15%
30%
45%
60%
– 20
20
40
60
80
2022 2023 2024 2025
Billion USD
Battery metals players
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 77
1. Market review
In 2025, production costs for copper and battery metals continued to decline, although the pace
of reductions slowed for battery metals
Production cash cost trends
IEA. CC BY 4.0.
Notes: 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
quartile.
Source: IEA analysis based on data from S&P Capital IQ.
1
2
3
4
5
’23 ’24 ’25
Labour Energy Reagents Other on-site TC/RC and shipment Royalties
USD per kilogramme (2025, MER)
Copper
1.2
2.4
3.6
4.8
6.0
’23 ’24 ’25
Lithium
3
6
9
12
15
’23 ’24 ’25
Nickel
5
10
15
20
25
’23 ’24 ’25
Cobalt
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 78
1. Market review
Declining production costs and rising prices supported margins, although trends diverged
across commodities
In 2025, improved market conditions, including rising commodity
prices, led to a 5% increase in industry revenues, reversing the
downward trend observed since 2023, based on our assessment of
24 mining companies with a strong presence in critical minerals
production (see Annex for details). However, the recovery was
uneven across company types. Copper-focused companies were the
primary drivers, with revenues increasing by around 10%, supported
by strong demand growth, higher prices and increased by-product
revenues. Profitability also improved markedly, with average
operating profit margins rising from 17% to 21% and free cash flow
margins increasing from 5% to 7% of revenue, underscoring copper’s
strong cash-generating position. Download: Global Critical Minerals Outlook 2026.pdf
By contrast, battery metals companies, including those focused on
nickel, cobalt and lithium, experienced some revenue recovery
following the downturn in 2024. However, operating profitability
declined slightly, with free cash flow generation improving but
remaining negative. While these trends indicate some degree of
market stabilisation, financial performance remains relatively
constrained, reflecting weaker pricing conditions across battery metal
markets. Recent price increases are nevertheless likely to provide
some support to company financials in 2026.
Diversified mining majors continued to demonstrate resilient
performance, with aggregate revenues increasing by 4%
year-on-year, while operating profit and free cash flow margins
remained broadly stable.
Production costs for copper, nickel, cobalt and lithium continued to
decline in 2025, extending the downward trend observed since 2024.
Copper costs fell gradually over the past three years, while cost
reductions for battery metals moderated in 2025 following substantial
declines in earlier years. The decline in 2025 was underpinned mainly
by lower labour, energy, reagent and other on-site costs, with nickel
seeing strong reductions across most categories, while cobalt largely
benefited from lower on-site costs. Lithium costs were pulled down
by lower labour and on-site costs, although higher treatment and
refining charges and shipment costs partly offset these gains. Copper
costs saw more modest declines, with lower labour and on-site costs
helping to offset rising royalty payments.
Despite recent declines in production costs, supply chain disruptions
linked to the Middle East conflict could place upward pressure on
costs in 2026. Higher energy prices, freight rates and reagent costs,
particularly for sulphuric acid, may increase operating costs across
several mineral supply chains.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 79
1. Market review
Critical mineral investment fell in 2025 after several years of growth, with the strongest decline
among battery metal companies
Capital expenditure on non-ferrous metal production by major mining companies
IEA. CC BY 4.0.
Notes: MER = market exchange rate. Excludes budgets for iron ore, coal, aluminium, gold and diamonds. Based company reporting from 24 major mining
companies.
Source: Based on company reporting from 24 major mining companies. The companies are listed in the Annex.
10
20
30
40
50
60
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Billion USD (2025, MER)
Diversified major Copper Battery metals
-30% -15% 0% 15%
2013 to 2025 year-over-year 2024 to 2025 growth
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 80
1. Market review
The growth in exploration spending seen since 2021 stalled in 2024 and declined in 2025…
Exploration spending for selected non-ferrous mineral resources, 2021-2025
IEA. CC BY 4.0.
Notes: MER = market exchange rate. Excludes budgets for iron ore, coal, aluminium, gold and diamonds. Others refer to cobalt, rare earth elements,
potash/phosphate and many other minor metals.
Source: IEA analysis based on data from S&P Capital IQ.
2
4
6
8
2021 2022 2023 2024 2025
Billion USD (MER, 2025)
Rest of world
Africa
Asia Pacific
Australia
Latin America
Canada
United States
By region
2
4
6
8
2021 2022 2023 2024 2025
Others
Uranium
Platinum
Silver
Lithium
Nickel
Zinc
Copper
By commodity
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 81
1. Market review
…while M&A activity picked up, driven by financial investors and majors acquiring copper
assets
M&A activity for selected non-ferrous mineral resources, 2021-2025
IEA. CC BY 4.0.
Notes: MER = market exchange rate. M&A activity only considers completed transactions and is categorised according to the primary commodity of the acquired
company.
Source: IEA analysis based on data from S&P Capital IQ and company information.
5
10
15
20
2021 2022 2023 2024 2025
Copper
Zinc
Nickel
Cobalt
Lithium
Silver
Uranium
Others
By target primary commodity
Billion USD (2025, MER)
2021 2022 2023 2024 2025
Undisclosed
Other
Diversified resources/holding
company
Downstream/strategic buyer
Junior
Intermediate
Government
Financial investor
Major
By buyer company type
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 82
1. Market review
Venture capital spending grew strongest in companies focused on innovative ways to extract
minerals
Equity funding of critical minerals technology start-ups, 2015-2025
IEA. CC BY 4.0.
Notes: MER = market exchange rate. Since the publication of Global Critical Minerals Outlook 2025, a new category for data-led exploration has been added to
reflect 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
been allocated to 2025 instead of 2024.
Sources: IEA analysis based on data from Cleantech Group and Crunchbase.
0%
3%
6%
9%
12%
0
1
2
3
4
2015 2020 2025
Billion USD (2025, MER)
Other exploration, extraction and refining Battery reuse
Battery recycling Recovery from waste streams
Data-led exploration Lithium extraction and refining
Share of total venture capital spending in energy (right axis)
0
10
20
30
40
2015 2020 2025
Yearly funding Number of start-ups receiving their first funding
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 83
1. Market review
Critical mineral investment diverged across segments, with battery metals weakening while
copper remained strong, reflecting its central role in electricity systems
Despite improved financial performance, strong underlying demand
and a recovery in prices for some critical minerals in 2025, companies
and investors remained cautious. This reflects elevated risks
associated with market concentration and geopolitical developments,
price volatility and uncertainty around future technology pathways.
After several years of rapid growth, investment in critical minerals
slowed in 2025. Our assessment of 24 large mining companies
indicates that aggregate capital expenditure fell 9% year-on-year,
marking the first substantial decline since 2020. The sharp price
increases observed between 2021 and 2022, followed by renewed
volatility in 2024-2025, exposed structural uncertainties around
critical mineral supply chains and complicated investment decisions.
Investment trends vary markedly by company type and commodity.
Companies focused on battery metals, such as lithium, nickel and
cobalt, experienced the largest decline in capital spending in over a
decade, falling by over 20%. Lithium specialists in particular reduced
investment by around 40%, following several years of strong growth.
This retrenchment reflects a combination of shifting battery chemistry
preferences, oversupply-driven price weakness and policy
uncertainty in key markets, all of which have weighed on investor
confidence in battery metal markets.
Diversified majors scaled back their spending more modestly, while
companies focused on copper registered an increase of 8% year-onyear, underscoring investor confidence in copper’s long-term growth
given its central role in electricity systems.
These patterns are also reflected in mineral exploration. Critical
mineral exploration spending fell by over 10% in 2025. Again, this
slowdown was commodity-specific: copper continued to be the main
focus of exploration budgets, with spending remaining broadly steady
year-on-year. Lithium and nickel, however, both saw notable drops of
around 40%. For lithium, this largely reflects subdued prices following
rapid supply expansion in recent years, while for nickel, it is the result
of rising uncertainty linked to battery chemistry shifts and policy
changes by major suppliers. Across regions, the largest declines in
exploration spending were in Australia and the United States, at
around 25%, whereas Asia Pacific recorded a 20% increase.
In parallel, China has made substantial domestic investments in
geological exploration, exceeding USD 15 billion in 2024 across all
minerals, and has continued to expand refining and processing
capacity both domestically and through overseas investment,
reinforcing its central role across multiple stages of critical mineral
supply chains.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 84
1. Market review
Overall M&A deal value rebounded in 2025, though the increase
resulted largely from a single USD 6.3 billion deal between Rio Tinto
and Arcadium Lithium. Behind this rise, divergence across
commodities was very pronounced. Spending on copper assets
doubled between 2024 and 2025 owing to consolidation and
competition for high-quality resources, reflecting copper’s strategic
importance and the concentration of high-value assets. In contrast,
deal activity in battery metals remained subdued beyond the Rio TintoArcadium transaction, again highlighting weaker investor sentiment.
Venture capital (VC) investments in critical minerals recovered in 2025
and remain concentrated in technologies aimed at extracting more
value from resources. Critical minerals have accounted for around 5%
of total energy technology VC funding since 2021, up from negligible
levels previously. In 2025, critical minerals start-ups raised
USD2 billion in total, almost 1.5-times higher than the 2024 level. This
2025 trend runs counter to the decline seen in energy technology VC
in general, and in VC across all economic sectors except AI.
This reflects strong investor interest in new technologies with high
perceived market potential, particularly direct lithium extraction, dataled exploration and advanced separation processes. However,
funding is not evenly spread across regions, with much of it going to
US start-ups. KoBold Metals, a United States-based data-led
exploration start-up founded in 2018, alone accounted for one-third
of total funding in 2025.
However, funding remains well below the level in 2023, reflecting a
more difficult environment for VC fundraising amid higher interest
rates and policy uncertainty. These concerns have not eased in 2026,
and a near-term rebound in VC for critical minerals to previous levels
remains unlikely. This poses a challenge for new start-ups that are
being launched and seeking funding. While almost 70 start-ups
raised their first round of funding in 2022 or 2023, only 40 did so in
2024 or 2025. They are also raising less money on average, with an
average first-round size of USD 12 million in the last year, versus
almost USD 20 million twoyears ago.
Data suggest that it has become more difficult to scale up rapidly.
Only three start-ups founded since 2020, Cyclic Materials, Vulcan
Elements and Genomines, are among the 40 that have raised more
than USD 40 million and account for around 90% of total funding to
date. Just three start-ups, Redwood Materials, KoBold Metals and
Ascend Elements, account for 50% of funding since 2015. In other
energy technology fields, the average share of post-2020 start-ups
representing 90% of fundraising is higher, at 20%. Battery recycling
start-ups find it especially difficult to scale up quickly, as reliable
streams of waste materials and clear standards are not yet developed.
Extraction and refining start-ups often face high capital barriers to
starting operations.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 85
1. Market review
Trading volumes for lithium and cobalt continue to expand, albeit from a small base, whereas
volumes for nickel remain subdued
Daily trade volumes for copper and battery metals at major exchanges
IEA. CC BY 4.0.
Notes: Trading liquidity indicates the monthly average of daily traded volumes on major metal exchanges: copper (LME, SHFE, Chicago Mercantile Exchange
[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
for cobalt and lithium are less than 1% of annual production. Physical trade volumes through these exchanges are much smaller than those figures.
Source: IEA analysis based on data from Bloomberg.
2
4
6
8
10
2021 2022 2023 2024 2025 2026
Copper Nickel
Copper and nickel
Mt
200
400
600
800
1 000
2021 2022 2023 2024 2025 2026
Cobalt Lithium
Cobalt andlithium
t
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 86
1. Market review
Lithium markets are experiencing increasing trading liquidity, with growing interest in hedging
and price risk management, but remain at an earlier stage of market development
Trading volumes on major metal exchanges reflect the liquidity and
maturity of different mineral markets. Copper and nickel remain the
most actively traded commodities, with long-established markets on
the LME, SHFE and Chicago Mercantile Exchange (CME), supported
by their large and diversified industrial demand base. Copper trading
activity reached record levels in early 2026, with average daily
volumes on the LME (including both futures and options) peaking
between January and March due to high price volatility and inventory
reallocation driven by policy uncertainty.
Trading activity for battery metals has expanded in recent years but
remains at an earlier stage of development. Cobalt and lithium have
seen notable trading volume growth on the LME and CME over the
last two years, reflecting rising demand and increasing interest in
managing price risk. Lithium contracts on the CME in particular saw
a sharp increase in early 2026, after the market launched in 2023, as
market participants increased their hedging activity amid heightened
price volatility.
Despite this growth, liquidity in battery metals markets remains
significantly lower than in base metals. Exchange-trade volumes
account for around 15% of annual copper production and 14% of
annual nickel production, but remain below 1% for lithium and cobalt.
As a result, exchange prices play a more limited role in price
discovery for these materials, although they remain an important
benchmark for bilateral contracts.
Exchanges have accelerated efforts to develop more liquid trading
instruments in the lithium market. A notable example is the launch of
exchange-traded contracts, such as the LME lithium hydroxide CIF
based on Fastmarkets prices. However, these contracts remain
closely linked to external price assessments and have yet to reach
the depth and liquidity of more established metal markets.
More broadly, lithium markets remain comparatively opaque and
fragmented, with no single universally accepted benchmark price
equivalent to those of traditional base metals. Pricing continues to
rely largely on assessments from price reporting agencies, which
publish price indexes with different methodologies, regional coverage
and use cases. Unlike copper or nickel, lithium markets also lack a
mature stockholding function, as trading is still dominated by bilateral
contracts, products are not fully standardised and derivatives markets
remain illiquid.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 87
1. Market review
Public finance announcements for critical minerals have been rising since 2023, reaching
around USD65 billion in 2025, over four times higher than in 2023…
Types of public sector financing commitments in selected countries, 2025
IEA. CC BY 4.0.
Notes: Policies included in the analysis are announced public financing commitments specifically targeted at critical minerals value chains and converted to USD.
Financing associated with regulatory measures or policies without quantified public support is excluded. Where policies contain multiple financing instruments,
financing has been apportioned across instrument types to avoid double counting. Grants cover direct disbursements for production-stage or supply chain projects as
well as policy envelopes supporting research, demonstration, pilot and innovation programmes. Budget allocation refers to government budget items used to support
national strategies where financing is provided through a broader spending envelope rather than a single disbursement mechanism.
Source: IEA (2025), Critical Minerals Policy Tracker.
20
40
60
80
2023 2024 2025
Billions
Total
Tax
incentive
Guarantee
Equity
investment
Loan
Budget
allocation
Grants
0%
25%
50%
75%
100%
2025
United Kingdom
Russia
Brazil
Australia
India
Canada
Japan
European Union
Korea
United States
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
…though the direction and pace of disbursements will determine supply chain outcomes
Given the strategic importance of critical minerals and the financing
challenges facing many projects, governments are increasingly
deploying public finance to de-risk investment across supply chains,
particularly in strategically important markets and for early-stage
projects. This marks a shift towards more active state participation,
mirroring China’s longer history of policy-backed financing across the
full supply chain.
Based on our assessment of public financing announcements,
governments have increasingly deployed blended finance
instruments to crowd in private capital for critical mineral supply
chains, a trend that has grown markedly since 2023. These include
equity funds, concessional loans and co-investment grants, though
the mix varies significantly by country and market context. Advanced
economies have increasingly combined direct state equity through
sovereign funds, export credits, state-owned enterprise participation
and development bank co-investment with risk-sharing tools such as
loan guarantees and offtake-backed facilities deployed to crowd-in
private capital. Concessional and blended finance structures have
grown in prominence, particularly in instruments targeting supply
chains in geographically diverse regions.
Several governments made headline financing commitments in 2025,
signalling a marked escalation in public ambitions for developing
critical mineral supply chains in line with their strategic objectives.
The United States alone mobilised over USD7 billion in direct
appropriations under the One Big Beautiful Bill Act, covering the
National Defense Stockpile, the Industrial Base Fund and Defense
Production Act financing, with a further USD 250 billion in loan
guarantee authority extended to the Department of Energy’s Energy
Dominance Financing office. Canada announced a USD 1.4 billion
Critical Minerals Sovereign Fund alongside a USD 1.1 billion First
and Last Mile Fund, India approved the USD3 billion National Critical
Minerals Mission, and Brazil’s BNDES and Finep launched a
USD1 billion fund targeting domestic processing and value chain
development. Governments also expanded previously established
funds, including USD 163 million for Korea’s Supply Chain
Stabilisation Fund in 2025 and USD 690 million for Australia’s Critical
Minerals Facility in 2026. At the multilateral level, the European Union
committed USD 3.4 billion under its RESourceEU Action Plan.
The gap between announced commitments and actual
disbursements remains considerable, however. Many instruments,
including sovereign funds, loan guarantees and blended finance
vehicles, were still in the design or early operationalisation phases at
the end of 2025, with project pipelines under assessment and
eligibility criteria being established. While the scale of headline
figures reflects political commitment and signal an important step up
in government ambition, the translation of announced commitments
IEA. CC BY 4.0.
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1. Market review GlobalCriticalMinerals Outlook 2026
into deployed capital remains uneven or uncertain. For example, the
EU Critical Raw Materials Act’s 47 European Union-based strategic
projects selected in 2025 carry an estimated total capital investment
requirement of USD 26 billion, yet the CRMA confers strategic project
status and access to a financing subgroup – bringing together the
European Investment Bank, national promotional banks and private
lenders – rather than a direct funding guarantee. Actual
disbursements under the RESourceEU Action Plan are similarly still
being operationalised.
Where disbursements have been made, they tend to reflect targeted,
project-level interventions. Support has included direct equity, such
as the US government’s USD 400 million investment in MP Materials
(acquiring preferred stock and warrants convertible into a potential
15% stake) as part of a broader multibillion-dollar public-private
partnership to build a domestic rare earth magnet supply chain,
and the UK National Wealth Fund’s USD 41 million direct
investment in Cornish Lithium. Others have deployed concessional
financing, loan guarantees and grants to reduce early-stage
capital burdens and improve project bankability, such as
Australia’s USD 1.2 billion concessional loan to Iluka’s Eneabba
rare earth refinery and France’s fiscal support for Caremag,
structured as a tax credit, alongside additional backing from
Japan. These show a pattern of public financing that functions
primarily as a risk-reduction tool at the project level, rather than as a
mechanism for broad sectoral capitalisation.
Expandingbeyond supply:demand-sideinterventions
Alongside supply-side measures, governments are looking at
deploying demand-side interventions to support investment in
mineral supply chains. Approaches such as demand aggregation,
strategic stockpiling and facilitated offtake arrangements gained
traction in 2025 as tools for improving revenue certainty and reducing
commercial risk at the project level. These measures address a
fundamental challenge in mineral project finance, where the absence
of long-term offtake has been a primary barrier to debt mobilisation.
Australia’sCritical Minerals Strategic Reserve and the US
government’s announced magnet offtake commitment to MP
Materials are among the clearest expressions of this approach.
The US Export-Import Bank also announced a direct loan of
USD 10 billion for Project Vault to establish strategic mineral
reserves in the country. China’sfinancing model, bycontrast, has
long embedded demand security structurally rather than
instrumentally, with vertically integrated supply chains
established by linking overseas upstream production to domestic
processing capacity to internalise offtake risk.
The scale of public financing announcements in 2025 is an inflection
point in how governments approach critical mineral supply chain
development. The central question for markets is not merely the
amount of public finance announced, but how, when and where
financing will be deployed. For the supply additions that consuming
economies are counting on to come online in the coming years, the
pace and reliability of public finance disbursement remain
consequential.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
Box 1.1 Investments by China in the last decade
China’s position in critical mineral supply chains is the product of
sustained, policy-backed investment over decades. It continues to
leverage state-backed lending and project finance structures
channelled through state-owned commercial banks, policy banks
and provincial subsidy programmes. Underpinned by strategic
frameworks, including the Belt and Road Initiative and successive
Five-Year Plans, and channelled through state-owned commercial
banks, such as the Bank of China, these investments have been
structurally coherent.
The dominant instrument has been limited-recourse project finance,
with lending portfolios supporting upstream project companies,
including special-purpose vehicles and joint ventures in which
Chinese firms hold equity stakes, across emerging markets and
developing economies. This structure ensures that raw or processed
mineral outputs from overseas projects are channelled back for
further domestic processing, effectively internalising offtake risk and
insulating downstream processors from supply disruptions and spot
market volatility. Between 2018 and 2023, the country poured over
USD 98 billion in upstream investment across copper, nickel, lithium,
cobalt, niobium and other minerals in nearly 20 countries.
The pace has since accelerated. Chinese firms deployed an
estimated USD 120 billion in outbound mining investment from 2023
to 2025. China also financed around USD 24 billion in 363 port
projects from 2001 to 2025, around 50% of which serve energy and
mineral supply chains. Sixty-three of these projects are located
within 500 km of a China-financed mine, anchoring the upstream
supply chain. At the domestic level, China has sustained over in
geological exploration spending since 2022, with most provincial
governments expanding exploration subsidies in 2025.
China state-backed mineral financing by region, 2018-2023
IEA. CC BY 4.0.
Note: CSAM = Central and South America.
Source: AidData (2026), Tracking China’s Transition Mineral Financing.
3
6
9
2018 2019 2020 2021 2022 2023
Billion USD
Oceania
Europe
Asia exChina
Africa
CSAM
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 91
1. Market review
Latest policy developments
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
Policy developments in 2025 reinforced diversification, international partnerships and broader
government engagement across supply chains
In 2025, supply risks arising from highly concentrated mineral supply
chains materialised at scale. Against this backdrop, many governments
intensified efforts to address these vulnerabilities, introducing a wide
range of policy measures to strengthen supply security and resilience.
Policy developments between 2025 and the first quarter of 2026
illustrate the growing use of government intervention to respond to
concentration risks and support supply chain diversification.
The IEA’s Critical Minerals Policy Tracker organises government
policies around four core objectives: ensuring supply reliability and
resilience; promoting exploration, production and innovation;
encouraging sustainable and responsible practices; and scaling up
recycling. Activity in 2025 was concentrated on the first two objectives,
underpinned by expanded public investment and marked growth in
international arrangements.
Revised critical minerals lists
Several governments refreshed their official designations of which
minerals constitute strategic priorities, with notable shifts in scope
and rationale. The United States updated its List of Critical Minerals
from 50 to 60 minerals, adding ten new entries, including copper,
uranium and lead, and extending strategic designation beyond
technology-critical metals to inputs required across the broader
industrial economy. The United Kingdom revised its critical minerals
list to introduce a second tier of “growth minerals”, explicitly linking
designations to industrial strategy, energy technology deployment,
defence and advanced manufacturing, encompassing industrial
minerals, battery minerals, germanium as a technology material and
phosphorus as a fertiliser input. SouthAfrica, as a major resource
holder, revised its list to prioritise domestically abundant and exportoriented minerals, with an emphasis on industrialisation,
beneficiation and greater value capture in global supply chains.
New Zealand released its first critical minerals list, covering
37 minerals with potential to be produced domestically and those for
which resilient supply will need to be supported.
Refreshed strategies and national frameworks
Some governments issued new or updated overarching minerals
strategies in 2025. New Zealand published its Minerals Strategy to
2040, targeting a doubling of its mineral export value to
USD 1.69 billion by 2035. The European Commission adopted the
ReSourceEU Action Plan to accelerate implementation of the Critical
Raw Materials Act, including the designation of 47 strategic projects
intended to fast-track development and improve financing access.
The United Kingdom’s Vision 2035: Critical Minerals Strategy sets
quantitative diversification objectives for 2035: at least 10% of
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
aggregate annual demand met through domestic production, 20%
from recycling and no more than 60% of annual demand for any
individual critical mineral sourced from any one supplier country. This
follows similar single-supplier thresholds adopted elsewhere,
including the European Union’s Critical Raw Materials Act (65% of
annual consumption of each strategic raw material) and Korea’s 2023
critical minerals strategy (50% by 2030). The Association of
Southeast Asian Nations published the Minerals Development Vision
2045 and accompanying Minerals Cooperation Plan 2026-2030,
covering integrated value chain development, workforce capacity,
investment facilitation and responsible supply principles. Chile
adopted its National Critical Minerals Strategy, aiming to strengthen
its role as a reliable and responsible global supplier of minerals, with
a focus on domestic value addition and international partnerships.
International arrangements and multilateral cooperation
One of the most active areas of policy in 2025 was bilateral and
multilateral arrangements between consuming and producing
economies, spanning memoranda of understanding (MOUs),
dedicated partnership frameworks and joint investment vehicles.
The United States was among the most active parties. By early 2026,
the country had concluded more than 20 critical minerals frameworks
or MOUs, including frameworks with Australia and India and MOUs
with Cambodia, Malaysia, Thailand and Saudi Arabia. Its
arrangement with the DRC is notable for explicitly providing priority
access for US private sector participants, extending beyond a
standard government-to-government model to embed commercial
offtake interests within a diplomatic framework. In addition, the United
States launched the Forum on Resource Geostrategic Engagement
(FORGE) in February 2026 to strengthen multilateral co-operation.
Since 2025, India has concluded MOUs and partnership frameworks
and issued joint declarations of intent on co-operation on critical
minerals with Argentina, Brazil, Canada, France, Germany, Italy,
Japan, the Netherlands, Norway, the UnitedArab Emirates, the
United Kingdom and the United States.
In May 2026, Indonesia and the Philippines formalised a co-ordinated
nickel supply corridor under an MOU, committing to move
200 000 tonnes of ore per month from Philippine mines to Indonesian
smelters starting June 2026 and establishing a structured partnership
between upstream Philippine producers and Indonesia’s downstream
processing capacity.
Also in May 2026, Australia, India, Japan and the United States
announced the Quad Critical Minerals Initiative Framework,
advancing the Quad Critical Minerals Initiative launched in July 2025.
The framework aims to coordinate investment, policy tools and
supply chains across the full minerals value chain and mobilise up to
USD 20 billion to reduce reliance on concentrated supply by jointly
developing mining, processing and recycling capacity.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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1. Market review
Under Canada’s presidency of the Group of Seven (G7) in 2025, G7
leaders launched the Critical Minerals Action Plan, building on
successive G7 presidencies’ work since 2023. Its principal
deliverable was the Roadmap to Promote Standards-Based Markets
for Critical Minerals, which identifies non-market policies and
practices as a core systemic challenge to mineral supply chains and
commits G7 members to using available instruments, including
procurement, financial incentives, trade measures and price floors, to
diversify supply chains. In parallel, Canada launched the Critical
Minerals Production Alliance to advance project-level collaboration
and financing among like-minded partners. This initiative has been
carried forward as the G7 Critical Minerals Resilience and Production
Alliance, with further project announcements expected.
In 2026, France assumed the G7 presidency and designated the
minerals agenda as a cross-cutting priority. G7 leaders adopted the
Declaration on Securing Supply Chains for Critical Minerals in June
2026, escalating collective ambition across industrial co-operation,
financing, market structuring, transparency and traceability,
stockpiling and recycling. The leaders set a concrete diversification
target for rare earths of reducing dependency on a single non-G7
supplier for rare earths and permanent magnets to below 60% by
2030. The Declaration also recognised the IEA’s Critical Minerals
Security Programme as a key international platform to advance G7
efforts. In February 2026, IEA Ministers acknowledged the significant
progress made under the Programme and adopted a Declaration
Supporting the IEA’s Work on Critical Minerals Security, directing the
IEA to reinforce and expand the Programme to support countries in
enhancing preparedness for potential supply disruptions and
accelerating supply diversification.
Revenue capture and supply management in emerging
markets
Governments of producing countries among emerging markets have
used policies to capture greater economic value from mineral
endowments and, in some cases, to exercise greater control over
export flows. Indonesia revised its nickel ore pricing framework in
April 2026 to embed the value of battery-relevant by-products,
including cobalt, in the government’sbenchmark formula, a change
with direct implications for downstream cost structures and mixed
hydroxide precipitate production economics. The DRC, having
imposed a cobalt export ban in February 2025, replaced it with an
export quota in October 2025, aimed at supporting prices while
maintaining export revenue. The Philippines officially enacted the
Enhanced Fiscal Regime for Large-Scale Metallic Mining in
September 2025, introducing a royalty structure to increase
government revenue from mineral extraction. Raw mineral export
restrictions more broadly, including Malaysia’s ban on raw rare earth
elements, remained a feature of the policy landscape in 2025.
Strategic reserves
Governments are increasingly complementing investment and
partnership strategies with dedicated stockpiling and reserve
mechanisms, reflecting concerns about near-term supply disruption
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Global Critical Minerals Outlook 2026
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1. Market review
risk. In February 2026, the United States announced Project Vault –
formally, the US Strategic Critical Minerals Reserve. The initiative is
structured as an independently governed public-private partnership
and is described as a demand-driven reserve backed by up to USD
12 billion, including roughly USD 10 billion in financing from the
Export-Import Bank of the United States and about USD 2 billion from
private capital. Rather than relying on centralised government
forecasting, the programme is intended to stockpile critical minerals
based on manufacturer commitments and supply-chain needs, with
rare earth elements receiving early emphasis. Complementary
instruments include equity stakes in mining companies, bilateral
price-floor frameworks, and offtake-linked financing.
Australia’s Critical Minerals Strategic Reserve is oriented towards supplyside investment facilitation for selected critical minerals: antimony, gallium
and rare earth elements. It has a range of financial tools to secure supply,
sell and selectively stockpile critical minerals, allowing it to de-risk
investment in projects where private finance is constrained, mitigate
supply shocks and address market distortions. The Reserve has
AUD1 billion (Australian dollars) available for transactions as part of an
expanded AUD5 billion Critical Minerals Facility. A further
AUD 150 million has been allocated for selective stockpiling of minerals.
The Democratic Republic of the Congo (DRC) has also adopted a
strategic reserve mechanism for critical minerals. In April 2026, the
government established a strategic reserve for cobalt, coltan and
germanium, administered by the Regulatory and Control Authority for
Strategic Mineral Substances. The reserve complements the existing
export quota and allows the government to acquire, hold and market
strategic minerals, providing an additional instrument to influence
supply availability and respond to market imbalances.
Traceability and transparency
Traceability is gaining traction as a policy instrument, with
governments across both consuming and producing economies
moving to establish or strengthen systems for monitoring mineral
flows through supply chains. The G7 Roadmap reflects this
momentum at the multilateral level, calling for interoperable digital
credentials and digital product passport compatibility aligned with the
United Nations Transparency Protocol. At the national level, India has
announced the development of a dedicated traceability system under
the National Critical Mineral Mission, signalling that major emerging
economy consumers are integrating traceability into their broader
minerals security frameworks. Among producing countries, Zambia
launched the Zambia Integrated Mining Information System in
February 2025. The digital platform consolidates mining-related
transactions, including applications for mining and non-mining rights,
payment of area charges and submission of statutory reports, with
the objectives of increasing transparency, streamlining licensing
processes, reducing corruption and enhancing inter-agency
collaboration. In Indonesia, the SIMBARA platform, established in
2022 to integrate government oversight of mineral and coal flows,
was required to be expanded in 2025 to include cobalt tracking,
extending its monitoring across additional critical minerals. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 96
1. Market review
Sustainability performance tracking
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 97
1. Market review
Sustainability risks continue to disrupt supply, underscoring the need for monitoring amid
gradual overall improvement
Recent developments in 2025 highlight that social, environmental
and governance-related risks continue to pose material threats to
critical mineral supply chains. At the operational level, regulatory noncompliance has led to abrupt supply disruptions. Crackdowns on
illegal mining, licence revocations and asset seizures in some
producing countries have temporarily removed supply from the
market. For example, in October 2025, Mali revoked over 90 mining
exploration permits and Ghana revoked over 270 small-scale mining
licenses due to regulatory non-compliance. In September 2025,
Indonesia suspended 190 coal and mineral permits due to
compliance deficiencies. Sourcing minerals from conflict-affected
areas can also disrupt supply, as seen in rare earth supply chains
when the Kachin Independence Army seized parts of Myanmar in
2024. These events illustrate how governance-related risks can
translate directly into physical supply constraints.
Labour violations or disputes also disrupted supply in 2025 and 2026.
Workplace fatalities in Chile, Indonesia and Kazakhstan led to
temporary halts in production. In the DRC, a labour strike at CMOC’s
Tenke Fungurume copper mine temporarily disrupted operations in
June 2026. These events illustrate how poor labour standards can
lead to strikes or government stop-work orders that affect the steady
supply of minerals.
Climate-related risks also continue to affect production in key regions.
Water stress, extreme weather events and changing environmental
conditions pose rising challenges for mining operations. Over the
past decade, excessive rainfall in Australia has disrupted
transportation links and forced copper mines to reduce production,
while in Chile, water scarcity has continued to cause declining
production at mines. In Canada, forest fires forced a halt in operations
at Hudbay Minerals’ Snow Lake mine in summer 2025. Climate or
environmental risks can disrupt production directly, delay project
development and increase operational costs. They can also affect
financing and investment: in September 2025, Norway’s state
pension fund divested its stake in Eramet over alleged environmental
damage and Indigenous rights violations at the PT Weda Bay Nickel
site in Indonesia.
At the same time, social opposition and community-related risks
remain a key source of disruption. Project delays linked to permitting
challenges, legal appeals and local stakeholder opposition continue
to affect timelines across multiple jurisdictions. For example, the
Resolution Copper project in the United States faced significant
permitting delays owing to legal challenges and community
objections. In Indonesia, four nickel mining permits were revoked in
Raja Ampat over environmental violations after public protests. In
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 98
1. Market review
Peru, road blockades by informal miners in 2025 disrupted the
transportation of copper, highlighting how social tensions and
informality can constrain the movement of mined output. In some
cases, companies have sought to mitigate these risks through
increased stakeholder engagement, benefit-sharing agreements and
local partnerships, although outcomes remain mixed.
Sustainability performance is also increasingly being integrated into
mineral trade flows. Many consuming economies are rolling out policy
measures that seek to encourage responsible practices in mineral
supply chains. For example, due diligence requirements are
increasingly common, requiring large downstream companies to
identify, assess and mitigate adverse impacts in their supply chains.
Examples include the European Union’s Batteries Regulation and
Corporate Sustainability Due Diligence Directive, France’s Duty of
Vigilance Law and Germany’s Act on Corporate Due Diligence
Obligations in Supply Chains. Government policies that link market
access to high sustainability performance are also increasingly
common. For example, forced labour import bans are now in force in
Canada, Indonesia, Mexico and the United States, with Canada
announcing an expanded ban in June 2026 and the European Union
planning to implement a new forced labour regulation in 2027. High
greenhouse gas (GHG) emissions performance is also increasingly
a condition for market access in importing countries, for example
through carbon border adjustment mechanisms in the
European Union and the United Kingdom or through the
European Union’s Deforestation Regulation. While some of these
policies have recently been pared down, for example in the
European Union, companies continue to face sustained regulatory
expectations to prevent or minimise adverse impacts within their
supply chains.
Taken together, these developments underscore the importance of
continued monitoring and redress of sustainability-related risks.
Strengthening transparency, utilising voluntary reporting standards,
improving operational practices and enhancing traceability will be
critical to mitigating supply disruption risks and ensuring resilient and
responsible mineral supply chains.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 99
1. Market review
After several years of improvement, sustainability reporting slowed in 2024 across major
producers
Number of companies with a strong presence in energy minerals reporting on selected indicators
IEA. CC BY 4.0.
Notes: 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
scope 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
policies to prevent child and forced labour; and biodiversity commitments refer to “no net loss” or “net positive impact” targets. Reporting numbers in the chart are
based on whether a given company disclosed a metric or policy for the relevant category in its annual sustainability report.
Sources: IEA analysis based on data from 2020-2024 sustainability reports from 24 major mining companies. Companies are listed in the Annex.
5
10
15
20
25
GHG
emissions
Gender
diversity
Community
investment
Water use Injury rate Waste
generation
Responsible
labour
Reporting
framework
Land disturbed
/ rehabilitated
Biodiversity
commitments
2020 2021 2022 2023 2024
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 100
1. Market review
Environmental indicators show mixed results across key mineral producers, with improving
biodiversity and waste outcomes but stagnating emissions and water performance
Industry performance across environmental indicators, 2020-2024
IEA. CC BY 4.0.
Notes: Left-axis values for GHG emissions, water use and mine waste are calculated as the production‑weighted averages across companies, using mineral
production data reported in sustainability disclosures. For GHG emissions and biodiversity indicators (net annual land change and annual rehabilitation), values for
2024 include estimates for companies that reported in 2023 but not in 2024.
Source: IEA analysis based on 2020-2024 sustainability reports.
Mine waste
0.4
0.8
1.2
150
300
450
2020 2021 2022 2023 2024 kt per kt of mineral
kilotonnes
Mine waste Per mined output (right axis)
0.10
0.20
0.30
12
24
36
2020 2021 2022 2023 2024
ktCO2
e per kt of
mineral
MtCO2e
Scope 1 and 2 emissions Per mined output (right axis)
GHG emissions
1.0
2.0
3.0
250
500
750
2020 2021 2022 2023 2024
GL per kt mineral
Gigaliters
Water use Per mined output (right axis)
Water use
8%
16%
24%
8
16
24
2020 2021 2022 2023 2024
Hundred km2
Net annual land change Annual rehabilitation ratio (right axis)
Biodiversity
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 101
1. Market review
Gains in women’s workforce participation and community investment contrast with stagnating
progress in senior leadership diversity
Industry performance on gender balance and community investment, 2020-2024
IEA. CC BY 4.0.
Notes: Social indicators are based on publicly reported data from major mining companies and may be subject to differences in reporting scope and methodology.
Coverage varies across indicators and years. Community investment figures are reported in nominal terms.
Source: IEA analysis based on 2020-2024 sustainability reports.
25
50
75
100
2020 2021 2022 2023 2024
Thousand USD/tonne
Community investment
6%
12%
18%
24%
30%
2020 2021 2022 2023 2024
Women in senior management
Share of women in the workforce
Genderbalance
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 102
1. Market review
Sustainability reporting weakened in 2024, while industry environmental and social
performance remained mixed
Momentum on sustainability reporting across major mineral
producers showed signs of slowing in the 2025 reporting cycle (which
covers activities during the 2024 calendar year), with progress
becoming more uneven. After years of steady expansion in coverage
and disclosures, this trend has moderated, even as companies
continue to recognise that stronger sustainability performance helps
mitigate financial risks and ensure compliance. Download: Global Critical Minerals Outlook 2026.pdf
To assess how companies are performing on sustainability reporting,
we selected six priority areas relating to sustainability, namely water,
GHG emissions, biodiversity, human rights, communities and
corruption. We then examined whether companies are disclosing
specific quantitative metrics relating to these six priority areas in their
annual sustainability reports, enabling comparison across companies
and over time. While human rights and corruption were identified as
priority areas, analysis was limited to the presence of corporate
policies due to limited comparable quantitative data. Overall, major
producers did not consistently disclose the same metrics for the 2025
cycle, with some operators providing less information than in previous
years. This suggests that, while reporting has not lost relevance,
momentum has weakened, reflecting a reprioritisation of company
resources and evolving regulatory uncertainty.
Among companies that reported, the quality and scope of disclosures
improved in some areas, although gaps remain in the consistency
and comparability of reported data. For example, comparability
required the use of externally estimated production data. For
biodiversity indicators, fewer companies reported relevant metrics
than in previous years, even where they had previously disclosed
annual land rehabilitated and land disturbed. Similar comparability
challenges are observed for gender balance indicators, as
companies report these using differing definitions and scopes, for
example focusing only on board-level diversity, reporting the share of
women in management, or combining multiple categories of staff,
such as middle, senior and executive management, relative to total
employees. This variation reflects the flexibility in existing reporting
frameworks, as reporting standards provide general guidance on
disclosing gender composition across governance bodies and
employee categories but do not prescribe a single, harmonised
methodology. This reinforces the case for standardising reporting
frameworks across companies and jurisdictions, facilitating
comparison of performance among major producers.
Third-party verification has continued to strengthen, particularly at the
mine-site level. An increasing number of operations are participating
in independent assurance mechanisms, with five sites announced as
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 103
1. Market review
commencing audits under the Initiative for Responsible Mining
Assurance (IRMA) in Q1 2025, compared with the announced
completion of three audits in the previous year. Similarly, the number
of sites undergoing Copper Mark assurance has expanded,
increasing from around 50 independently verified operations in 2023
to approximately 100 participating sites in 2024, of which around
three-quarters had already been verified. In 2025, membership of the
International Council on Mining and Metals expanded for the first time
since 2021, with Hindustan Zinc and Maaden joining the group, and
both companies also joined the Extractive Industries Transparency
Initiative, reflecting growing alignment with recognised standards and
principles.
China-owned mining companies, which had shown notable
improvements in disclosure in the 2024 cycle, did not sustain the
same pace of progress in the latest cycle, in part reflecting delays in
reporting. Among these, CMOC continues to stand out as a leading
discloser, maintaining relatively comprehensive reporting across
waste and energy indicators, whereas disclosures on social and
governance indicators are comparatively less standardised in
quantitative terms and rely more on qualitative reporting. Other
Chinese companies have shown limited updates, with variations in
both the depth and timeliness of disclosure.
Performance trends
Despite mixed progress in reporting coverage, the underlying
performance indicators present a varied picture. Recent disclosures
suggest that some social performance indicators have shown steady
improvement since 2020. For example, in 2024, reported figures for
community investment were up 20% from 2020 and, after a downturn
in 2022, up 12% from 2023. Worker safety has also improved.
Gender balance shows mixed performance, with the share of women
in the workforce growing from 19% in 2020 to 22% in 2024, although
the share of women in senior management has stagnated since 2021.
At the same time, indicators related to environmental performance
continue to show gradual efficiency gains. Companies report
improvements in mine waste intensity, pointing to continued
operational optimisation across major key mineral producers.
Biodiversity-related indicators indicate gradual improvement, with
land rehabilitation increasing relative to annual land disturbed. The
rehabilitation ratio increased from 18% in 2020 to 20% in 2024,
notwithstanding year-to-year variations. However, performance has
been less favourable for other environmental dimensions: water-use
intensity shows signs of deterioration, and scope 1 and 2 GHG
emissions (both in absolute terms and on an intensity basis) are
stagnating. These patterns reflect persistent structural challenges,
including expanding mining operations, declining ore grades and an
increasing reliance on lower‑quality deposits, which continue to place
upward pressure on absolute levels of resource use and
environmental disturbance.
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Global Critical Minerals Outlook 2026
PAGE | 104
1. Market review
Developments in regulations and standards
Regulatory developments also contributed to uncertainty in 2024 and
may have influenced corporate reporting practices in 2025. Progress
has varied significantly across jurisdictions, with regulatory
momentum strengthening in some countries while slowing or
reversing in others. In several jurisdictions, policy makers have
sought to recalibrate or streamline corporate reporting and due
diligence requirements. In the European Union, the Omnibus I
Package narrowed the scope and simplified the reporting
requirements under the Corporate Sustainability Reporting Directive
and the Corporate Sustainability Due Diligence Directive, with
extensions also made to compliance timelines. In the United States,
the Securities and Exchange Commission proposed rescinding its
2024 rules on climate-related disclosures, though California is set to
enforce its regulation on GHG emissions reporting beginning in 2026.
In Canada, the Canadian Securities Administrators paused the
development of a new mandatory rule on climate-related disclosures,
with a view to supporting Canadian markets and issuers. There was
forward momentum in Australia, with its mandatory climate reporting
standards coming into effect for eligible companies on 1 January
2025.
Despite growing regulatory uncertainty, voluntary standards continue
to emerge and strengthen responsible mining, with an increasing
focus on harmonisation and alignment between existing standards.
For instance, the Global Reporting Initiative’s Sector Standard for
Mining came into effect on 1 January 2026. The Initiative for
Responsible Mining Assurance is updating the IRMA Standard to
broaden coverage across the mining value chain and strengthen
requirements for responsible mining. In addition, the Consolidated
Mining Standard Initiative is developing a global standard that
consolidates the Copper Mark, the International Council on Mining
and Metals’ Mining Principles, the Mining Association of Canada’s
Towards Sustainable Mining and the World Gold Council’s
Responsible Gold Mining Principles, which is expected to launch in
early 2027. In 2026, the China Chamber of Commerce of Metals,
Minerals & Chemicals Importers & Exporters also opened a global
public consultation for the development of a Sustainability Mining
Code, with a view to aligning it with international responsible mining
standards.
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Global Critical Minerals Outlook 2026
PAGE | 105
1. Market review
For some key energy minerals, the pace of decline in production-related emissions intensity
accelerated in 2025
Change in emissions intensity associated with critical minerals production
IEA. CC BY 4.0.
Note: Changes in emissions intensity are based on scope 1 and scope 2 GHG emissions from mining and refining activities.
Source: IEA analysis based on data from Wood Mackenzie.
-10%
-8%
-6%
-4%
-2%
0%
2%
4%
6%
8%
Copper (mining) Copper (smelting) Lithium Nickel
’23 ’24 ’25 ’23 ’24 ’25 ’23 ’24 ’25 ’23 ’24 ’25
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Global Critical Minerals Outlook 2026
PAGE | 106
1. Market review
Declining emissions across key energy mineral production highlight progress towards
company decarbonisation targets
GHG emissions intensities for copper, lithium and nickel production
declined overall in 2025 compared with the previous year. Copper
continued the downward trend observed since 2023, with emissions
intensities for mining falling by 6% year-on-year in 2025 and by 8%
for smelting. The reduction in copper smelting was the most
pronounced. For lithium and nickel, growth in emissions intensity
slowed or shifted into decline in 2025. Emissions intensity for nickel
continued the reduction trend observed in 2024, while lithium shifted
into declining intensity in 2025.
The drivers of lower emissions varied across commodities. In copper
mining, the decline was led by lower emissions from purchased
electricity for milling, which accounts for one of the largest shares of
emissions in this segment. In copper smelting, lower emissions from
purchased power also contributed to the decline. Facility-level
disruptions may also have played a role: for example, the Philippines’
sole copper smelter, PASAR, was taken offline for part of 2025 amid
unfavourable market conditions. For lithium, emissions related to
diesel use at mine sites, which increased from 2023 to 2024, declined
in 2025, contributing to the overall reduction. For nickel, lower
emissions from coal use and purchased electricity in the smelting
segment supported the reduction in 2025.
These trends are taking place alongside a growing number of
companies setting medium- and long-term decarbonisation targets.
Among the companies covered, 20 have established net zero or
equivalent targets for 2050, while 14 have set interim targets for 2030.
However, variation in target scope and underlying methodologies
continues to limit comparability and assessment of progress against
these goals.
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Global Critical Minerals Outlook 2026
PAGE | 107
1. Market review
Box 1.2 Traceability to support market differentiation and responsible supply chains
Traceability is a foundational tool for the development of
sustainable and responsible supply chains. Implementing
traceability systems can enable the collection of information on
sustainability metrics, such as GHG emissions, corruption risk or
compliance with labour standards. This can allow upstream
producers with higher standards to differentiate their products from
those associated with poorer practices, supporting the emergence
of performance-based purchasing by midstream and downstream
companies. In turn, this could support the emergence of “highperformance price premiums” or “low-performance grey discounts”.
IEA analysis indicates that traceability is on the rise: in a joint survey
conducted by the IEA and the OECD, two-thirds of surveyed
companies reported having some form of traceability system in
place. Yet companies still face many obstacles to traceability
implementation. Major obstacles reported by companies include
high implementation costs, a lack of interoperability and limited
incentives for sharing information along the supply chain. Price
signals also remain weak: only one-quarter of respondents
reported receiving some form of premium for differentiated
materials. Further, most companies collect core provenance and
ownership data, while far fewer collect the broader performancerelated and corporate transparency information needed to underpin
performance-based purchasing.
Governments can help accelerate uptake of traceability systems by
providing financial support for traceability infrastructure, harmonising
traceability standards and strengthening incentives for data sharing
along the supply chain. Strengthening traceability systems through
government intervention can help develop standards-based
markets, which in turn can unlock supply in non-incumbent countries
and mitigate the risk of supply disruptions associated with poor
practices.
Share of companies that indicated receiving price premiums
across five focus minerals
IEA. CC BY 4.0.
Notes: “Price premium” refers to companies that indicated receiving a price premium
based on origin, low GHG emissions or material with social audit certificates. “No price
premium” refers to companies that expressly stated that they do not currently receive a
price premium for traced material. The remaining percentage refers to companies that
either reported discounts for non-traced material, provided their own response (e.g.
“n/a” or “not yet tracked”) or did not answer.
Source: IEA-OECD joint survey, October 2025.
25%
50%
75%
100%
Copper Lithium Nickel Rare earths Graphite
No price premium Price premium
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 108
2. Outlook for key minerals
2. Outlook for key minerals
Part 1
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 109
2. Outlook for key minerals
Outlook overview
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 110
2. Outlook for key minerals
Energy technologies continue to drive strong demand growth for critical minerals across all
scenarios
Global critical minerals demand in the STEPS, 2025-2040
IEA. CC BY 4.0.
Notes: CPS = Current Policies Scenario; HDS = High Demand Scenario; kt = kilotonnes; Li = lithium; Mt = million tonnes; STEPS = Stated Policies Scenario.
The 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
blue) are between 2024 and 2040.
43%
54%
53%
4
8
12
16
202520302040
Graphite (Mt)
1.9x
29%
34%
37%
10
20
30
40
202520302040
Energy technologies Other uses CPS HDS
Copper (Mt)
1.3x
23%
32%
32%
50
100
150
200
202520302040
Rareearths(kt)
1.5x
35%
45% 42%
120
240
360
480
202520302040
Cobalt (kt)
1.3x
18%
32%
41%
2
4
6
8
202520302040
Nickel (Mt)
1.7x
74%
85%
90% 0.4
0.8
1.2
1.6
2025 2030 2040
Lithium (Mt Li)
3.4x
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 111
2. Outlook for key minerals
Accounting for recycling, global supply gaps persist through 2035 for copper and lithium and
widen slightly for nickel
Expected mine supply from existing and announced projects and primary supply requirements for key energy minerals
by scenario, 2035
IEA. CC BY 4.0.
Notes: CPS = Current Policies Scenario; HDS = High Demand Scenario; STEPS = Stated Policies Scenario. The percentage values indicate the share of base case
supply against 2035 primary supply requirements in the STEPS. Expected supply is based on mined or raw material output based on announced projects, except for
graphite, where the figure refers to the sum of natural flake graphite and synthetic graphite supplies. Primary supply requirements are calculated as total demand net
of secondary supply, also accounting for losses during refining operations. Rare earths refer to magnet rare earth elements only.
0.4
0.8
1.2
CPS Additional in STEPS Additional in HDS
Lithium (Mt Li)
Primarysupply requirements
68%
10
20
30
Base case High-production case
Copper (Mt)
Expectedsupply
75%
150
300
450
Cobalt (kt)
74%
5
10
15
Graphite (Mt)
96%
3
6
9
Nickel (Mt)
9
92%
50
100
150
Rareearths(kt)
107%
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 112
2. Outlook for key minerals
Over USD 750 billion in investment is required across key energy mineral value chains to meet
demand
Cumulative capital requirements for mining and refining in the STEPS, 2026-2040
IEA. CC BY 4.0.
Notes: STEPS = Stated Policies Scenario. Capital requirements cover greenfield and brownfield mining, refining expansions and sustaining capital. Requirements
are derived from projected production gaps to 2040 and assume rising capital intensity over time, reflecting declining ore grades.
Sources: IEA analysis based on data from company reports and S&P Capital IQ.
100
200
300
400
500
600
Mining Refining
Cobalt
Lithium
Nickel
Copper
Billion USD
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 113
2. Outlook for key minerals
Project pipelines reveal a structural imbalance in diversification efforts, with limited refining
and downstream capacity in the project pipeline
Estimated 2035 production from existing and announced projects outside top refiners
IEA. CC BY 4.0.
Notes: 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
to magnet rare earths only. For downstream sectors, the values respectively reflect the contained volume of lithium (in kt Li equivalent), spherical graphite (in kt
battery-grade equivalent) and rare earths (in kt REE equivalent) in battery cathodes, battery anodes and permanent magnets manufactured. Graphite mining is in kt
battery-grade equivalent, accounting for processing losses.
100
200
300
400
Mining
Refining
Cathode
kt Li equivalent
North America Central and South America Europe Asia except top refiners Australia Africa Russia Other
200
400
600
800
Mining
Refining
Anode
kt battery-grade equivalent
0.5
1.0
1.5
2.0
Mining
Refining
Mt
50
100
150
200
Mining
Refining
kt
15
30
45
60
Mining
Refining
Magnet
kt REE equivalent
Lithium Graphite Nickel Cobalt Rare earths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 114
2. Outlook for key minerals
Processing bottlenecks persist despite a strong critical mineral demand outlook
Demand outlook
Critical mineral demand continues to grow strongly in the Stated
Policies Scenario (STEPS), which reflects today’s policy settings. The
deployment of electric vehicles (EVs), battery storage, renewables and
electricity networks keeps energy technologies at the centre of
demand growth for a wide range of minerals through to 2040.
Strong growth is also evident across the broader range of scenarios,
including the Current Policies Scenario (CPS), which provides a more
conservative outlook for energy technology deployment, and the High
Demand Scenario (HDS), which assumes more rapid adoption of
low-emissions energy technologies. Demand in the CPS is around
10% lower than in the STEPS by 2040, while demand in the HDS is
around 16% higher. Download: Global Critical Minerals Outlook 2026.pdf
Lithium experiences the strongest growth, with demand increasing
well over threefold by 2040 in the STEPS. Demand for graphite
doubles over the same period, while nickel demand grows by 65%.
Demand for rare earth elements rises by around 50%, and copper
demand increases by over 25%, adding around 7 million tonnes (Mt)
by 2040. Energy technologies account for an increasing share of total
demand across all major minerals. For example, energy applications
account for around 18% of nickel demand today, but this share rises
to around 40% by 2040.
The assessment also reflects ongoing technology evolution. For
cobalt, demand growth is moderated by the increasing adoption of
lithium iron phosphate (LFP) battery chemistries. While the share of
energy technologies in total cobalt demand rises from 31% today to
43% by 2030, it subsequently declines towards 2040. Nevertheless,
total cobalt demand still increases by over 30% between today and
2040 in the STEPS.
Supply outlook
Supply projections are derived from a detailed, asset-by-asset
assessment of announced mining and refining projects. Reflecting
the latest project developments, this year’s analysis updates both the
base case and the high-production case.
The base case includes output from existing operations, assets
under construction and projects considered highly likely to proceed,
based on factors such as secured permits, committed financing and
established offtake agreements. The high-production case
incorporates projects at a relatively advanced stage of development
that are still seeking financing and/or permitting approval. Neither
scenario includes speculative projects or projects that remain at an
early stage of development.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 115
2. Outlook for key minerals
In recent years, the number of announced projects targeting key
energy minerals has continued to increase, signalling the potential for
a notable expansion in future mining and refining capacity.
Nonetheless, expected supply from existing and announced projects
suggests that supply gaps for copper and lithium persist through 2035,
while the gap for nickel is slightly tighter than in last year’s Global
Critical Minerals Outlook. A supply gap also emerges for cobalt in this
year’s assessment, driven almost entirely by the export quota
introduced by the Democratic Republic of the Congo (DRC).
Investment requirements
Meeting the rising demand for critical minerals requires substantial
investment. In the STEPS, just over USD 750 billion in capital
investment is required for both mining and refining between now and
2040. This reflects the upfront capital needed to develop new mines
and refineries, as well as capital for brownfield expansions and
sustaining capital expenditure. It also captures rising capital intensity
for new projects, driven by declining ore grades, particularly in more
mature markets such as copper.
Among the minerals, copper accounts for the largest capital
requirements at about USD 310 billion, reflecting the sizable
projected supply gap, which requires significant investment to bring
new mining capacity online, expand existing operations and address
rising capital intensity as ore grades decline. Nickel also faces
USD 280 billion in investment needs, primarily in mining, as supply
gaps begin to emerge after 2030. By contrast, although lithium also
faces supply gaps, its relatively lower capital intensity limits overall
investment requirements, while cobalt’s small market size means that
only modest investment is required to meet demand.
Supply chain imbalances
This year’s analysis places a stronger focus on pathways to supply
chain diversification, examining the extent to which projects outside
the leading countries could reduce vulnerabilities associated with
highly concentrated supply chains. The assessment covers mining
and refining activities, as well as selected downstream processing
segments, including battery chemicals and permanent magnets.
Across several minerals, the project pipeline points to a structural
imbalance between upstream supply growth and midstream and
downstream manufacturing capacity. While mining projects are
expanding across geographically diverse regions, the pipeline for
refining and downstream capacity remains relatively small, creating
potential bottlenecks in the event of supply disruptions.
Rare earth elements illustrate these challenges. By 2035, announced
projects are sufficient to reach close to 50 kilotonnes (kt) of rare earth
element content in mining capacity outside the leading producer.
However, planned refining and separation capacity amounts to less
than 40 kt, with activity concentrated primarily in Malaysia and the
United States. Downstream capacity is more constrained.
Announced projects for rare earth metals, alloys and magnets total
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 116
2. Outlook for key minerals
only around 18 kt on a rare earth element content basis as of early
2026, equivalent to about half of the mining capacity in the pipeline.
A similar pattern is evident in lithium supply chains. Mining projects
located outside the dominant supplier point to potential supply growth
well above 350 kt by 2035, but announced refining capacity remains
below 200 kt. At less than 120 kt, cathode material capacity outside
the dominant supplier is even smaller. For graphite, battery-grade
processing capacity outside the dominant supplier also lags behind
mining supply growth. Similar trends are visible for nickel and cobalt,
where downstream processing expansion remains smaller relative to
upstream supply. In the case of cobalt, refining capacity outside the
dominant supplier amounts to only below 40% of projected mined
supply.
This imbalance should also be interpreted in light of different
investment timelines across the supply chain: mining projects
generally require longer lead times for permitting and construction
than refining or processing facilities, so their announcements tend to
appear earlier.
This leaves room for policy action to change the picture, as timely
measures to reduce investment risks and support strategic capacity
in refining and downstream manufacturing could help ensure more
balanced supply chain development (see Chapter 3).
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 117
2. Outlook for key minerals
Except for nickel, announced projects suggest gradual progress towards diversification of
mining supply sources across regions…
Geographical distribution of mined or raw material production for key energy minerals in the base case, 2025-2035
IEA. CC BY 4.0.
Notes: DRC = Democratic Republic of the Congo. Graphite mining is for natural flake graphite. Rare earths refer to magnet rare earth elements only. The figure
shows the production shares of the top three producing countries in the given year.
20%
40%
60%
80%
100%
20252035 20252035 20252035 20252035 20252035 20252035
Rest of world
Brazil
United States
Myanmar
Madagascar
Mozambique
Russia
Philippines
Indonesia
China
Peru
DRC
Chile
Australia
Lithium Copper Nickel Cobalt Naturalgraphite Rare earths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 118
2. Outlook for key minerals
… while refining shows a starker picture, with diversification momentum emerging for rare
earths but remaininglimited across most other minerals
Share of the top refiner of key energy minerals in the base case, 2025-2035
IEA. CC BY 4.0.
Notes: GCMO = Global Critical Minerals Outlook. Figures for graphite are based on battery-grade graphite, including spherical graphite and synthetic graphite. Rare
earths refer to magnet rare earth elements only.
0%
25%
50%
75%
100%
Share
today
GCMO
2025
GCMO
2026
Share
today
GCMO
2025
GCMO
2026
Share
today
GCMO
2025
GCMO
2026
Share
today
GCMO
2025
GCMO
2026
Share
today
GCMO
2025
GCMO
2026
Share
today
GCMO
2025
GCMO
2026
China Indonesia Rest of world
Lithium(kt Li)
Nickel(Mt) Cobalt(kt) Graphite(Mt) Rare earths(kt) Copper(Mt)
2035 2035 2035 2035 2035 2035
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 119
2. Outlook for key minerals
Meeting demand outside the dominant supplier requires additional refining projects to emerge
across both upstream and end-market geographies
Demand and refined supply outside the dominant suppliers for selected minerals, 2035
IEA. CC BY 4.0.
Notes: CSAM = Central and South America. N-1 supply excludes production volumes from the largest refiners from the total global supply, and N-1 demand
excludes consumption of those countries from total global demand. Graphite considers only battery-grade requirements and battery-grade supply, covering both
spherical and synthetic materials.
125
250
Demand
2035
Output
today
Base
case
2035
High
case
2035
kt
Demand Supply: CSAM Australia Europe North America Asia ex-China Africa Russia Other
1.5
3.0
Demand
2035
Output
today
Base
case
2035
High
case
2035
Mt
1
2
Demand
2035
Output
today
Base
case
2035
High
case
2035
Mt
Lithium Nickel Graphite
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 120
2. Outlook for key minerals
Secondary supply could double its share, with recycling rates rising from around 10% on
average today to close to 20% by 2040 under today’s policy settings
Primary and secondary supply of key energy minerals in the STEPS, 2025-2040
IEA. CC BY 4.0.
Notes: STEPS = Stated Policies Scenario. The figure includes recycled volumes from end-of-life equipment and manufacturing scrap. For copper, direct-use scrap is
excluded. Rare earths refer to magnet rare earth elements only.
10
20
30
40
2025 2040
Mt
Secondary supply Primary supply Share secondary (right axis)
150
300
450
600
2025 2040
kt
10%
20%
30%
40%
50
100
150
200
2025 2040
kt
1.5
3.0
4.5
6.0
2025 2040
Mt
150
300
450
600
2025 2040
kt
Copper Lithium Nickel Cobalt Rare earths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 121
2. Outlook for key minerals
Mining diversification improves, but refining concentration remains high andgraphite and
nickel reveal persistent “N-1” challenges
Supply concentration
Mining supply shows some signs of diversification, though progress
remains uneven across different minerals. Except for nickel, a
pipeline of new project announcements offers some optimism for a
more diversified geographic base in mining. Since 2021, the IEA has
tracked supply concentration using the combined share of the top
three producing countries. On average, these countries account for
around 76% of global mine production today, and this share is
projected to decline modestly to 73% by 2035. Lithium supply is
expected to become more diversified as growing production in Africa
and continued investment in Argentina reduce the combined share of
Australia, Chile and China from around 75% to below 70%. Graphite
and rare earths follow a similar trend. Cobalt supply concentration
remains broadly stable as the share of the DRC declines, offset
growing production in Indonesia and uncertainty over the extent to
which DRC supply will reach the market under current export
restrictions. Nickel is the notable exception, with concentration
increasing further as Indonesia’s share of global supply rises above
70%. The top three producers are expected to remain largely
unchanged over the next decade, with two exceptions: in graphite,
Tanzania is set to overtake Madagascar, while in magnet rare earths,
Australia and the United States switch position. Download: Global Critical Minerals Outlook 2026.pdf
The picture for refining is considerably starker. Refining remains
significantly more concentrated than mining, with China maintaining
dominant positions across multiple midstream segments. Today,
China accounts for just under 50% of global copper refining capacity,
70% of lithium refining, 75% of cobalt refining, 85% of magnet rare
earth separation and over 90% of battery-grade graphite production.
Last year’s Global Critical Minerals Outlook pointed to a modest
decline in top-refiner concentration, from around 70% today to 67%
by 2035, and recent project announcements have done little to alter
the broader picture. New rare earth separation projects outside China
provide some diversification momentum, but structural inertia
remains strong across most value chains. For many minerals, refining
capacity remains closely linked to established chemical processing
infrastructure, accumulated technical expertise and proximity to
downstream manufacturing. As a result, even as mining becomes
more geographically diversified, midstream bottlenecks persist,
reinforcing supply chain vulnerabilities and strategic dependencies.
N-1 assessment and security implications
High levels of supply concentration create the risk of significant
supply shortfalls if production from the largest supplier is disrupted
for any reason. A common approach to assessing such vulnerabilities
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 122
2. Outlook for key minerals
is the “N-1” framework, which evaluates how a system would function
in the absence of its largest participant. Applied to critical minerals,
this framework helps illustrate how markets would operate without the
dominant supplier. Under this approach, N-1 supply refers to global
supply excluding the largest producing country, while N-1 demand
excludes consumption from that same country. Comparing N-1
supply and demand provides a useful indication of the extent to which
markets outside the dominant supplier can meet their own needs.
Current project pipelines suggest that significant gaps between N-1
supply and demand could persist for several minerals, particularly
nickel and graphite, highlighting continued exposure to disruptions in
the dominant supplier. Closing these gaps would require substantial
additions of refining and processing capacity, both in upstream
resource-rich economies and in downstream manufacturing and
consumer markets. The N-1 framework provides a practical lens for
assessing diversification progress and identifying remaining
vulnerabilities.
• For lithium, announced lithium chemical projects suggest the
potential to roughly double refined output outside China. This
expansion is geographically distributed between upstream-linked
facilities in Latin America and Australia and downstream-oriented
projects in North America. Despite a sizeable overall supply gap,
the N-1 gap is relatively modest.
• For graphite, project announcements indicate strong ambition to
reduce the current level of concentration. In the base case,
production outside the dominant supplier could increase nearly
fivefold, rising to as much as ninefold in the high-production case,
driven primarily by new capacity in Asia and additional projects in
Europe. However, even with this rapid expansion, a sizeable N-1
gap remains.
• For nickel, diversification prospects remain more limited. Refining
capacity outside China and Indonesia is projected to meet only
around one-third of N-1 demand, reflecting a relatively modest
pipeline of new projects.
Secondary supply
Secondary supply from recycling can play an increasingly important
role in easing primary supply constraints and strengthening system
resilience. There is potential for its contribution to roughly double,
with average recycling rates rising from around 10% today to close to
20% by 2040 in the STEPS. However, prospects vary considerably
across minerals, reflecting differences in product lifetimes, collection
systems, manufacturing scrap availability, and technical and
economic feasibility.
Cobalt and copper already benefit from relatively well-established
recycling streams, with recycling rates of around 16% and 10%,
respectively (excluding direct use of copper scrap). These could
increase to approximately 25% for cobalt and 20% for copper by 2040,
supported by improvements in collection, sorting and processing
systems. Rare earth magnet recycling remains dependent on
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 123
2. Outlook for key minerals
manufacturing scrap from magnet production, with only limited endof-life recovery today. However, the retirement of early generations
of EVs and wind turbines is expected to create a significant new
source of recyclable material.
For lithium and nickel, recycling remains at an early stage, with
current rates below 5%. Despite this, rapid market growth and rising
concerns over supply security provide strong incentives for the
expansion of recycling capacity. Overall, secondary supply could
account for a substantially larger share of future demand by 2040,
provided that supportive policies, investment in recycling
infrastructure and sustained end-market demand are in place.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 124
2. Outlook for key minerals
Outlook for copper
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 125
2. Outlook for key minerals
Copper prices hit record highs in 2026 as structural and short-term pressures converge
Copper monthly average price, 1990-2026
IEA. CC BY 4.0.
Notes: The copper price is the LME Copper Grade A Cash price. Prices are nominal.
Source: IEA analysis based on data from S&P Capital IQ.
2 000
4 000
6 000
8 000
10 000
12 000
14 000
USD/tonne
Copper price 1990-2026 average price
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 126
2. Outlook for key minerals
Copper prices surge due tomajor supply disruptions, acid supply risks from the Middle East
conflict and structural challenges
Copper prices rose sharply throughout 2025, surpassing USD 12 000
per tonne for the first time in December, and surged further to record
highs in 2026, exceeding USD 14 000 per tonne in May. Initially, the
unprecedented price levels were driven by several important shortterm developments, including supply disruptions at several major
mines and a build-up of US copper inventories due to tariff uncertainty
in 2025. However, they were also underpinned by underlying factors
such as challenges in developing new copper mines and the
anticipation of strong demand growth from electrification and data
centre construction. Lower interest rates, a softer US dollar, a
broader investor shift into physical assets and significant financial
speculation also amplified upward pressure on prices. However, with
the closure of the Strait of Hormuz in February 2026, new pressures
emerged around sulphuric acid, a critical input for primary copper
leaching, solvent extraction and electrowinning (SxEw) operations,
given the Gulf’s role as a major sulphur supplier and the Strait’s
importance as a key trade route. This was amplified further by China’s
ban on sulphuric acid exports, fuelling increasing supply concerns
and price rises.
Global demand for refined copper reached almost 28 Mt in 2025, a
robust increase of 3.7% from 2024. India, Saudi Arabia and Malaysia
continued to record strong demand growth, while Viet Nam also saw
a major increase in demand, driven by rapid industrial and
infrastructure development. Although volumes remain relatively low,
Africa was the fastest-growing region of demand. Demand in China
grew by almost 5%, led by particularly strong demand from the
industrial and manufacturing sector.
Change in annual copper consumption by sector and region
IEA. CC BY 4.0.
Note: Includes direct-use scrap.
On the supply side, there were major supply disruptions of 1.5 Mt in
2025, equivalent to over 6% of global mined supply for the year. This
-1 500
-1 000
– 500
500
1 000
1 500
’22 ’23 ’24 ’25 ’22 ’23 ’24 ’25 ’22 ’23 ’24 ’25
Grid networks Transport Construction Others Net change
kt
Global China Ex-China
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 127
2. Outlook for key minerals
tipped the refined market into deficit and was the primary driver of the
exceptional copper price rises. There were disruptions at two major
mines, Grasberg in Indonesia and Kamoa-Kakula in the DRC.
Grasberg is the second-largest copper mine in the world, accounting
for almost 4% of global mined copper production in 2024. A
disastrous mudflow in September 2025 caused major disruption and
fatalities, causing production in 2025 to be around half that in 2024.
Significant disruptions are expected throughout 2026, with a full
recovery only anticipated in 2028. At Kamoa-Kakula, the largest
copper mine in the DRC and the fourth-largest copper mine in the
world by 2024 production, seismic activity caused severe flooding
and infrastructure damage, leading to a production cut of almost
one-third in 2025 relative to guidance. Rehabilitation requirements
and timelines mean that 2026 production guidance is expected to
remain below 2024 levels.
Impact of the conflict in the Middle East and China’s
ban on sulphuric acid exports
The conflict in the Middle East and effective closure of the Strait of
Hormuz caused a supply shock for sulphur and sulphuric acid, with
consequences for metals and fertiliser markets. Around half of global
seaborne sulphur trade passes through the Strait of Hormuz, while
Gulf countries and Iran account for a quarter of global sulphur supply.
Compounding this effect, China implemented a ban on sulphuric acid
exports from May 2026 until the end of the year, affecting almost a
quarter of ex-China acid needs.
Sulphuric acid is a critical input to primary copper leaching, affecting
production through SxEw methods. Over 15% of global primary
copper output is produced via this route. There are major leaching
operations relying on sulphuric acid in the DRC (almost 1.5 Mt) and
Chile (1.2 Mt), which are the most vulnerable to the acid export ban
and any supply shortages. The DRC is particularly vulnerable, with
almost 45% of its total copper production using sulphuric acid
leaching, compared to 20% for Chile. For an average SxEw facility,
acid accounts for 13% of costs, but the DRC has higher cost
exposure, at 20%, due to the higher carbonate content of the ore.
Mexico, the United States and Zambia are also exposed as
significant producers relying on acid leaching for copper production.
With existing pressure from sulphur supply challenges in the Middle
East now combined with China’s restrictions on sulphuric acid
exports, copper producers are facing significant headwinds. Sulphur
or acid inventory levels in some producers are reportedly down to
30-60 days, with warnings of potential production cuts growing.
At the global level, reduced acid availability from a prolonged acid
ban or sustained high prices would result in global SxEw production
curtailments, adding considerable supply stress to an already tight
copper supply market. Copper prices are already near record highs,
and further supply strains are likely to drive prices higher, with
impacts on a range of strategic sectors and electrical technologies
that depend on copper, including grids, energy technologies,
transport, data centres, industrial equipment, defence and
construction.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 128
2. Outlook for key minerals
Copper SxEw production based on sulphuric acid leaching, 2025
IEA. CC BY 4.0.
DRC = Democratic Republic of the Congo.
Source: IEA analysis based on data from Wood Mackenzie.
Despite relatively low volumes, Iran is the leading copper producer in
the Middle East, at over 400 kt in 2025, but these volumes are unable
to access the global market due to the closure of the Strait. Damage
to the copper production infrastructure in the Middle East remains
limited, as most of the main mines are inland and away from the
conflict zones. Nevertheless, planned project developments are likely
to be hindered by financing and construction risks.
Trade developments
The United States implemented tariffs on semi-finished copper
products and copper-intensive derivative products in 2025. Refined
copper (cathode) was excluded from these tariffs but was under
consideration. The prospect of tariffs on copper cathode led to net
imports of 1.5 Mt of cathode to the United States and a build-up of
0.5 Mt on the COMEX, while inventories fell to low levels at Asian and
European exchanges. This inventory building in the United States
reflects front-loading of demand in anticipation of potential tariffs,
regional stock relocation and precautionary stock holding. There was
significant arbitrage between the London Metal Exchange (LME) and
the Chicago Mercantile Exchange(CME) amid expectations of US
tariffs. Recently renewed concern over tariffs has again increased
arbitrage and is expected to increase cathode imports to the
United States. Download: Global Critical Minerals Outlook 2026.pdf
There has also been a shift in copper scrap trade flows in recent
years. China originally tightened rules on low-grade copper scrap
imports, leading to the development of significant processing capacity
in Southeast Asia to upgrade scrap from the UnitedStates and other
countries before it entered China. However, countries in
Southeast Asia, such as Viet Nam and Thailand, have tightened their
rules on scrap imports in recent years, leading to India and Pakistan
emerging as two of the leading hubs for low-grade scrap processing.
1
2
3
4
5
6
DRC Chile United
States
Mexico Zambia
Mt Cu
SxEw Conventional
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Despite record copper prices, smelter fees have fallen to record lows, underscoring deepening
risks for the midstream sector
Copper smelter treatment charges, 2016-2026
IEA. CC BY 4.0.
Notes: 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
spot 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
correlated with it. In 2026, both the benchmark TC and refining charge fell to USD 0/tonne.
Source: IEA analysis based on data from Wood Mackenzie.
– 150
– 100
– 50
50
100
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
USD/tonne
Benchmark TC Spot TC
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 130
2. Outlook for key minerals
Strategic pressures rise for copper smelters
Despite record-high copper prices, the copper midstream market is
facing growing challenges. Smelter fees for processing copper
concentrate, known as treatment and refining charges (TC/RCs),
have hit all-time lows. The annual TC/RC benchmark, which is based
on an agreement between Chilean miner Antofagasta and major
Chinese smelters, settled at USD 0 per tonne in January 2026, the
lowest level ever agreed in annual negotiations. Meanwhile, spot
TC/RCs have been negative since 2024 and have fallen to all-time
lows.
The annual TC/RC benchmark is used to settle the majority of smelter
contracts, with a smaller share using the spot price, although
benchmark usage has been declining. The annual TC benchmark
settling at USD 0 per tonne in 2026 means that copper smelters using
this benchmark would effectively be eliminating any processing
income.
These lows have been driven by a surge in smelter capacity additions
from China, which has significantly outstripped growth in copper
concentrate production, sharply weighing on smelter fees. Since
2005, China has accounted for over 90% of growth in global copper
smelter output, lifting its share from around 15% to half of global
supply in 2025.
Copper smelter production by region, 2005-2025
IEA. CC BY 4.0.
Note: DRC = Democratic Republic of the Congo.
Source: IEA analysis based on data from Wood Mackenzie.
Despite the sharp decline in TC/RCs, many smelters remain
profitable for now. This is largely due to revenues from selling byproducts, such as gold, silver, free metal and sulphuric acid. With
prices for these by-products recently at record highs, smelters with
access to by-product-rich concentrate and the ability to maximise
recoveries are still generating robust profits, offsetting losses from
low TC/RCs. However, increasing volatility and recent declines in
0%
10%
20%
30%
40%
50%
5
10
15
20
25
’05 ’07 ’09 ’11 ’13 ’15 ’17 ’19 ’21 ’23 ’25
Mt Cu
China Europe
Japan and Korea Chile
DRC Other
Share of Chinese supply(right axis)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 131
2. Outlook for key minerals
precious metal prices raise questions about how long this protective
buffer can be sustained in the medium term. The smelter revenue
structure, which has historically relied heavily on TC/RCs, has
become much more dependent on by-products and premium markets,
both of which are inherently more exposed to volatility.
Surging acid prices from the conflict in the Middle East have recently
supported smelter economics. China’s acid export ban is also likely
to drive a bifurcation in acid prices between China and ex-China
markets, a dynamic that is already emerging. There is recent upward
pressure on acid prices outside China, supporting ex-China smelter
economics, while prices have been falling in China due to the surplus
domestic acid supply that cannot be exported.
Copper smelter revenue structure, 2020-2026
IEA. CC BY 4.0.
Note: TC/RCs = treatment and refining charges.
Source: IEA analysis based on data from Benchmark Minerals Intelligence.
Custom smelters are likely to be more affected by the tight
concentrate market and depressed TC/RCs than integrated smelters,
which can secure a large share of their concentrate internally from
affiliated mining operations. Some custom smelters outside China
have already been forced to cut production, and others have received
emergency government support to prevent closure. Some are
reducing primary operations but expanding recycling operations.
Average copper smelter utilisation rates, 2020-2025
IEA. CC BY 4.0.
Source: IEA analysis based on data from Wood Mackenzie.
There is already a large disparity in utilisation rates for smelters inside
and outside China. All smelters operated at around 80% utilisation in
2020, but by 2025 utilisation had diverged, falling to below 70% for
0% 20% 40% 60% 80% 100%
2026
2023
2020
TC/RCs Free metal copper By-product metals
By-product acid Premiums
65%
70%
75%
80%
85%
90%
2020 2021 2022 2023 2024 2025
China Rest of world Global
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 132
2. Outlook for key minerals
ex-China smelters, while Chinese smelters operated at 85%.
Smelters in China generally benefit from lower capital and operating
costs than those outside China, reflecting lower labour and
construction costs, greater economies of scale and newer smelters
with higher energy efficiency, greater yields, and lower maintenance
and refurbishment requirements. Most Chinese smelters are stateowned enterprises, some of which may also benefit from government
support during periods of low TC/RC income. These factors make
leading Chinese smelters more competitive and typically more
resilient to periods of depressed TC/RCs than many custom smelters
outside China. Nonetheless, low TC/RCs are also recognised in
China as one of the most pressing challenges facing the domestic
copper smelting industry.
There is broad consensus that low TC/RCs are likely to persist over
the medium term. A structural increase in TC/RCs would require
either a major boost in concentrate supply or a meaningful reduction
in smelter capacity. Most new concentrate supply growth in the
pipeline is linked to integrated or semi-integrated smelters, while
custom concentrate supply is already declining, making a surge in
freely available concentrate unlikely.
This leaves smelter cuts or closures as the main mechanism to
balance the market. China’s top smelters have agreed to cut
production capacity by over 10% in 2026, and the government has
halted around 2Mt of planned new smelting capacity to address the
issue. However, these cuts are not enough to meaningfully balance
the market. Moreover, China remains a net importer of refined copper,
making large-scale smelter closures unlikely. In the first two months
of 2026, output actually increased by almost 10%, and some smelters
are planning to raise or maintain output this year. However, if acid
prices in China fall because of the export ban, Chinese smelters may
bring forward planned maintenance to mitigate the risks from lower
by-product revenues and acid inventories, which could provide some
short-term relief to TC/RC pressure. Download: Global Critical Minerals Outlook 2026.pdf
Copper smelter production cost curve, 2025
IEA. CC BY 4.0.
Note: c/lb = cents per pound.
Source: IEA analysis based on data from Wood Mackenzie.
If the low TC/RC environment persists and by-product prices fall,
many custom smelters outside China could face significant economic
10
20
30
40
50
60
70
5 000 10 000 15 000
Direct cash costs (c/lb)
Other
China
Copper from concentrate (kt)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 133
2. Outlook for key minerals
challenges. Should these conditions materialise, the copper market
could follow a pattern seen for some other critical minerals:
oversupply drives low prices, rendering production outside China
uneconomic, in turn resulting in curtailment or rationalisation, and
eventually increasing China’s market concentration. This recently
played out in the nickel market, where a flood of supply from
Indonesia, predominantly developed with Chinese investment, drove
the market into sustained oversupply, rendering projects around the
world uneconomical, while rapidly increasing the concentration of
supply in Indonesia. It is becoming increasingly crucial to pay close
attention to growing midstream concentration risks in copper supply
chains. Consideration may also need to be given to whether the
current TC/RC framework remains fit for purpose in a changing
market structure.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 134
2. Outlook for key minerals
The large primary supply deficit remains the greatest challenge for copper markets, but there
has been some progress in project development
Mined copper supply from existing and announced projects and primary supply requirements by scenario
IEA. CC BY 4.0.
Notes: CPS = Current Policies Scenario; HDS = High Demand Scenario; STEPS = Stated Policies Scenario. Based on mined output. Primary supply requirements
are calculated as total demand net of secondary supply, also accounting for losses during refining operations. See the Introduction section for definitions of the base
and high-production cases.
5
10
15
20
25
30
2025 2030 2035 2040
High-production case
Base case
CPS
STEPS
HDS
Mt Cu
Expectedsupply
Primary supplyrequirements
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 135
2. Outlook for key minerals
The copper supply gap remains sizeable at around 25% in 2035, slightly narrower than last year,
due to new project development
Copper is one of the most strategically important metals, playing a
fundamental role across strategic sectors including energy, transport,
construction, data centres and defence. However, despite a strong
demand outlook, the key challenge for the copper market remains the
difficulty of developing new mined supply. Despite record-high copper
prices, project development remains insufficient. Based on the
project pipeline, global primary copper supply could face a 25%
deficit in 2035 under today’s policy settings.
One of the key challenges in developing new copper supply is
declining copper ore grades, with the average global grade of copper
mines having decreased by 40% since 1991, increasing capital costs
and project complexity. The average capital intensity for expanding
existing projects (brownfield) has also increased by 65% since 2020,
approaching levels typically associated with new greenfield projects.
These challenges are compounded by a rapidly declining rate of new
resource discoveries. Of all the copper deposits discovered in the last
35years, only 5% have been discovered in the last decade. Finally,
lead times for new copper projects are long, at around 17 years from
discovery to production, and many major projects have recently
experienced significant delays and cost overruns. These dynamics
suggest a structurally tighter market for copper concentrate, raising
risks for supply security and underscoring the need for supply- and
demand-side measures.
Recent project development progress in the DRC,
Zambia, Peru and Canada
There has, however, been some notable progress in project
development in the last year, increasing the number of projects with
a higher chance of materialising. This has led to a slight narrowing of
the projected deficit, from 30% in last year’s Outlook to over 25% in
this year’s base case for 2035. Africa is the greatest source of
increased supply, with the DRC and Zambia together adding almost
650 kt in 2035 compared to last year’s Outlook. In the DRC, this
increase is primarily driven by higher projected output from Chinesebacked Malachite ore operations. There are also significant project
expansions, such as the Kisanfu mine expansion, operated by
China’s CMOC Group. In Zambia, growth has been primarily driven
by a major expansion at the Lumwana mine, owned by Canada’s
Barrick Gold, planned for production by 2028, as well as a number of
new smaller operations.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 136
2. Outlook for key minerals
Increase in 2035 mined supply outlook relative to last year’s
Outlook
IEA. CC BY 4.0.
Note: DRC = Democratic Republic of the Congo.
Peru also shows a major increase of almost 300 kt, primarily through
the life extension of the large Antamina project and the long-delayed
Tia Maria SxEw project from Southern Copper. However, in April, the
permit for Tia Maria was revoked before being reauthorised 11 days
later, demonstrating the uncertainty and challenges in bringing major
new copper projects online. In the United States, the large-scale
Resolution project remains tied up in legal proceedings and is
therefore too uncertain to include in either the base or highproduction case. Russia could add almost 350 kt, primarily through
the major Baimskaya project, though it faces some development
challenges. Canada adds 200 kt, primarily through the life extension
approval for the major Highland Valley Copper mine operated by
Teck Resources.
Despite a slightly improved long-term outlook, the short- and
medium-term supply outlook appears to have worsened considerably.
Constraints on sulphuric acid availability pose a significant risk to
SxEw production. Coupled with slower-than-expected recoveries
from disruptions at major mines and an already tight market, the
copper market faces a strong set of near-term challenges.
Substitution efforts could stall, but copper scrap
presents some opportunity
Aluminium is the leading substitute for copper, with substitution
already occurring in some applications, such as overhead power lines,
heat exchangers and certain EV cabling. However, beyond
performance constraints, such as lower conductivity (around 60% of
copper), reduced safety and greater maintenance requirements,
aluminium is now also facing significant supply challenges and a
tighter market. With 8% of aluminium supply coming from the
Middle East, conflict in the region is constraining exports and pushing
prices higher. A price ratio of 3 to 1 between copper and aluminium
was often heralded as the threshold for significant substitution of
copper by aluminium. However, the price ratio has exceeded 3.5 to 1
for much of the past five years without triggering a major tipping point
100
200
300
400
kt Cu
Africa Latin America China North America Other
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 137
2. Outlook for key minerals
for substitution. If aluminium supply challenges persist, there will
likely be a slowdown in substitution efforts.
Copper scrap, however, presents a significant but underexploited
source of supply. The share of demand met by secondary supply
increased in 2025 to 18%, from 17% in 2024, following the increase
in copper prices. In 2026, this share is expected to increase further
given the surge in copper prices to record levels this year.
Nevertheless, the collection rate for end-of-life copper products
remains relatively low, particularly compared with aluminium. If
collection rates are significantly increased through targeted policy
support, secondary supply could become a major source of global
copper supply, potentially meeting over a third of global copper
demand by 2050 in the STEPS.
Construction remains the largest source of end-of-life copper scrap
across all scenarios to 2050. However, copper from EVs and storage
is the fastest-growing source of end-of-life scrap. The higher copper
intensity of EVs compared with internal combustion engine vehicles,
from the batteries and motors, results in greater copper volumes
becoming available when EVs reach end of life, compared with the
displaced copper from conventional internal combustion engine
vehicles. Copper volumes from end-of-life EVs are set to become
available particularly in the major current EV markets of China,
Europe, the United States and Southeast Asia. Key policy priorities
for increasing secondary copper production include increasing
collection rates for legacy copper applications, such as old buildings
and cables, strengthening recycling mandates, improving sorting
systems and investing in new secondary smelters.
Recycled copper volumes outlook, 2023-2050
IEA. CC BY 4.0.
Note: Recycled copper volumes detail the volumes recovered from recycling
from secondary production and direct-use scrap, accounting for collection and
recycling process yield losses.
20%
40%
60%
10
20
30
2023 2024 2025 2040 2050
Mt Cu
Direct-use scrap
Secondary production
Share of demand incl. direct scrap (right axis)
Share of demand excl. direct scrap (right axis)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 138
2. Outlook for key minerals
Outlook for lithium
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 139
2. Outlook for key minerals
Lithium chemical output continued to expand strongly in 2025, driven by new Chinese capacity
additionsand outpacing growth in mine supply
Change in mined and refined lithium output by region, 2024-2025
IEA. CC BY 4.0.
Notes: CSAM = Central and South America. Volumes are in elemental content (kt Li) unless otherwise stated. Raw materials cover the extraction of lithium from hard
rock ore, as well as from clays and brines. Lithium chemicals cover the first production of lithium carbonate, hydroxide, sulphates and chlorides, and exclude
reprocessing.
200
225
250
275
300
325
2024 Australia China Africa CSAM Other 2025
kt Li
200
225
250
275
300
325
2024 China CSAM AustraliaIndonesia Korea 2025
Mining Refining
+18%
+32%
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 140
2. Outlook for key minerals
Changing lithium markets in 2025: lithium demand from battery storage grew by 60%, while
output from Africa expandedmarkedly by 44%
China and energy storage: keywords for sustained
lithium demand growth
Lithium demand continued to expand rapidly in 2025, reaching more
than 275 kt. This represents a 23% year-on-year increase: a slight
moderation from growth in 2024, but still well above the growth rates
seen in most other commodity markets. The expansion reflects the
continued acceleration of electrification. Demand from EVs rose by
20% to 170 kt, while demand from battery storage reached 30 kt.
China accounted for about 90% of the increase in global lithium
demand, followed by Korea (+4.2 kt) and Central Europe (+1.4 kt),
where battery material production capacity is being developed.
Lithium prices back on the rise
Lithium prices rebounded sharply in early 2026, with lithium
carbonate prices nearly doubling over a short period to about
USD 20 000 per tonne of lithium carbonate equivalent. This reflected
tightening upstream supply conditions caused by overseas bans on
ore exports by Zimbabwe, as well as tighter permitting in China’s
Jiangxi region. Restocking by downstream cathode buyers also
added to price pressure. This marked a recovery from two years of
weak market conditions, when oversupply and destocking pushed
prices down.
Lithium carbonate, hydroxide and spodumene prices, April 2025-April 2026
IEA. CC BY 4.0.
Source: IEA analysis based on data from S&P Capital IQ and Bloomberg.
Current prices remain moderate compared with the peaks observed
in 2022, when they reached USD 80 000 per tonne of lithium
carbonate equivalent. A fall back in lithium prices remains possible,
which could typically be caused by a resumption of lepidolite mining
in China, a stabilisation of lithium ore trade flows or a rise in
inventories at cathode production plants.
5 000
10 000
15 000
20 000
25 000
30-04-2025 31-08-2025 31-12-2025 30-04-2026
USD/t LCE
Carbonate Hydroxide Hard-rock ore (spodumene)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 141
2. Outlook for key minerals
Growing strains on hard-rock lithium supplies
Hard-rock ore, and particularly spodumene, is increasingly becoming
the dominant source of lithium supply compared with brine-based
resources. The market for hard-rock ores tightened significantly over
the course of 2025, due to strong feedstock demand and mining
supply constraints. In 2025, lithium chemical output grew by 32%,
whereas mined output grew by 18%.
Lithium raw material supply by type, 2020-2025
IEA. CC BY 4.0.
Diversifying lithium mining driven by African suppliers
In 2025, Argentina saw faster growth output than the historical major
producers, Chile, China and Australia. New entrants are reshaping
the supply landscape, particularly in Africa: mined output from the
continent grew by 44%, helping diversify supply but also involving
challenges related to infrastructure and logistics. While three regions,
the South American “lithium triangle”, China and Australia, account
for the majority of lithium supplies today, African nations now
represent 14% of global supplies, a 26-fold increase from 2020. While
contributing to the diversification of mining supply, this trend could,
however, reinforce the dominance of the top refining country, as over
65% of new lithium mining capacity on the continent is owned by
companies headquartered in China. With the rise of regional output,
the importance of small-scale mining is slowly expanding, bringing its
own challenges.
This year, significant steps were also taken to increase European
output. In 2025, Finland’s Keliber mine began operating, with a
planned annual capacity of 2.5 kt before 2030, sufficient to meet 90%
of European demand for cathode production in the short term. France
is also accelerating strategic mining projects, such as the Allier hardrock lithium and Alsace brine projects.
Increasing lithium refining concentration
Global lithium refining output grew rapidly in 2025, with Chinese
output expanding by close to 40% year-on-year due to the ramp-up
of new capacity, such as Ganfengs’s new Dazhou plant (7.2 kt of
capacity each), as well as increased utilisation. Some new capacity
also emerged in the United States, Korea, Indonesia and Australia
but has yet to ramp up, as average utilisation rates remain well below
those of China. Overall, this led to increased concentration in lithium
refining output, with China’s share rising from 70% in 2024 to 75% in
2025.
The first half of 2026 was marked by the start of the first lithium
refining plant in Africa, with the ramp-up of a China-owned Zhejiang
0% 20% 40% 60% 80% 100%
2025
2024
2020
Brine Hard-rock ore: Spodumene Lepidolite Petalite
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 142
2. Outlook for key minerals
Huayou factory in Zimbabwe. The plant, at a total investment cost of
USD 400 million, is designed to refine about 6.5 kt in the form of
sulphate, which can then be further refined overseas into carbonate
or hydroxide and then battery chemicals. Download: Global Critical Minerals Outlook 2026.pdf
Lithium refining output and capacity, 2024-2025
IEA. CC BY 4.0.
Market conditions remained uneven across products. Lithium
hydroxide, a chemical used in nickel-rich chemistries, continued to
perform less strongly than carbonate, due to the rise of LFP
chemistries. This continued to weigh on hydroxide refineries, as well
as those converting carbonate into hydroxide, and led to curtailments
outside China, including at Australia’s Kemerton plant.
Recycling and market maturity
Secondary supply continues to scale rapidly, with recycled volumes
increasing by over 40% year-on-year in 2025. However, it still
accounts for only around 5% of total supply, highlighting both its
growing importance and its current limitations in materially
contributing to overall supply growth.
The lithium market is gradually becoming more structured, as
reflected in record trading volumes for lithium futures and the
development of forward pricing tools. Downstream players are
increasingly securing long-term supply, as illustrated by recent deals
involving MinRes and POSCO, as well as Pilbara Minerals and
Canmax.
6
12
18
24
’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25 ’24 ’25
United
States
Germany Korea Indonesia Australia
kt Li
Refining output Refining capacity Utilisation rate (right axis)
0%
25%
50%
75%
100%
100
200
300
400
’24 ’25
China
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 143
2. Outlook for key minerals
Cost competitiveness is becoming increasingly important amid volatile lithium prices, with
Latin American production leading the lowest-cost supply
Existing and projected lithium mining capacity to 2035 by country and production cost
IEA. CC BY 4.0.
Note: DRC = Democratic Republic of the Congo, LCE = Lithium carbonate equivalent. Production costs are C3 costs, which include operating expenditure and
capital expenditure costs accounting for depreciation and amortisation, interest and royalties, in current US dollars.
Source: IEA analysis based on data from Benchmark Minerals Intelligence, S&P Capital IQ and Wood Mackenzie.
25
50
75
100
125
150
175
Argentina Australia Chile China United
States
DRC Mali Canada Brazil Zimbabwe
kt Li
Less than USD 9/kg LCE Between USD 9/kg and10/kg LCE Between USD 10/kg and11/kg LCE
Between USD 11/kg and14/kg LCE Over USD 14/kg LCE
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 144
2. Outlook for key minerals
Lithium is the fastest-growing critical mineral, with demand quadrupling between today and
2040 and requiring a 2.5-fold increase in mined output
Lithium demand and supply requirements in the STEPS, 2020-2040
IEA. CC BY 4.0.
Notes: STEPS = Stated Policies Scenario. Based on raw material output covering the extraction of lithium from hard rock ore, clays and brines. Planned new projects
are based on the base case supply projection.
250
500
750
1 000
2020 2025 2040
kt Li
Electric vehicles
Storage
Other
Demand in the STEPS
250
500
750
1 000
2020 2025 2040
Secondary supply
Additional mine requirements
Planned new projects
Existing capacities
Mining and secondary supply
x3.9
x3.8
x3.8
x2.5
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 145
2. Outlook for key minerals
In a context of surging lithium demand, the project pipeline highlights the continued need for
new mines, as well as opportunities for diversification on the refining side
Lithium demand is set to continue rising strongly over the next two
decades. In the STEPS, demand in 2040 is 3.5-times higher than in
2025 and around 14 times higher than in 2020. EVs remain the main
source of growth as their deployment continues to expand across
major markets. At the same time, energy storage is becoming an
increasingly important source of demand growth. In the STEPS,
lithium demand from energy storage rises to around 70 kt in 2040 and
reaches 90 kt in 2050, around three times today’s level. In the HDS,
demand from storage reaches 120 kt in 2050, underlining the growing
role of batteries in power systems with rising shares of variable
renewables.
Lithium recycling to rise 25-fold, moderating mining
needs
Secondary lithium production from recycling reaches around 250kt
in 2050, around 25 times higher than today, as larger volumes of endof-life batteries become available and collection and processing
systems improve. In the HDS, which assumes stronger recycling
rates, secondary supply rises further to around 560 kt in 2050. This
growing contribution from recycling does not remove the need for
large-scale investment in new supply, but it helps ease pressure on
primary production and improve supply security over time.
Ten more median-sized lithium mining projects are
needed to fill the long-term supply gap
Even after accounting for the growing contribution of recycling, lithium
mining needs to expand substantially to keep pace with rising
demand. In the STEPS, primary lithium supply requirements
(demand net of contributions from secondary supply) rise to around
850 kt by 2040, implying that mined output needs to increase by
around 2.5 times from current levels. The current project pipeline
points to roughly 500 kt of mining output by 2035 in the base case, or
around 550 kt in the high-production case. Around 40% of additional
output in the base case is located in China, 222% in Argentina, 16%
in Australia and 14% in North America, with smaller additions planned
in Europe, Africa and elsewhere in Latin America. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 146
2. Outlook for key minerals
Additional lithium mining output in the base case by region and
top additional project, 2025-2035
IEA. CC BY 4.0.
Note: Base case projects = dark colour. Top additional projects = light colour.
This still leaves a sizeable gap between projected primary supply
requirements and the current pipeline. Closing this gap of around 25%
would require the emergence of about 10 additional median-sized
projects. While challenging, this is not out of reach: lithium mining
output has grown nearly fourfold over the past five years, and recent
technological progress, including the ramp-up of direct lithium
extraction by Eramet in Argentina, points to stronger prospects for
unlocking new resources.
Growing prospects for lithium refining diversification
The refining project pipeline also suggests potential for diversification.
The project pipeline in the base case is broadly sufficient to process
projected mining output, but additional projects would still be needed
to meet demand requirements in the STEPS. Over the projection
period, refining concentration eases from today’s elevated levels,
with the dominant supplier’s share falling from around 75% to 66%
by 2035. While more than half of additional refining capacity in the
base case is still planned in China, a growing number of chemical
plants are expected elsewhere. Argentina is set to play a stronger
role, supported by rising brine supply, and could account for around
10% of global lithium chemical capacity by 2035. It is followed by the
United States, with projects including Tesla’s Corpus Christi, Lithium
Americas’ Thacker Pass, Albemarle’s Silver Peak and Standard
Lithium’s lithium development, and by Australia, where Kwinana and
a possible Kemerton restart could support renewed growth, alongside
additions in Indonesia and Chile.
40
80
China Argentina North
America
Australia Mali Chile Europe
kt Li Da Hongliutan Hombre Muerto Thacker Pass Greenbushes
Goulamina Atacama Keliber Other
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 147
2. Outlook for key minerals
Outlook for nickel
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 148
2. Outlook for key minerals
The nickel market is well supplied in the shortterm, but policy and cost pressures are emerging
in the leading producer, Indonesia
The nickel market remained in a 200 kt surplus in 2025, keeping
prices subdued throughout the year. Global production increased by
9% year-on-year in mined output and 7% in refined output, driven
primarily by Indonesia, which remains the world’s largest producer of
both mined and refined nickel. Outside Indonesia, persistently low
prices continued to weigh on output, with production in the rest of the
world declining by over over 10%% in mined production and just
under 3% in refined production. At the same time, global nickel
demand rose by almost 3% in 2025 to 3.5 Mt, largely supported by
growth in nickel use in battery applications, particularly in nickel-rich
chemistries for EVs.
The global nickel market has become increasingly concentrated in
Indonesia, which now accounts for almost two-thirds of mined supply
and just under half of refined output. This reflects structural
advantages, including a large laterite resource base, an integrated
processing ecosystem, strong state support focused on industrial
policy, Chinese capital and technology, economies of scale and
access to relatively low-cost coal-based energy. As a result, policy
developments in Indonesia are increasingly shaping global market
dynamics. Despite continued physical oversupply, nickel prices
began to rise towards the end of 2025 and into early 2026 following
a series of policy announcements in Indonesia.
Nickel supply and demand growth, 2015-2025 (left), and market
balance, 2025 (right)
IEA. CC BY 4.0.
Notes: RoW = rest of world. Supply and demand are for refined nickel supply.
Indonesia’s mined nickel output is governed by production quotas
(RKAB), introduced in 2023 as three-year allocations. This framework
was revised in October 2025, shortening quotas to one year and
requiring companies to reapply for quotas covering 2026 and 2027.
-20%
0%
20%
40%
60%
China Indonesia RoW
2015-2020 2020-2025
0
1
2
3
4
Mt
2025
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 149
2. Outlook for key minerals
Shortly after, Indonesia’s Minister of Energy and Natural Resources
announced plans to curb nickel output in 2026 to support prices and
government revenues. These measures followed the revocation of in
September 2025 due to non-compliance with rehabilitation or
production requirements. Taken together, these developments
tightened expectations around future supply availability and
contributed to a 20% increase in nickel prices between December
2025 and mid-2026.
Nickel prices, January 2025-April 2026
IEA. CC BY 4.0.
Note: The nickel sulphate price refers to China nickel sulphate, with a
minimum nickel content of 22% and a maximum cobalt content of 0.4%.
Sources: IEA analysis based on data from S&P Capital IQ and Bloomberg.
As policies increasingly restrict access to domestic ore and aim to
support higher prices and royalties, Indonesian smelters have
increasingly turned to imported feedstock, importing almost 300 kt of
nickel metal equivalent from the Philippines in 2025, up by almost 50%
from 2024. The Philippines is the world’s second-largest holder of
nickel reserves, largely limonite ore, which feeds into high-pressure
acid leaching (HPAL) processing facilities and enables the production
of battery-grade intermediates. Co-operation between the two
countries was recently formalised through the IndoPhil Nickel
Corridor, which aims to provide stable feedstock supply for
Indonesia’s expanding HPAL capacity.
The Indonesian government also revised the mineral ore benchmark
price (HPM) in April 2026. The HPM serves as Indonesia’s official
floor price for nickel ore, ensuring a minimum price for mines while
increasing royalty revenues and limiting the ability of smelters, which
are mostly Chinese-owned, to push domestic ore prices too low.
Previously, higher-grade saprolite (1.5-2.7% nickel content) had a
higher HPM floor price, while limonite (typically 0.8-1.8% nickel
content) was priced lower. Under the revision, limonite and saprolite
floor prices were brought closer into alignment, with the adjustment
raising the limonite floor price relative to its nickel content. Although
this provides support to domestic miners, it also increases feedstock
costs for HPAL operations. The revision was reportedly introduced to
strengthen fiscal revenues, support domestic miners and provide
upward pressure on nickel prices.
5 000
10 000
15 000
20 000
01-01-2025 01-07-2025 01-01-2026
LME Nickel Nickel sulphate
USD/tonne
Jan-25 Jan-26 July-25
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 150
2. Outlook for key minerals
Composition of new versus old mineral ore benchmark price
(HPM) compared with Chinese ore price
IEA. CC BY 4.0.
Notes: CIF = cost, insurance and freight; wmt = wet metric tonne.
Sources: IEA analysis based on data from Wood Mackenzie and Bloomberg.
A key structural feature of the nickel market is the two main
processing routes for laterite ores, each with distinct cost profiles and
end-use applications. Rotary kiln electric furnace technology, which
dominates in Indonesia, produces nickel pig iron and ferronickel for
stainless steel applications and generally benefits from lower capital
intensity. In recent years, part of this nickel pig iron output has been
further processed into nickel matte, enabling conversion into batterygrade products and creating an additional pathway into the battery
value chain. This has provided some producers with flexibility to
redirect part of their output between stainless steel and battery
markets, depending on the relative economics and demand
conditions.
By contrast, high-pressure acid leaching enables the production of
battery-grade intermediates, such as mixed hydroxide precipitate
(MHP), but is significantly more capital-intensive and highly sensitive
to input costs, particularly sulphur. While recent policy changes in
Indonesia have contributed to higher ore benchmark prices and
tighter market conditions, they have also weakened HPAL project
economics, compounded by rising sulphur costs resulting from a
tighter global market. Requiring approximately 9 tonnes of sulphur
per tonne of contained nickel, an 80% increase in sulphur prices
raises operating costs for HPAL facilities by roughly USD1.7 per
kilogramme of nickel, pushing up marginal production costs for
intermediates such as MHP. As a result, there has been additional
strain on some operations, causing some HPAL facilities to decrease
output and tightening availability of battery-grade intermediates.
However, although nickel matte production also relies on sulphur, its
intensity is around three times lower, resulting in a much smaller cost
impact. As a result, the nickel pig iron and ferronickel market remains
relatively well supplied, with elevated inventories continuing to
moderate price pressures. Download: Global Critical Minerals Outlook 2026.pdf
20
40
60
80
Old New Old New
Chromium
Iron
Cobalt
Nickel
USD/wmt
Saprolite Limonite
CIF China
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 151
2. Outlook for key minerals
Impact of rising sulphur costs on Indonesian HPAL producers
IEA. CC BY 4.0.
Notes: 2026e = 2026 estimated costs. Costs are based on an average of
HPAL costs across two projects in Indonesia. The 2026 estimates assume an
80% increase in sulphur costs.
Sources: IEA analysis based on data from company reporting and Wood
Mackenzie.
A key question is whether Indonesia will expand domestic HPAL
facilities to produce nickel sulphate in line with its downstreaming
strategy, given its importance for precursor and cathode
manufacturing. At present, HPAL facilities produce mostly
intermediates, and Indonesian nickel sulphate capacity remains
limited relative to downstream battery cell manufacturing capacity.
Indonesia produces only 10% of global nickel sulphate and continues
to export intermediate products such as MHP to China for further
processing. China remains the dominant battery-grade nickel
sulphate producer, accounting for 75% of production.
In 2025, Indonesia exported 75 kt of nickel mattes, about 25% of its
total supply, to China, where they were further refined. This export of
Indonesian intermediate products to China for further processing
explains why Indonesia still has a smaller market share in refining
than in mining, despite bans on the export of unprocessed ore.
2
4
6
8
2025 2026e
Sulphur cost
Ore
purchase
Refining
costs
USD/lbNi
14%
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 152
2. Outlook for key minerals
Supply concentration increases across nickel mining and refining as Indonesia continues to
drive supply growth, while projects in geographically diverse regions face challenges
Mining and refining supply additions from 2025 to 2040 and early-stage projects
IEA. CC BY 4.0.
Notes: CSAM = Central and South America; RoW = Rest of world. Refined nickel includes all final products. Potential supply includes supply from projects outside
the 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
care and maintenance.
23% -6%
15%
36%
13% -2% 7%
55%
2
4
6
8
2025 2040
Base case
2040
High
production
Potential
supply
2025 2040
Base case
2040
High
production
Potential
supply
Indonesia Philippines China Australia North America CSAM Africa Europe RoW
Mining
Mt
Refining
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 153
2.Outlook for key minerals
Despite robust demand growth, the nickel market is expected to remain well supplied, although
Indonesia’s policy shifts could alter the outlook
The nickel market is expected to remain in surplus over the next
few years, with excess supply persisting before 2030 despite
continued demand growth. Based on announced projects, Indonesia
continues to drive production expansion, accounting for over 100%
of the supply growth in mining and 80% in refining to 2030 in the base
case. Indonesia’s production share is set to rise further to almost 75%
in mining and around half in refining by 2035, from almost two-thirds
and 45% today, respectively, reflecting structural advantages.
At the same time, demand continues to grow at a robust pace. By
2035, batteries are expected to account for 30% of total nickel
consumption, accounting for almost two-thirds of demand growth.
China, Indonesia, Japan and Korea represent the bulk of incremental
demand as battery manufacturing and downstream capacity continue
to expand. Although the shift towards LFP chemistries moderates
nickel demand relative to last year’s Outlook, nickel-rich chemistries
are expected to retain an important role, particularly for battery
makers outside China and in markets such as North America and
Europe, where consumers prefer long-range vehicles.
Nickel demand use by sector in the STEPS, 2015-2040
IEA. CC BY 4.0.
Notes: STEPS= Stated PoliciesScenario. Otherenergyincludesnickeluse
forrenewablesand hydrogen.
Supply gaps start to emerge beyond in the late 2020s in the base
case, with a 1.9 Mt gap emerging by 2040. The high-production case
closes over 60% of thisshortfall but depends on sustained
expansion in a limited number of jurisdictions, mainly Indonesia.
Despite this, a number of projects remain on hold or under care and
maintenance. In addition, almost 2 Mt of early-stage mining projects
0% 20% 40% 60% 80% 100%
2015
2025
2030
2035
2040
EV and storage batteries Other energy
Alloys Other uses
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 154
2. Outlook for key minerals
exist across Indonesia, Australia, North America and LatinAmerica,
which could provide additional supply if economic conditions support
development and help narrow supply gaps.
Concentration in the battery-grade nickel market, 2025 and 2035
IEA. CC BY 4.0.
Notes: For these purposes, convertible feedstock refers to any nickel product
that can be used to produce nickel sulphate, even if a further processing step
is required, such as nickel pig iron or mixed hydroxide precipitate.
Source: IEA analysis based on data from Wood Mackenzie.
However, many projects in geographically diverse regions have
struggled to emerge or recover following prolonged periods of low
prices, given persistent and structural challenges. Higher energy and
operating costs, stricter environmental standards, smaller project
scale and slower ramp-up profiles limit competitiveness at prevailing
prices. Both brownfield expansions and greenfield developments
outside today’s dominant producers require higher incentive prices to
proceed.
The largest concentration risks in the nickel market are closely linked
to the battery value chain, where supply disruptions or policy shifts
can have outsized impacts on the availability of battery-grade nickel
products. Battery production requires nickel sulphate, which can be
produced either from Class I nickel metal or from nickel intermediates,
such as MHP and nickel matte. While Indonesia has rapidly
expanded production of these intermediates and is expected to
account for just over 70% of the global market by 2035, China is
expected to remain the dominant supplier of nickel sulphate,
accounting for 70% of the market by 2035. Download: Global Critical Minerals Outlook 2026.pdf
25%
50%
75%
100%
2025 2035
Indonesia China Rest of world
Convertible feedstock
2025 2035
Sulphate capacity
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 155
2. Outlook for key minerals
Outlook for cobalt
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 156
2. Outlook for key minerals
The cobalt market is expected to shift into deficit from 2026 due to DRC export restrictions,
with the outlook increasingly shaped bypolicy developments in the DRC and Indonesia
In 2025, mined cobalt production stood at around 320 kt, similar to
production levels in 2024. However, trade in cobalt intermediates
(unrefined cobalt), particularly cobalt hydroxide, saw a notable
reduction following the introduction of export controls by the
Democratic Republic of the Congo (DRC), the world’s largest mined
cobalt supplier.
Following several years of oversupply and depressed prices, the
DRC implemented an export ban on cobalt, including cobalt
hydroxide, the country’s prevalent export form, in early 2025. Later in
2025, this was followed by a quota system capping cobalt exports at
96 600 tonnes, less than half of 2024 production volumes. These
measures led to supply tightness in intermediate feedstocks and
contributed to upward pressure on prices. Cobalt metal prices
approached USD58 000 per tonne in the first quarter of 2026, more
than three times as high as the previous year. However, refined
cobalt inventories remained elevated, resulting in differing price
dynamics between intermediates and refined products. In early 2026,
prices of cobalt hydroxide approached those of cobalt metal. Strong
demand growth from the batteries and electronics sectors in 2025
widened the price premium of cobalt sulphate and cobalt tetroxide
over cobalt metal.
Meanwhile, Indonesia has emerged as a significant alternative
supplier, producing cobalt as a by-product of nickel operations. Its
share of global production has increased from around 1.5% in 2020
to approximately 15% in 2025.
Cobalt intermediates and cobalt metal prices
IEA. CC BY 4.0.
Note: DRC = Democratic Republic of the Congo. The DRC implemented an
export ban on cobalt in February 2025 and replaced this with an export quota
system in September 2025.
Source: IEA analysis based on data from Benchmark Minerals Intelligence.
25
50
75
100
Jan-25 May-25 Sep-25 Jan-26 May-26
Cobalt hydroxide Cobalt sulphate Cobalt metal
Thousand USD/t Co
DRCexport quota
DRCexport ban
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 157
2. Outlook for key minerals
Impact of the DRC’s policy changes: export restrictions,
strategic reserve and mineral partnerships
The DRC remains the world’s largest cobalt producer, accounting for
two-thirds of global mined output. However, its supply profile has
been fundamentally altered by successive policy interventions since
late 2024. The quota system introduced by the Regulatory and
Control Authority for Strategic Mineral Substances (ARECOMS) in
September 2025 took effect in October 2025 to bring up cobalt prices
and incentivise value addition. Under this system, ARECOMS will
distribute quotas pro rata based on historical export volumes, with
exceptions granted to the state-owned entity Entreprise Générale du
Cobalt and Société pour le Traitement du Terril de Lubumbashi.
Companies are excluded from the quota system if they exported less
than 100 tonnes in 2024, operate refineries without mining activity or
possess depleted cobalt reserves.
A strategic quota was also allocated to ARECOMS and will be used
for projects of national strategic importance, with the right to buy back
excess cobalt stocks and withdraw quotas from companies that
process third-party or artisanal cobalt.The system increased supply
uncertainty, with no clear allocation framework provided beyond 2027.
Meanwhile, inventories of cobalt hydroxide in the DRC continue to
build, forcing mining operations to manage excess materials through
stockpiling in warehouses, storage in tailings facilities or production
curtailments.
Marketed global mined cobalt supply by region
IEA. CC BY 4.0.
Notes: DRC = Democratic Republic of the Congo. The supply numbers for
2025-2026 consider sold supply volumes, instead of production volumes, in
the DRC. Following 2026, the export quota is assumed to remain in place at
the current level.
In April 2026, the DRC established a strategic reserve of critical
minerals, administered by ARECOMS. The mechanism enables the
state to withhold or release volumes in response to prevailing price
conditions. As such, downstream buyers will need to factor in
discretionary state interventions by ARECOMS, which could increase
medium-term price uncertainty.
The Strategic Partnership Agreement between the United States and
the DRC has also led to early-stage deals aimed at enabling value
addition within the DRC while diversifying ownership of supply. In
January 2026, the DRC offered US investors access to state-owned
50
100
150
200
250
300
350
2025 2026 2027 2028 2029 2030 2035
Rest of
world
Indonesia
DRC
ktCo
-26%
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
mineral assets not committed under existing farm-outs or joint
venture arrangements, including Gecamines’ Mutoshi copper-cobalt
project, Sakima’s coltan and gold assets and Cominiere’s lithium
licences. Through the partnership, Glencore announced a nonbinding (MoU) with the Orion Critical Minerals Consortium (backed
by the US International Development Finance Corporation) for a
potential 40% stake acquisition in Glencore’s DRC assets in February
2026. Also with support from the Orion Critical Minerals Consortium,
Virtus Minerals announced the acquisition of Chemaf in April, one of
the largest producers of high-grade copper and cobalt, with a
potential capacity of at least 20 kt of cobalt hydroxide annually.
Shortly after, Virtus Minerals signed an MoU with US Strategic Metals
to supply cobalt and copper directly to US Strategic Metals’
hydrometallurgical plant. While these initiatives may help attract nonChinese capital into the sector, they are unlikely to translate into
significant new volumes in the near term.
Indonesia’s rise as an alternative supplier amid
emerging cost and input constraints
Indonesia is the second-largest and fastest-growing cobalt producer.
By 2035, mined cobalt production in the country is set to almost
double in the base case, supported by the expansion of the Pomalaa
and Morowali processing hubs. However, structural challenges
remain. In Indonesia, cobalt is produced as a by-product of nickel
processing via the High Pressure Acid Leach (HPAL) route, which
treats limonite ore – a lateritic nickel ore type that also contains
recoverable cobalt. Production of MHP from HPAL operations is
slowing down due to tight availability of sulphuric acid, a constraint
that is being reinforced by rising sulphur import costs and supply
disruptions, given Indonesia’s heavy reliance on imported inputs for
acid-intensive processing. While copper-cobalt SxEw operations in
the DRC are also highly dependent on sulphuric acid inputs, the nearterm impact on cobalt supply is expected to be more contained due
to elevated inventory levels and more established acid sourcing
channels, including regional suppliers such as Zambia, reducing
exposure to disruptions affecting Middle East sulphur trade routes.
Larger, integrated producers in particular benefit from access to
domestic or contracted supply, although smaller operations remain
exposed to rising reagent costs and procurement risks.
At the same time, in April 2026, Indonesia revised its mineral
benchmark ore price (HPM) formula for nickel ore, for the first time
explicitly valuing cobalt content as a priced component of the nickel
ore HPM, rather than treating it as an free-of-charge by-product.
Associated cobalt is also now subject to a 2% royalty tax rate. With
cobalt content factored into the price and tax base of nickel ore,
offtake contracts for mixed hydroxide precipitate (MHP) or other
intermediates sourced from HPM-referenced ore must account for
cobalt’s contribution to the benchmark price. This further increases
processing costs for MHP and battery-grade intermediates containing
cobalt. Any increase in cobalt production also requires a considerable
increase in nickel production in the country at a time when nickel
prices are low. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 159
2. Outlook for key minerals
Electric vehicles maintain the largest share of demand, while aerospace and defence see
steady growth through to 2040
Cobalt demand by sector in the STEPS (left) and sectoral demand composition (right)
IEA. CC BY 4.0.
Note: STEPS = Stated Policies Scenario.
100
200
300
400
2025 2030 2035 2040
kt Co
0%
20%
40%
60%
80%
100%
2021-2025 2026-2030 2031-2035 2036-2040
Electric vehicles Portable electronics Aerospace and defence
Power devices Energy storage systems Others
Share of total demand
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
The cobalt market transitions to deficit from 2026 under persistent DRC export constraints, with
adequate supply contingent on responses from Indonesia and other producers
Cobalt demand growth continues to be led by EVs, with cobalt use
for EV batteries rising by nearly two-thirds through 2040 in the STEPS,
even though cobalt demand for EV batteries has been revised down
compared with last year’s Outlook due to shifts in battery chemistry
choices.
The rapid rise of LFP batteries continues to weigh on cobalt demand
growth. However, this effect is partially offset by changes within
nickel-cobalt-manganese (NCM) chemistries compared with previous
expectations. In particular, NCM 622 and NCM 532, both more
cobalt-intensive than higher-nickel chemistries such as NCM 811, are
maintaining stronger market shares in premium EV segments,
especially in Europe and North America, where energy density
requirements, vehicle performance considerations and original
equipment manufacturer product cycles continue to support cobaltbearing cathodes. As a result, battery chemistry developments have
a mixed impact on cobalt demand, with the growth of LFP reducing
demand while the persistence of cobalt-intensive NCM chemistries
provides an important source of support.
Beyond EVs, non-EV sources make growing contributions to cobalt
demand. Devices and wearables enabled with artificial intelligence
(AI) functions are driving energy density requirements that favour
lithium cobalt oxide cathodes, and smartphone replacement cycles
have exceeded prior projections. The share of portable electronics is
set to grow from over 15% to almost 30% in the medium term and by
up to 40% to 2040 from the base year. Cobalt superalloys, used
primarily in high-temperature aerospace engine components where
demand is not substitutable, account for approximately 7% of global
cobalt consumption. Aerospace and defence are exhibiting structural
demand growth: commercial aircraft order backlogs are extending
delivery timelines, sustaining superalloy demand beyond military
applications. Should planned increases in defence spending
materialise across major economies, incremental demand for cobalt
in superalloys and lithium-cobalt battery applications could provide
additional upside to projections. Total demand for cobalt is growing,
with an increasing regional share from North America and Europe.
Mined supply of cobalt is increasingly shaped by policy
developments in the top suppliers
Near-term mined supply is driven by DRC policy implementation and
Indonesian ramp-up, but intermediate markets are expected to be
tight while export controls remain in place. In 2025, large-scale
miners in the DRC posted strong production results. CMOC produced
117 kt from Tenke Fungurume and KFM, while Glencore’s production
from KCC and Mutanda totalled 36 kt. However, export quotas limited
the material reaching the market: KCC and Mutanda did not export
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 161
2. Outlook for key minerals
cobalt in Q4 2025, and while CMOC’s cobalt production was up 0.3%
year-on-year, sales were down 92% year-on-year. For 2026, CMOC
received 31 200 tonnes of the total quota of 96 000 tonnes, including
the DRC’s strategic quota to be distributed by ARECOMS to projects
of national strategic importance, while Glencore received
22 800 tonnes. The currently published 2026 quota levels are
insufficient to meet projected intermediate supply requirements,
which may be further constrained by administrative delays in physical
exports.
Concentration in battery-grade cobalt material production
IEA. CC BY 4.0.
Note: DRC = Democratic Republic of the Congo. Cobalt intermediates include
cobalt hydroxide and mixed hydroxide precipitate.
This has tightened hydroxide availability and increased competition
for intermediate feedstocks, limiting the ability of refining capacity to
respond to growing demand. While Indonesia is expected to provide
incremental supply, its contribution is subject to constraints.
Indonesia’s 2026 RKAB quota tightening and rising sulphur costs
have disrupted HPAL feedstock availability and increased cost
pressures. At the same time, quota-driven tightness on nickel supply
supports nickel prices, which in turn underpins the economics of
cobalt produced as a by-product. As Indonesian nickel production
drives cobalt supply expansion over the long term, cobalt markets
become increasingly linked to nickel markets, with almost 50% of
global cobalt projected to be produced as a by-product of nickel by
2035 in the base case.
From around 2030, production in the DRC starts to decline by around
5% per year to 2040, driven by diminishing ore quality. Meanwhile,
Indonesia already accounts for over 15% of total mined cobalt supply
and is projected to expand output by almost 40% to 2040 in the base
case. Diversification of mined supply beyond the DRC and Indonesia
remains limited in the near term. Australia and Canada together
accounted for 3.5% (around 11 kt) of global cobalt production in 2025,
a share projected to reach 4% by 2040, supported by by-product
extraction from nickel and copper operations and government
support programmes. Moreover, many projects in alternative
jurisdictions projects remain pre-production, with no material volume
contribution expected before 2027. For example, Cobalt Blue’s
Broken Hill Cobalt Project in Australia may provide supply outside of
0%
25%
50%
75%
100%
2025 2035
DRC Indonesia Rest of world China
Cobalt intermediates
2025 2035
Refinedcobalt
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 162
2. Outlook for key minerals
the top two producing countries by 2027, with around 0.6 kt of cobalt
per annum. It is in the process of submitting its environmental permits
for 2026. Possible projects in Canada include Nickel Creek
Platinum’s Nickel Shaw and Giga Metals’ Turnagain, which may add
around 3 kt to global supply by 2027, though both are in pre-feasibility.
China’s lead in refining persists as diversification
prospects remain limited
China remains the leading cobalt refiner, accounting for more than
75% of the market in 2025, a share that remains broadly unchanged
through the projection period. Limited new refining projects in
geographically diverse regions are in sight, keeping China’s refining
dominance intact in the near to medium term. Chinese refineries have
dealt with shortages in cobalt intermediates due to administrative
delays in DRC quota allocation, though the impact has been
contained given that quota allocations have been directed primarily
to Chinese-invested DRC operations.
For cobalt sulphate, a key precursor for EV batteries, the market is
set to grow by almost 60% by 2035, with few operations outside
China and Indonesia. In January 2026, Morocco’s Managem planned
to switch its cobalt metal production in Bou Azzer to sulphate, with a
capacity estimated at 6 kt per annum, of which 1.2 kt is contained
cobalt. In the long term, operations such as Umicore’s Kokkola cobalt
refinery in Finland will continue to contribute almost 2.5 kt per annum.
Secondary cobalt supply is projected to over double by 2035 to
almost 45 kt, though volumes remain insufficient to close the demand
gap from primary sources. China lifted its ten-year ban on black mass
imports on 1 August 2025, redirecting secondary feedstock to
Chinese refiners and reinforcing its downstream position. A
combination of policy actions incentivising higher recycling of
consumer and EV batteries is projected to raise the secondary share
of total supply to 15% by 2035 in the STEPS.
Overall, the market remains constrained by uncertainty around
exports of DRC-mined material, with limited ability to offset these
restrictions through increased production elsewhere. In 2025, supply
was sufficient to meet demand, with only a marginal surplus, although
this outcome was supported by the extension of Q4 2025 export
quotas into the first quarter of 2026, allowing delayed shipments to
be completed as the DRC’s quota system was being implemented.
This masked underlying tightness in intermediate markets. If existing
export quotas persist at current levels, the market will move into
deficit from 2026 onwards, with these imbalances expected to persist
into the longer term. This reflects the continued reliance on DRC
supply, limiting the ability of the market to respond to growing demand
despite expansion projects in other regions. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 163
2. Outlook for key minerals
Outlook for graphite
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 164
2. Outlook for key minerals
New synthetic graphite production in China drives supply growth…
Growth of natural and synthetic graphite supply and demand, 2023-2025
IEA. CC BY 4.0.
– 150
150
300
450
600
2023 2024 2025
China Japan India United States
Indonesia Canada Other Demand
Battery-grade supply and demand growth
kt
-10%
0%
10%
20%
30%
40%
2023 2024 2025
Natural spherical Synthetic battery anodes
Spherical and synthetic supply growth
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 165
2. Outlook for key minerals
…consolidating a downward trend in prices
Price of China’s synthetic and natural anode active materials
IEA. CC BY 4.0.
Notes: Free on board China prices. High power: >340 mAh/g; medium power: 320-340 mAh/g; low power: <320 mAh/g.
Source: IEA analysis based on data from Wood Mackenzie.
2 000
4 000
6 000
8 000
10 000
12 000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
High power
Medium power
Low power
USD/tonne
Natural
Synthetic
High power
Medium power
Low power
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 166
2. Outlook for key minerals
Graphite demand grows strongly, while overcapacity drives a persistent low-price environment
In 2025, global graphite demand increased by around 6%
year‑on‑year, driven almost entirely by the battery sector, where
demand rose by over 14%, reflecting continued growth in EV and
stationary storage deployment. By contrast, demand from
non‑battery applications remained broadly stable. Despite the strong
demand growth, the graphite market remained oversupplied across
all major segments of the supply chain, with sustained downward
pressure on prices. New supply was mainly driven by the growth of
synthetic graphite, which increased by 22% in 2025, while natural
spherical graphite supply decreased by 3%.
Natural graphite
In the natural graphite segment, additional supply entered the market
in 2025 following the restart of the Balama mine in Mozambique and
some output from the Lindi Jumbo project in Tanzania, although
operations there remained constrained after entering administration.
These developments contributed to a modest diversification of
upstream supply, reducing the share of the top supplier in mined
graphite output to around 80% in 2025, from 84% in 2023.
In 2025 and early 2026, some spheroidisation and coating projects,
in which mined graphite is converted into battery-grade anode
material, announced significant developments. These included the
Vittangi anode project in Sweden, the Tangier anode plant in
Morocco, and the Bécancour plant in Canada, which together are
expected to produce around 20 kt of battery-grade coated spherical
graphite by 2030.
Synthetic graphite
The synthetic graphite market remains highly concentrated, with the
vast majority of production capacity located in China and only a
limited number of projects producing at scale elsewhere. From 2022
to 2025, synthetic graphite supply increased at an average rate of 15%
per year, outpacing the growth of natural graphite. With growing
competitive pressures in a prolonged low-price environment,
consolidation and vertical integration are becoming more visible
along the anode supply chain, including moves by established
Chinese producers, such as China Baoan Group’s participation in the
restructuring of Shanshan Group through its subsidiary BTR.
Some projects outside China have revised or scaled back their
planned capacity expansions in response to weaker project
economics. Recent examples include SGL’s graphite facilities in
Poland and Tokai COBEX’s project in France, both of which have
adjusted their ambitions amid sustained price pressure, high
operating costs and strong competition from the dominant supplier.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 167
2. Outlook for key minerals
As production costs become an increasingly critical factor for battery
manufacturers, the synthetic graphite industry is shifting away from
an exclusive reliance on high‑quality needle coke towards a
multi‑feedstock model in which low‑sulphur petroleum coke accounts
for a growing share of inputs. In addition to lowering costs, this
transition reduces exposure to needle coke supply constraints. China
remains a net importer of needle coke, despite recent investments to
expand domestic production capacity.
Global share of synthetic graphite in battery anodes, 2010-2025
IEA. CC BY 4.0.
Source: IEA analysis based on data from Wood Mackenzie.
Anode material
The supply and demand dynamics described above led prices of
synthetic graphite anodes for medium- and low-power applications to
roughly halve from 2022 to 2025, while prices of spherical natural
graphite anodes fell less sharply, with those for low-power
applications decreasing by one-third. Synthetic anodes used to be
more expensive than those made of natural graphite, reflecting higher
production costs. However, more recently, the use of lower-cost
feedstocks has contributed to a sharper decline in synthetic battery
anode prices. These dynamics have reinforced a structural shift in
anode composition: anode active material production in China is now
almost entirely based on synthetic graphite, while natural spherical
graphite retains a higher share outside China. Prices of anode
material are now set at historic lows, making further reductions
challenging.
Needle coke
Contrasting with this trend, needle coke prices increased in 2025,
with calcined petroleum needle coke up around 4% year-on-year,
reflecting persistent supply deficits in China and rising production
costs. In early 2026, shipping disruptions in the Strait of Hormuz
pushed up oil prices, with knock-on effects on needle coke markets:
prices rose by more than 20% since the start of the conflict, and
uncalcined needle coke reached USD 928 per tonne in April. These
increases could materially affect the cost base of synthetic graphite
anode production.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 168
2. Outlook for key minerals
Graphite electrodes for electric arc furnaces
The graphite electrodes market remained subdued in 2025, as delays
in electric arc furnace project expansions weighed on demand. Prices
edged up slightly in 2025 but remained below historical averages
amid ample supply and slower steel sector activity. However, in early
2026, several producers announced price increases, citing rising
input costs.
Trade and industrial policies add to market uncertainty
Trade policy developments are adding a further layer of uncertainty
to already concentrated graphite and battery supply chains.
China’s exports of battery-grade natural spherical graphite
IEA. CC BY 4.0.
Source: IEA analysis based on China Customs statistics, commodity codes
25041091 and 38019010.
Following the introduction of export controls on natural and synthetic
graphite in 2023 and 2024, China announced new export controls
covering batteries in October 2025, including graphite anode
materials and anode production equipment. One month later, in
November 2025, China’s Ministry of Commerce and Customs
suspended these measures for one year. While the suspension has
alleviated immediate supply disruptions, risks remain elevated. Any
re-imposition or expansion of restrictions would significantly constrain
efforts to establish competitive anode supply chains outside China,
which already face challenges related to financing, cost
competitiveness and access to advanced processing technologies.
Trade in battery-grade graphite from China has been affected by the
controls announced in 2024, with total exports of spherical graphite
decreasing by 16% in 2025. The issuance of export licences has in
some cases been targeted to specific countries, with exports of
spherical graphite to the United States halted since April 2025. In
June 2026, Mozambique also introduced restrictions on the export of
unprocessed materials, mandated local value addition and required
10% of mining revenues to be directed to local communities.
Regulatory changes in importing countries are also reshaping
incentives for local production. In the United States, total tariffs on
graphite imported from China fell sharply from over 200% in February
2026 to about 35% by late March, following rulings by the
Supreme Court and the United States International Trade
Commission. At the same time, in May 2026 the International Trade
Commission determined that graphite electrodes imported from
China and India were sold at less than fair value, highlighting the
continued use of trade measures to address perceived market
distortions. Download: Global Critical Minerals Outlook 2026.pdf
10
20
30
40
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Q4 Q1 Q2 Q3 Q4
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Other
Indonesia
Hungary
Japan
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United
States
kt
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 169
2. Outlook for key minerals
EV and storage batteries drive graphite demand growth through 2040, with China playing a
leading role
Global graphite demand outlook by sector and region in the STEPS
IEA. CC BY 4.0.
Note: EAF = electric arc furnace; STEPS = Stated Policies Scenario.
2
4
6
8
10
12
2025 2030 2035 2040
EV batteries Battery storage Other batteries
Electrodes (EAF) Other uses
Mt
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2025 2030 2035 2040
China Asia ex-China North America
Europe Other
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 170
2. Outlook for key minerals
Supply is also expected to grow strongly, with significant idle synthetic graphite production
capacity available
Total and battery-grade graphite supply from existing and announced projects in the base case, additional supply from synthetic anode
projects, and demand in the CPS, STEPS and HDS, 2025-2040
IEA. CC BY 4.0.
Note: CPS = Current Policies Scenario; HDS = High Demand Scenario; STEPS = Stated Policies Scenario.
2025 2030 2035 2040
STEPS
HDS
CPS
2
4
6
8
10
12
14
2025 2030 2035 2040
China
Africa
Asia (except China)
North America
Europe
Russia
Other regions
Additional synthetic
anode projects
Mt
Total supply (natural and synthetic) Refined battery-grade supply (spherical and synthetic)
Supply
Primary supply
requirements
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 171
2. Outlook for key minerals
Concentration risks call for strong action and policy support fordiversification
The global graphite market remains broadly well supplied through
2030, with ample idle synthetic production capacity that could be
mobilised in China in response to market signals. However, new
demand comes not only from batteries but increasingly from
non-battery applications, notably electrodes for electric arc furnaces,
as well as graphite use in other industrial and strategic sectors.
Several of these applications require specific graphite grades that are
not readily interchangeable with battery-grade material, underscoring
the emerging risks of grade-specific tightness.
Demand
Graphite demand is set to almost double from 2025 to 2035 in the
STEPS, mainly driven by strong growth in demand for EV and storage
batteries. In the long term, material choice and technology
substitution will play a role in shaping demand for battery-grade
graphite, as silicon, lithium metal and hard carbon are set to
progressively increase their market shares and substitute graphite.
Demand is expected to remain concentrated in China, which
accounted for two-thirds of demand in 2025. Outside China, new
graphite demand is expected to come mainly from new battery
projects in Asia, North America and Europe.
Electrification of steel is driving demand growth for graphite
electrodes, set to increase by around 50% from 2025 to 2035, though
surplus production capacity is expected to persist into the 2030s,
while other uses such as refractories, foundries and recarburising are
expected to overall increase by 30%.
Supply
Graphite supply growth by country, 2025-2035
IEA. CC BY 4.0.
-20%
0%
20%
40%
60%
Mined
supply
Spherical
natural
Synthetic
Other
India
Indonesia
Japan
Brazil
Canada
Madagascar
Tanzania
Mozambique
China
Total growth
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 172
2. Outlook for key minerals
From 2025 to 2035, total graphite supply is expected to grow by over
50% in the base case, driven by new battery-grade supply (both
natural spherical and synthetic) from China. Mined supply, however,
is expected to decrease in China, offset by new flake mine
developments in other regions, mainly Africa, Canada and Brazil. In
Canada, Nouveau Monde Graphite confirmed the final investment
decision for its Matawinie Mine project, which is expected to produce
around 100 kt per year of graphite starting before 2030. New graphite
mine developments are expected to deliver significant progress in
mined supply diversification, decreasing China’s share from 80% in
2025 to 53% in 2035. However, the country is expected to retain a
strong hold on refined graphite markets, with its share of batterygrade graphite supply decreasing only from 94% to 91% in the next
decade.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 173
2. Outlook for key minerals
Box 2.1 Strategic importance of specialised graphite beyond batteries
Graphite plays a strategic role across defence, aerospace, nuclear
and other high-technology sectors where performance
requirements combine extreme temperatures, mechanical stress,
electrical conductivity and chemical or nuclear stability. In many of
these applications, graphite and carbon-based materials are
effectively non-substitutable.
High-purity graphite for these specialised applications, with carbon
content higher than 99.9%, is obtained through isostatic pressing,
which requires ultra-fine controlled powders, and is always
produced from synthetic feedstocks. However, there is growing
interest among producers in high-purity natural graphite as demand
from these sectors grows.
In defence and aerospace, graphite and carbon-carbon composites
are essential inputs for missile and rocket nozzles, hypersonic and
re-entry structures, aircraft braking systems, seals and bearings.
These applications require high-density materials that retain
strength and dimensional stability at very high temperatures while
remaining lightweight.
In nuclear energy systems, nuclear-grade graphite is a critical
component in graphite-moderated reactors, serving both as a
neutron moderator and a structural material.
The safety and performance requirements of nuclear applications
impose exceptionally tight specifications, including ultra-high purity
(up to 99.999% carbon content), controlled isotropic microstructure,
high density and resistance to radiation-induced degradation.
Other strategically important industries, such as semiconductors,
solar PV, fuel cells and hydrogen technologies, depend on very
high-purity graphite with tightly controlled grain size, porosity and
thermal properties. Materials for these applications are required to
operate in ultra-clean, high-temperature environments where
contamination or microstructural variability can lead to system
failure.
While these non-battery applications account for a relatively small
share of total graphite volumes, they are highly
specification-sensitive and mission-critical. Demand for specialised
graphite is expected to increase steadily over the next decade,
driven by rising defence expenditure, expansion of aerospace and
space systems, expansion of nuclear capacity, and the scaling-up
of semiconductor manufacturing. This creates strategic exposure,
as supply chains for high-grade graphite remain highly
concentrated, and capacity for specialised grades is significantly
more difficult to substitute or scale than bulk battery materials.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 174
2. Outlook for key minerals
Outlook for rare earth elements
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 175
2. Outlook for key minerals
With export controls, rising prices and supply uncertainty, 2025 was one of the most turbulent
years for rare earth element markets since the 2010s
Evolution of rare earth magnet export volumes from China (left) and price of selected rare earth elements (right) since January 2025
IEA. CC BY 4.0.
Notes: kt = thousand tonnes; NdFeB = neodymium-iron-boron permanent magnet; REE = rare earth elements. Magnet REE = neodymium, praseodymium,
dysprosium and terbium. Non-magnet REE = yttrium, samarium, gadolinium, holmium, erbium and lutetium. The assessment is based on neodymium,
praseodymium, dysprosium, terbium, yttrium, samarium, cerium, erbium and lanthanum rare earth oxide 99.5% min free on board China spot prices, and scandium,
gadolinium, holmium and europium rare earth oxide 99% min Ex Works China prices. Indexed values were calculated relative to January 2025.
Sources: IEA analysis based on statistics from China’s General Administration of Customs, accessed 13 May 2026 and KOMIS (2026), accessed 29 April 2026. Download: Global Critical Minerals Outlook 2026.pdf
0.8
1.0
1.2
1.4
1.6
1.8
2.0
2.2
Jan-25 Apr-25 Jul-25 Oct-25 Jan-26 Apr-26
Index (1 Jan 2025 = 1)
Magnet REE Non-magnet REE
1
2
3
4
5
6
7
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
Feb
Mar
2025 2026
kt NdFeB
Europe United States Korea Japan Rest of World
Export restrictions
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 176
2. Outlook for key minerals
Against the backdrop of supply uncertainty triggered by geopolitical events, unprecedented
momentum emerged to support projects in geographically diverse regions
Export controls, trade and prices
In 2010, China implemented rare earth controls using quotas and
licensing, causing a global supply shock and rare earth prices to spike
temporarily by as much as ten times. These controls were eventually
ruled non-compliant with the World Trade Organization (WTO),
leading to their removal. In 2025, significantly strengthened and
expanded rare earth export controls from China re-emerged.
The April 2025 export controls on seven heavy rare earths (including
dysprosium, terbium and samarium, which have applications in
permanent magnets) and their related products led export volumes
from China to drop sharply in April and May, leaving many
automakers in the United States, Europe and beyond struggling to
source permanent magnets. Exports of dysprosium and terbium
oxides and metals were also affected by the restriction, dropping in
May before slowly recovering in the following months, impacting the
supply of feedstocks for magnet manufacturing outside China. Even
after trade volumes recovered, a significant premium for magnets
produced outside China remained.
Expanded export controls announced in October 2025 not only
added five additional rare earth elements, notably holmium, which
was used as a substitute by magnet makers in the aftermath of the
April controls, but also broadened the scope to include
“internationally made” products containing Chinese-sourced “parts,
components and assemblies” or manufactured using Chinese
technologies. In November 2025, China announced a one-year
suspension of the export restrictions introduced in October 2025,
providing relief to the market. However, the underlying risks and
potential for future implementation remain (see Chapter 1).
Notably, prices for neodymium‑praseodymium (NdPr) oxide nearly
doubled over the seven months from October 2025, reaching around
USD 125 perkilogramme in February 2026, their highest level since
mid‑2022. The elevated prices are likely to be temporary, with a
marginal downward correction already being observed.
New landscape for policy support and partnerships
Governments have rapidly deployed a range of policy instruments to
reduce vulnerabilities across rare earth supply chains, spanning trade,
project financing, research and development, and international
partnerships. These efforts were accelerated by the announcement
of export controls and growing recognition of the importance of
fostering long-term supply chain resilience.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 177
2. Outlook for key minerals
Financing has been the most widely utilised policy response, with
governments stepping in where private capital is lacking. Australia’s
AUD 1.65 billion (Australian dollar) loan to Iluka Resources for the
Eneabba rare earths refinery is one example, alongside the
United States’ USD 150 million loan to MP Materials for its plan to
expand heavy rare earth separation capabilities. Additional actions
from the Australian government are expected, partly linked to the
country’s Critical Minerals Strategic Reserve initiative. The US
International Development Finance Corporation has also been active,
including through the Critical Minerals Consortium, which is backed
by USD 600 million in funding. Export credit agencies have started to
finance projects as well, including Export Development Canada’s
letter of interest to support a Viridis mining project in Brazil with
CAD 100 million (Canadian dollars) in debt financing. In November
2025, the Indian government approved an INR 72.8 billion (Indian
rupee) (approx. EUR 780 million) scheme to develop integrated
permanent magnet manufacturing capacity of , covering the full value
chain from rare earth oxides to finished magnets.
Research, development and innovation along the supply chain
have also received significant funding, including the US Department
of Energy’s National Energy Technology Laboratory’s letter of intent
with USA Rare Earth to develop digital twin technology for heavy rare
earth separation at the company’s Wheat Ridge laboratory and
Round Top deposit.
Geological exploration has been a way for countries to expand their
domestic resource base. India’s Atomic Minerals Directorate, for
example, has been conducting systematic rare earths exploration
and targeting monazite and xenotime deposits. Between 2021 and
2024, the Geological Survey of India launched 368 critical mineral
exploration projects, which include rare earths, with a further 195
projects initiated from 2024 to 2025. These efforts were
complemented by the 2026 Union Budget, which introduced
dedicated rare earth industrial corridors in Andhra Pradesh, Kerala
and Odisha, designed to bundle extraction, processing and valueadded manufacturing into a coherent development strategy for
electronics and defence supply chains.
Recycling is also a parallel priority for many countries. The
European Union’s Critical Raw Materials Act introduced a suite of
measures aimed at strengthening rare earth recycling across the
region, including requirements for rare earth content labelling and
minimum recycled content obligations, with implementation
scheduled between 2028 and 2032. In parallel, under the
RESourceEU Action Plan, the European Commission is expected to
put forward a proposal to restrict exports of permanent magnet scrap
and waste from EU countries. India’s incentive scheme to promote
critical minerals recycling sets aside INR1 500crore (approx.
EUR 145 million) to provide financial incentives for the development
of recycling capacity for the separation and production of critical
minerals from secondary sources.
International partnerships have increasingly become a cornerstone
of many countries’ efforts to secure rare earth supply chains. For
example, the United States has signed many bilateral agreements
IEA. CC BY 4.0.
PAGE | 178
2.Outlook for key minerals GlobalCriticalMinerals Outlook 2026
since 2025, including a framework with Australia specifically focused
on securing supply in the mining and processing of critical minerals
and rare earths, and more recently a strategic
cooperation framework with Saudi Arabia. Last December,
Malaysia signed a memorandum of cooperation to
strengthen technical collaboration on rare earth exploration
and resource evaluation to support geological surveys,
technology exchange and capacity building, and to position
Malaysia as a hub for an integrated rare earth supply chain. In
February 2026, Brazil and India signed a non‑binding MoU on rare
earths and critical minerals, establishing a framework for
cooperation on reciprocal investment, exploration, mining and
technology applications, including AI. In April 2026, France
and Japan agreed to strengthen their existing
cooperation on rare earth supply chains, building on their
cooperation on the Caremag project for rare earth processing and
recycling. The IEA Critical Minerals Security Programme was
reinforced in February 2026 to serve as an avenue for partnerships
on strategic projects and policy instruments. In addition, a growing
number of governments are making collaborative efforts to develop
supply chains from mining to magnet manufacturing, from joint
ventures between state-backed entities and mining companies
to government-facilitated offtake agreements and equity
investments by national resource agencies in foreign operations. In
June 2026, Group of Seven (G7) member countries agreed to
reduce dependencies on rare earths and permanent magnets
from a single supplier to under 60% by 2030 in the G7 leaders’
declaration on securing supplychains for critical minerals. These
examples point to an emerging approach in which governments are
extendingmore directsupportto thesupplychain,in addition to
creating enabling policyenvironments.
Private sector engagement sees a step change
For decades, investment levels in rare earth companies in
geographically diverse regions remained low due to a combination of
low prices, small market sizes, price-sensitive end-use industries,
lack of market transparency and policy uncertainty. However,
developments in 2025 highlighted the strategic importance of rare
earths, particularly magnet rare earths (neodymium [Nd],
praseodymium [Pr],dysprosium [Dy], terbium [Tb]),across a wide
range of sectors from energy and transport to electronics, high-tech
manufacturing for AI and data centres, aerospace and defence.
Unprecedented billion-dollar investment agreements in the rare
earths industry have come from both the public and private sectors in
the last 12 months, with companies playing an increasingly active
role in efforts to build diversified supply chains. The agreements have
often been cross-border, leveraging strengths in different regions,
with many companies aiming to create “mine-to-magnet” value
chains.
In July 2025, MP Materials, which operates one of the only integrated
rare earth facilities outside China, announced a landmark partnership
with the US Department of War to expand domestic permanent
magnet production, including support for its existing Independence
magnet manufacturing facility and the development of the new largescale 10X magnet manufacturing campus. The US Department of
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PAGE | 179
2.Outlook for key minerals GlobalCriticalMinerals Outlook 2026
War committed to a floor price of USD 110 per kg for neodymiumpraseodymium products. The company also signed a
USD 500 million agreement with Apple, under which Apple will
purchase magnets produced at the Independence facility using
recycled feedstock. The two companies also agreed to establish a
recycling line at Mountain Pass to recover and reprocess materials
from end-of-life products and scrap.
USA Rare Earth has signed multiple agreements in less than a year,
including its acquisition of United Kingdom-based metallisation
company Less Common Metals with an equity investment of
USD 125 million and Brazil’s rare earth mining companySerra Verde
for USD 2.8 billion. The company has also planned an all-stock
purchase of Texas Mineral Resources Corporation and announced a
12.5% equity stake in the French metal and alloy production facility
operated by Carester. In addition to an estimated USD 1.6 billion in
financing and equity support from the US government, USA Rare
Earths has also raised around USD2 billion from private sources to
help finance these deals.
Lynas Rare Earths has signed a binding letter of intent with the US
Department of War to finalise a four‑year supplyagreement for light
and heavy rare earth oxides, under which approximately
USD 96 million will be allocated for purchases, including a floor price
of USD 110 per kg for NdPr oxide. The company has also agreed to
a 12-year supply arrangement with Japan for the same floor price.
Both deals match the minimum level established last year in the
support agreement with MP Materials. The deal also allocates to
Japan around half of Lynas’s future heavy rare earth oxide production,
supported through the Japan Australia Rare Earths partnership
involving Sojitz and the Japan Organization for Metals and Energy
Security (JOGMEC). In March 2026, Lynas signed a co-operation
deal with Korean company LS Eco Energy, with plans to build a metal
processing facility in Viet Nam. Last October, the company also
partnered with United States-based magnet manufacturer Noveon
Magnetics in an agreement that includes both light and heavy rare
earth materials.
Private companies also boosted efforts to scale up recycling. Neo
Performance Materials and Cyclic Materials signed a non‑binding
MoU to develop a circular and traceable rare earth supply chain,
centred on recycling magnet‑production scrap and end‑of‑life
magnet‑bearing materials into mixed rare earth oxides that can be
reintegrated into Neo’s alloy and magnet‑manufacturing operations
in Europe. Korea Zinc and Alta Resource Technologies formed a joint
venture to build a rare earth recycling facility in the United States by
2027, aiming to reach a production capacity of 100 tonnes of oxides
per year. ReElement Technologies will receive USD 80 million in
federal loans to expand recycling and refining capabilities, supporting
closed-loop production of neodymium-iron-boron magnets. Ionic
Rare Earths signed an MoU with US Strategic Metals to develop a
recycling plant in Missouri that will produce high-purity rare earth
oxides. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 180
2. Outlook for key minerals
Timely realisation of all announced projects would nearly triple today’s volumes of mined and
refined production for magnet rare earths from diversified sources by 2035
Mined and refined rare earth production outside the top producer in the high production case and share of top producer
IEA. CC BY 4.0.
Notes: REE = rare earth elements. For mining, the figures exclude China and Myanmar. The figures are for magnet rare earths (neodymium, praseodymium,
dysprosium and terbium) only.
25%
50%
75%
100%
20
40
60
80
2025 2035 2025 2035
Rest of world
France
Malaysia
India
Brazil
United States
Australia
Share of top producer
(right axis)
kt REE
Mining Refining
2.8 x
2.7 x
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 181
2. Outlook for key minerals
While demand continues to grow steadily and supply remains sufficient at the global level,
supply from diversified sources remains well below demand outside the top producer
Demand
As described in the IEA’s Rare Earth Elements special report,
demand for magnet rare earths – neodymium, praseodymium,
dysprosium and terbium – continues to grow steadily. It has doubled
since 2015, driven by rapid growth in the electrification of end uses
and industrial processes, as well as the deployment of new energy
technologies such as EV and wind turbines, whose powerful motors
rely heavily on permanent magnets. The two heavy magnet rare earth
elements, dysprosium and terbium, continue to play small but
significant roles in phosphors, displays, medical equipment, nuclear
reactors and metallurgy, but the strongest driver of their demand
growth has been their use as additives to enhance the performance
of modern permanent magnets.
In the STEPS, global demand for magnet rare earths is set to expand
by a quarter between 2025 and 2030, approaching 120 kilotonnes
of rare earth elements (kt REE), and by over 80% to 2050, reaching
170kt REE. Driven by sustained growth in the deployment of EVs,
wind generation, industrial motors and automation, and other
applications in transport, appliances and electronics, permanent
magnets, though of various sizes and performance specifications,
account for the majority of magnet rare earth demand throughout the
projection period. Demand from wind turbines, though still rising
throughout the period, is lower by over 10% in 2030 and 15% in 2050
compared with the projections in the Global Critical Minerals Outlook
two years ago. Emerging growth in automation, robotics and digital
technologies plays a larger role in driving total demand beyond 2030,
as permanent magnets enable precision motion control,
miniaturisation (through small motors with high power) and energy
efficiency for these applications.
Magnet rare earth demand by sector in the STEPS, 2021-2050
IEA. CC BY 4.0.
Notes: CPS = Current Policies Scenario; STEPS = Stated Policies Scenario;
HDS = High Demand Scenario; EV = electric vehicle; REE = rare earth
elements. The figures are for magnet rare earths only.
0
50
100
150
200
2021 2025 2030 2040 2050
kt REE
EV motors Wind turbines
Other magnets Industrial equipment
Other transport Non-magnet uses
Demand in the CPS Demand in the HDS
IEA. CC BY 4.0.
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PAGE | 182
2. Outlook for key minerals
Demand for magnet rare earths outside China also rises steadily in
all scenarios, driven primarily by the rapid expansion of electrification,
energy and automation technologies. The largest contribution comes
from EV deployment in both advanced economies and emerging
markets and developing economies. Major original equipment
manufacturers expanding production across Japan, Korea,
North America, Europe and India rely on magnet rare earths most
prominently for EV traction motors, but also for many smaller
magnetic components, such as actuators, speakers and sensors, in
conventional cars and other types of vehicles. Asia, excluding China,
remains the dominant centre of demand, accounting for roughly half
of global consumption outside China throughout the outlook period,
supported by large manufacturing bases in Japan and Korea. Europe
and North America register notable increases, reflecting strong policy
support for electrification and renewed ambitions to scale up
domestic manufacturing for high-tech supply chains. Nevertheless,
the global share of demand outside China expands only gradually,
indicating that China continues to play a central role in magnet rare
earth consumption throughout the projection period.
Although magnet uses account for over half of total rare earth
element demand, demand for non-magnet rare earths is also notable:
gadolinium (used in medical devices and nuclear control rods and as
a substitute for dysprosium in magnets) and holmium (used in
phosphors, displays and ceramics) grow at an average rate of around
4% per year, while yttrium (used in medical devices, optic fibres, highfrequency applications and coatings in aviation parts) grows at 2.5%
per year to 2030.
Supply
From today’s levels, mined supply for magnet rare earths rises by 30%
to reach 104kt REE in 2035 in the base case, and an additional
21kt REE is added in the high-production case, which includes
projects at earlier stages of development. Refined supply also
increases similarly, reaching 125kt REE in the high-production case
in 2035.
In response to export controls and heightened supply risks, many
projects have been announced in geographically diverse regions in
recent years. In the high-production case, production outside the
dominant supplier triples for both mining and refining, reaching
57kt REE and 38kt REE, respectively, by 2035. While China
remains the dominant supplier throughout the projection period, it is
worth noting that the steady build-out of a diversified pipeline leads
to its share in mined supply of magnet rare earths declining from
around 60% in 2025 to 55% in 2035 in the base case and further to
45% in the high production case– falling below half of global mined
supply for the first time in recent decades if all announced
geographically diverse projects are delivered on time. Increase in
diversified mined supply is led by Australia and the United States,
with additional contributions from Brazil, Lao People’s Democratic
Republic (PDR), Tanzania, India and other smaller producers. For
refining, China’s share dropped from 90% to 85% between 2024 and
2025, with the majority of the lost share being claimed by the
United States and the rest by Malaysia, and is projected to decline to
73% in 2035 in the base case and further to 70% in the highIEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 183
2. Outlook for key minerals
production case. Diversified refining activity is concentrated in
Malaysia and the United States, followed by Australia, Viet Nam,
Japan, the United Kingdom, France and Estonia.
Despite this progress, cumulative planned production of metals,
alloys and finished magnets from projects announced as of early
2026 amounts to around 57 kt of neodymium-iron-boron (NdFeB) in
2035, equivalent to 18 kt of magnet rare earth content, significantly
less than diversified rare earth mining and refining capacities. This
reflects a modest pipeline led by the United States, with notable
contributions from Europe, Japan, Korea and Viet Nam. This
pronounced tapering of diversified projects from upstream mining to
downstream magnet manufacturing highlights the difficulty of
establishing entire supply chains outside China. While resource
development is advancing in several regions, the comparatively
slower build-out of refining and magnet production suggests that
critical midstream and downstream stages could remain bottlenecks.
Without accelerated investment in these parts of the value chain,
many regions may continue to depend on external processing and
manufacturing, even as domestic extraction capacity expands.
Supply-demand balances
Global rare earth markets have been well supplied over the last
decade, as supply, predominantly from the top supplier, has
continued to outpace demand growth, despite a slowdown in China’s
production quota growth in 2024. Projected supply remains broadly
sufficient through to 2040. Global mined supply from announced and
planned projects in the base case grows faster than demand in the
STEPS and CPS, but satisfying demand after 2030 in the HDS
requires at least half of the projected supply from less advanced
projects in the high-production case to come online as planned.
Despite this global picture of well-supplied markets, the
announcement of export controls from China and sustained social
and governance challenges in Myanmar have emerged as tangible
risks to the reliable supply of these minerals for strategic industries in
the rest of the world. Demand for magnet rare earth elements in
regions outside the dominant supplier is set to grow by 50% over the
next decade. Production from current capacities and their planned
expansions in regions outside China, and outside Myanmar for
mining, accounts for about 50% of the ex-China demand for mining,
25% for refining and well below 20% for magnets in 2035. Many new
projects have been announced across geographically diverse regions,
but even if these come online as scheduled, their sustained
operations will depend on consumer motivation to buy materials from
diversified suppliers. Nurturing strategic manufacturing industries,
including EVs, energy technologies, electronics, data centres,
robotics, aerospace and defence, can provide a solid demand base
for diversified mined, refined and magnet supply sources. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
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PAGE | 184
2. Outlook for key minerals
Innovation throughout the rare earths value chain is vital to closing existing gaps in
geographically diverse projects and mitigating supply pressures
Innovation to build diversified ecosystems
Rare earth separation and processing and permanent magnet
manufacturing are complex and technically demanding processes
that have been improved and perfected by the dominant supplier over
a few decades. Diversification is therefore not simply a question of
planning new projects. Technology, equipment and skills gaps need
to be addressed in parallel in order to nurture an entire-ecosystem
approach. Chapter 3 discusses these issues in more detail.
Innovation in magnet composition and design
Demand-side innovation represents a powerful complement to
supply‑side efforts, providing a pathway to alleviate supply
constraints. It can take three distinct forms: reducing the amount of
heavy rare earth elements (HREEs) required within existing magnet
chemistries, substituting one HREE for another that is less
supply‑constrained, and developing entirely new technologies that
drastically minimise or eliminate rare earth use altogether.
The performance of NdFeB permanent magnets can be enhanced
through the addition of HREEs, notably dysprosium and terbium,
which improve coercivity and high‑temperature stability. However,
HREE production remains overwhelmingly concentrated in China
and Myanmar. This over-reliance heightens vulnerability to supply
disruptions and export restrictions. One major avenue of innovation
therefore focuses on reducing HREE intensity within NdFeB magnets
without sacrificing performance.
Indicative elemental composition of different types of magnets
IEA. CC BY 4.0.
Note: NdFeB = neodymium-iron-boron magnet; EV = electric vehicle; SmCo =
samarium-cobalt magnet; AlNiCo = aluminium-nickel-cobalt alloy magnet.
20% 40% 60% 80%100%
AlNiCo
Ferrite
SmCo (factory automation)
SmCo (high performance)
NdFeB (factory automation)
NdFeB (wind turbine)
NdFeB (EV)
Neodymium Dysprosium Samarium
Copper Aluminium Nickel
Cobalt Iron Other
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 185
2. Outlook for key minerals
The HREE content of magnets varies significantly by application:
high‑performance EV traction motors contain around 8.5-11% of
HREEs by weight (although the latest designs could have much lower
content of around 2%, but with performance trade-offs), while
magnets used in industrial motors and wind turbines typically have
slightly lower ratios of heavy to light rare earths. Manufacturers are
improving grain boundary engineering, motor cooling and system
design to achieve equivalent functionality with less dysprosium or
terbium.
Together with continued improvement in materials science and
engineering, co-ordinated action across the value chain can
accelerate both reduction and substitution strategies. Collaboration
among motor manufacturers, magnet producers and public
authorities is particularly effective in overcoming technical barriers
and scaling innovation. Following the rare earth supply shock of 2010,
for example, Japan implemented government‑supported
programmes to redesign motors for vehicles, industrial equipment
and hard disk drives. Even though demand has risen again in recent
years due to growing magnet applications, overall rare earth demand
in Japan has fallen significantly since the implementation of these
measures. Total rare earth demand in Japan, including heavy rare
earths, is currently nearly 30% below 2010 levels.
A more transformative pathway is the development of technologies
that substitute rare earth‑based magnets entirely. Mature alternatives
such as ferrite and aluminium-nickel-cobalt (AlNiCo) magnets contain
little or no rare earth content and are already widely used where
performance requirements are lower. These materials, based on
abundant iron alloys or ceramic oxides, can replace NdFeB magnets
in applications such as speakers, sensors and lower‑power motors,
thereby reducing overall rare earth demand and material costs.
Emerging rare earth‑free technologies are also progressing towards
commercialisation. In the United States, Niron Magnetics has begun
construction of a permanent magnet manufacturing facility in
Minnesota based on iron nitride (FeN) technology with no rare earth
elements, aiming to serve the automotive and electronics sectors. In
parallel, research programmes are developing electric motors that
avoid permanent magnets altogether by using alternative
electromagnetic designs based on widely available materials such as
iron and aluminium. Although many of these technologies remain at
demonstration or early commercial stages, they illustrate a growing
strategic shift towards reducing dependence on critical minerals.
For new solutions to achieve widespread adoption, they must offer a
competitive combination of performance, cost and manufacturability
without introducing new supply constraints elsewhere in the value
chain. Innovations that merely shift dependency from rare earths to
other scarce or geopolitically concentrated materials would provide
limited systemic benefit. Priority should therefore be given to
technologies based on abundant inputs, scalable production
processes and compatibility with existing industrialsystems.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 186
2. Outlook for key minerals
Other key materials
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 187
2. Outlook for key minerals
Manganese: Battery-grade manganese sulphate remains a major potential chokepoint for
battery supply chains, but the project pipeline is diversifying
Battery-grade manganese sulphate production capacity and demand, 2023-2035
IEA. CC BY 4.0.
Notes: CPS = Current Policies Scenario; STEPS = Stated Policies Scenario; HDS = High Demand Scenario. Production capacity is the nameplate capacity.
Source: IEA analysis based on data from Benchmark Mineral Intelligence.
200
400
600
800
1 000
1 200
2023 2024 2025 2030 2035
kt Mn
Other
Botswana
Czechia
Canada
United States
China
CPS
STEPS
HDS
Demand
Production capacity
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 188
2. Outlook for key minerals
Manganese: The United States and Canada are leading diversified battery-grade manganese
sulphate project announcements, but challenges remain in bringing these projects to reality
While manganese demand remains dominated by steel, its growing
importance in battery chemistries is making it an increasingly
strategic mineral. Conventional nickel-based and emerging battery
chemistries, namely manganese-rich and sodium-ion, require
battery-grade manganese sulphate, which is emerging as a potential
chokepoint for battery supply chains. Production of battery-grade
manganese sulphate is exceptionally concentrated, with China
producing over 95% of global supplies in 2025, making it highly
vulnerable to potential future supply disruptions.
Despite China dominating current production, a number of projects
are being announced and developed in geographically diverse
regions, particularly the United States, Canada and Czechia. Despite
having no operating capacity in 2025, the United States is expected
to have over 140 kt of manganese sulphate production capacity (kt
manganese contained) by 2035, amounting to almost 20% of global
capacity if planned projects come online as scheduled. Canada also
plans for significant growth in production capacity, with almost 10%
of capacity in 2035, while Czechia accounts for 5%. However, reliable
production of battery-grade manganese sulphate at scale is
technically challenging, so new players may face considerable
challenges in ramping up capacity. There may also be
competitiveness challenges relative to established Chinese players
in terms of limited economies of scale, limited production expertise
and stricter environmental requirements for handling by-products and
waste. At present, there are only two operating refineries producing
battery-grade manganese sulphate outside China, in Japan and
Belgium. Partnerships between existing and new players could help
accelerate learning and project development.
The projected supply gap for manganese sulphate has narrowed to a
deficit of almost 20% in 2035 compared with 45% in last year’s Outlook.
While still significant, the demand outlook has moderated slightly due
to the strong growth of LFP batteries over nickel-based chemistries.
The uptake of lithium manganese iron phosphate (LMFP) batteries has
also been slower than expected due to the continued innovation and
improved performance of the latest LFP chemistries. A potential
source of demand upside in the medium term is the emergence of
high-energy-density lithium-manganese-rich (LMR) chemistries,
though large-scale deployment is not expected until the 2030s. Given
these developments, battery-grade manganese sulphate demand is
projected to reach almost 1 Mt in 2035 under today’s policy settings,
amounting to 5% of total manganese demand, up from less than 1%
today. However, between 2035 and 2040, battery manganese demand
is set to almost double to close to 10% of total demand, reflecting the
growing deployment of manganese-rich chemistries.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 189
2. Outlook for key minerals
Manganese prices, 2023-2026
IEA. CC BY 4.0.
Note: Mn sulphate 32%, Ex Works China. Manganese Ore Mn32%
Fe20%,Tianjin-SA.
Source: IEA analysis based on data from Bloomberg.
Following a period of price volatility in 2024 from major supply
disruptions, manganese ore prices eased in 2025. However, in 2026,
prices have started rising again. With the increase in oil prices from
the conflict in the Middle East raising costs across the mining sector,
manganese producers are among the most affected. Manganese
mining operations, primarily open-pit, typically have a strong
dependence on diesel for extraction, ore transport and the generation
of backup power. Leading production in South Africa and Gabon is
located deep inland, requiring significant diesel-dependent rail and
road transport. Given the surge in diesel prices, manganese margins
are being compressed, adding pressure on manganese prices.
Moreover, a major weather-related supply disruption in Australia in
March 2026 added further pressure to prices. Prices for battery-grade
manganese sulphate have broadly followed changes in manganese
ore prices, but in early 2024, prices fell to historic lows, leading
several Chinese operations to halt production. These cuts flipped the
market from oversupply into deficit, leading to price recoveries
throughout 2024. Prices fell slightly in the first part of 2025 but have
been increasing steadily due to increases in sulphuric acid prices in
the latter half of 2025 and particularly in 2026 from the Middle East
conflict, with reports of manganese sulphate contracts recently being
settled at over USD1 000/tonne. Increased sulphuric acid costs, as
well as higher ore prices, are key drivers.
South Africa still dominates mined manganese supply, with almost
40% of global production in 2025. Gabon is the second-largest
supplier, with a quarter of global supply in 2025. Ghana and Australia
are the other major suppliers, with 10% and 8% of global production
in 2025, respectively. Supply disruptions have remained a major
source of volatility in manganese markets. For example, the major
disruption at South32’s GEMCO mine, the second-largest
manganese mine in the world, in Australia from cyclone damage in
2024 led to major manganese ore and sulphate price increases.
Despite resuming production in 2026, operations were paused again
in March 2026 due to a new cyclone, highlighting the risks to major
manganese assets from weather incidents. Download: Global Critical Minerals Outlook 2026.pdf
250
500
750
1 000
1 250
Jan-23 Jan-24 Jan-25 Apr-26
USD/tonne
Battery-grade manganese sulphate Manganese ore
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 190
2. Outlook for key minerals
Phosphoric acid: Battery-grade purified phosphoric acid is a major chokepoint for battery
supply chains, with little diversification on the horizon
LFP batteries have rapidly become the leading battery chemistry,
accounting for 55% of the global electric car market and 90% of the
battery storage market in 2025, up from 15% and 30%, respectively,
in 2020. LFP battery production requires battery-grade purified
phosphoric acid (PPA), which is produced from phosphate rock and
sulphuric acid. China currently dominates global PPA supply, with 70%
of production in 2025. The rapidly growing deployment of LFP
batteries, particularly in battery storage, and the high level of PPA
supply concentration make PPA an increasingly important chokepoint
for global battery supply chains.
Unlike manganese sulphate, there is limited diversification in the
project pipeline for PPA. Based on current project announcements
and developments, China is projected to maintain 75% of global
production capacity in 2035, almost the same as today. Despite
having the world’s largest phosphate rock reserves and plans to
expand phosphate mining, Morocco is set to hold only 5% of global
PPA production capacity by 2035. The United States is set to have
the third-largest capacity, with almost 5% by 2035, followed by
Canada. Together, Morocco, the United States and Canada account
for over 55% of planned ex-China PPA capacity by 2035.
Development of PPA production capacity outside China faces similar
challenges to those facing battery-grade manganese sulphate. Key
challenges include cost competitiveness stemming from economies
of scale and established phosphate production advantages in China,
as well as limited production expertise and equipment availability.
There are also additional challenges related to waste and by-product
disposal.
Purified phosphoric acid (PPA) production capacity, 2023-2035
IEA. CC BY 4.0.
Note: P2O5e = phosphorus pentoxide equivalent.
Source: IEA analysis based on data from Benchmark Mineral Intelligence.
5
10
15
2023 2024 2025 2030 2035
Mt P₂O5e
Other
Belgium
Canada
United
States
Morocco
China
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 191
2. Outlook for key minerals
Prices for phosphoric acid have been increasing due to rising input
costs, increasing by almost 4% to over USD1 500 per tonne in the
first quarter of 2026. PPA generally trades at a premium to
phosphoric acid and faces the same cost pressures. As sulphuric
acid is a key input for PPA production, rising prices for sulphur and
sulphuric acid from the conflict in the Middle East are providing
upward pressure on PPA prices. This is being compounded by higher
prices for phosphate rock, which also increased due to the disruption
to phosphate exports from Jordan following the closure of the Strait
of Hormuz. Phosphate rock prices have also increased on the back
of the announcement by Egypt’s Ministry of Petroleum and Mineral
Resources that it would not sign any new phosphate export contracts,
as the government tries to shift from exporting raw materials to
producing higher value-added products, such as phosphate fertilisers.
Together, these effects are increasing PPA prices, with likely knockon effects for LFP cathodes and batteries. However, the higher prices
may support diversified project development.
Despite having the world’s largest reserves of phosphate rock, with
70% of global reserves, Morocco currently accounts for less than 15%
of global mined supply. China, on the other hand, leads mined
phosphate rock supply, with 45% of global production in 2025,
despite holding only 5% of global reserves. The United States is the
world’s third-largest producer, with almost 10% of global supply in
2025. In recent years, there has been a surge in Chinese battery
supply chain investment in Morocco, including from Gotion, BTR,
Huayou and CNGR, with its major phosphate reserves a key driver.
Morocco’s trade agreements with the European Union and its free
trade agreement with the United States also provide these Chinesebacked battery supply chain projects with preferential access to EU
and US markets compared with direct exports from China.
Phosphate rock mining and reserves, 2025
IEA. CC BY 4.0.
Source: IEA analysis based on data from US Geological Survey (2026).
0%
20%
40%
60%
80%
100%
Production Reserves
Other
Egypt
Russia
United
States
China
Morocco
IEA. CC BY 4.0.
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PAGE | 192
2. Outlook for key minerals
Tin: Strong demand growth driven by high-tech and energy applications has met constrained
supply, although supply conditions have begun to ease in recent months
Over the past few years, tin prices have continued to rise as strong
demand growth, fuelled by the AI investment boom and related
semiconductor demand, has coincided with supply constraints in
major producing countries such as Indonesia and Myanmar,
stemming from mining permit issues and crackdowns on illegal
mining.
Tin prices, 2024-2026
IEA. CC BY 4.0.
Note: LMEtin 99.85% cash prices.
Source: IEA analysis based on data from Bloomberg.
The largest tin mining country is China (24%), followed by Indonesia
(21%) and Peru (11%). China is also the largest tin refining country,
accounting for about 50% of global supply. Recent data indicate that
refined tin supply is recovering from the supply disruptions in 2025,
as reflected in rising inventory levels. While this is helping to ease
market tightness, strong underlying demand is expected to keep
prices above historical norms.
More than half of global tin consumption is used as solder for bonding
circuit boards. Beyond traditional uses in consumer electronics,
demand for tin is expanding in strategic applications such as AI and
EVs. Tin also plays a crucial role in solar PV through soldering and
electrical interconnections.
Historically, tin-lead solder was widely used, but lead-free solders are
now more common due to environmental regulations such as the EU
Restriction of Hazardous Substances Directive. Currently, tin-silvercopper solder is the most prevalent type, where tin provides strong
wettability, conductivity and reliable connections.
Tin is not easy to substitute, although epoxy resins could partially
replace it in certain applications. Like copper, tin is a highly recyclable
material that can be reused without loss of quality. In 2023, recycled
tin accounted for about one-third of total tin supply.
50
100
150
200
250
2024 2025 2026
Index (Jan 2024 = 100)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Platinum group metals: Prices have strengthened again due to constrained mine supply and
improving demand prospects
The six platinum group metals (PGMs) – platinum, palladium,
rhodium, ruthenium, iridium and osmium – are highly geographically
concentrated in production. South Africa accounted for around 70%
of global mined platinum supply in 2025, followed by Russia at 12%.
For palladium, Russia is the leading mined output supplier at around
45%, followed by South Africa. Zimbabwe and North America also
produce PGMs, but at smaller shares.
Price trend for key platinum group metals (monthly average)
IEA. CC BY 4.0.
Sources: IEA analysis based on data from Bloomberg and Johnson Matthey.
PGM markets experienced renewed price strength in 2025 and early
2026. Platinum prices doubled throughout 2025 and reached an alltime high in January 2026. Palladium prices rose by around 90%
year-on-year in January 2026. Rhodium prices also soared, reaching
USD 11 000 per ounce in March 2026, their highest level since 2023.
These price developments were driven by a combination of
constrained mine supply and improving demand prospects.
Mined PGM output declined in 2025 across key producing regions,
reflecting persistent structural challenges. In South Africa, production
was affected by rising production costs and electricity supply
constraints. For example, ore mining and milling operations at the
Bokoni platinum mine were suspended in June 2025 due to cost
pressures. PGM output in Russia also edged lower compared with
2024, reflecting declining ore grades, equipment replacement and
maintenance at Norilsk Nickel facilities. Secondary supply from
recycling registered strong growth in 2025, increasing by about 17%
year-on-year. In China, continued incentive schemes to encourage
the scrappage of older vehicles have increased volumes of end-oflife autocatalyst scrap, contributing to recycling growth. However, this
growth only partially offset primary supply constraints. Download: Global Critical Minerals Outlook 2026.pdf
At the same time, continued demand growth from the automotive
sector supported consumption. Broader macroeconomic uncertainty
3 000
6 000
9 000
12 000
1 000
2 000
3 000
4 000
Platinum Palladium Rhodium (right axis)
USD/ounce
USD/ounce
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 194
2. Outlook for key minerals
and geopolitical tensions also boosted investor interest in precious
metals, contributing to increased price volatility.
In the near term, PGM markets are expected to remain relatively tight.
Mine supply is expected to decline, reflecting persistent cost
pressures, operational challenges and limited new production growth.
The expansion of commercial operations at Ivanhoe’s Platreef mine
and stable supply from Implats’ PGM operations are expected to
support production volumes, while Russia is projected to see a slight
decline in output due to changes in the metal composition of
processed feedstocks. While recycling supply is expected to continue
increasing, it is unlikely to fully offset constraints in primary production.
Demand from autocatalysts is expected come under pressure from
the growth of EVs, although continued sales of internal combustion
engine and hybrid vehicles, are expected to support PGM
consumption in the near term.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 195
2. Outlook for key minerals
Silver: Strong industrial demand and persistent supply constraints are set to support elevated
prices despite a narrowing supply deficit
Silver prices increased sharply in 2025, rising from around USD 29
per troy ounce (toz) to approximately USD 72/toz, an annual increase
of about 150%. Prices continued to rise into 2026, with spot prices
briefly surpassing USD 100/toz for the first time in January 2026.
These price increases were driven by accumulated multi-year supply
deficits and a strong industrial demand outlook. In particular,
expectations of rising industrial silver demand from the expansion of
solar PV, growing investment in AI and data centres, and power grid
upgrades provided support to prices. The pace of supply growth also
remained limited, reflecting the nature of silver production as a byproduct of copper, gold, lead and zinc mining, as well as declining ore
grades, delays in new project development and tighter environmental
and permitting regulations. Uncertainty surrounding US tariff reviews
and expectations for Federal Reserve policy also contributed to
heightened market volatility.
Silver supply increased to around 1.1 billion toz in 2025, supported
by recovering production in South America and growth in recycled
supply. Global mine production rose by 3% year-on-year. Higher byproduct output from Peru’s Antamina mine and expanded production
at Russia’s Prognoz mine contributed to supply growth. By contrast,
production in Mexico, the world’s largest silver producer, declined
partly due to lower ore grades at the Peñasquito mine, while
Indonesia experienced production disruptions at the Grasberg mine.
Recycled silver supply also increased strongly, reaching around
200 million ounces, its highest level in more than a decade,
supported by increased scrap recovery amid higher silver prices.
Silver market balance and price trends, 2018-2025
IEA. CC BY 4.0.
Notes: Moz = million ounces; toz = troy ounce.
Source: IEA analysis based on data from the Silver Institute (2026).
0
5
10
15
20
25
30
35
40
45
0
200
400
600
800
1000
1200
1400
2018 2019 2020 2021 2022 2023 2024 2025
USD/toz
Moz
Supply Demand Price (right axis)
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 196
2. Outlook for key minerals
Meanwhile, silver demand fell by 2% in 2025, marking its lowest level
since 2021. Industrial demand declined for the first time after four
consecutive years of growth. In particular, weaker demand from the
solar PV sector was a key factor behind the broader slowdown in
silver demand growth. Although global solar installations continued
to expand, reductions in silver usage per cell partially offset the
impact of installation growth. This reflected manufacturers’ efforts to
reduce silver usage (thrifting) and adopt alternative materials in
response to higher silver prices.
However, expanding investment in AI and data centres, together with
the expansion of EVs, charging infrastructure and power grid
upgrades, is set to support resilient silver demand in the coming years.
Owing to its high electrical conductivity and durability, silver is widely
used in semiconductors, servers, power electronics, EVs and energy
infrastructure. By contrast, supply constraints are likely to persist,
keeping market conditions relatively tight in the near term.
IEA. CC BY 4.0.
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2. Outlook for key minerals
2. Outlook for key minerals
Part 2
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 198
2. Outlook for key minerals
Strategic minor minerals
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 199
2. Outlook for key minerals
Strategic minor minerals: small market sizes, high supply concentration, outsized economic
impacts
Market size and top refining country share for selected minerals
IEA. CC BY 4.0.
Notes: Titanium refers to titanium metal. Rare earths refer to magnet rare earths only.
0
1
10
100
1 000
30% 40% 50% 60% 70% 80% 90% 100%
Billion USD
Base metals Battery materials Strategic minor minerals Magnet rare earths
Lead
Copper
Zinc
Aluminium
Titanium
Antimony
Germanium
Tungsten
Gallium
Indium
Lithium
Cobalt
Nickel
Rare earths
Tellurium
Tantalum
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Despite their high supply concentration, strategic minor minerals offer an area where targeted
policy measures can deliver rapid improvements in supply security
Beyond key energy minerals, there is a strong case for greater policy
attention on a broader group of materials that play a vital role across
strategic sectors such as high-tech, aerospace and defence. These
materials, referred to here as “strategic minor minerals”, typically
have small market sizes but face extremely high levels of supply
concentration compared with other minerals. They also carry
disproportionate economic consequences in the event of a disruption.
Rare earths are a prominent example, but the list extends beyond
them to include antimony, gallium, germanium, indium, titanium and
tungsten, among others. The market size for many of these minerals
is often below USD 10 billion. Like rare earths, China is the leading
supplier of almost all these minerals, and a growing number are
becoming subject to export controls or other trade restrictions. Given
their limited substitutability and vital role in advanced manufacturing,
disruptions could have significant economic consequences across
the automotive, high-tech, defence and energy sectors.
However, counter-intuitively, these minerals offer one of the most
promising opportunities to deliver visible improvements in supply
security at a reasonable cost, if accompanied by strong policy support.
Many strategic minor minerals do not require the massive scale of
investment typically needed for bulk commodities. In some cases,
bringing a small number of key projects online could materially
strengthen supply security and improve diversification. For example,
the planned refinery by Korea Zinc, with annual production capacity
of 54 tonnes of germanium and 44 tonnes of gallium, has the
potential to double diversified germanium supply and increase
diversified gallium supply fivefold.
In many instances, this can be achieved without developing new
mines. A large share of these minerals are produced as co-products,
recovered as secondary outputs during the extraction or processing
of primary commodities such as aluminium, copper, zinc and lead.
Gallium, for example, is contained in small quantities in bauxite and
zinc ores. Typically, less than 10% of the gallium contained in mined
ores is recovered. Substantially higher global supply outside the
dominant refiner would be possible if gallium were recovered more
systematically. This creates a clear opportunity for governments to
improve supply security at relatively modest cost through targeted
support for recovery, refining and processing capacity.
In this section, we explore the broad landscape of strategic minor
minerals, focusing on the key materials used in the high-tech,
aerospace and defence sectors and assessing their risk profiles. The
IEA plans to publish deeper analysis on these minerals in the coming
months, examining their market dynamics, risk exposure and
diversification potential. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 201
2. Outlook for key minerals
A wide range of critical metals and minerals form the backbone of many strategic high-tech
industries, such as semiconductors, robotics, servers and telecommunications
Indicative list of strategic minerals used across selected high-tech industries
IEA. CC BY 4.0.
Note: Materials only serving secondary or tertiary applications in one sector were excluded from the chart: semiconductors (cadmium, cerium, chlorine, europium,
fluorine, gadolinium, helium, krypton, lanthanum, neon, nitrogen, tellurium, xenon and yttrium); robotics (terbium); and servers and storage (barium and platinum).
Li 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
Servers and
storage
Robotics
Semiconductors
Telecommunications
Lithium
Beryllium
Boron
Aluminium
Silicon
Phosphorus
Titanium
Chromium
Manganese
Iron
Cobalt
Nickel
Copper
Zinc
Gallium
Germanium
Arsenic
Niobium
Molybdenum
Ruthenium
Palladium
Silver
Indium
Tin
Antimony
Praseodymium
Neodymium
Samarium
Dysprosium
Hafnium
Tantalum
Tungsten
Gold
Bismuth
83 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
IEA. CC BY 4.0.
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2. Outlook for key minerals
As semiconductors, robotics and artificial intelligence chart new frontiers in innovation, supply
security for the minerals that underpin them is becoming increasingly important
Modern economies are increasingly moving towards electrified,
digitalised and automated systems, and the industries that underpin
this transformation are mineral-intensive. This section explores some
strategic high-tech industries and assesses which minerals are most
critical for them.
Semiconductors
The semiconductor industry relies on a wide range of metals and
minerals. The main materials that form the semiconducting layers
include silicon, gallium, germanium, indium, arsenic, phosphorus and
boron, while other materials such as antimony, tantalum, tungsten,
copper, gold, silver, aluminium, nickel, cobalt, palladium, platinum,
hafnium, titanium, certain rare earth elements, tin and zinc play
important roles in soldering, electrical contact formation, coating and
packaging. Among these, silicon is by far the most important, forming
the substrate of most integrated circuits. Compound semiconductors
such as gallium arsenide (GaAs) and gallium nitride (GaN) have
taken on increasingly important roles for high-frequency,
optoelectronic and power applications, where GaN, in particular,
enables more efficient operation at high voltages and temperatures,
making it a critical material for data centre power management.
Germanium improves transistor performance in advanced chips.
Copper and aluminium are essential for electrical interconnections,
and gold, silver and palladium are widely used in contacts and
bonding due to their excellent conductivity and resistance to
corrosion. Tantalum and hafnium are critical for capacitors and
advanced transistor gate materials, helping to improve device
efficiency and miniaturisation.
Robotics
As the robotics industry combines several technologies, including
actuators, sensors, motors, batteries and electronic systems, it relies
on a very large number of materials. The main materials used include
steel, aluminium, copper, nickel, cobalt, lithium, manganese, graphite,
magnet rare earths (neodymium, praseodymium, dysprosium and
terbium), silicon, gold, silver, tantalum, tungsten, titanium, platinum
group metals and tin. Among these, bulk materials such as steel and
aluminium are important structural components, providing the
strength, durability and weight characteristics required for robotic
systems. Copper is essential for motors, wiring and power
transmission, while lithium, nickel, cobalt and manganese play key
roles in rechargeable batteries for mobile and autonomous robots.
Silicon underpins the semiconductors that enable sensing, control
and AI functions, while gold, silver and tantalum are widely used in
electronic components due to their superior conductivity and
reliability. Rare earth-based permanent magnets are particularly
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 203
2. Outlook for key minerals
important because they enable compact, lightweight and energyefficient motors with high torque and precision. While some materials
can be substituted in specific applications, replacing the most critical
materials – particularly rare earth elements in high-performance
magnets and copper in electrical systems – often results in lower
performance, larger component sizes, reduced energy efficiency or
higher costs.
Servers and data storage
Servers and data storage systems depend on metals and minerals
for processors, memory, storage devices, power systems and
networking equipment. The main materials include silicon, copper,
aluminium, iron and steel, gold, silver, palladium, tantalum, tungsten,
nickel, cobalt, tin, gallium, germanium, indium, hafnium, titanium,
platinum group metals, graphite and certain rare earth elements such
as neodymium, dysprosium and yttrium. Among these, silicon is the
most important material, forming the basis of processors, memory
chips and other integrated circuits. Copper is essential for electrical
interconnections, power distribution and networking infrastructure,
while aluminium and steel provide structural support for servers and
data centre equipment. Gold, silver and palladium are widely used in
connectors and contacts because of their conductivity and resistance
to corrosion, and tantalum, tungsten and hafnium are critical for
advanced semiconductor components.
Telecommunications
Telecommunications networks, including 5G infrastructure, require
materials for semiconductors, antennas, fibre-optic systems, power
equipment and network hardware. The main materials include silicon,
copper, aluminium, gallium, germanium, indium, arsenic, tantalum,
gold, silver, nickel, cobalt and certain rare earth elements such as
neodymium, praseodymium and dysprosium. Among these, silicon
forms the basis of the semiconductors used in network equipment,
base stations and communication devices. Copper is essential for
electrical wiring, power distribution and telecommunications cables,
while gallium-based compounds, particularly GaN and GaAs, are
critical for the high-frequency and high-power performance required
by modern 5G networks. Rare earth elements are used in magnets,
signal processing equipment and specialised electronic components,
while gold and silver provide reliable electrical contacts and
connections.
IEA. CC BY 4.0.
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2. Outlook for key minerals
A range of materials are critical to the aerospace and defence sectors, with major applications
including aircraft components, jet engines, drones, radars, armed vehicles and munitions
Indicative list of strategic minerals used across aerospace and defence applications
IEA. CC BY 4.0.
Note: MREE = magnet rare earth elements.
Jet bodies
Jet engines
Avionics
Drones
Radars
Armed vehicles
Munitions
Atomic number
Bismuth
Rhenium
Tungsten
Tantalum
Hafnium
Gadolinium
MREE
Tellurium
Antimony
Tin
Indium
Molybdenum
Niobium
Zirconium
Yttrium
Arsenic
Germanium
Gallium
Zinc
Copper
Nickel
Cobalt
Iron
Manganese
Chromium
Vanadium
Titanium
Scandium
Aluminium
Magnesium
Carbon
Beryllium
Lithium
Helium
Bi 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
83 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
IEA. CC BY 4.0.
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2. Outlook for key minerals
The aerospace and defence sectors rely on critical minerals for specific high-performance
requirements
A wide range of materials are critical to the aerospace and defence
sectors. These are used typically as high-performance materials with
high strength and resistance to high temperatures, in energy
applications in the sector, as well as in radars and sensors. Download: Global Critical Minerals Outlook 2026.pdf
Aerospace
In aerospace and defence, aluminium and titanium alloys are key
structural materials, along with steel and composites. For example,
aluminium-copper alloys are used in aircraft fuselages and
aluminium-zinc alloys in upper-wing skins, stringers and stabilisers,
both of which are sometimes replaced by aluminium-lithium alloys to
achieve weight reductions. Titanium alloys are used for parts
requiring a high strength-to-weight ratio, such as landing gear
assemblies, or moderate temperature resistance. These materials
also play a key role in gas turbines, which are used both as aircraft
engines and to produce electricity in gas-fired power plants.
The main elements of gas turbines are the compressor, the
combustion chamber and the turbine. The temperature profile in
these sections is key for selecting materials: in the compressor,
temperatures increase to around 500 °C, a range that is too high for
aluminium but below the range requiring superalloys, and in which
titanium-based alloys can be used.
Temperature profile and materials used in turbine engine stages
IEA. CC BY 4.0.
Note: YSZ = yttria-stabilised zirconia.
In the combustion chamber, however, much higher temperatures are
reached, as higher turbine inlet temperatures directly influence the
efficiency of the machine, and are typically between 1 250 °C and
1 800 °C. To withstand these extreme temperatures, nickel- and
cobalt-based superalloys are used up to around 1 200 °C, after which
500
1 000
1 500
2 000
Compressor
Combustion
Turbine
Titanium
alloys
Nickel-based
superalloys
YSZ and other
coatings
1 200
Temperature (°C)
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
ceramics and thermal barrier coatings become necessary. Typical
coating materials include yttria-stabilised zirconia or other rare earth
zirconates such as gadolinium zirconate, nickel-chromiumaluminium-yttrium alloys, advanced multilayer ceramic coating
systems and platinum group metals.
Various other elements, such as hafnium, rhenium, tungsten,
molybdenum, vanadium and zirconium, are also used to enhance the
high-temperature strength, creep resistance, and oxidation
resistance of superalloys in aircraft and gas turbines. Rhenium is
particularly important for turbine blades operating at high
temperatures. Around 80% of global rhenium demand is for
superalloys, particularly for turbine blade applications.
Defence
An important set of critical minerals for the defence sector overlaps
to some extent with energy applications. Lithium-ion batteries are
widely used in aircraft and unmanned aerial and ground vehicles
(UAV and UGV), as well as in guided munition systems and onboard
equipment for armed vehicles. Magnet rare earth elements are key in
defence applications for motors and actuators in aircraft, unmanned
systems, missiles and smart munitions, naval propulsion and ground
vehicles. Nuclear propulsion also contributes a distinct application,
with naval reactors in submarines and aircraft carriers requiring
enriched uranium fuel, typically at higher enrichment levels than in
the civilian sector and designed for long operational lifetimes.
Military jets use materials similar to those used in civilian aircraft, but
in different proportions. Titanium is typically used in higher shares
(around one-third of total weight in some advanced military aircraft,
compared with around 10-15% in passenger planes), due to its higher
tolerance to damage, corrosion resistance and low weight, with lower
shares of aluminium (often around 10-20%, compared with higher in
commercial aircraft).
Radar-absorbing materials are used in defence to achieve stealth
properties. These can be magnetic materials such as nickel-zinc and
manganese-zinc ferrites, which are heavy but effective. Lighter
carbon-based materials include carbon fibre composites, nanotubes
and graphite, making graphite a critical mineral for these applications.
Polymers and ceramics are also used where mechanical strength,
light weight and thermal resistance are needed.
There is a wide intersection between the minerals used for high-tech
applications and defence. In most cases, these minerals, whose
demand is mostly driven by their civilian uses, remain critical to
defence contexts, in which they are rarely substitutable. Radars,
infra-red detectors and night vision equipment rely on high-tech
materials. Gallium arsenide is used in high-frequency radiofrequency chips and gallium nitride in high-power radar modules.
Indium gallium arsenide is used for short-wave infra-red detectors,
while modern-generation night vision uses gallium arsenide in
photocathodes. Germanium is key for infra-red optical lens materials
and fibre optics. Indium antimonide is typically used for mid-wave
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
infra-red detectors, which capture thermal images for night vision.
Tellurium-based semiconductors are also key for infra-red equipment.
Electronic equipment relies on silicon as a base semiconductor
material and copper for wiring.
Munitions and missiles use critical minerals and materials for
structural elements, guidance systems, thermal stability and
mechanical strength. Aluminium is used in structures for propellant
tanks and casings, where it can be replaced by titanium or carbon
fibre when high strength, light weight, thermal resistance or a specific
fragmentation pattern is needed, and also as a solid propellant in the
form of powdered aluminium. Carbon-based composites derived from
graphite are used as heat shields and re-entry systems, thanks to
their thermal stability and mechanical strength. Tungsten is
fundamental for kinetic energy penetrators and fragmentation
applications, primarily because its exceptionally high density and
hardness enable effective penetration of hardened targets at high
speed. Bismuth is part of the binder in explosive mixtures and is used
as a non-toxic substitute for lead in bullets and shot, driven by
environmental regulations and the phase-out of lead-based
ammunition in several North Atlantic Treaty Organization (NATO)
countries.
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Minerals are essential enablers of high-tech, aerospace and defence technologies
Key critical minerals in the high-tech, aerospace and defence sectors
IEA. CC BY 4.0.
High-tech industries Aerospace and defence
Robotics
and
servers
Sensors
Superalloys
Silicon
Titanium
Silver
Germanium
Gallium
Tungsten
Cobalt
Magnet rare earths
Nickel
Graphite
Yttrium
Rhenium
Molybdenum
Antimony
Niobium
Tellurium
Indium
Tungsten
Beryllium
Tin
Arsenic
Tantalum
Magnet rare earths
Germanium
Semiconductors
and
telecommunications
Light weight
High-performance
Antimony
Bismuth
Cobalt
Vanadium
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
The risk assessment considers a range of factors, including supply risk, the availability of
alternative supply sources and strategic importance
Risk assessment framework
IEA. CC BY 4.0.
Alternative
supply routes
Price transparency
Number of suppliers
Ease of substitution
By-product dependence
Strategic
importance
National security
Strategic applications
Supply risk
Export restriction
Concentration (refining)
Concentration (mining)
Supply-demand balance
Price volatility
Share of top 1 supplier
Price standard deviation since 2014
Existence of active restriction on any form of the material
Projected market tightness in 2030
Number of producers accounting for at least 5% of supply
Assessment of substitutability in strategic applications
Share of production relying on by-products
Existence of price indexes
Number of strategic applications relying on the material
Presence of the material in strategic materials lists
Share of top 1 supplier
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Many strategic materials essential to high-tech, aerospace and defence applications face
elevated supply risks
Risk assessment results
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IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 211
2. Outlook for key minerals
Gallium, magnet rare earths, yttrium, graphite, tungsten, cobalt and germanium exhibit some of
the highest levels of supply risk
Risk assessment methodology
To assess the risk exposure of materials essential for high-tech,
aerospace and defence applications, we developed a framework
based on key criteria, including supply risk, the availability of
alternative supply routes and strategic importance. This allows
materials to be ranked according to their overall exposure across
multiple dimensions of risk. Download: Global Critical Minerals Outlook 2026.pdf
When evaluating supply risk, the first risk dimension, the level of
supply concentration in both mining and refining, is a critical measure.
Relying on a few dominant suppliers means that any disruption can
quickly push markets into shortfall. For gallium, graphite, manganese
and rare earths, the top refiner, China, accounts for over 90% of
global supply. High price volatility further complicates the
development of new supply: for example, lithium, vanadium, rare
earths and cobalt have exhibited significantly higher volatility than oil
and gas. Many high-risk minerals are already affected by some form
of export restriction, such as rare earths, gallium, and tungsten,
straining their supply chains.
The availability of alternative supply routes is the second key risk
dimension. For some materials, there are limited options for
substitute materials, such as chromium for corrosion-resistant
stainless steel, titanium for alloys requiring a high strength-to-weight
ratio and germanium for high-performance fibre optics, heightening
the risks from supply disruptions. Additionally, many materials are
produced as co-products or by-products (see Annex) alongside other
minerals, making their supply less responsive to demand or price
signals. For example, gallium is mainly recovered as a by-product of
zinc and aluminium production, tellurium from copper and lead
processing, and germanium from zinc and coal.
The strategic importance of each material depends on the sectors in
which it is used. When materials have applications in strategic
sectors such as semiconductors or defence, their security of supply
becomes a crucial factor for economic and national security. While
strategic importance can be assessed at the global level, each
country should also consider domestic vulnerabilities and
dependencies to assess the potential impact on its overall security
and resilience.
Risk assessment results
The results of the risk assessment show that some of the highest-risk
materials include gallium, magnet rare earths, yttrium, graphite,
tungsten, germanium, tellurium and cobalt. Most of these materials
are characterised by high supply concentration, limited availability of
substitutes and strategic applications, and many are already subject
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
to some form of export restriction. Several of them, such as gallium,
magnet rare earths, graphite, cobalt and germanium, play essential
roles across a wide range of strategic applications.
Many high-tech materials are characterised by high exposure to
supply risks, including high supply concentration and dependence on
by‑product supply, as well as limited substitution options. These
minerals, such as gallium, magnet rare earths, cobalt, germanium,
nickel, indium and silicon, are widely used across multiple technology
domains, underscoring their systemic importance and creating strong
cross‑sector dependencies. Many of these minerals’ markets are also
relatively small‑scale, making their supply more vulnerable to
disruption and market volatility. At the same time, the parallel
expansion of these sectors, driven by rapid growth in electrification,
automation and AI‑related technologies, would simultaneously
increase competition between sectors, leading to additional pressure
on supply chains and an increased risk of market tightness and
imbalances.
Inherently, most materials critical for the aerospace and defence
sectors have high strategic importance given the national security
implications. Beyond this, many are already subject to export
restrictions targeting military applications through “dual-use”
designations, are highly concentrated in supply and are very
challenging to substitute, making them high-risk materials. Given the
challenging operating temperatures and conditions, the range of
materials that are critical for these sectors is wide. The highest-risk
materials for the aerospace and defence sector can be split into four
broad categories of primary applications: high-performance materials,
lightweight materials, superalloys and sensors. Most of the key
materials used in high-performance applications are challenging to
substitute and already subject to export restrictions, including yttrium,
tungsten, magnet rare earths and lithium. Superalloy applications
also present high risk, particularly where they are challenging to
substitute and have by-product dependencies, such as vanadium and
cobalt. Lithium and graphite are critical for defence, as they are used
in batteries needed for drones and portable electronics for soldiers’
equipment. There are also some materials that have key lightweight
applications, in particular titanium, which is highly difficult to
substitute. Finally, many high-tech materials are also key for
aerospace and defence, including gallium, germanium, tellurium and
antimony, which are utilised in radar and sensing applications.
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2. Outlook for key minerals
2. Outlook for key minerals
Part 3
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Nuclear supply chains
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Nuclear power is making a strong comeback, with uranium prices rising and reactor capacity
additions reaching record highs
Total nuclear capacity additions and capacity under construction (left) and uranium price development (right)
IEA. CC BY 4.0.
Notes: tU3O8 = tonne of triuranium octoxide. Capacity is reported on a gross basis and shown as annual average additions for each period.
Sources: IEA analysis based on data from the International Atomic Energy Agency’s PRIS database (2026), and UxC and TradeTech for uranium prices (2026).
20
40
60
80
100
’05-’09 ’10-’14 ’15-’19 ’20-’25 2025
GW
Capacity additions In construction
50 000
100 000
150 000
200 000
250 000
2019 2020 2021 2022 2023 2024 2025 2026
USD/tU3O8
Uranium long-term Uranium spot
Nuclear capacity additions Uranium price
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Strong growth in nuclear capacity requires a new wave of uranium supply
Nuclear capacity currently under construction, at around 78 GW, is at
its highest level in 30 years. Nuclear power has entered a renewed
phase of expansion in recent years, marking a clear shift from the
stagnation observed in the early 2000s. Global installed nuclear
capacity has increased steadily, reaching close to 420 GW by 2025,
compared with around 390 GW in the early 2000s. China has been
the main driver of this growth, adding close to 35 GW since 2015 and
bringing its total fleet to nearly 65 GW by 2025, while India, Korea,
Türkiye and the United Kingdom have also continued to expand
capacity. Download: Global Critical Minerals Outlook 2026.pdf
In parallel, tightening uranium market conditions reflect changing
demand expectations, renewed contracting activity and dwindling
secondary supply. After several years of subdued prices, uranium
markets strengthened significantly from 2020 onwards, with spot
prices of uranium concentrate rising from around USD 60 per kg of
oxide content to peaks above USD 200 per kg of oxide content in
2024, before moderating in 2025.
Looking ahead, in the STEPS, global nuclear generation doubles by
2050 while maintaining a relatively stable share of close to 10% of
total electricity generation. Installed capacity rises from close to
420 GW in 2025 to nearly 800 GW by 2050, with even higher levels
in the HDS. This expansion reflects sustained policy support across
an increasing number of countries, driven by energy security
considerations and decarbonisation objectives.
China is set to have the world’s largest nuclear fleet in the early 2030s,
accounting for roughly one-third of global capacity additions through
2050, with its fleet expanding by more than 2.5 times over the next
decade. The United States also sees renewed growth, increasing
from around 100 GW in 2025 to about 140 GW in 2040, supported by
both reactor life extensions and new builds. Shares of nuclear in
power generation also rise in India, Japan, Korea and Russia, while
remaining stable in Brazil and the UnitedArab Emirates. At the same
time, deployment is expanding into a broader set of emerging
markets beyond traditional markets, including Türkiye, but also
Bangladesh, Egypt, Kazakhstan, Poland, Uzbekistan and Viet Nam.
This widespread expansion points to sustained growth in nuclear fuel
requirements and the need for significant capacity additions across
uranium supply chains.
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Nuclear fuel types vary depending on the reactor and technology design
Selected nuclear fuel characteristics
IEA. CC BY 4.0.
Notes: Natural uranium demand includes reactors with fuel enriched below 2%. MOX combines recycled uranium and plutonium.
Sources: IEA analysis based on data from the International Atomic Energy Agency’s PRIS database (2026); World Nuclear Association (2025), World Nuclear Power
Reactors and Uranium Requirements.
Type Lattice Associated reactors
Current reactor
share
Existing fuels
Natural uranium Cylindrical Pressurised heavy water reactor (PHWR) 7%
Low-enriched uranium
(LEU, 2% to 5%)
Square
Pressurised water reactor (PWR) 62%
Boiling water reactor (BWR) 13%
Light water graphite reactor (LWGR) 2%
Cylindrical Gas-cooled reactor 1%
Hexagonal VVER (ex-Soviet designed PWR) 14%
Emerging fuels
Low-enriched uranium plus
(LEU+, 5% to 8%)
or
High-assay low-enriched uranium
(HALEU, 8% to 20%)
Square or hexagonal PWR, VVER, BWR Next-generation
Pebble or prismatic
Sodium-cooled fast reactor
Next-generation Lead-cooled fast reactor
High-temperature gas-cooled reactor
Circulating liquid molten salt Molten salt reactor Next-generation
Secondary fuels
Mixed oxide fuel (MOX, 2% to 5%) or
Reprocessed uranium (RepU, 2% to 5%)
PWR, fast breeder reactor Marginal
PWR, LWGR Marginal
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
The emergence of advanced nuclear reactors is diversifying the nuclear fuel cycle
Illustrative nuclear fuel cycle value chain
IEA. CC BY 4.0.
Notes: BWR = boiling water reactor; HALEU = high-assay low-enriched uranium (8-20%); LEU = low-enriched uranium (2-5%); LEU+ = low-enriched uranium plus
(5-8%); MOX = mixed oxide fuel; PHWR = pressurised heavy water reactor; Pu = plutonium; PUREX = plutonium uranium reduction extraction; PWR = pressurised
water reactor; RepU = reprocessed uranium; SMR = small modular reactor; TRISO = tri-structural isotropic; U = uranium;U3O8 = triuranium octoxide; UF4 = uranium
tetrafluoride; UF6 = uranium hexafluoride; UO2 = uranium dioxide. This figure illustrates a simplified, generalised flowsheet and does not capture the full complexity of
real-world circuits, which frequently require customisation for specific mined ores, enrichment needs, and nuclear fuel requirements.
Mining & milling
Open-pit /
underground
In-situ
leaching
Yellowcake (U3O8
)
Conversion
UO2UF4UF6
Natural (UF6
)
U3O8
Enrichment
Gas
centrifuge
Laser
diffusion
Low enriched UF6
UF6
0.7%
LEU fuels
LEU
2-5% UF6UO2
powder
pellets rods
Fuel assemblies
Nuclear reactors
Enriched U fuel
PWR, BWR
Nuclear reactors
Natural U fuel
PHWR
U3O8
Higher enrichment
Gas
centrifuge
Laser
diffusion
High enriched UF6
Advanced fuels
TRISO / metallic /
molten-salt fuels
Various fuel forms
HALEU
8-20%
Nuclear reactors
Next generation fuels
SMRs, Gen IV, etc
LEU 2-5%
LEU+
5-8%
Reprocessing
Reprocessed fuel
Pu + RepU, RepU
MOX, RepU
Final disposal
Deep geology
Long-term isolation
Interim storage
Wet (pool)
Cooled spent fuel
Dry (cask)
Oncethrough
Natural U fuels
U3O8UO2
powder pellets bundle
Fuel assemblies
Metallic U-Pu-Ma, metallic nitride
Fast reactor fuels
Spent nuclear fuel
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
What types of fuels and uranium requirements are associated with different reactor types?
Nuclear power generation is currently dominated by light water
reactors, notably pressurised water reactors and boiling water
reactors, which account for close to 90% of global capacity and rely
on low-enriched uranium (LEU), typically enriched to 2-5%
uranium-235. Some reactor types, such as Russian water-water
energetic reactors (VVERs), require specific fuel assembly designs,
limiting substitutability across suppliers (see section below on supply
concentration).
Lattice structure of selected nuclear fuels
IEA. CC BY 4.0.
Note: The figure illustrates simplified fuel rod designs used in reactor cores
and does not capture the full complexity of customised and real-world fuels.
Pressurised heavy water reactors (PHWRs), deployed in Argentina,
Canada, India, and Romania and accounting globally for a 7% market
share in 2025, consume specific fuel types containing natural
uranium (around 0.7% uranium-235) that do not require enrichment.
New advanced PHWRs, such as those under construction in India,
can require slightly enriched uranium of up to 1.1% to achieve
improved burnup.
Growing role of small modular reactors
Large-scale reactors continue to dominate new nuclear deployment,
but momentum behind small modular reactors (SMRs) is building.
China already operates a land-based SMR and has an additional
125 MW commercial SMR under construction, while Russia operates
a marine-based SMR and is building a further 300 MW unit.
Additional SMR projects are planned or being developed in Argentina,
Canada, Korea, Sweden, the United Kingdom and the United States,
necessitating reactor manufacturing and fuel services. In the STEPS,
SMRs grow from the early 2030s, reaching close to 40 GW by 2050,
or around 5% of total capacity.
SMRs include both small-scale pressurised water reactors and a
range of advanced designs using alternative fuels. Many of the
projects under development are expected to rely on low-enriched
uranium plus (LEU+), enriched to between 5% and 8%, or high-assay
low-enriched uranium (HALEU), enriched up to 20%, enabling higher
burnup and longer operating cycles. In some cases, specific fuel
geometries may be required, as opposed to the more conventional
square lattice pellets used in current light water reactors, such as tristructural isotropic particles. Enrichment specifications vary
accordingly. Download: Global Critical Minerals Outlook 2026.pdf
Square lattice Hexagonal lattice Cylindrical bundle
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Alongside the expanding global nuclear fleet, uranium requirements are set to increase
strongly, with new fuel types needed for emerging next-generation fleets
Mining
Annual uranium demand is close to 70 kilotonnes of natural uranium
equivalent (ktU) today, and this is set to increase strongly as global
nuclear generation expands. While uranium requirements generally
increase with nuclear generation, improvements in fuel utilisation and
reactor performance may reduce uranium demand per unit of
electricity generated.
40% of this growth is concentrated in China and 20% in other
emerging markets, including in India, the Middle East and Africa as
new programmes mature. Demand in the European Union is
expected to grow moderately.
Enrichment
Global enrichment requirements are close to 49 million separative
work units (SWU) today and are set to rise significantly. The
emergence of LEU+ and HALEU and the broader shift towards higher
enrichment levels introduce additional requirements beyond the
current supply chain configuration, including industrial facilities and
specific cascade technologies. For a given amount of fuel, higher
enrichment grades imply greater requirements for mined uranium and
enrichment work units, making the front end of the nuclear fuel cycle
more resource-intensive and reinforcing pressure on both uranium
and enrichment work unit supplies. Greater development of nextgeneration reactors and stronger demand for HALEU could push
overall enrichment requirements higher.
Fuel
The composition of reactor technologies also reshapes fuel
requirements. Global uranium oxide fuel fabrication requirements are
around 11.5 kilotonnes of heavy metal today and are also set to
increase in line with nuclear capacity expansions. Among
conventional large-scale reactors, pressurised water reactors and
boiling water reactors are set to continue to dominate uranium
consumption. VVER designs, which operate with a hexagonal fuel
lattice, maintain a significant market share: current global
consumption of close to 11 ktU is expected to grow further. PHWRs
in Canada and India also currently retain an important regional role,
requiring about 3.4 ktU of dedicated fuel supply.
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2. Outlook for key minerals
New projects are needed to meet growing demand for nuclear fuels
Mined uranium
The market for mined uranium remains tight. Existing capacity and
the project pipeline suggest that the gap between requirements and
likely available output is expected to widen over the next decade,
making accelerated project development and access to higher-cost
or undiscovered resources necessary. While identified uranium
resources are generally sufficient to support projected nuclear growth,
maintaining adequate supply will require timely investment in new
mining projects and fuel-cycle infrastructure. Long-term supply risks
are therefore driven primarily by the pace of investment and project
development rather than by physical resource availability.
Recent project developments present a mixed picture, highlighting
both new sources of supply and emerging structural constraints. The
restart of the Langer Heinrich mine in Namibia is expected to
contribute additional volumes, but these gains are partly offset by
disruptions in traditional supply corridors. In Canada, the restart of
Cameco’s McArthur River-Key Lake operation has brought significant
capacity back into production after suspension, with potential for
further expansion to full licensed capacity. New projects are also
being developed in Mongolia (France’s Orano), Uzbekistan (domestic
operator Navoiyuran), Tanzania (Russia’s Uranium One) and
Mauritania (Australia’s Aura Energy).
However, several large legacy mines are progressively approaching
depletion, with Canada’s Cigar Lake mine, which accounts for close
to half of the country’s production capacity, facing decline from the
mid-2030s and McArthur River about a decade later. Supply
additions are also exposed to geopolitical and logistical complications.
Production in Kazakhstan, the leading producer of uranium, is
increasingly limited by sulphuric acid supply constraints, declining ore
grades and rising costs, prompting a pivot towards higher-value
contracts. Without new expansion or greenfield developments, the
longer-term supply outlook is likely to tighten.
Higher uranium prices in recent years have supported a revival of
exploration and development activity, initially focused on restarting
idled capacity before extending to new greenfield investment
decisions across Central Asia, Africa and North America. However,
delivering sufficient new supply remains challenging: mine
development timelines typically span 10-15 years, reflecting
increasingly stringent regulatory requirements. Producers are also
facing rising input costs, supply chain disruptions and increasing
operational complexity. In addition, supply remains vulnerable to
geopolitical disruptions, as illustrated by the loss of around 1 000
tonnes of production in Niger, which previously supplied about 23%
of EU demand. This underscores the continued exposure of uranium
markets to concentrated supply risks.
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2. Outlook for key minerals
Uranium conversion: new projects needed rapidly
Uranium conversion, the first step that prepares mined concentrate
for enrichment, remains structurally fragile. The process involves
transforming uranium concentrate into uranium hexafluoride. Global
uranium hexafluoride capacity, totalling 62 ktU, leaves little margin to
absorb disruptions and volatility. Conversion prices recorded historic
highs, with prices increasing by close to 30% over the year. These
increases were driven by shifting trade flows and stronger demand
expectations, although long-term fuel procurement strategies and the
use of commercial inventories provide a buffer against short-term
supply disruptions.
Rising demand is expected to require a major expansion of
conversion capacity. While new projects and capacity expansions are
planned in Canada, France, the United Kingdom and the
United States, including by new players, long development timelines
may delay their impact. In parallel, recently launched facilities are still
ramping up, and it may take time for new projects to make a
significant contribution in the near term. In this context, inventory
management and long-term contracting practices complement efforts
to diversify supply sources, helping to mitigate short-term market
tightness.
Enrichment capacity: sufficient today, but additions
needed for the future
Enrichment capacity remains sufficient in the near term but may face
a bottleneck with rising demand over the medium term. This
tightening outlook is already reflected in market signals, with spot and
term enrichment prices rising respectively by more than 10% and 6%
compared with 2024. Given the long lead times associated with new
facilities, additional projects will be needed to prevent emerging
constraints, as no major greenfield commercial capacity is expected
before 2030.
In China, the ongoing expansion of enrichment capacity is primarily
oriented towards strengthening domestic supply security rather than
increasing export availability. The recent commissioning of the
Emeishan plant has increased national enrichment capacity to
10.8 million SWU. Nevertheless, the current pipeline remains limited
in its ability to expand the country’s role as an exporter of enriched
uranium.
In Europe, enrichment capacity is broadly aligned with domestic
demand. However, the region imports enriched uranium from Russia
for domestic consumption while exporting its domestically enriched
production to other regions, including Japan, Korea and the
United States. Planned capacity increases are expected in 2028,
including the addition of around 750 000 SWU at Urenco’s Almelo
plant and approximately 2.5 million SWU through the expansion of
Orano’s Georges Besse II facility. However, these additions are
IEA. CC BY 4.0.
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2. Outlook for key minerals
primarily aimed at maintaining supply balance and may offer limited
headroom if existing external supply sources are reduced.
In the United States, enrichment capacity is expanding, with the
Department of Energy committing USD 2.7 billion to domestic
enrichment initiatives, supporting projects led byAmerican Centrifuge
Operating, General Matter and Orano Federal Services, including
Project IKE. In parallel, Urenco USA announced an expansion of its
Eunice enrichment plant by 2036, adding 2.1 million SWU and
increasing total capacity to more than 7 million SWU. HALEU projects
are also emerging but remain at an early stage of development.
Current activities include the operation of Centrus Energy’s HALEU
pilot facility in Piketon, Ohio, and Global Laser Enrichment’s
demonstration test loop in Wilmington, North Carolina. Both
companies are also advancing plans for larger commercial facilities
in Kentucky. Despite this progress, the scale and timing of these
projects suggest a gradual build-up of capacity, implying a limited role
in serving short-term demand.
Fuel fabrication capacity is sufficient for conventional
fuel types, but not for next-generation fuels
Global fuel fabrication capacity remains adequate to meet
requirements, supported by utilisation rates below 70%. This
provides a buffer to accommodate short-term increases in demand.
However, fuel fabrication remains highly reactor-specific, with limited
interchangeability across designs, which may create bottlenecks for
certain fuel types and reactor technologies. Long-term fuel
procurement strategies and commercial inventories provide an
additional layer of resilience against short-term disruptions in mining,
conversion, enrichment or fuel fabrication services, complementing
efforts to diversify supply sources. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
Three countries account for almost three-quarters of uranium mining, while 70% of both
conversion and enrichment capacity is concentrated in three countries
Geographical and ownership distribution of the nuclear fuel cycle, 2025
IEA. CC BY 4.0.
Notes: Conversion, enrichment and fuel fabrication distributions are calculated based on project capacities. Mining ownership is calculated based on project shares.
Sources: IEA analysis based on Nuclear Energy Agency (2025), Uranium 2024: Resources, Production and Demand; Kazatomprom (2026), Operating and Financial
Review for 2025; World Nuclear Association (2024), Conversion and Deconversion; World Nuclear Association (2026), Nuclear Fuel and Its Fabrication; World
Nuclear Association (2025), Uranium Enrichment; International Atomic Energy Agency (2026), List of Nuclear Fuel Cycle Facilities; Zang et al. (2015), China’s
Uranium Enrichment Capacity.
0%
20%
40%
60%
80%
100%
Mining Conversion Enrichment Fuel fabrication
Russia China Kazakhstan Canada Namibia Australia France United Kingdom United States Others Top 3 share
Region
Mining Conversion Enrichment Fuel fabrication
Ownership
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2. Outlook for key minerals
Concentration and new fuel requirements are emerging as key constraints on nuclear fuel
supply security
Mining
Three countries, Canada, Kazakhstan and Namibia, currently
account for around 70% of global mining output. Concentration is
even more pronounced from an ownership perspective, with six
companies controlling 88% of global supply. This reflects an industry
in which national champions, such as Kazatomprom, Cameco, Orano
and China National Nuclear Corporation, coexist with majors
operating multinationally, although upstream supply remains more
accessible than in subsequent stages of the fuel cycle. This level of
concentration reflects muted exploration and development activity
during the decade following 2011, when uranium prices were
historically low.
The security of mined uranium supply is shaped less by the
distribution of resources than by the concentration of transport routes
linking production to conversion plants. Kazakhstan and Uzbekistan,
two landlocked countries accounting for close to 45% of global mined
output, rely entirely on external conversion and enrichment services,
making export corridors a potential chokepoint. Historically, uranium
flows were oriented towards Russia by land, for transit or conversion,
accounting for about 23% of mined uranium transit in 2015. Over time,
trade patterns have increasingly shifted towards China, now the
largest end market for Kazakh uranium, reflecting both long-term
supply contracts and growing Chinese participation in upstream
assets in Kazakhstan. Between 2015 and 2025, about half of uranium
mined globally transited through Russia or China. This high reliance
on a limited number of corridors is compounded by constraints further
downstream, highlighting the limited flexibility of alternative primary
mined supply under today’s market conditions. In parallel, efforts to
diversify transport routes have gained momentum since 2022.
One possible export channel is the Trans-Caspian corridor, shipping
through the CaspianSea and the Caucasus to Europe. In addition to
providing access to European and North American markets, this
corridor is increasingly viewed as a strategic alternative to traditional
routes, particularly in the context of shifting geopolitical dynamics.
However, this route remains constrained by limited capacity, and the
necessary transshipment adds operational complexity and cost.
Adding to these challenges, uranium transport is governed as much
by regulatory constraints as by physical logistics, as radioactive
materials require country-specific licences that are not mutually
recognised. This creates incentives to minimise transit jurisdictions
and channel flows through a few specialised routes and ports, a trend
reinforced by the declining willingness of some carriers and terminals
to handle nuclear cargo.
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2. Outlook for key minerals
Looking beyond conventional uranium-based fuels, thorium is
attracting renewed interest in some countries, notably India and
China, due to their abundant domestic resources and its potential to
enhance long-term fuel supply security. However, commercial
deployment remains limited to India’s Advanced Heavy Water
Reactor and China’s Molten Salt Reactor programme.
Conversion
Commercial-scale conversion can only be carried out in five major
facilities operated and owned by Rosatom, Cameco, Orano,
ConverDyn and China National Nuclear Corporation, creating
significant exposure to logistical bottlenecks. The top three countries
account for around 70% of global output, increasing exposure to
potential disruptions while remaining slightly better distributed than
enrichment capacity, both by geography and ownership. However,
when excluding the two largest suppliers, Russia and China,
available conversion capacity is estimated to cover only 80% of
requirements, highlighting emerging constraints in supplying
diversified markets in an already tight conversion market.
Enrichment
The geographic distribution of enrichment facilities creates significant
challenges, with the share of the top three countries reaching close
to 70%. Among key producers, Urenco operates across Germany,
the Netherlands, the United Kingdom and the United States.
Combined with Rosatom (Russia), Orano (France) and China
National Nuclear Corporation (China), four companies handle 92% of
the enrichment step. While nominal global capacity appears sufficient
in 2025, available enrichment capacity outside the two largest
suppliers– Russia, whose supplier role to the United States is to be
phased out by 2028, and China– is estimated to meet only around
90% of requirements under an N-2 configuration. Effective supply
could be even lower given utilisation rates remain below full capacity.
N-2 enrichment requirements and capacity by geography, 2025
IEA. CC BY 4.0.
Note: The N‑2 balance excludes the two largest supplying countries from both
demand and capacity.
Sources: IEA analysis based on Nuclear Energy Agency (2025), Uranium 2024:
Resources, Production and Demand; World Nuclear Association (2025), World
Nuclear Power Reactors and Uranium Requirements; World Nuclear
Association (2025), Uranium Enrichment; International Atomic Energy Agency
(2026), Nuclear Fuel Cycle Facilities Database (2026); Zang et al. (2015),
China’s Uranium Enrichment Capacity.
The deployment of SMRs at commercial scale is set to challenge the
front end of the nuclear fuel cycle. Depending on the enrichment level,
HALEU fuel fabrication can require up to four times more uranium
0 20 40 60 80
Demand
Capacity
M SWU
N-2 supply (excluding supply from top suppliers)
N-2 demand (excluding demand from top suppliers)
Top suppliers
91%
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2. Outlook for key minerals
input and five times greater enrichment effort per tonne of fuel. This
implies structurally higher demand intensity for both uranium and
enrichment services, amplifying pressure on upstream stages.
Commercial-scale HALEU production remains geographically limited,
with Russia and China currently the only established commercial
suppliers through downblending. The 2024 US ban on Russian
uranium imports has reinforced policy efforts to establish alternative
supply chains. Outside these suppliers, Centrus Energy’s Piketon
facility in the United States is the only operating pilot cascade, with
cumulative deliveries of less than 1 tonne between late 2023 and
mid-2025. Expansion plans target around 12 tonnes per year,
supported by recent public funding and private investment. Additional
projects are under development, such as Urenco USA’s and Orano’s
enrichment expansions, as well as proposed facilities in Oak Ridge
and Paducah. However, most projects are not expected to deliver
material volumes before the early 2030s, indicating a potential timing
gap between HALEU availability and SMR deployment needs.
In the United States, the Department of Energy’s HALEU Availability
Program, launched in 2020, is designed as an interim supply
mechanism for early advanced reactor projects. Federal stockpiles are
projected to reach about 21 tonnes by mid-2026, with approximately
15 tonnes potentially available for temporary allocation. While
conditional allocations began in April 2025, government-held
inventories under the HALEU Availability Program are expected to play
a critical role for first-mover projects, pending the emergence of
commercial-scale HALEU production towards the end of the decade.
Fuel fabrication
Fuel fabrication capacities are more geographically distributed, with
the top three regions accounting for 47%, as dedicated assembly
lines are typically located close to reactor fleets. However, while
global fabrication capacity generally exceeds demand, effective
diversification is constrained by reactor-specific designs and
qualification requirements, which limit substitutability between
suppliers. As a result, ownership remains relatively concentrated,
with Westinghouse (United States), Framatome (France), TVEL
(Russia), GNF (United States) and KEPCO (Korea) together holding
around 65% of global fabrication capacity.
Recent developments highlight reliability and technological progress
as key near-term priorities. In 2025, operational performance and
innovation remained areas of attention at key facilities. Following
technical difficulties, some plants are currently planning works before
resuming production. Framatome advanced the qualification of
accident-tolerant fuels for European reactors, including at facilities in
France and Germany. At the same time, investment is increasingly
directed towards advanced fuel types rather than expanding
conventional output, with projects such as X-energy’s TRISO-X
facility and BWXT’s expansion in Lynchburg in the United States. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
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2. Outlook for key minerals
Reactor-specific and fuel-lattice design requirements are particularly
binding for VVER reactors, which account for around 14% of the
global nuclear fleet and rely on a limited pool of qualified fuel designs.
Historically, Russia’s TVEL, which remains outside EU sanctions, has
been the primary supplier. Since the early 2020s, Westinghouse has
secured offtake agreements for its new VVER-440-compatible fuels,
in addition to existing VVER-1000 supply contracts. Framatome,
supported by the APIS initiative, is also advancing plans in France
and Germany for a new VVER fuel fabrication facility, alongside
Westinghouse-linked projects in Spain and Ukraine. While most
European VVER operators have taken steps to diversify procurement,
only a limited share of fuel requirements is currently covered by
alternative suppliers. Westinghouse’s Västerås 200-tHM plant has
the capacity to supply about half of the demand outside China and
Russia. Although diversification efforts are progressing, fuel
qualification, licensing and reactor-specific certification requirements
remain binding constraints, with available fabrication capacity not
immediately translating into usable supply. The pace of diversification
is therefore likely to vary across operators and reactor types.
Geographical distribution of VVER fuel demand and supply, 2025
IEA. CC BY 4.0.
Source: Westinghouse (2026), Press release; International Atomic Energy
Agency (2026), Nuclear Fuel Cycle Facilities Database.
For VVER-1200 reactors, there are currently no alternative fuel
options, with continued reliance on TVEL representing a particular
challenge for countries such as Bangladesh, Hungary andTürkiye.
As a result, replacement capacity is expanding but is not yet sufficient
to provide meaningful alternatives in the near term. Near-term
security of supply therefore continues to rely on a combination of
existing inventories, legacy supply chains and ongoing efforts to
advance diversification.
250 500 750 1 000 1 250 1 500
Capacity
Demand
Sweden Czechia Ukraine
Slovak Republic Bulgaria Hungary
Finland India Armenia
Russia Belarus China
Iran
tHM
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2. Outlook for key minerals
Shifting contracting dynamics and prospects for secondary supply
Contracting dynamics
In recent years, contracting dynamics have increasingly shifted in
favour of producers, reinforcing sustained price tightness. During the
decade following 2011, characterised by persistently low uranium
prices, contracts were predominantly structured as fixed-price or
base-escalated agreements, often including volume flexibility at the
discretion of utilities. Demand-side utilities previously relied on lowpriced fixed or base-escalated contracts, leaving producers exposed
to prolonged market weakness.
Since 2020, however, a combination of reduced secondary supply and
recovering demand has led to a marked tightening of market conditions.
Contracts are now market-indexed, often incorporating higher floor
prices and, in some cases, more flexible or uncapped pricing structures,
with producers seeking to benefit from rising market prices. Utilities have
limited bargaining power under today’s market conditions, and
producers’ willingness to lock in volumes several years ahead at prices
well above current levels signals strong expectations of continued
tightness. Concurrently, these utilities are increasingly turning to longerterm contracting strategies and building inventories to hedge against
market and geopolitical uncertainty. The February 2026 long-term
agreement between Kazakhstan and India’s Department of Atomic
Energy, securing a significant share of future production volumes,
underscores the shift towards secured state-backed demand.
The evolving market structure is also reflected in the growing
presence of financial actors. Physical uranium investment vehicles,
such as exchange-traded funds, are accumulating uranium
concentrate for storage purposes, effectively removing material from
the market and contributing to tighter supply conditions.
The evolving role of alternative and secondary supply
Secondary supply can partially offset primary uranium requirements,
supplementing freshly mined material with existing inventories and
recycled fuels. This includes (i) drawdowns of stockpiles, (ii) recycling,
(iii) enrichment underfeeding practices that reduce primary uranium
demand by extracting more value from available material at the cost
of additional enrichment effort, (iv) re-enrichment of tails, and (v) the
downblending of secondary materials. These supplies have
historically played a significant role, at times meeting more than onequarter of global uranium demand, but their contribution has declined
to around one-tenth in recent years. As inventories tighten and
underfeeding opportunities diminish, the role of secondary supply is
expected to decline further, increasing reliance on mining.
Used fuel remains a stable but limited contributor to fuel supply in the
form of mixed oxide fuel, a blend of uranium and plutonium, the latter
generated during reactor operation. In France, recycled fuel accounts
for around 10% of nuclear feed today, with a target for recycled
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Global Critical Minerals Outlook 2026
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2. Outlook for key minerals
plutonium to contribute roughly 25% alongside enriched reprocessed
uranium, before rising towards 40%. Orano’s Melox plant is ramping
back up and undergoing modernisation, while longer-term projects at
the La Hague nuclear waste treatment plant aim to replace ageing
facilities and increase recycling flexibility beyond 2040. Elsewhere,
progress remains uneven. Despite advances such as Russia’s
REMIX pilot completion in 2026, delays at key facilities such as
Japan’s Rokkasho plant continue to constrain expansion. In parallel,
discussions on the potential revival of reprocessing in the
United States, including for future SMR applications relying on
specific plutonium streams, illustrate renewed policy interest,
although concrete deployment pathways remain uncertain. As a
result, near-term trends point to consolidation rather than a structural
increase in the global role of recycled fuel.
Looking ahead, while current recycling activity remains centred on
mixed oxide fuel and reprocessed uranium, alternative reprocessing
approaches capable of recovering a broader range of actinides are
under consideration for fast-spectrum reactors, such as sodium- and
lead-cooled designs. These could expand the role of recycled
materials over the longer term, although commercial deployment
remains uncertain. Future deployment of fast reactors and advanced
closed fuel-cycle technologies could expand the role of recycled
materials beyond current commercial applications, potentially
affecting long-term uranium requirements.
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2. Outlook for key minerals
Box 2.2 Nuclear supply chains require more than uranium
Even though nuclear power plants consume relatively marginal
volumes of non-uranium minerals compared with other energy
technologies, they nonetheless rely on a range of specialised
minerals, including zirconium, niobium and hafnium, whose supply
chains are often highly concentrated and offer limited alternatives.
Fuel cladding tubes, which encase uranium fuel pellets inside
reactor cores, depend almost exclusively on nuclear-grade
zirconium alloyed with small additions of niobium, tin, chromium and
nickel. These materials are subject to single-country supply
reliance, creating supply chain risks. Australia and South Africa
account for roughly 60% of global zircon mining, while China
controls about 38% of global zirconium refining. Niobium is even
more concentrated, with three Brazilian mines providing around
90% of global output, one of which accounts for 80% on its own.
Brazil exports niobium primarily as an alloy that is not directly usable
in fuel cladding, but the transformation of niobium into nuclear-grade
material is less concentrated and closer to demand centres.
Reactor control rods rely on boron carbide, hafnium and silverindium-cadmium alloys, while gadolinium is used as a burnable
poison in nuclear fuel. These minerals face highly concentrated
supply and co-production constraints, posing vulnerabilities in
nuclear-related mineral supply chains.
Hafnium is obtained only as a co-product of zirconium refining, with
China being the leading refiner, while France, India, Russia and the
United States also produce nuclear-grade zirconium. Indium, a byproduct of zinc refining, is similarly dominated by China, which
accounts for close to 70% of refined output. VVER fuel rods are also
reliant on refined rare earths supplied by China. In addition, the
deployment of advanced reactor designs and next-generation fuel
systems may increase the importance of other specialised inputs,
including nuclear-grade graphite, yttrium and beryllium, whose
supply chains may also present structural concentrationrisks. Download: Global Critical Minerals Outlook 2026.pdf
Share of the top producer of refined nuclear-related minerals,
2025
IEA. CC BY 4.0.
Source: IEA analysis based on USGS (2026), Mineral Commodity
Summaries; European Commission (2025), RMIS – Raw Materials’ Profiles;
Institute for International and Strategic Affairs (2022), Critical Minerals in the
Nuclear Industry.
50% 100%
Niobium
Tin
Tantalum
Chromium
Zirconium
Brazil
China
France
Türkiye
50% 100%
Indium
Hafnium
Boron
Cadmium
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
3. Pathways to resilient and
diversified supply chains
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Emergency preparedness
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Significant increases in critical mineral prices have a limited impact on the prices of final
downstream products
Share of critical minerals in the final price of battery, rare earth and copper products
IEA. CC BY 4.0.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Effective emergency preparedness starts with understanding the economic impact of supply
disruptions; rare earth export controls put USD6.5 trillion of downstream production at risk…
Economic value of downstream production at risk from full export controls of rare earths by region and sector, 2025
IEA. CC BY 4.0.
Notes: Economic value of downstream production at risk outside China. The full methodology is detailed in the next section.
1 2 3 4 5 6 7
Region
United States Europe Japan and Korea Canada Australia Other
Trillion USD
1 2 3 4 5 6 7
Sector
Automotive Electronics Defence Aviation, trucks and trains Data centre servers Wind Other
Trillion USD
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
… and over USD 300 billion of downstream production at risk from graphite export controls
Economic value of downstream production at risk from full export controls of battery-grade graphite by region and sector, 2025
IEA. CC BY 4.0.
Notes: Economic value of downstream production at risk outside China. Electric vehicles production includes both battery electric vehicles and plug-in hybrid electric
vehicles. Battery storage includes all battery storage systems. Batteries include both batteries produced for electric vehicles and storage applications. The full
methodology is detailed in the next section.
100 200 300 400
Region
United States Europe Japan and Korea Other Asia Other
Billion USD
100 200 300 400
Sector
Electric vehicles Battery storage Batteries
BillionUSD
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Understanding strategic risk exposure and the potential economic impact of disruption
In recent years, there has been a surge in both announced and
implemented critical mineral export controls. Understanding a
country’s strategic vulnerabilities and economic exposure has never
been more important. Assessing the potential economic impact of
existing, announced or possible future export controls, as well as
other supply disruptions, is a crucial first step in strengthening
emergency preparedness. Identifying the most vulnerable sectors
helps countries develop effective response strategies and build the
capacity to mitigate impacts quickly in the event of a disruption.
Economic impact of disruption assessment methodology
Estimating the economic value of downstream production at risk from
a major critical mineral supply disruption involves several steps.
• First, it requires an understanding of the import volumes of the
disrupted material, together with as much information as possible
on how it is consumed across sectors.
• Second, it is necessary to identify the products in each sector that
depend on the disrupted material and lack immediate substitutes,
along with their material intensities.
• Third, imported material volumes and product intensity data are
combined to validate the estimated number of downstream
products reliant on the exposed material.
• Fourth, product price and independent product sales data are
used to calculate the economic value at risk by multiplying the
product prices by the number of material-dependent products sold.
Sales data provide an additional layer of validation.
• Finally, the results can be aggregated by sector or region,
depending on the focus of the analysis.
Using this approach, we assess the economic impact of two major
export controls announced by China – on rare earth elements and
battery-grade graphite – under a scenario in which trade flows are
fully disrupted.
Rare earth element export controls
For magnet rare earths, the economic value of downstream
production at risk was estimated based on the export controls
announced by China in October 2025 (suspended until November
2026), as if they were implemented in full. If implemented, companies
would need to obtain a licence from China to export any domestic or
internationally made “parts, components and assemblies” containing
China-sourced rare earth materials or produced using Chinese
technologies. In a scenario in which the relevant licences are not
granted, the production and trade of final end-use products
containing Chinese rare earth elements would be severely
constrained. As a result, downstream manufacturers would face
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
economic losses stemming from their inability to produce, sell and
export the affected products.
To estimate the economic value of downstream production at risk
outside China from full export controls, the assessment first utilises
data on rare earth magnet demand in end-use products across the
economies, covering both neodymium-iron-boron (NdFeB) and
samarium-cobalt magnets. These data are combined with data from
the IEA database of rare earth intensities for downstream products in
each sector to determine the number of magnet-dependent products.
These sales numbers are then combined with product price
information to calculate the exposed revenue if licences are not
granted, thereby quantifying the economic value of downstream
production at risk from the loss of sales. Twenty-four specific product
categories were analysed. Independent product sales data are also
used to validate the estimates derived from rare earth intensities. The
resulting economic value of downstream production at risk by product
is then aggregated by region and by sector.
Economic impact results – rare earths
If the rare earth export controls are implemented in full, the economic
value of downstream production at risk would reach USD 6.5 trillion
per year for countries outside China. For context, this economic
exposure amounts to around 7% of the combined annual gross
domestic product of these countries. The United States and Europe
face the largest potential economic value at risk, with over
USD 1.5 trillion in direct economic losses each. Japan and Korea
together face over USD 500 billion in potential economic losses,
underlining the severity of the impact these controls could have on
major economies if fully implemented.
In terms of sectoral exposure, the automotive sector accounts for the
greatest economic value of downstream production at risk, with over
USD3 trillion in direct losses for countries outside China, followed by
electronics and other transport sectors (aviation, trucks and trains),
with over USD1 trillion in losses each. These three sectors together
are responsible for almost 85% of the economic value of downstream
production at risk, demonstrating their economic importance and
vulnerability. The defence sector also faces losses of almost
USD 600 billion, while losses in the data centre sector exceed
USD 350 billion.
Across all major economies, the automotive sector accounts for the
largest economic losses, representing over 40% of losses in the
United States and over 50% in other economies. However,
vulnerabilities in other sectors vary considerably by region. In the
United States, data centre servers and defence applications are more
exposed, accounting for 15% of losses each, while Europe, Japan
and Korea have high exposure to electronics, at around 20% of
losses. Data centres currently represent a smaller source of
economic exposure for countries outside the United States, but their
significance could increase over time as new facilities are deployed
more widely across other economies.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Graphite export controls
The same analysis was conducted for battery-grade graphite, based
on the battery supply chain export controls also announced by China
in October 2025, which were also suspended until November 2026.
This analysis builds on previous battery-grade graphite export
controls from 2023. Previously limited to natural flake graphite and
synthetic graphite with properties above a set threshold, the newly
announced export controls extended controls to all graphite anode
materials, both natural and synthetic. Given the central role of
graphite anode materials in global battery supply chains, if fully
implemented, this control would severely affect battery production
outside China, with major constraints on the production of dependent
high-value electric vehicles (EVs) and storage systems.
To estimate the economic value of downstream production at risk, the
economic value of battery production outside China was first
calculated by combining 2025 battery production data by country with
the corresponding battery prices. To calculate the impact on EVs, the
number of battery electric vehicles (BEVs) and plug-in hybrid electric
vehicles (PHEVs) that could not be produced due to the inability to
produce batteries outside China was calculated. Using our data on
average battery sizes by country and powertrain, together withBEV
and PHEV sales shares by country, the number of affected vehicles
was estimated. This was then multiplied by average vehicle sales
prices in each country to derive the associated economic value. The
same was calculated for battery storage systems that could not be
produced due to the inability to produce batteries outside China.
Economic impact results – battery-grade graphite
If the battery-grade graphite export controls are implemented in full
and trade flows are disrupted, the economic value of downstream
production at risk would be over USD 300 billion per year for
countries outside China. This is over 20 times smaller than for rare
earths, demonstrating the criticality of rare earths for a multitude of
major economic sectors. Nevertheless, as demand for batteries,
storage systems and EVs continues to expand rapidly, the economic
value at risk is set to rise considerably over time.
Europe faces the largest potential economic losses from the export
controls, accounting for over half of global losses, with more than
USD 150 billion exposed. The United States faces the second-largest
exposure with over USD90 billion in potential losses, while Japan
and Korea together are exposed to over USD 50 billion in potential
losses. The economic impacts of battery-grade graphite supply
disruptions are almost entirely concentrated in these four major
markets, amounting to over 95% of economic exposure, compared
with just 60% for rare earths. This demonstrates the concentration of
EV and battery production in these regions.
By sector, over 85% of exposure comes from EV production with USD
275 billion at risk. BEVs comprise almost 70% of EV economic
exposure compared with PHEVs, given their significantly larger share
of sales, at 65-80% in all major markets outside China. Only USD 5
billion is exposed for battery storage systems as the vast majority of
battery storage deployment outside of China relies on LFP batteries
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3. Pathways to resilient and diversified supply chains
produced in China. However, almost USD 40 billion of battery
production is exposed outside of China due to the significant battery
production capacity in the United States, Europe, Japan and Korea.
One important nuance regarding the economic impact of the graphite
restrictions is that the graphite controls do not include the same
restrictions on “parts, components, and assemblies” as the rare earth
controls. Therefore, affected automakers could potentially mitigate
the loss of diversified battery supply by purchasing additional
batteries from Chinese suppliers. However, this would further
increase the concentration of global battery supply, increasing
exposure to future supply risks. One example is the broader battery
supply chain export controls announced in 2025, which covered
multiple battery supply chain chokepoints. These measures were
suspended for one year in November 2025.
Indirect economic impacts
In practice, the impacts of a disruption extend far beyond the loss of
direct product sales. A wide range of high-value services depend on
sales of critical mineral-dependent products. For example, many
high-value services, such as artificial intelligence (AI), e-commerce,
fintech and cloud computing, rely on data centre servers, which
depend on rare earths. If data centre servers cannot be sold for the
installation of new data centres due to rare earth export controls,
there could be a major economic multiplier effect beyond the loss
from data centre sales. The same is true for the plethora of high-value
operations that depend on industrial motors containing rare earths,
such as automated and advanced manufacturing, robotics, and
applications in energy, mining, and oil and gas production. There is a
cascading economic effect from the inability to trade critical mineraldependent products. These economic losses could be several times
larger than the direct economic losses estimated in this analysis.
Strategic impacts
Some sectors may have lower economic impacts in some regions but
still pose major strategic vulnerabilities, such as defence or medical
applications that rely heavily on rare earths or batteries. Future
economic and strategic value is also a key consideration, even where
current exposure appears modest today. For example, data centre
servers, which are critical for AI development, underpin a sector
widely regarded as one of the most strategically and economically
significant for the future. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Critical minerals comprise just 3% of the price of an average electric vehicle but almost 20% of
the battery pack price
Share of critical minerals in the price of battery cells, battery packs, storage systems and EVs
IEA. CC BY 4.0.
Notes: Other materials include manganese sulphate. Lithium refers to lithium carbonate and lithium hydroxide, graphite to battery-grade graphite, nickel to nickel
sulphate 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
utility-scale storage. The EV price refers to the average of the European and United States BEV prices in 2025.
Sources: IEA analysis based on BloombergNEF and Global EV Outlook 2026.
0%
25%
50%
75%
100%
Battery cells Battery packs Storage systems EVs
Other
Other materials
Copper
Graphite
Cobalt
Nickel
Lithium
26%
18%
3% 2%
Critical minerals
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
A tripling of critical mineral prices would increase batterypack prices by over 35%, but electric
vehicle and storage system prices would only increase by 5%
Battery pack, storage and EV price impact of tripling the prices of critical minerals
IEA. CC BY 4.0.
Notes: 3x refers to the product price impact from tripling the price of all critical minerals. Other materials include manganese sulphate. Lithium refers to lithium
carbonate and lithium hydroxide, graphite to battery-grade graphite, nickel to nickel sulphate and cobalt to cobalt sulphate. Storage systems refer to the global
average 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
European and United States BEV prices in 2025.
Sources: IEA analysis based on Bloomberg, BloombergNEF and Global EV Outlook 2026.
200
400
600
800
2025 3x
USD/kWh
Storage systems
50
100
150
200
2025 3x
USD/kWh
Lithium Nickel Cobalt Graphite Copper Other materials Other
Battery packs
20 000
40 000
60 000
80 000
2025 3x
USD
EVs
+4%
+36%
+5%
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3. Pathways to resilient and diversified supply chains
Rare earth elements make up 40% of the value of permanent magnets but less than 1% of the
value of electric vehicles and conventional cars
Share of rare earth elements in the final price of magnets, motors, EVs, ICE cars and aircraft
IEA. CC BY 4.0.
Notes: EV = electric vehicle; ICE = internal combustion engine. Magnet refers to a rare earth element permanent magnet for a midsize BEV, motor refers to a
100 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.
Sources: IEA analysis based on Bloomberg and Argus.
0%
25%
50%
75%
100%
Magnets Motors EVs ICE cars Wide-body aircraft
Other
Terbium
Dysprosium
NeodymiumPraseodymium
40%
Rare earth elements
5%
0.2% 0.05% <0.001%
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
A tripling of rare earth element prices would almost double the price of permanent magnets but
increase the price of a car by just 0.1%
Product price impact of a tripling of rare earth element prices
IEA. CC BY 4.0.
Notes: 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
permanent 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
and product prices.
Sources: IEA analysis based on Bloomberg and Argus.
500
1 000
1 500
2 000
2 500
3 000
2025 3x
USD
Motors
50
100
150
200
250
300
2025 3x
USD/kg
Neodymium-praseodymium Dysprosium Terbium Other
Magnets
10 000
20 000
30 000
40 000
50 000
60 000
2025 3x
USD
ICE cars
+10% +80%
+0.1%
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Copper comprises 10% of transformer prices and 15% of power cable prices
Share of copper in the price of transformers and cables, and price impact of a higher copper price
IEA. CC BY 4.0.
Notes: 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
2026 copper price in May 2026.
0%
25%
50%
75%
100%
Transformers Subsea cables
Copper Other
10%
15%
10
20
30
40
Base
(2023)
At 2026
price
Thousand USD/ MVA
Transformers
1
2
3
4
Base
(2023)
At 2026
price
Million USD/km
Subsea cables
+10%
+7%
Price share
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Understanding the downstream product cost implications of critical mineral price increases
An important element, often missing in critical mineral policy
discussions, is a quantitative assessment of the cost share of critical
minerals in downstream products and the impact of changes in critical
mineral prices on the prices of these products. The implications of
this relationship can be significant. Download: Global Critical Minerals Outlook 2026.pdf
First, understanding price impacts is essential for emergency
response strategies. It helps identify where disruption risks are most
severe, where downstream impacts could be critical and where
temporary emergency support may be required to prevent broader
economic spillovers.
Second, it is crucial for the design of policy tools aimed at supply
chain diversification. Projects in geographically diverse regions
generally have higher cost structures than incumbent suppliers,
meaning that the additional cost of diversification needs to be borne
by someone, whether governments, consumers or actors across the
value chain. Understanding the magnitude of the price impact can
therefore inform the design of appropriate policy instruments and
burden-sharing mechanisms.
The relationship between material prices and downstream costs
varies significantly across materials. For some materials, the material
cost share in the downstream product is small. In such cases, higher
material prices may have onlya limited impact on final product prices.
However, the reverse can also be true. If the material price share is
high, the downstream product price can be sensitive to changes in
material prices, making it more difficult to absorb higher material
costs. These dynamics are highly relevant for the design of policy
tools to support diversification. In this context, we evaluate the price
share and cost implications of material price changes for three major
critical mineral markets: batteries, rare earths and copper.
Battery materials
Batteries require a range of critical minerals to operate, including
lithium hydroxide and lithium carbonate, several metal sulphates
(nickel, cobalt and manganese), graphite and copper. In 2025, these
materials comprised a quarter of the price of battery cells and almost
20% of the price of battery packs. Lithium and graphite are the largest
material cost components, each comprising over 4% of the pack price,
followed by nickel sulphate and copper, at over 3% each. Cobalt
sulphate comprises around 2%, while manganese sulphate accounts
for just 0.1% of the pack price due to its significantly lower price than
other materials. Despite accounting for a relatively high share of the
price of cells and packs, critical minerals comprise only a small share
of EV and storage system prices, accounting for just 3% of an
average EV price. This is even lower for storage systems, where just
2% of the price is attributable to critical minerals, predominantly due
to the dominance of lithium iron phosphate chemistries for storage,
which require no nickel or cobalt.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Battery material prices have seen high volatility in recent years,
particularly for lithium, cobalt and nickel. The lithium price increased
ninefold from January 2021 to December 2022 alone. Tripling the
price of all critical minerals in batteries would increase the price of
battery packs by over a third, a major increase that would have
significant consequences for the competitiveness of batteries, with
likely consequences for storage system and EV producers in terms
of downsizing and demand destruction. The competitiveness of
battery manufacturers in geographically diverse regions can be
significantly affected by increases in material prices, particularly as
they compete with established, low-cost incumbent producers.
However, a tripling of mineral prices would increase the final price of
EVs and storage systems by only around 5%, a notable but much
more limited impact. For end users, EV consumers and grid
developers, the price impacts may be manageable. However, original
equipment manufacturers (OEMs), storage system producers and
battery purchasers would face a significant increase in input costs as
battery pack prices rise. In the case of non-vertically integrated
producers, the impact on final product prices could be higher due to
additional margins along the value chain, or lower if upstream and
midstream suppliers absorb part of the increase in material costs.
Rare earth elements
The case is more pronounced for rare earth elements. Rare earth
elements comprise 40% of the final price of neodymium-iron-boron
(NdFeB) permanent magnets. Dysprosium represents the largest
share, at almost 20% of the magnet price, followed by neodymiumpraseodymium, at almost 15%. Terbium is used in very small
amounts in many NdFeB permanent magnets to improve hightemperature performance and resistance to demagnetisation.
However, as the price of terbium is over ten times higher than that of
neodymium-praseodymium, it is responsible for around 10% of the
value of a permanent magnet. For an EV motor, rare earths comprise
around 5% of the total price, a significantly smaller share due to the
high value added of the motor and the small volumes of rare earth
elements used. Further downstream, rare earths account for an
almost negligible fraction of the value of the products. Rare earths
account for less than 1% of the value of an EV, less than 0.1% of the
value of an internal combustion engine (ICE) vehicle and less than
0.001% of a wide-body aircraft, despite being critical to all of these
downstream products.
Tripling the price of all magnet rare earths would almost double the
price of permanent magnets, with significant impacts on prospective
magnet manufacturers competing against incumbent producers. The
higher magnet prices would also create challenges for motor
producers, which typically operate with thin margins. Tripling rare
earth prices would increase motor prices by 10%. The impact on
motor prices is significant and may incentivise carmakers and OEMs
to increase research into technologies that reduce rare earth intensity
in magnets and motors. However, it is unlikely to be cost prohibitive
for automakers and would not stop OEMs from being able to
purchase rare earth-based motors. The impact on final consumer
prices would be minimal. Even a tripling of rare earth prices would
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
increase the price of an ICE vehicle by only around 0.1%, making the
effect largely imperceptible to consumers. Therefore, the impacts are
more acute for magnet and motor producers, but the costs could be
more easily absorbed downstream.
Copper
In today’s electricity system, two of the major products that are highly
dependent on copper are transformers and power cables. Prices for
power transformers have almost doubled since 2019, predominantly
due to manufacturing bottlenecks and insufficient production capacity
to meet surging demand from grid development. Copper has also
seen exceptional price rises to record highs from the end of 2025
through 2026. Therefore, we assessed the share of copper in the
price of transformers and subsea power cables based on 2023 data
to reflect typical circumstances. In 2023, copper comprised around
10% of the power transformer price and 15% of the subsea highvoltage power cable price, a significant but not dominant cost
component. However, when considering these costs with 2026 peak
prices from May 2026, representing a 66% increase from the 2023
average price, this increases the transformer price by 7% and the
subsea cable price by 10%, representing significant cost increases
for grid developers and providers. This price increase is significant
but not prohibitive, suggesting some scope for transformer and cable
prices to absorb changes in copper prices. While sustained periods
of high copper prices could place upward pressure on grid investment
costs, they are unlikely to fundamentally undermine the economic
viability of transmission and distribution projects.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
A mineral security premium could be an insurance policy for strategic and economic security
Some important conclusions can be drawn by combining the analysis
of risk exposure with the downstream cost implications. Major
strategic and economic losses are at stake from critical minerals
export controls and disruptions, given the wide range of high-value
products and strategic sectors that depend on these materials. While
supply diversification remains the only durable solution to these
structural risks, projects in geographically diverse regions generally
have higher cost profiles than incumbent producers. In many cases,
operating costs can be around 50% higher than in established supply
bases, which can materially affect investment decisions (refer to the
following Policy and market frameworks section in Chapter 3).
This creates a central policy challenge: diversified supply is needed
by both governments and consumers, but it is less clear who should
bear the additional cost or how this cost gap can be addressed.
Recent efforts have often focused on introducing a “sustainability
premium” linked to environmental, social and governance
performance. However, such premiums have not emerged at
meaningful scale in practice.
In the current context, characterised by rising geopolitical tensions,
the additional cost of diversification may instead be viewed as aform
of economic insurance against major security risks. In this context, a
“mineral security premium” may be a more appropriate framing. Such
a premium reflects the idea that societies already pay for risk
management across multiple domains, including energy security,
infrastructure resilience and financial risk. Given the rising frequency
of export controls and geopolitical disruptions, this form of insurance
is becoming increasingly relevant and is something consumers and
policy makers may need to price in to enhance economic and
business security.
In the case of rare earths, fully implemented export controls could
result in an estimated USD 6.5 trillion of downstream economic value
at risk per year for countries outside China, whereas a tripling in rare
earth prices would increase the price of a conventional car by just
0.1%. Against this backdrop, the estimated downstream price impact
of around 0.1% appears to be a relatively modest cost for enhanced
economic security.
Because downstream price impacts are generally modest in end-use
applications, a large share of the diversification cost can be absorbed
without significant effects on consumers. However, it is important to
note that diversification may also entail additional costs beyond
higher material prices, including supplier qualification, product testing
and certification processes, and other switching costs associated with
establishing new supply relationships.
The price impacts are more pronounced in specific intermediate
segments, such as motor manufacturing and battery production,
where input cost sensitivity is higher. In these cases, targeted policy
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
support may be required. More broadly, the appropriate financing of
a security premium could be shared across governments, industry
and consumers, depending on where in the value chain the cost
burden can be most effectively absorbed.
A clearer understanding of the cost implications is therefore essential
to inform policy design. Governments need to consider how best to
structure policy tools and burden-sharing mechanisms, and at which
point in the value chain intervention would be most effective. In this
context, quantifying downstream impacts helps clarify how costs and
risks are distributed across governments, industry and consumers.
Ultimately, the issue is one of strategic risk management, and framing
it as such through a security premium may help unlock the investment
needed to accelerate the development of diversified supply. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 251
3. Pathways to resilient and diversified supply chains
Emergency response measures protect against elevated risks of supply disruptions
Developing diversified sources of supply for critical minerals is a clear
priority to increase the long-term resilience of supply chains. However,
it inevitably takes time to develop new projects in both mining and
refining. Emergency preparedness measures can provide short-term
protective and mitigative actions to safeguard countries from supply
shocks while they develop new, diversified sources of supply.
At the centre of emergency preparedness, response measures
provide relief to disrupted supply chains, acting on the supply and/or
demand side. On the supply side, unlocking spare production
capacity and commissioning new projects in an accelerated time
frame can help make up for lost supply in the event of a disruption.
For countries with existing stockpiling systems, the release of
stockpiled material is also a key option, providing a temporary buffer.
On the demand side, temporary allocation of available supply to
strategic industries, incentives for efficiency and substitution, and
rationing could also help withstand supply shortages.
Redirecting available supply to priority industries could help reduce
the economic impact of disruptions, but countries would need to
conduct a prioritisation exercise ahead of a crisis. Many countries
have experience in conducting similar exercises for the oil sector,
providing lessons that can be adapted to different industry structures.
Beyond the selection of possible response measures, emergency
preparedness includes close market monitoring to promptly identify
disruptions and react in time, the development of protocols for the
rapid implementation of emergency response measures, and
exercises to stress-test systems and identify vulnerabilities and
potential responses.
Tabletop exercises can simulate a realistic supply disruption and help
countries develop co-ordinated response measures. These exercises
offer opportunities to improve common understanding of domestic
and global risk exposure, test emergency procedures, and
co-ordinate the management and exchange of available supply. The
process of simulating supply disruptions through exercises may also
help build domestic data-gathering capabilities and strengthen
emergency response capacity.
Emergency procedures
An essential element of emergency preparedness is the ability to
identify and quickly react to acute market disruptions. The
establishment of emergency procedures is key to achieving this goal
and involves several steps:
1. Establishing market monitoring systems with access to
information such as supply, demand and trade of high-risk
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3. Pathways to resilient and diversified supply chains
materials. This would enable the creation of early-warning
systems to provide signals of potential supply shocks.
2. Setting up government-industry monitoring groups to exchange
information on market developments. This would include
designated contact points that centralise information and
communicate the implementation of security measures through
secure channels.
3. Playing an active role in international platforms, such as the IEA
Critical Minerals Security Programme, that facilitate information
exchange and the co-ordination of response measures.
In preparation for potential supply disruptions, governments can plan
measures that would increase readiness for emergencies:
1. Mapping industrial players supplying or using high-risk materials
and improving data quality and monitoring efforts.
2. Identifying critical sectors that would need to be prioritised in case
of supply shortages.
3. Preparing a set of measures that would be considered in case of
an emergency. These can act on the supply side, such as
stockpile releases, production ramp-up or quick commissioning of
new projects, or on the demand side, such as the prioritisation of
specific sectors and incentives for efficient material use.
4. Creating, through specific agreements, an international network
of partner countries that would be able to support, if possible, with
additional supply or diplomatic engagement.
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3. Pathways to resilient and diversified supply chains
Stockpiling governance models should leverage government financing and industry expertise
to ensure cost-efficient systems tailored to specific materials
Critical mineral stockpiling governance models
IEA. CC BY 4.0.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
The cost of stockpiling materials exposed to the highest risk is less than USD 900 million at the
global level
Operating cost of stockpiling materials for countries outside the largest supplier
IEA. CC BY 4.0.
Notes: CAM = cathode active material. The cost of stockpiling is equivalent to one year of imports from the largest supplier. Graphite includes artificial and spherical
graphite; rare earths include magnet rare earth oxides and metals, neodymium-iron-boron powder and alloy, permanent magnetic sheets and permanent magnets;
lithium includes lithium hydroxide and lithium carbonate; cobalt refers to unwrought cobalt; titanium includes titanium powder, shapes, sponge, tubes and pipes, and
unwrought titanium; tungsten includes ammonium paratungsten, tungsten carbides, oxides and hydroxides, powders, trioxides, and wrought and unwrought
tungsten; molybdenum includes molybdenum powders and roasted molybdenum; antimony includes antimony hydrides, sulphide, wrought antimony and oxides;
germanium includes wrought and unwrought germanium; and gallium includes wrought and unwrought gallium.
100
200
300
Graphite CAM Rare earths Lithium Cobalt Titanium Tungsten MolybdenumAntimony Germanium Gallium
Million USD
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
The feasibility of stockpiling varies by material, but warehousing challenges can be overcome
through temperature control, packaging and stock rotation
Assessment of material properties and stockpiling warehousing requirements for selected strategic minerals
IEA. CC BY 4.0.
Notes: Magnet rare earth oxides and metals include neodymium, dysprosium, praseodymium and terbium. The scores assigned to material properties and
warehousing requirements indicate how each material compares with the others, based on materials’ safety data sheets and industry interviews. Hygroscopicity is
the material’s sensitivity to humidity, reactivity refers to its tendency to react with air, hazardousness indicates potential physical and health hazards, and fragility
reflects the risk of damaging the material when handling it. Temperature refers to the need for delicate temperature control in the warehouse, packaging indicates the
need 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
the frequency at which stocks need to be replaced because of their short shelf lives.
Antimony trioxide
Cathode active material
Chromium (ferrochromium)
Cobalt sulphate
Cobalt (unwrought)
Copper cathode
Gallium metal
Germanium metal
Graphite (coated spherical)
Indium ingot
Lithium hydroxide
Manganese sulphate
Molybdic oxide
Nickel sulphate
Niobium pentoxide
Magnet rare earth oxides
Magnet rare earth metals
Rare earth magnets
Silicon metal
Tantalum metal
Elemental tellurium ingots
Titanium ingots
Tungsten ingots/rods
Vanadium pentoxide
Zirconium ingots
Lithium carbonate
Material properties Warehousing requirements
Hygroscopicity Reactivity Hazardousness Fragility Temperature Packaging Transport Stock rotation
Black mass
Anode material
High
Medium
Low
High
Medium
Low
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3. Pathways to resilient and diversified supply chains
Strategic stockpiling provides a supply buffer to gain time in case of sudden disruptions
Strategic stockpiles of critical minerals, held specifically for
emergency purposes with the involvement of the government, can
play an important role in providing emergency supply in case of
severe supply disruptions. Even when they are not used, they send
a signal to markets that sudden supply shocks or export restrictions
need not immediately cripple the system. Download: Global Critical Minerals Outlook 2026.pdf
In the oil market, strategic stocks have been proven effective over
many decades as a tool to prevent and respond to supply disruptions.
Since the creation of the IEA, there have been six collective actions.
The sixth and largest collective action was implemented on 11March
2026 in response to disruptions stemming from the conflict in the
Middle East. Critical mineral markets operate in a very different
context from oil markets. However, stockpiles can still play an
important role in providing emergency supply and protecting
industries and jobs. Some countries, such as Japan, Korea and the
United States, hold strategic stockpiles of critical minerals that have
protected industries during past supply disruptions.
One of the key steps in emergency preparedness is the identification
of possible vulnerabilities, typically through risk assessments. A
fundamental risk assessment involves classifying minerals according
to the risks associated with them. The IEA Critical Minerals
Stockpiling Assessment Framework was developed to analyse the
risks and challenges for each material across multiple dimensions:
supply risk, availability of alternative supply routes, strategic
importance and feasibility of stockpiling.
The feasibility of stockpiling varies by material, as each mineral takes
different forms along its supply chain. The form most suitable for
stockpiling is generally the imported form, which is most exposed to
disruption risks and can be used directly domestically in case of a
disruption, without the need for further processing abroad. A broad
assessment of the properties of strategic materials imported by IEA
Member countries highlights a number of warehousing challenges for
certain minerals, such as hygroscopicity (sensitivity to humidity),
reactivity, hazardousness and fragility. For example, lithium
hydroxide is highly sensitive to humidity and degrades quickly in air,
reducing its shelf life to around six months, while lithium carbonate
can be stored for much longer. Gallium has a melting point of around
30 °C. These warehousing challenges can be overcome, for example,
by controlling warehouse temperature and humidity, using advanced
packaging to minimise contact with air and moisture, and rotating
stocks of materials with short shelf lives. However, these additional
requirements increase the cost and complexity of stockpiling.
Stockpiling governance
Strategic stockpiling systems can follow a spectrum of governance
models that can be grouped into two broad categories based on
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
where the minerals are physically stored: government-held models
and industry-held models, each with two main options. For
government-held (centralised) stockpiling models, the government
owns and manages the stockpiles, either directly or through a public
agency acting on its behalf. Industry-held (decentralised) models
require companies to store strategic stocks in addition to their existing
commercial inventories. A public-private partnership that owns and
manages the stocks can also be established, combining the
advantages of government-held stocks, such as lower financing costs,
and industry-held stocks, such as a close relationship with the private
companies that ultimately use the materials.
The appropriate stockpiling governance model varies by material
and depends on the domestic context and supply chain structures.
In the case of rare earths, for example, the storage of more
upstream materials such as rare earth oxides or metals, which could
be used by multiple downstream magnet manufacturers, could
benefit from stronger government involvement and centralised
stockpiling. When stockpiling materials that are closer to
downstream products, such as rare earth permanent magnets,
industry-held models may be better suited, as each company can
store the specific materials it needs and rotate stocks more
efficiently. Stockpiled materials should be imported materials that
are capable of being rapidly deployed. For example, if there are no
domestic magnet manufacturing facilities, it would be beneficial to
directly stockpile the permanent magnets required domestically.
Stockpiling costs
The total cost of stockpiling comprises both the initial purchase cost
and the operating cost. However, the investment to purchase the
material is transformed into an asset that is later sold, either for stock
rotation or for a stock release. The real cost is therefore the operating
cost of stockpiling, which comprises the financing cost, warehousing
cost, logistics cost, material losses and discount. The discount cost
is associated with the need to refresh stocks by selling them at a
discount before they reach the end of their shelf life.
The net annual cost of stockpiling the 11 high-risk materials identified
by the IEA Critical Minerals Stockpiling Assessment Framework
amounts to less than USD900 million. The purchase cost, which is
converted into the stockpile’s asset value, is USD 9.2 billion. This
amount, while significant, is quickly dwarfed by the potential direct
economic impact of supply disruptions, which can be as high as
USD 6.5 trillion in the case of rare earth disruptions and over
USD 300 billion for graphite disruptions.
International co-ordination
While the objective of stockpiles is to strengthen the security of
domestic supply, co-ordination with international partners can help
achieve greater security more efficiently and quickly. Alignment on
the timing of stockpile purchases and the establishment of principles
for releases can help ensure that markets are not distorted. When
procuring stocks, countries could also agree to support strategic
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
projects that would increase global diversification or aggregate
demand. When compatible with domestic policies, countries might
co-locate stocks for greater efficiency, particularly for low-volume
materials, or reserve production in countries with production
infrastructure for emergency use. Close dialogue among partners
also facilitates the transfer of knowledge on efficient stockpile
management.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 259
3. Pathways to resilient and diversified supply chains
Policy and market frameworks to
diversify supply chains
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Meeting demand through diversified supply sources requires major new capacities across
mineral value chains
Demand and production from existing and announced projects outside the top producer, 2035
IEA. CC BY 4.0.
Notes: REE = rare earth elements. Recycling has the potential to reduce the remaining gaps. Rare earths are for magnet rare earths only (neodymium,
praseodymium, terbium and dysprosium).
25
50
75
2035 Mining Refining Magnets
Existing production Base case High-production case Remaining gap
Magnet uses Non-magnet uses Battery uses Non-battery uses
ktREE equivalent
Supply:
Demand:
2
4
6
2035 Mining Batterygrade
Mt
Rare earths Graphite
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
In the case of rare earthsand graphite, closing the supply gaps requires just under
USD 90 billionin investmentoutside the dominant supplier
Investmentrequirementsto 2035 to meetprojecteddemand outside the top producer
IEA. CC BY 4.0.
Notes: Investment requirements are estimated by multiplying the gap between projected supply and primary supply requirements by capital intensity. Capital
intensities are estimated using reported capital expenditure and production capacity.
Sources: IEA analysis based on data from company reporting, Wood Mackenzie and S&P Capital IQ.
20
40
60
80
Expansion of
existing
Planned new
projects
Remaining
gap
Total
Billion USD
Mining Refining Magnet
10
20
30
Expansion of
existing
Planned new
projects
Remaining
gap
Total
Billion USD
Mining Refining
Rare earths Graphite
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 262
3. Pathways to resilient and diversified supply chains
An essential first step towards long-term supply chain security and diversification is
understanding the required scale of supply additions and investment
Developing diversified critical mineral supply chains requires a clear
understanding of current and future needs. Without this, it is difficult
to assess the need for capacity expansion, estimate investment
requirements and co-ordinate policy targets effectively. While
demand is relatively well understood in large markets, such as copper
and battery metals, many smaller strategic minerals, including rare
earths and graphite, have more limited data visibility on future
requirements. Download: Global Critical Minerals Outlook 2026.pdf
An “N-1” assessment of demand and supply can provide a useful way
ofassessing the required capacity additions. For example, in both
rare earths and graphite, the largest global supplier is also the largest
consumer. It is therefore valuable to examine demand and production
capacity excluding this supplier (and consumer). Outside this market,
existing supply remains insufficient to meet demand, leaving
countries dependent on large-scale imports. This dependence
exposes strategic downstream industries to supply risks, as
highlighted by recent export controls.
For rare earths, current supply outside the dominant supplier
accounts for approximately 50% of mining, 30% of refining and 15%
of magnet demand. Although capacity expansions and new supply
are expected to emerge in geographically diverse regions over the
next decade, they remain insufficient to meet growing demand. By
2035, a gap of over 40% for mining, 50% for refining and just over
80% for magnet manufacturing persists.
A similar dynamic is observed in graphite. Despite emerging demand
outside the dominant supplier, current diversified supply meets only
about 50% of mined and battery-grade graphite demand. Announced
projects will expand capacity but are not sufficient to close the gap by
2035.
Closing these gaps requires just over USD 60 billion in rare earth
investment and almost USD 30 billion in graphite investment over the
next decade, including financing for announced projects and for the
additional capacity needed to close the remaining supply gap.
Refining requires the largest amount of investment across rare earths
and graphite. For rare earths, magnet manufacturing also requires
substantial investment of USD 21 billion.
Despite the strategic importance of diversification, persistent cost and
financing challenges have impeded investment in diversified supply
chains. The most fundamental constraint is the structural cost
differential between projects in incumbent regions and those in
geographically diverse jurisdictions.
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Capital costs for critical mineral refining projects range from 20% to over 150% higher in the
rest of the world compared to the dominant supplier, driven by facilities and equipment costs
Capital cost differentials between the top producer and the rest of the world
IEA. CC BY 4.0.
Notes: Plant costs refer to the cost of process facilities and the associated equipment directly involved in transforming ore, concentrate, intermediates or chemicals
into 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
materials. The aggregate capital cost figures are for refining.
Sources: IEA analysis based on data from company reporting, S&P Capital IQ and Wood Mackenzie.
50%
100%
150%
200%
Battery-grade
graphite
Copper Nickel Cobalt
50%
100%
150%
200%
Battery-grade graphite
Other capital costs
Infrastructure
Construction
Land acquisition
Coating
Shaping
Purification
Cost mark-up over the dominant supplier
Aggregate Decomposed
Plantcosts
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Operating costs are 50% higher in the rest of the world compared to the dominant supplier,
largely driven by feedstock, energy and process input costs
Operating cost differentials between the top producer and the rest of the world
IEA. CC BY 4.0.
Notes: Process inputs refer to reagents, reactants and consumables. Other costs include general and administrative, tailings, and royalty costs.
Sources: 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
Batteries.
– 75%
– 25%
25%
75%
125%
175%
Cobalt sulphate Nickel sulphate Natural graphite Synthetic graphite Lithium hydroxide
Other
Process inputs
Labour
Energy
Feedstock
By-product credit
Net Cost mark-up over the dominant supplier
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Costs of capital for critical mineral projects tend to be higher than those for other energy
sectors due to higher market volatility and a low leverage ratio
Cost of capital and average investment attractiveness in selected industries and minerals
IEA. CC BY 4.0.
Notes: 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
companies included in each industry available from Damodaran (2026). Investment indexes are calculated by weighting investment attractiveness indexes from the
Annual Survey of Mining Companies by country-proven reserves, as in Vespignani and Smyth (2024).
Sources: IEA analysis based on data from Damodaran (2026), Cost of Capital by Industry Sector; and Vespignani and Smyth (2024), Artificial Intelligence
Investments Reduce Risks to Critical Mineral Supply.
0%
2%
4%
6%
8%
10%
2015 2017 2019 2021 2023 2025
Power Renewable energy
Metals and mining US interest rate
Cost of capital
0
16
32
48
64
80
Rare earths
Platinum
Graphite
Tungsten
Barite
Manganese
Antimony
Cobalt
Lithium
Bauxite
Copper
Zinc
Nickel
Coal
Iron ore
Gold
Average investment attractiveness index
Keyenergy minerals
Others
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Higher costs and market conditions are constraining investment in diversification
Multiple factors have hampered investment in diversification, but one
of the most persistent barriers is economic. Across critical mineral
value chains, projects in geographically diverse regions face
structurally higher costs than incumbent producers, both in terms of
upfront investment and ongoing operational costs. These
disadvantages are compounded by volatile prices, demand
uncertainty in smaller markets and weak downstream ecosystems,
all of which undermine project bankability and make diversification
difficult to achieve through market forces alone. Download: Global Critical Minerals Outlook 2026.pdf
IEA analysis indicates that capital costs for refining projects in the
rest of the world are significantly higher than in today’s leading
producing countries, ranging from 20% to over 150%. Decomposing
the factors driving this difference for battery-grade graphite, the
largest are the over 100% higher plant costs, reflecting the benefits
that incumbent producers derive from larger industrial bases, more
standardised plant designs and better access to technology.
Construction costs are also over 20% more expensive, due in part to
the lack of supporting infrastructure and specialised engineering
capabilities, and contingency and indirect capital costs, which are 50%
higher.
Operating costs are also significantly higher outside the leading
producer, averaging around 50% above incumbent levels, with the
main drivers varying significantly depending on the mineral and
processing route. Feedstock costs are a major component across all
minerals and an important source of cost differentials in several
cases. For graphite and lithium hydroxide, greater reliance on
imported intermediates and less-integrated processing ecosystems
outside the dominant supplier, China, contribute to higher feedstock
costs. By contrast, feedstock costs for cobalt sulphate and nickel
sulphate are lower on average outside China, reflecting the ability of
other major producing regions to secure domestic feedstock. Higher
process input costs, including reagents and consumables, also play
an important role in driving the cost differential, particularly for lithium
refining, which relies on sulphuric acid, soda ash and other
purification reagents. Economies of scale, plant utilisation rates and
process efficiencies in incumbent processing hubs can further
reinforce these advantages.
The differences are particularly important in refining, where margins
are often thin and competitiveness depends heavily on access to lowcost inputs, scale and process optimisation. The result is that even
where projects can secure financing and reach production, sustaining
operations may remain challenging in the face of low-cost incumbent
supply.
Beyond individual cost components, incumbent producers often
benefit from integrated industrial clusters in which by-products and
waste streams from one industry serve as inputs for another, lowering
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
overall operating costs and improving system efficiency. These
ecosystems benefits can also include shared infrastructure, such as
water treatment facilities, logistics networks and waste management
systems, which reduce costs for individual operations.
Market structure further worsens these cost disadvantages. In many
mineral markets, limited price transparency makes it difficult to form
reliable revenue expectations or design effective support
mechanisms. At the same time, demand uncertainty remains high,
especially for smaller strategic minerals where future consumption
depends on the pace of downstream industrial development,
technology choices and policy commitments. Relatively small
physical market sizes can also mean that a limited number of new
projects can lead to excess supply, raising downside price risks and
weakening project bankability. In highly concentrated markets, prices
are often set by the lowest-cost producers, limiting the ability of
higher-cost diversified projects to recover their full costs.
Taken together, these factors contribute to an elevated risk profile for
critical mineral projects. Opaque pricing and uncertain offtake
weaken confidence in future cash flows and make it more difficult to
secure long-term contracts or debt financing. Additional uncertainties
around resource and product quality, offtaker creditworthiness,
interdependencies across the supply chain and project development
risks, such as cost overruns, further erode investor confidence.
As a result, access to debt financing is often constrained, leading to
lower leverage ratios and greater reliance on equity. This raises the
overall cost of capital for critical mineral supply chain investments,
resulting in much higher financing costs than in traditional energy
sectors. Over the past ten years, metals and mining companies
headquartered in Europe and the United States have paid an almost
50% premium on raising capital relative to companies operating in
power generation. Challenges in raising debt financing also force
companies to rely on a much higher share of expensive equity
financing, pushing up their costs of capital.
Building diversified critical mineral supply chains will require the
cultivation of an ecosystem that addresses the key structural barriers
preventing competitive supply from coming and staying online. This
will require a co-ordinated package of policies that addresses market
and financing challenges, including investment risk, market structure,
lack of technology and operational know-how, and co-ordination gaps,
while balancing incentives for both supply-side and demand-side
development. No single instrument will be sufficient on its own; rather,
measures need to reinforce each other to shift supply chains in a
meaningful way.
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
A combination of targeted supply- and demand-side measures is required to de-risk projects
and crowd in private capital in order to build diversified critical mineral supply chains
Supply- and demand-side policy tools to support diversification
IEA. CC BY 4.0.
Notes: CAPEX = capital expenditure; OPEX = operating expenditure.
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Targeted capital expenditure and operating expenditure support can de-risk projects and crowd
in private capital
Support measures on the supply side can improve project viability by
easing upfront financing needs or operational risks. These measures
broadly fall into three groups: capital expenditure (CAPEX) measures,
such as equity, grants, concession loans and loan guarantees;
operating expenditure (OPEX) support, which can reduce operating
cost drivers such as through facilitating access to competitively priced
feedstock or energy cost reductions; and risk-mitigation measures
that reduce price and volume risks, such as contracts for difference
or volume-based tools such as offtake backstops. CAPEX and OPEX
support can help improve bankability, crowd in private capital and
accelerate final investment decisions, while risk mitigation measures
can improve financing conditions by reducing price and volume risks.
CAPEX support
Governments can support strategic projects through a variety of capital
support mechanisms, such as equity, concessional loans, guarantees
and grants, to ease upfront capital constraints and improve bankability.
Equity investments allow governments to take a direct stake, which
may be particularly relevant for strategic projects. Public equity
participation can strengthen project balance sheets, reduce the
amount of private capital needed at the outset and signal strong
government backing, which can help attract additional investors. This
can be particularly valuable for high-risk, capital-intensive projects with
long return horizons. However, such investments require clear and
robust governance frameworks, including well-defined shareholder
rights and obligations, robust conflict-of-interest safeguards,
indemnification clauses, arbitration mechanisms and pre‑agreed
dispute resolution procedures to ensure transparency, avoid conflicts
of interest and allocate risk appropriately. Measures should clearly
specify who absorbs any losses, how cost overruns or delays are
managed and the terms under which private co-investment is
structured. Mechanisms should also be designed in a way that ensures
the recouping of upside returns, which can help align incentives and
ensure that support delivers long-term public value.
Governments can also provide concessional loans, loan guarantees
or grants to reduce early-stage risks and unlock commercial lending,
particularly in regions with weaker financial ecosystems.
Concessional loans featuring below-market interest rates, longer
tenors or grace periods can significantly improve project economics
and help de-risk capital-intensive phases. Loan guarantees can
unlock commercial lending by reducing lenders’ credit exposure,
making them particularly useful in jurisdictions with less mature
financial markets or high political risks. Grants, while more fiscally
demanding, can be used in targeted ways to support pre-commercial
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
stages, such as feasibility studies, pilot plants and technology
qualification, or to lower the cost of installing strategic infrastructure
to enable multiple projects. These forms of support can be tailored to
project needs and deployed in combination to maximise impact.
Project eligibility for capital support can be determined through a
strategic assessment of priority segments, taking into account where
supply gaps are most acute and where diversification benefits are
greatest. Alternatively, support can be allocated via competitive
auctions to ensure transparent and efficient allocation. Governments
can also prioritise projects in nascent industries, such as magnet
manufacturing, or those adopting less mature technologies.
OPEX support
While CAPEX support measures can help bring forward new projects,
sustaining their operations may require complementary OPEX
measures that work more directly on operating cost drivers to
improve project competitiveness. Key operating cost components
include feedstock, energy, reagents, labour, logistics and
environmental management.
Targeted measures can reduce the cost gaps faced by diversified
players by lowering input costs, improving access to infrastructure
and enabling operational efficiencies. These measures could include
facilitating access to competitively priced feedstock through
integration or offtake agreements; reducing energy costs via
preferential tariffs, long-term power contracts or access to low-cost
renewable electricity; supporting the domestic supply of key reagents
and process inputs; and investing in shared infrastructure, such as
transport, utilities and waste treatment.
Riskmitigation
Building diversified supply also requires reducing both price and
volume risks, enabling projects to operate through periods of market
volatility. This can be particularly useful for materials with small
market sizes, high levels of concentration and significant potential
economic impacts in the event of disruptions, although their use must
be carefully assessed against the potential fiscal costs.
Risk mitigation: Revenue stabilisation mechanisms
(price-based)
Price-based mechanisms are designed to reduce revenue uncertainty
by ensuring that operators receive a guaranteed minimum revenue for
their output. These can be implemented through a two-sided contract
for difference, or a price cap-and-floor mechanism, where there is an
agreed strike price and reference price. These mechanisms provide
support to an operator when market prices fall below the strike price
and require repayment to the government when prices exceed it,
thereby reducing revenue volatility while limiting fiscal exposure. The
operator then sells its products at regular market prices and settles the
difference between the strike price and the reference price, improving
bankability and allowing sustained production in volatile markets, with
limited distortion to downstream pricing as products continue to be sold
at market prices. Download: Global Critical Minerals Outlook 2026.pdf
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Contracts for difference have been used widely in European
renewable electricity markets, where they have helped finance 33%
to 50% of new offshore wind capacity since the late 2000s. More
recently, they have started to be used in some mineral markets,
particularly in small, nascent markets such as rare earths.
However, effective design is critical to ensure success, including
setting the strike and reference prices (see box 3.1 for more
information) and determining the length and allocation of contracts.
Contract allocation can be undertaken through bilateral negotiation
or competitive auctions. In auction-based approaches, governments
set a budget or capacity target and award contracts to the lowest bids,
with successive rounds used to bring forward additional projects as
market conditions, price dynamics and project developments evolve.
Contracts are typically time-bound, with durations in the power
generation sector often around 15 years.
It is also crucial to ensure that markets remain competitive. To
incentivise cost reductions over time, eligibility for price-based
mechanisms could be linked to performance targets, or strike prices
could be adjusted progressively, including through successive
allocation rounds, to encourage projects to narrow the cost gap with
incumbent producers while limiting fiscal costs.
Risk mitigation: Demand assurance mechanisms
(volume-based)
In addition to price, predictable and bankable demand is critical for
investment decisions. Even when prices are favourable, uncertainty
around future offtake can prevent projects from reaching final
investment decisions or scaling to commercially viable levels. Volumebased mechanisms address this by providing demand certainty,
reducing revenue risk and improving bankability, typically by
guaranteeing a minimum level of sales rather than a minimum price.
In practice, these can be operationalised through contractual clauses
such as offtake backstops, where a public entity guarantees minimum
purchases or payments if commercial demand falls short. This
provides producers with an assured market while allowing
governments to support supply chain deployment and, in some cases,
build strategic reserves. Recent examples include government
agreements with MP Materials and Nouveau Monde Graphite.
These tools have long been used in infrastructure, electricity and
commodity markets. In some export projects for liquefied natural gas,
state-backed utilities or buyers commit to long-term minimum volumes
through take-or-pay contracts, effectively underwriting project viability.
While often commercial rather than purely governmental, similar
structures could be publicly backed in strategic sectors.
Design considerations include determining guaranteed volumes,
eligibility criteria, contract duration and risk-sharing arrangements,
while balancing improvements in investment attractiveness against
fiscal exposure and risks of oversupply. As with other instruments,
co-ordination across countries can strengthen demand signals,
expand the pool of eligible projects and improve overall effectiveness.
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Box 3.1 Price support measures require appropriate strike and reference prices
Effective design of strike and reference prices is crucial to ensure
the success of price-based mechanisms. Strike prices must balance
project viability with fiscal cost: if set too low, they fail to support
investment; if set too high, they create excessive public liabilities.
For example, under the United Kingdom’s contract for difference
system for renewable energy, no offshore wind developer bid for
support during Allocation Round 5 in 2023, as industry actors
judged that the strike price was too low and did not account for
inflation in input costs.
The strike price can be determined in several ways. Cost-based
methods can use production costs over a defined period of time,
adding a margin for profit or using a percentile of the global cost
curve. Market-based approaches can also be used, such as
historical multi-year average prices or forward-looking price
forecasts, potentially adjusted for regional cost differences. These
can be simpler, though they may be uncertain in markets with low
price transparency and may fail to support high-cost entrants if
priced do not reflect current market conditions. Finally, a competitive
bid process or bilateral negotiation can allow operators to bid their
required price. Competitive bids can reveal true costs through
competition but require sufficiently large project pools. Bilateral
contracts can allow for flexibility but risk less efficient outcomes.
The reference market price determines whether the operator is
entitled to fiscal support or must repay the government. It can be set
in several ways. The actual realised sale price is the most accurate,
as it reflects the actual price received by the producer, but it requires
verification through reporting or auditing. Safeguards, such as
cross-checking sales prices against independent indices or
requiring evidence of competitive marketing, are also necessary to
ensure that there are still incentives to secure the highest possible
contract prices.
Another option is to use a published market price or index that would
apply regardless of the individual negotiated price. This would
depend heavily on market transparency and the credibility of
available indexes, and would be more difficult in thin, opaque
markets where many transactions occur off-exchange and
published prices may not reflect actual traded values. Reference
prices could also use a weighted average of global prices over a
defined period of time, anchoring them in broader market trends.
Many critical mineral markets face heterogeneity in product quality
and specifications, which can lead to significant variation in realised
prices. Price mechanisms should therefore be designed to account
for grade, purity or performance differences to ensure appropriate
incentives and avoid mispricing.
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Potential approaches to determining the appropriate strike and reference prices
Approach How it is calculated Key data requirements Considerations
Strike price
Cost-based Operating cost per unit + return
Individual project-level CAPEX,
OPEX, output and cost of capital
Ensures project viability, but causes
information asymmetry and depends on cost
assumptions
Cost curve
benchmark
Cost of marginal (e.g. nonincumbent) producer
Global projects’ CAPEX, OPEX,
output and cost of capital
Requires robust cost data and may not
reflect project-specific risks
Historical price Average past prices, with possible
adjustments
Historical price series, ex-China
premiums
Transparent and simple, but may reflect
unrepresentative market conditions
Forwardlooking price
Expected future market price Price forecasts Highly uncertain
Auction-based Lowest price bid by developers Bids from competing projects Requires sufficient competition and credible
bids
Negotiated Agreed price based on costs and
market benchmarks
Project costs, benchmarks Potentially inconsistent
Reference market price
Realised sales
price
Actual price received by producer Contract prices, reporting/audit data High accuracy, but limited transparency and
higher administrative burden
Published price
index
External benchmark price at time
of sale
Price reporting agency/index data Transparent and simple; may not reflect
realised contract prices
Average price Average of market prices over a
defined period
Time series of prices Reduces volatility, but introduces timing
mismatches with realised sales
Auction-based Proposed adjustment factor to
external benchmark price
Price reporting agency/index data and
bids from competing projects
Requires sufficient competition and credible
bids; may not reflect realised contract prices
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3. Pathways to resilient and diversified supply chains
Demand-side policies can help shift sourcing decisions towards diversified supply
Supply-side tools can help bring diversified projects online, but in
competitive markets dominated by low-cost producers, downstream
users often lack incentives to switch suppliers. Demand-side policies
can address this by generating predictable demand for diversified
supply, helping projects secure long-term offtake agreements and
investment. These tools are most effective when applied in contexts
where cost gaps are moderate and there is access to refining
technology or where such technology is being developed. Download: Global Critical Minerals Outlook 2026.pdf
Diversified sourcing obligations
Diversified sourcing obligations require or incentivise manufacturers
to source a share of inputs from non-dominant suppliers, shifting
demand towards diversified supply. They can be implemented
through regulations, such as minimum local content requirements
that mandate a minimum share of inputs to be sourced domestically
or from diversified suppliers. They can also be combined with fiscal
incentives, such as tax credits or deductions conditional on a
minimum percentage of inputs being sourced locally or from
diversified sources. In strategic sectors, such measures may also
extend to restrictions on sourcing from designated foreign entities of
concern across supply chains.
Obligations can be applied to specific downstream products, such as
EVs or data centres, or to various segments of the supply chain.
To remain effective and manageable, obligations should be phased
in over time in line with project pipelines, allowing downstream
manufacturers to gradually adapt to the sourcing requirements. While
such measures may increase costs, impacts on downstream product
prices are typically small and could be mitigated through targeted
incentives that aim to offset any cost burdens, such as tax credits.
Demand aggregation and facilitated offtake
Demand aggregation and facilitated offtake can help create a
consistent, sizeable and growing demand base. This is particularly
relevant in value chains or segments where downstream supply
chains are more nascent, such as EVs, new energy technologies and
high-tech manufacturing. In the absence of growth in downstream
capabilities in diversified regions, upstream and midstream projects
may face weak or uncertain offtake, limiting investment and
increasing exposure to price volatility. Policy measures that nurture
strategic downstream industries in energy, automotive and high tech,
and aggregate their demand, can underpin long-term contracts and
support financing decisions. Countries with established
manufacturing bases can also strengthen partnerships with regions
that have significant end-use demand, reinforcing market confidence,
enabling economies of scale and supporting the long-term
competitiveness of emerging supply chains.
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3. Pathways to resilient and diversified supply chains
Trade-based measures
Trade-based mechanisms could shift demand by altering price
competitiveness at the border, for example through tariffs, price
bands or origin-based charges. By narrowing the price gap between
low-cost incumbent supply and higher-cost diversified supply, these
measures can help redirect demand towards diversified supply.
Their effectiveness depends on careful calibration of design elements.
For measures such as price bands, if prices are set too low, they will
fail to shift demand, whereas if they are too high, they can raise costs
and fiscal risks. For measures such as tariffs, designing an effective
approach would require detailed cost analysis across the value chain
to determine appropriate tariff rates and assess where tariffs would
be most applicable. Design must also account for downstream
impacts, as higher input costs can affect the competitiveness of
downstream manufacturing, potentially requiring mitigation measures
such as revenue recycling.
Selected policy instruments and disbursements, 2025-2026
Type of
instrument
Country Amount Description
Direct
equity
investment
United
Kingdom
GBP 26.8
million
National Wealth Fund’s direct
equity investment in Cornish
Lithium to support domestic tin
extraction.
Concessional loan
Australia AUD 1.65
billion
Concessional loan to Iluka
Resources for the Eneabba rare
earth refinery.
Loan
guarantee
United
States
Up to
USD 250
billion
Loan guarantee authority
extended to the Department of
Energy’s Energy Dominance
Financing Office through FY2028.
Grant Canada CAD 1.5
billion
Non‑repayable, repayable and
grant funding for critical minerals
projects, including mining,
processing, transport and energy
infrastructure, plus mine‑site
development and Indigenous
engagement.
Offtake/
price floor
Japan Undetermined
Agreement to purchase annual
tonnage of neodymiumpraseodymium until 2038 with an
agreed market-linked floor price.
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3. Pathways to resilient and diversified supply chains
Different policy support options have varying impacts on the levelised cost of production…
Impact of different policy support measures on the levelised cost of an average rare earth refining project
IEA. CC BY 4.0.
Notes: The levelised cost of production and the impact of cost reductions are estimated using a cash‑flow model for an average diversified rare earth refining project.
Policy 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
the tax incentive is a 5% reduction in the tax rate (USD 15 million gross fiscal cost).
-12%
-12%
-4%
-3%
25
50
75
100
Baseline cost CAPEX support OPEX support Revenue
stablisation
Tax incentive After policy
Levelised cost of production
(baseline cost = 100)
-68%
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
…and different impacts on project economics and fiscal costs
Impact of different policy support measures on the internal rate of return versus gross annual fiscal cost
for an average rare earth refining project
IEA. CC BY 4.0.
Notes: pp = percentage points. The change in the internal rate of return and the impact on gross fiscal costs are estimated using a cash‑flow model for an average
diversified 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
is 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
tax 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
upfront capital expenditure.
1
2
3
2 4 6 8 10 12 14 16 18 20
Change in internal rate of return (pp)
Gross annual fiscal cost (million USD)
Floor price
Take or pay
Corporate tax reduction
Refundable tax credit
Forgiveable loan
Upfront cash grant
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3. Pathways to resilient and diversified supply chains
Policy support design matters for both fiscal impact and policy effectiveness
Cap-and-floor mechanism and fiscal cost to support half of refining demand outside the dominant supplier, 2026-2035
IEA. CC BY 4.0.
Note: 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
the period to 2035, based on historical price movements over the last 10 years.
Net fiscal cost under different floor levels
(10-year annual average)
20 000
60 000
100 000
140 000
180 000
NdPr price (USD/tonne)
NdPr price Floor Cap
Indicative price cap-and-floor
– 400
– 300
– 200
– 100
Cap: USD 110 000/t
Floor: USD 85 000/t
Cap: USD 110 000/t
Floor: USD 65 000/t
Million USD
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Effective policy design requires aligning instruments with specific market contexts, including
market structure, scale and value chain characteristics
Different policy instruments affect project economics through distinct
channels, and their impacts depend on the structure of each mineral
market and value chain segment. Download: Global Critical Minerals Outlook 2026.pdf
In small, opaque and volatile mineral markets (e.g. rare earths and
gallium), supply chains are highly concentrated, with dominant pricesetting producers and limited price transparency. Cost gaps between
incumbent and diversified producers tend to be pronounced,
reflecting factors such as scale, co-product economics,
environmental compliance costs and technology lock-in. Price signals
are often weak, limiting the ability of markets to incentivise new entry.
We evaluated the impact of different policy tools on the levelised cost
of production and returns for a representative rare earth refining
project outside the incumbent producer, using financial cash flow
modelling. The results suggest that, for the same level of gross fiscal
costs to governments, direct cost-reduction measures, particularly
CAPEX and OPEX support, are among the most efficient instruments
for lowering the levelised cost of production. By reducing either
upfront investment requirements or ongoing operating costs, these
measures directly improve the cost competitiveness of new refining
projects, narrowing the competitiveness gap with incumbent
producers.
By contrast, in large, liquid markets (e.g. copper and nickel),
investment in diversified production is typically constrained by
structural factors such as cost competitiveness, permitting,
infrastructure availability and discoveries of new resources. In these
cases, ongoing operating cost support is often less effective and can
become fiscally prohibitive if applied at scale, given large volumes.
Upfront capital support, such as concessional loans and loan
guarantees, is generally better suited to addressing investment risk.
Measures to accelerate permitting and support the build-out of
enabling infrastructure (e.g. rail and power) can further support
investment.
Battery metals markets (e.g. cobalt, lithium and graphite) are not as
large and liquid as base metal markets but are more advanced than
minor mineral markets. These markets are characterised by rapid
demand growth, medium levels of concentration and strong linkages
to downstream industries such as batteries and EVs. Competition is
driven by a combination of energy and reagent costs, financing costs
and integration with downstream offtake. Cost gaps for diversified
producers may be relatively smaller than for strategic minor minerals,
but bankability remains a constraint given project risks and price
volatility. In this context, a blended approach may be better suited,
combining upfront CAPEX support, such as grants or concessional
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3. Pathways to resilient and diversified supply chains
finance, with targeted price or volume support, which can help de-risk
investments, particularly in the early stages, allowing support to
decline over time as technologies mature and cost gaps narrow.
Across the value chain, mining is typically capital-intensive and
exposed to geological and development risk, making upfront capital
support particularly relevant. Refining projects are more sensitive to
costs and margins; in this case, operating cost tools may support
competitiveness.
Demand-side measures can be applied across all markets, as they
can provide volume guarantees or preferential market access that
enable structural shifts in demand towards diversified supply. They
may be particularly useful in large mineral markets, where capital
support may be fiscally burdensome if applied at scale.
Public support must be carefully calibrated to reduce risk, crowd in
private investment and enable bankability while ensuring that it does
not sustain structurally uncompetitive production or create long‑term
fiscal liabilities. Policy makers need to assess capital and operating
costs, cost gaps with incumbent producers and market-specific
challenges, balancing policy effectiveness and fiscal cost, as different
instruments have varying impacts on both the internal rate of return
and public expenditure. For example, for an average rare earth
refining project outside the incumbent producer, price cap-and-floor
mechanisms produce a 2.4 percentage point change in the internal
rate of return but an average annual gross fiscal cost of almost
USD 18 million when applied during the first 15 years of repayment.
For strategic minerals and materials markets, the scale of support
across the sector may not be overly fiscally burdensome given
relatively small market sizes. We evaluated the fiscal cost of
supporting rare earth refining projects located outside today’s
incumbent producer through a cap‑and‑floor contract for difference
mechanism. Historical rare earth prices over the past decade were
used to estimate support requirements, evaluating the impact of two
different floor prices of USD 85 000 and USD 65 000 per tonne of
total rare earth oxides, and a cap of USD 110 000 per tonne. The
difference between market prices and this corridor defines the annual
price gap that governments would either bridge or recover.
Projected supply outside China, including existing operations,
expansions and planned projects, is compared with ex-China
demand to estimate the volume of capacity requiring support. The
analysis assumes that the mechanism covers the production needed
to meet half of this demand by 2035. Multiplying this supported
volume by the estimated price gap yields the fiscal cost.
Under these assumptions, the gross fiscal cost of such a
cap‑and‑floor mechanism is estimated at around USD 3.7 billion
through to 2035, equivalent to approximately USD 370 million per
year under a floor price of USD 85 000 per tonne. Actual costs would
depend on future price trajectories and the specific design of the
support mechanism.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Cross-cutting enabling measures are required for a whole-of-ecosystem approach
Wider pool of accessible financing sources
High capital intensity, long lead times and specialised processing
technology can limit critical minerals projects’ ability to access
traditional export credit agency and development finance institution
financing. To address this, countries could create dedicated funding
windows within existing institutions with terms tailored to critical
mineral projects, including longer repayment periods, lower collateral
requirements and co-financing for processing infrastructure.
Co-ordinated approaches across countries could further scale
financing by pooling balance sheet capacity and applying a shared
rulebook for eligibility, risk mitigation and due diligence. This could
reduce duplication and ensure that financing is targeted at projects
with the highest strategic value globally.
Regulatory permitting reforms
Permitting complexity and fragmentation remain key barriers to
project development. Greater co-ordination across countries, through
common principles, harmonised standards and shared best practices,
can improve predictability for investors operating across multiple
countries and help avoid fragmented regulatory approaches that slow
project development. Joint efforts with partner governments,
including model legislation, technical guidance and capacity-building,
could also help address these bottlenecks.
Price transparency and market development
Limited price transparency in many critical mineral markets
constrains investment by reducing confidence in future revenues.
Enhancing price discovery, particularly outside the dominant supplier,
is therefore critical for stimulating diversified supply. Measures could
include strengthening price reporting systems, leveraging alternative
data and increasing transparency on long-term contracts. In some
cases, state-backed exchanges or disclosure requirements can help
establish more credible benchmarks. These approaches are already
being utilised in some mineral markets, such as uranium.
Cross-border public-private partnerships
Given the global nature of supply chains, cross-border public-private
partnerships can help develop integrated value chains linking
upstream resources, processing capacity and end-use downstream
manufacturing bases. Governments can facilitate this through
co-ordinated project pipelines, shared financing packages and
multi-country support agreements for integrated projects. Regional
processing hubs, where processing or waste management
infrastructure is jointly funded, can reduce duplication and lower
barriers. Such partnerships would allow a bloc to leverage
complementary strengths and create end-to-end supply chains that
can compete with incumbent producers.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Box 3.2 Standards-based markets and traceability
The development of sustainable and responsible supply chains has
a role to play in reducing concentration and enhancing
diversification: not only can it unlock supply in diversified countries
with high sustainability standards, but it can also mitigate the risk of
supply chain disruptions associated with poor practices, such as
labour strikes, government investigations and community backlash.
Any of the mechanisms outlined here could be adapted to
incorporate standards-based criteria. For standards-based markets
to emerge and function effectively, countries would need to
establish clear and transparent criteria regarding what counts as
“responsible” extraction, processing and trade. There are two broad
categories of criteria that can be used: (1) performance-based
indicators, which rely on measurable outcomes (e.g. GHG
emissions intensity, water consumption and the rate of safety
incidents); and (2) process- or policy-based indicators, which
require the presence of specific corporate systems or policies (e.g.
anti-bribery policies and safety audit protocols).
Existing voluntary industry initiatives, such as the Initiative for
Responsible Mining Assurance or the Responsible Minerals
Assurance Process, can be leveraged to create standards-based
markets, for example by using certification under one of these
initiatives as an indicator of good performance.
However, utilising these initiatives may also bring challenges.
Existing initiatives do not consistently require clear and comparable
disclosure of environmental or social metrics, instead sometimes
focusing on wider due diligence efforts. Most voluntary mining
standards were developed for large, consolidated sectors and are
less applicable in smaller market contexts. Many of the smaller
supply chains also involve highly specialised separation and refining
steps for which robust, comparable indicators are still emerging.
Thus, while existing voluntary standards can provide useful
guidance, significant adaptation and targeted criteria‑setting would
be required for market access mechanisms to function credibly.
In addition to establishing common criteria for what counts as
responsible production, standards-based markets also require a
method to collect, report and verify data. When operators disclose
verified data on performance, regulators and buyers can confirm
that purchased material meets the criteria. Traceability systems,
which can enable the collection and sharing of performance-related
data, are thus a crucial bedrock for building standards-based
markets. However, they require careful design and implementation
to ensure interoperability, supported by international co-ordination
and common standards, such as those being developed by the
United Nations Transparency Protocol. Download: Global Critical Minerals Outlook 2026.pdf
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Technology, equipment and
workforce
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3. Pathways to resilient and diversified supply chains
Diversified project development needs to be viewed through an ecosystem lens, paying special
attention to technology, equipment and workforce bottlenecks
Indicative summary of the impact of different ecosystem bottlenecks on diversified project timelines and costs
IEA. CC BY 4.0.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
For diversification efforts to succeed, existing gaps in technology, equipment and knowledge
need to be addressed through innovation and policy support
The concentration of critical mineral processing and refining capacity
has emerged as one of the most significant vulnerabilities in global
supply chains. While mineral resource endowments are often
geographically diverse, the intermediate processing and refining
stages required to produce materials that conform to strict industry
specifications for the manufacturing of batteries, magnets or
semiconductors remain highly concentrated. This pattern is evident
across minerals such as lithium, graphite, rare earth elements and
gallium, where a single country has established dominant positions
across several steps of the value chain.
In many cases, access to mineral feedstock is not the only hurdle to
overcoming the high level of geographical concentration in
processing and refining. In each mineral supply chain,
competitiveness depends on a whole ecosystem comprising
specialised technology, machinery, equipment, reagent availability,
precise process control and optimisation, waste and environmental
impact management, scientific and engineering expertise and
integration with downstream manufacturing sectors. As a result,
many of the barriers facing new entrants are complex and
multifaceted. They arise from accumulated operating experience,
industrial clustering and economies of scale.
In many cases, there are very few suppliers of specialised machinery
and equipment outside China, making them more expensive and
increasing the time required to acquire them. Even once the
equipment is procured, process optimisation, a prerequisite for
producing materials with low defect density that pass certification for
high-tech industries, is often time-consuming. Given the presence of
well-established chemical industries in many regions, reagents are
often much more widely available than machinery, but still tend to be
more expensive outside the dominant supplier, and infrastructure for
their proper handling, storage and disposal adds to overall costs. In
the current context, affected by events in the Middle East and the
subsequent export control announcement from China, sulphuric acid,
which serves as a reagent for the pre-processing of several critical
minerals, including copper, lithium and rare earths, has emerged as
an important bottleneck (see Chapter 1).
This section dives deeper into the essential ingredients for midstream
processing of critical minerals, including technology, equipment,
reagents and knowledge, using examples from rare earth elements,
battery-grade lithium and graphite, and semiconductor-grade gallium.
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3. Pathways to resilient and diversified supply chains
The value chain for rare earth elements remains among the most geographically concentrated,
and supply diversification calls for nurturing the entire ecosystem
Ecosystem bottlenecks for creating diversified magnet rare earth supply chains
IEA. CC BY 4.0.
Note: REE = rare earth element.
Separation Metallisation Alloy production Magnet production
Equilibrium data for
processing different
feeds
Equipment/machinery/reagent bottleneck
Magnet sintering
empirical knowledge
Precision cutting of
magnet blocks
Producing single
element oxides
from mixed REE
compounds
Refining the
oxides to produce
rare earth metals
Produce rare earth
metal alloy
powders for
magnet production
Knowledge bottleneck
Produce rare earth
permanent magnets
predominantly
through sintering
Electrolysis cells
with high energy
efficiency
Strip casters
Alignment presser
Grain boundary
diffusion equipment
Refining Magnet production
Process
Description
Bottlenecks
Legend:
Mining
Heap/in-situ
leaching
Producing mixed
REE compounds
from ionic clay
deposits
Methods that avoid
highly contaminating
strong acids
Stainless steel cells
and tanks for nitric
acid routes
Higher reagent
costs
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Processes for the separation of rare earth elements and magnet manufacturing face significant
bottlenecks in the form of technology, equipment and knowledge gaps
While there has been a marked increase in announced rare earth
mining projects across geographically diverse regions in recent years,
the pipeline for separation and refining, alloy production and magnet
manufacturing is much narrower and insufficient to meet projected
industrial requirements outside China, making it a critical bottleneck
to the development of diversified supply chains. Download: Global Critical Minerals Outlook 2026.pdf
Rare earth refining and magnet production rely on a multitude of
complex technical production processes, requiring specialised
equipment, machinery, skills and training to produce magnets that
conform to strict industry specifications. There are very few suppliers
of rare earth refining and magnet production equipment and
machinery outside China, and the time required to obtain the
equipment can often span several years. There is an urgent need to
nurture this industry in parallel with project development. China’s
2023 export controls, which covered a wide range of rare earth
processing equipment and technologies, highlighted the importance
of addressing this issue.
Mining technologies and equipment are generally less of a bottleneck,
although certain gaps remain, for example in the extraction of heavy
rare earths from ionic adsorption clay(IAC) deposits without relying
on the acid leaching methods commonly used in China and Myanmar.
However, significant technology gaps remain in the separation,
metallisation and magnet production stages.
Separation
There is a significant gap in knowledge and equilibrium data for
solvent extraction used for rare earth separation, which is a complex
process due to the similar chemical properties of many rare earth
elements found together. This concern is particularly relevant for
mixed feeds, such as monazite and bastnaesite. Another issue at the
separation stage is that China predominantly uses chloride routes
(hydrochloric acid) that require polyvinyl chloride (PVC) tanks and
cells, whereas most suppliers outside China have favoured the nitric
route (nitric acid), which requires stainless steel tanks and cells that
are more expensive to produce. The nitric acid route also requires
very strong wastewater management systems and land-use planning
regulations, and there is limited experience in tackling this issue
systematically outside China and Japan.
Aside from machinery and equipment, reagents could also be a
bottleneck for diversified projects, as they account for 15-25% of
conversion costs depending on the route used (chloride or nitric), and
the acids are usually sold at lower prices in China than in most other
regions.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Alloying, metallisation and magnet manufacturing
The priority areas where there is a stark deficiency of competitive
equipment and machinery that meet industry specifications are alloy
production, metallisation and magnet production. Equipment for
these supply chain steps outside China could be 5-12 times more
expensive and often has two to three times longer lead times than
equipment from China. The increased costs and lead times are due
to the limited number of equipment manufacturers outside China,
which typically produce this equipment for other applications and
have not optimised it for rare earth processing, which often requires
some resizing and re-specification. Moreover, they have not yet
achieved economies of scale, have not secured long-term
established customers, and need time to customise and ramp up
production. In some cases, there is only a single supplier of
equipment and machinery outside China, meaning that a competitive
landscape for efficient scaling does not exist.
For metallisation, particularly for light rare earth metals, there is a
bottleneck in the design of energy-efficient equipment for the
electrolysis step. Light rare earth metals typically use molten salt
electrolysis, and to achieve competitive costs, the design of the
electrolysis cells must be highly energy efficient. This is because
energy is one of the largest cost factors in the metal conversion
process. The design of highly energy-efficient electrolysis equipment
remains closely held and is not widely available outside China. For
heavy rare earth metals, vacuum induction chambers are used for
calcination/reduction. This equipment is made by very few producers
nd needs to be highly customised to scale the metals to size.
Therefore, the design and development of energy-efficient
electrolysis cells and vacuum chambers need to be a priority to
achieve viable, economically competitive metallisation to support
diversified projects.
In the production of alloys, a key process is strip casting to produce
rare earth alloys with additives such as iron, gallium or zirconium
(which make up less than 1% of the alloy by weight). Strip casters are
another key piece of equipment with few suppliers available outside
China. Jet milling equipment, used to produce alloy powder, has
suppliers outside China but is more expensive.
However, some of the most critical equipment challenges are in
magnet production. In the production of sintered magnets, the
availability and quality of alignment pressers is a source of concern.
There are a few suppliers outside China, but their pressers can be
around ten times more expensive, and the technology and design are
notably less advanced. Finally, the technology for grain boundary
diffusion processes, used to apply heavy rare earth molecules as a
coating to magnets, is subject to Chinese technology and equipment
export controls. There is currently a single equipment supplier outside
China, whose equipment is around 12 times more expensive and has
a longer lead time. Grain boundary diffusion is also a highly patented
process, with many ongoing litigation disputes, providing another
barrier to successful development for emerging producers.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Beyond equipment and machinery, there are several areas with skill
and knowledge bottlenecks. In the separation process, there is a
considerable lack of equilibrium data for processing various feeds.
The same is true for sintering furnaces for magnet production, where
there are major empirical and heuristic knowledge gaps in the
protocols needed to produce sintered magnets with the required
specifications. This also extends to the high-precision cutting of
magnet blocks, where, while the equipment needed exists outside
China, limitations exist in process knowledge to achieve results at
scale and speed. These are areas that require training, practice and
time to hone techniques and build a skilled workforce.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Production of refined battery-grade lithiumin geographically diverse regions hinges on honing
process optimisation and operational know-how
Ecosystem bottlenecks for creating diversified battery-grade lithium supply chains
IEA. CC BY 4.0.
Note: Mg = magnesium; Ca = calcium; Na = sodium; K = potassium; Al = aluminium; B = boron.
Higher reagent costs
(lime, soda ash, sodium
hydroxide)
Maintaining battery-grade
purity levels
Operating data for
achieving high recovery
rates
Different processes for
different feedstocks
Roasting and conversion Purification Crystallisation
Construction of
standardised designs;
furnace optimisation and
operating data
Equipment/machinery/reagent bottleneck
Producing crystals with strictly controlled
particle size distributions, morphology and
impurity profiles
Sulphuric acid roasting to
obtain lithium sulphate
suitable for extraction
Removal of impurities (Mg,
Ca, Na, K, Al and B)
Knowledge bottleneck
Conversion of purified lithium solutions into
battery-grade lithium carbonate or lithium
hydroxide
Refining Battery-grade lithium precursor production
Process
Description
Bottlenecks
Legend:
Heat integration and
thermal efficiency strongly
influence operating costs
Access to and cost of
sulphuric acid
Operating data as product quality is highly
sensitive to operating conditions
Costs related to testing and pilot operations to
achieve battery-grade qualification
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3. Pathways to resilient and diversified supply chains
Reagent costs and process optimisation play a more defining role than machinery in achieving
impurity control and crystallisation for battery-grade lithium production
In the case of lithium, mining does not face significant technology and
equipment bottlenecks. For hard-rock projects, mining and
beneficiation produce spodumene concentrate, typically through
crushing, grinding, dense media separation and flotation circuits. The
required equipment, including crushers, grinding mills, flotation cells,
thickeners and filtration systems, is supplied by a broad range of
international companies, including Metso, FLSmidth and Weir Group.
Although permitting, infrastructure and project financing can delay
mine development, the technologies involved are mature and widely
deployed. Unlike hard-rock operations, brine projects do not require
mining and mineral beneficiation. Instead, lithium-bearing brines are
pumped from underground aquifers and concentrated through a
combination of evaporation, chemical treatment and refining. Brines
vary significantly in lithium concentration and impurity composition,
particularly in terms of the magnesium-to-lithium ratio. High
magnesium concentrations can substantially increase reagent
consumption and processing complexity. Process optimisation
therefore requires extensive site-specific knowledge and long
operating histories. Download: Global Critical Minerals Outlook 2026.pdf
Chemical conversion and battery-grade refining stages face the most
significant supply chain bottlenecks in the development of diversified
supply chains.
Roasting and conversion
The first stage of hard-rock lithium refining converts naturally
occurring alpha-spodumene into the more reactive beta-spodumene
phase before sulphuric acid roasting converts lithium into lithium
sulphate suitable for extraction. This stage determines downstream
recovery rates and is one of the most energy-intensive steps in the
refining process. The principal equipment includes rotary kilns,
fluidised-bed roasters, acid dosing systems, gas-cleaning systems
and heat-recovery units. Major suppliers include Metso, FLSmidth
and thyssenkrupp Uhde.
The equipment itself is generally available internationally and is not
subject to significant supply constraints. The bottleneck lies in the
ability to operate these systems efficiently. Heat integration, thermal
efficiency and furnace optimisation have a major influence on
operating costs. Chinese engineering firms have commissioned
dozens of lithium conversion facilities and have accumulated
substantial operational knowledge that reduces energy consumption
and commissioning risks.
Sulphuric acid is the principal reagent consumed during conversion.
China benefits from one of the world’s largest sulphuric acid
industries, supported by extensive copper and zinc smelting sectors
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3. Pathways to resilient and diversified supply chains
that generate the acid as a by-product. This provides refiners with
lower reagent costs and greater supply security.
Engineering, procurement and construction capability also
represents an important advantage. Chinese contractors have
repeatedly delivered lithium conversion facilities and benefit from
standardised designs, specialised subcontractor networks and
extensive operating data. This frequently results in lower capital costs
and shorter commissioning periods than for equivalent projects
elsewhere. The concentration of lithium refining reflects both scale
and accumulated expertise that give rise to competitive prices.
Purification
Following acid leaching, lithium-bearing solutions need to be purified
to remove impurities, including magnesium, calcium, sodium,
potassium, aluminium and boron. These contaminants can affect
cathode active material (CAM) production and battery performance if
not reduced to extremely low concentrations.
Purification circuits employ reactors, precipitation vessels, thickeners,
filters and solid-liquid separation systems supplied by companies
such as Andritz Group, Metso and FLSmidth. The principal reagents
include lime, sodium hydroxide and soda ash. China possesses one
of the world’s largest chlor-alkali and soda ash industries, enabling
refiners to access these inputs at lower cost and with shorter supply
chains than many competitors.
Recent research highlights the importance of impurity management
in battery-grade lithium production and notes that the largest cost
component of lithium production comes from the impurity elimination
process to satisfy battery-grade purity requirements of over 99.5%.
However, refining specifications continue to evolve as battery
technologies advance.
Once again, at this step, the primary bottleneck is process
optimisation rather than equipment availability. Different feedstocks
require different purification strategies, and achieving high recovery
rates while maintaining battery-grade specifications requires
experienced metallurgists and extensive operating data.
Crystallisation
Crystallisation converts purified lithium solutions into battery-grade
lithium carbonate or lithium hydroxide. The purpose of crystallisation
is not simply to recover lithium but to produce crystals with strictly
controlled particle size distributions, morphology and impurity profiles.
These characteristics influence cathode production, filtration
behaviour and downstream battery performance.
The process uses evaporators, crystallisers, centrifuges and drying
systems supplied by firms such as GEA Group, Veolia Water
Technologies and Andritz.
Research on lithium carbonate crystallisation demonstrates that
product quality is highly sensitive to operating conditions, and the lack
of operating data makes optimising these conditions a significant
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3. Pathways to resilient and diversified supply chains
technical challenge. As with the previous steps, the bottleneck is
operational know-how. Several lithium projects outside China have
experienced commissioning delays because battery-grade
specifications proved more difficult to achieve than expected. Product
qualification by cathode manufacturers can further extend the
timeline to commercial production. Qualification can take months or
even several years, particularly for automotive battery supply chains.
Overall, the principal bottlenecks in lithium processing are
concentrated in purification and crystallisation. Unlike rare earth
elements, equipment availability is generally not the major constraint,
and most key processing equipment can be sourced internationally.
The more significant challenges relate to reagent costs, process
optimisation, impurity control and battery-grade product consistency.
Efforts to diversify lithium refining capacity should focus on
developing refining expertise alongside physical infrastructure. Pilot
plants, demonstration facilities and workforce development
programmes can accelerate the accumulation of operational
knowledge. Closer integration with chemical producers may reduce
reagent costs, while partnerships with cathode and battery
manufacturers can support and accelerate product qualification. Over
time, operational experience is likely to be as important as capital
investment in determining competitiveness for battery-grade lithium
production in geographically diverse regions.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Battery-grade graphite production is one of the most energy-intensive steps in battery supply
chains, and diversified producers face high energy and environmental barriers
Ecosystem bottlenecks for creating diversified battery-grade graphite supply chains
IEA. CC BY 4.0.
Note: HF = hydrofluoric acid.
Jet mills, impact mills, air
classifiers and specialised
spheronisation systems
Yield optimisation
controlled by proprietary
knowledge
Purification
Micronisation and
spheronisation
Graphitisation
Methods that avoid highly
contaminating acids
Equipment/machinery/reagent bottleneck
Novel graphitisation
techniques to reduce
energy intensity
Removal of silica and
other impurities using
hydrofluoric acid
Conversion of graphite
flakes into spherical
particles
Knowledge bottleneck
Improving conductivity
and crystalline
structure by heating
spheronised graphite
to 3000 ⁰C
Refining Battery-grade graphite production
Process
Description
Bottlenecks
Legend:
Fluoropolymer-lined
reactors, corrosionresistant pumps and
waste-treatment
infrastructure
Handling and
procurement costs for HF
Furnaces with high
energy efficiency and
utilisation rate
Carbon coating
Coating with carbon to
improve battery
performance, cycle life
and coulombic efficiency
Specialised thermal
treatment systems,
carbon precursor
materials
Operating data to
achieve uniform coating
thickness and surface
properties
Costs related to testing
and pilot operations to
achieve battery-grade
qualification
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Extremely high energy intensity, limited equipment suppliers and relatively high reagent costs
are key challenges faced by battery-grade graphiteproducers in geographically diverse regions
Natural graphite mining and beneficiation remain concentrated in
China, although not to the same extent as midstream refining and
downstream anode production. The strongest concentration,
however, is seen in spherical graphite and anode material production.
Mining is followed by crushing, grinding and flotation to produce
graphite concentrate. The required equipment, including crushers,
grinding mills, flotation cells, thickeners and filtration systems, is
supplied by some international companies, including Metso,
FLSmidth, Eriez and Weir Group. The mining and beneficiation
technologies themselves are mature. However, concentrate quality
can significantly influence downstream purification costs and anode
performance, meaning that access to high-quality flake graphite
deposits remains commercially important. Download: Global Critical Minerals Outlook 2026.pdf
Synthetic graphite production represents an additional and
strategically important component of the graphite supply chain.
Synthetic graphite is most commonly produced through the
calcination and graphitisation of petroleum coke or needle coke at
temperatures approaching 3 000ºC. The process relies on
calcination systems, high-temperature graphitisation furnaces and
carbon-processing equipment supplied by very few non-Chinese
firms, such as Mersen and ECM Technologies. Synthetic graphite
production is highly energy-intensive and depends on access to
petroleum coke, needle coke and competitively priced electricity.
China has developed substantial advantages in synthetic graphite
production due to its large furnace capacity, integrated hydrocarbon
production industry and lower processing costs. Synthetic graphite is
becoming increasingly important in EV batteries, particularly for highperformance anodes.
China’s strong presence in purification, spheronisation, graphitisation
and synthetic graphite production reinforces its advantage in graphite
mining.
Purification
Battery-grade graphite generally requires purity levels exceeding
99.95% carbon. The dominant industrial route uses hydrofluoric acid
to remove silica and other mineral impurities.
The process relies on fluoropolymer-lined reactors, corrosionresistant pumps, filtration systems and waste-treatment infrastructure.
The limited number of diversified suppliers includes De Dietrich
Process Systems and Pfaudler. The principal reagent is hydrofluoric
acid, which requires infrastructure for safe handling, transport and
disposal, as it is extremely corrosive. China benefits from one of the
world’s largest fluorochemical industries, providing cost advantages
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
and extensive waste-treatment infrastructure. Environmental impact
and waste treatment can be major challenges for new entrants.
Alternative thermal purification routes could reduce dependence on
hydrofluoric acid but require significantly higher energy consumption
in an already energy-intensive value chain, creating a
competitiveness challenge.
Micronisation and spheronisation
Natural graphite flakes must be converted into spherical particles
before they can be used in lithium-ion battery anodes. This process
uses jet mills, impact mills, air classifiers and specialised
spheronisation systems supplied by a few specialised equipment
producers, including NETZSCH Grinding & Dispersing and Bühler
Group, increasing the time required to acquire the equipment in
geographically diverse regions.
In addition to the equipment bottleneck, there is also a knowledge
gap in yield optimisation. During particle shaping, a substantial
proportion of feed material can be lost. Small improvements in yield
can significantly improve project economics, but much of the
industrial knowledge remains proprietary, creating barriers for new
entrants.
Graphitisation
Graphitisation improves conductivity and crystalline structure by
heating the spheronised graphite to temperatures approaching
3 000ºC. This step is identical to the one needed for the production
of synthetic graphite.
The bottlenecks are related to limited equipment suppliers but, more
importantly, the very high energy intensity of the process.
Graphitisation is among the most electricity-intensive stages in the
entire battery supply chain and is therefore highly sensitive to
electricity prices, furnace efficiencies and utilisation rates. Chinese
producers benefit from extensive installed furnace capacity, lower
electricity costs and a mature ecosystem of furnace suppliers and
maintenance providers.
Novel graphitisation technologies, such as induction furnaces and
bio-graphite production, were described in last year’s Global Critical
Minerals Outlook, but most of these alternatives require significant
investment and research to reach maturity.
Carbon coating
Following graphitisation, graphite particles are coated with carbon to
improve battery performance, cycle life and coulombic efficiency.
This stage uses specialised thermal treatment systems and carbon
precursor materials, including petroleum pitch and coal-tar pitch.
China benefits from large domestic supplies of these precursor
materials and from integration with broader carbon materials
industries.
The bottlenecks for diversified players here are both precursor
availability and process control, including maintaining consistent
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
precursor quality. Variations in coating thickness and surface
properties can significantly affect battery performance.
Finally, qualification by battery manufacturers is often one of the
longest stages of market entry for graphite products. New suppliers
must demonstrate consistent performance through extensive testing
programmes before materials can be incorporated into commercial
batteries. This process can take several years and requires stable
production quality throughout.
Chinese producers benefit from proximity to battery manufacturers,
established commercial relationships and continuous quality
feedback from downstream users. Furthermore, China’s export
licensing requirements for certain graphite products and processing
technologies, introduced in 2023, further highlight the strategic
importance of graphite processing capabilities within battery supply
chains.
Overall, principal bottlenecks in graphite processing are hydrofluoric
acid management, yield optimisation during spheronisation,
graphitisation economics, carbon coating consistency and customer
qualification. Equipment is available internationally but from only a
handful of suppliers, and process performance depends heavily on
accumulated expertise and industrial integration.
Diversification efforts should focus on building complete anode
material ecosystems rather than standalone processing facilities.
Alternative purification technologies may help reduce environmental
constraints, while access to competitively priced electricity will be
essential for project feasibility. Closer collaboration with battery
manufacturers can accelerate the qualification process, and
investment in building stronger workforces skilled in materials
engineering can improve competitiveness over the longer term. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 298
3. Pathways to resilient and diversified supply chains
Semiconductor-grade gallium production is almost entirely concentrated in one country, and
diversified producers must address significant gaps in technology and operational know-how
Ecosystem bottlenecks for creating diversified semiconductor-grade gallium supply chains
IEA. CC BY 4.0.
Notes: LEC = liquid-encapsulated Czochralski; VGF = vertical gradient freeze; MOCVD = metal-organic chemical vapour deposition. 6N to 8N indicate purity levels
from 99.9999% to 99.999999%.
Ultra-high-purity refining Gallium arsenide crystal growth
Operating data and expertise
Equipment/machinery/reagent bottleneck
Extremely precise thermal
management, pressure control
and impurity control to minimise
crystal defects, dislocations and
compositional variations
Removal of impurities to achieve
purity levels ranging from 6N to 8N
Knowledge bottleneck
Crystal growth using LEC and VGF
furnaces
Refining Semiconductor-grade material production
Process
Description
Bottlenecks
Legend:
Vacuum distillation systems, zonerefining systems and ultra-cleanhandling equipment
Advanced analytical laboratories,
specialised mass spectrometers to
detect extremely small
concentrations of impurities
Highly specialised and customised
furnaces
Gallium nitride epitaxial growth
Deposition of atomically controlled
layers from precursor gases onto
wafers in MOCVD reactors
Access to precursor galliumcontaining gases
Extremely precise temperature
uniformity, gas flow distribution,
chamber pressure and precursor
delivery to minimise defects
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Technically demanding processes, equipment and reagent constraints, and knowledge gaps
make the galliumvalue chain one of the most specialised among high-tech materials
Most primary gallium production occurs through recovery from Bayerprocess alumina refining streams, although smaller quantities are
also recovered as by-products from zinc processing and zinc refinery
residues. Recovery from alumina production remains the dominant
source because gallium becomes concentrated in Bayer liquor during
the refining of bauxite into alumina. The dominant recovery
technologies are ion exchange and solvent extraction. Ion exchange
systems employ specialised resins that selectively remove gallium
from Bayer liquor. The handful of suppliers outside China include
Lanxess and DuPont Water Solutions.
Despite the limited number of equipment suppliers for gallium
recovery in geographically diverse regions, access to large Bayer
liquor streams is a more important determinant of production
economics than access to equipment. Nearly all refined production of
gallium today occurs in China, as the country benefits from being the
world’s largest alumina producer and therefore possesses the largest
potential source of gallium-bearing Bayer liquor. In addition,
specialised ion exchange resins also represent a bottleneck for
diversification. Performance depends on selectivity, resistance to
fouling and long-term stability, characteristics that are often
supported by proprietary formulations and accumulated operational
know-how. China’s export licensing requirements imposed on
gallium-related products in 2023 and 2024 further underscore the
strategic importance of these supply chains.
Ultra-high-purity refining
Semiconductor-grade gallium typically requires purity levels ranging
from 6N up to 8N (99.9999% to 99.999999%), depending on the
application and device requirements. Manufacturing of gallium
arsenide and gallium nitride, the downstream products of gallium that
play central roles in applications relying on semiconducting materials,
is particularly sensitive to trace metallic and oxygen impurities,
making contamination control and analytical capability critical. The
purification process relies on vacuum distillation systems, zonerefining systems and ultra-clean handling equipment supplied by a
few specialised firms, such as PVA TePla and ECM Technologies.
To achieve such purity levels, trace contaminants at parts-per-million,
parts-per-billion or even parts-per-trillion levels can affect crystal
growth, epitaxy and semiconductor device performance. Advanced
analytical laboratories equipped with inductively coupled plasma
mass spectrometry and glow discharge mass spectrometry to detect
extremely small concentrations of impurities therefore become
essential components of the production process, as does the
expertise required to operate these facilities and maintain rigorous
contamination control standards. Very few suppliers exist globally for
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
this ultra-specialised laboratory equipment, and the time required for
equipment procurement can be a significant component of the total
fabrication time.
Gallium arsenide wafer production
Gallium arsenide (GaAs) is used in high-frequency and highperformance electronic and optoelectronic applications, including
radio frequency chips, satellite communications, solar cells, lightemitting diodes and defence systems.
Gallium arsenide production begins with crystal growth using liquid
encapsulated-Czochralski (LEC) and vertical gradient freeze(VGF)
furnaces. These systems create large, defect-free single crystals that
are subsequently sliced, polished and processed into semiconductor
wafers. Liquid-encapsulated Czochralski furnaces produce large
single-crystal gallium arsenide ingots by slowly pulling a crystal seed
from molten gallium arsenide while the melt is covered by a boron
oxide encapsulant. The encapsulant suppresses arsenic evaporation,
which would otherwise destabilise the melt at the high temperatures
required for crystal growth. Vertical gradientfreeze furnaces instead
solidify the melt under carefully controlled temperature gradients,
reducing thermal stress and improving crystal uniformity. Both
systems require extremely precise thermal management, pressure
control and impurity control to minimise crystal defects, dislocations
and compositional variations.
The process becomes more complex when producing compound
semiconductors that incorporate indium, such as indium gallium
arsenide (InGaAs) or indium gallium phosphide (InGaP). These
materials require stricter compositional control because small
variations in indium concentration can significantly alter electronic
and optical properties. Maintaining uniform alloy composition during
crystal growth therefore introduces additional process-control
challenges and increases sensitivity to temperature fluctuations and
precursor purity. Specialised equipment suppliers are, once again,
fairly limited, and furnace settings often need to be customised for
the exact composition needed. PVA TePla is one of the few notable
specialised crystal growth equipment manufacturers outside China.
The key challenge is defect control. Crystal quality depends on
precise thermal management, impurity control and process stability,
and achieving commercially competitive yields requires significant
operational expertise. Wafering and polishing also require
specialised equipment and process knowledge to achieve the surface
quality demanded by semiconductor manufacturers. Download: Global Critical Minerals Outlook 2026.pdf
Gallium nitride epitaxy
Gallium nitride (GaN) is increasingly used in power electronics, fast
chargers, electric vehicles, radar systems and advanced
telecommunications infrastructure because of its ability to operate at
high voltages, frequencies and temperatures.
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Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
Gallium nitride manufacturing is predominantly carried out in metalorganic chemical vapour deposition (MOCVD) reactors, which
deposit atomically controlled semiconductor layers onto wafers.
Precursor gases such as trimethylgallium and ammonia decompose
at elevated temperatures and react on the wafer surface to form
gallium nitride layers with highly controlled thickness and composition.
The reactors must maintain precise temperature uniformity, gas flow
distribution, chamber pressure and precursor delivery in order to
minimise crystal defects and achieve high device performance. As
with gallium arsenide, the process becomes more complex for mixed
semiconductors, such as indium gallium nitride (InGaN), which are
widely used in light-emitting diodes and advanced optoelectronic
devices. Incorporating indium requires tighter control of growth
temperature and precursor flow. Maintaining uniform composition
across the wafer while avoiding crystal defects represents a major
process-engineering challenge. The market for MOCVD reactors
outside China is concentrated among a very small number of
suppliers, particularly Aixtron and Veeco Instruments. The supply of
semiconductor-grade trimethylgallium is also concentrated among a
limited number of specialist chemical manufacturers, creating
additional supply chain dependency.
The bottlenecks for semiconductor-grade gallium production in
geographically diverse regions encompass equipment, reagents and
knowledge. Specialist expertise, process recipes, yield optimisation,
and equipment and reagent procurement lead times are all concerns.
Unlike many stages in lithium and graphite processing, equipment
concentration itself constitutes a significant barrier. Gallium arsenide
and gallium nitride manufacturing also require highly controlled
cleanroom facilities to minimise particulate contamination and
airborne impurities during wafer fabrication and epitaxial growth. The
construction and operation of these facilities significantly increase
capital costs and operational complexity. Semiconductor cleanrooms
also require ultra-high-purity gases, specialised chemical-delivery
systems and continuous contamination monitoring. The
considerations extend beyond infrastructure alone. Maintaining
cleanroom performance requires highly trained operators, rigorous
process discipline and extensive operational experience.
An additional concern is the safe handling of substances: arsenicbased compounds are highly toxic and require strict handling,
ventilation and waste management systems during crystal growth,
wafer fabrication and semiconductor processing. Metal-organic
precursors used in epitaxy, including trimethylgallium, are pyrophoric
and highly reactive, requiring specialised gas-handling systems and
tightly controlled operating environments.
Overall, diversification efforts should focus on expanding materials
science capabilities and strengthening downstream manufacturing.
Investment in specialist workforce development, pilot-scale facilities
and partnerships with equipment suppliers can accelerate progress.
Given the technical complexity of the value chain, successful
diversification is likely to require sustained industrial investment over
an extended period.
IEA. CC BY 4.0.
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3. Pathways to resilient and diversified supply chains
Closing existing technology, equipment and knowledge gaps in geographically diverse regions
requires a holistic approach encompassing innovation, policy and co-operation
The gaps in costs and lead times observed today are a function of
the high levels of supply chain concentration and the lack of major
industrial bases outside China. As efforts to diversify supplies ramp
up, there is potential for competitive markets for equipment and
machinery to emerge.
Innovation is a critical enabler of efforts to diversify supply chains, as
new entrants face substantial technical, economic and environmental
barriers across mining, separation and refining. Tracking the scale of
patents across mineral value chains reveals that progress in supplyside innovation has been concentrated in one country over the last
decade (Box 3.3). To develop successful mineral production
ecosystems in geographically diverse regions, the first and highest
priority is to address gaps in knowledge, equipment costs and lead
times. Providing targeted subsidies and incentives to existing and
emerging equipment and machinery producers can be effective in
reducing both lead times and equipment and machinery costs
through economies of scale. Building a consortium of domestic or
international equipment producers to co-ordinate the production of
components and equipment can also realise scale advantages more
effectively, leveraging technology and skills transfer between
partners and facilitating product certification.
Second, providing financial support both at the direct capital cost and
operating cost levels, or through other de-risking measures, such as
loan guarantees or lowered interest rates, can help diversified
equipment producers and new entrants to secure and scale their
operations. These measures strengthen the business case for
producers and also incentivise private investment in the sector by
reducing perceived risks. Unlocking private investment can
accelerate the development of diversified ecosystems, where scale
and speed are both key drivers for building competitive businesses.
Finally, even if the whole ecosystem is successfully created, longterm operations can only be sustained if there is demand for these
diversified players. It is therefore critical to simultaneously stimulate
demand, for example by introducing incentives or mandates to use
magnets or batteries produced using a share of materials, processing
technology and equipment originating from diverse sources.
Nurturing downstream manufacturing industries or partnering with
like-minded countries that have strong industrial demand bases will
be a major factor in sustaining operations for diverse upstream
players. Co-ordination among key diversified players may also
improve negotiating positions in the event of patent disputes.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 303
3. Pathways to resilient and diversified supply chains
Box 3.3 Patents across critical mineral value chains reveal remarkable progress in
innovation but high geographical concentration
Global patenting trends in critical mineral technology areas, 2000-2024
IEA. CC BY 4.0.
Notes: IPFs = international patent families, based on fractional counts. As a first attempt, the IEA defines critical minerals sectors using Cooperative Patent
Classification codes combined with keyword searches for extraction, processing and materials technologies, as well as digital and automation applications linked
to 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
the rest of the countries.
Source: IEA analysis based on European Patent Office PATSTAT patents database (Spring 2025 edition, accessed through the OECD Micro-data Lab:
Intellectual Property Database).
5
10
15
20
25
2000 2005 2010 2015 2020 2024
Thousand IPFs
United States Europe Japan Korea China Rest of world
Exploration, extraction and processing
2
4
6
8
10
2000 2005 2010 2015 2020 2024
Refining
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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3. Pathways to resilient and diversified supply chains
The dynamism of the technology innovation landscape for critical
minerals is reflected in increased patenting activity across the
sector. The trends appear in several regions at every stage of the
value chain: exploration, extraction, refining and recycling. Since
2021, the level of patenting globally has been around three times
higher than the level seen prior to 2010. These patents mostly relate
to exploration and extraction technologies, demonstrating a
continued commercial interest in new ways to tap into mineral
resource endowments. However, the marked increase in China’s
contributions to the total patent pool since the 2010s mirrors the role
the country has played as the leading producer of a wide range of
minerals over the last 15 years. As of 2024, China accounted for
more than 35% of patents within international patent families and
files the highest number of national patent families. Moreover, as
highlighted in the section above, innovation in the midstream has
also been predominantly concentrated in China over the last
decade, while Japan has maintained a consistently high share of
the total since 2000. Download: Global Critical Minerals Outlook 2026.pdf
A recent joint report published by the European Patent Office and
the IEA, Battery Circularity, shows that there has also been rapid
increase in patenting for battery recycling technologies, at 42% per
year on average since 2017, growing faster than any other category
of patents related to batteries. This follows a growing focus on
diversifying supply chains to reduce mineral supply risks in
importing regions and improving environmental performance.
However, China also represents two-thirds of all patents relating to
battery recycling.
Despite having limited domestic extraction or refining, Japan’s
contribution to innovation in critical minerals is noteworthy. This
indicates that major Japanese battery manufacturers seek to
manage their supply chains to mitigate supply risks and remain
competitive.
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 305
4. Special focus on Latin America and the Caribbean
4. Special focus on Latin
America and the Caribbean
IEA. CC BY 4.0.
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PAGE | 306
4. Special focus on Latin America and the Caribbean
Latin America and the Caribbean holds significant reserves of multiple critical minerals, with
considerable scope for further development
Shares of global reserves and production for selected minerals inLatin America and the Caribbean
IEA. CC BY 4.0.
Source: IEA analysis based on data from the United States Geological Survey (2026), Mineral Commodity Summaries 2026.
0% 25% 50% 75% 100%
Argentina
Bolivia
Brazil
Chile
Jamaica
Mexico
Peru
Other
Share of world reserves
0% 25% 50% 75% 100%
Share of world production
Niobium
Lithium
Silver
Copper
Rare earths
Graphite
Molybdenum
Manganese
Antimony
Zinc
Bauxite
Nickel
Tin
Rhenium
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
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4. Special focus on Latin America and the Caribbean
The region combines established mining capabilities with emerging opportunities in critical
minerals, particularly for key energy materials such as lithium, copper, graphite and rare earths
Latin America and the Caribbean’s shares of global reserves and mining output for selected minerals, 2025
IEA. CC BY 4.0.
Source: IEA analysis based on data from the United States Geological Survey (2026), Mineral Commodity Summaries 2026.
20%
40%
60%
80%
100%
Reserves Mining production
Opportunities Strengths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 308
4. Special focus on Latin America and the Caribbean
Latin America and the Caribbean is expected to maintain its global market share in the mining
of key minerals such as copper and lithium, but faces strong competitive pressures in refining
Copper and lithium output in Latin America and the Caribbean in the base case, 2025-2040
IEA. CC BY 4.0.
Note: Lithium mining covers extraction from hard-rock ores and brines.
3
6
9
12
’25 ’30 ’35 ’40 ’25 ’30 ’35 ’40
kt
Mt
Chile Argentina Peru Mexico Brazil Share of global (right axis)
10%
20%
30%
40%
50
100
150
200
’25 ’30 ’35 ’40
Copper Lithium
Mining Refining Mining
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 309
4. Special focus on Latin America and the Caribbean
Latin America and the Caribbean is a leading global mineral producer with significant untapped
resources
Latin America and the Caribbean (LAC) is a major supplier of critical
minerals, supported by a large and diverse resource base. The region
holds significant shares of global resources of lithium, copper, silver
and graphite, alongside important reserves of molybdenum and tin,
and established production of specialty minerals such as niobium and
rhenium. This endowment underpins LAC’s strategic importance for a
wide range of technologies, including those central to the energy
transition as well as high‑technology, aerospace and defence
applications.
LAC also has significant potential to help diversify highly concentrated
global mineral supply chains while strengthening its own economic
development. Expanding processing and downstream activities could
enable the region to capture greater value from its mineral resources.
Current production landscape
The production of base metals is a key strength for the region,
accounting for at least one-fifth of global production of copper,
molybdenum, tin and zinc. Chile, Peru and Mexico together
accounted for almost 40% of global mined copper supply in 2025.
For molybdenum, a by-product of copper production, LAC countries
account for just under 40% of global production, mainly from Chile
and Peru.
LAC also hosts significant production of speciality minerals. Brazil
accounts for more than 90% of global production of niobium, a
mineral used mainly as an alloying material for steel, but with growing
applications in superconductors and electronics. Chile produces over
one-third of the world’s rhenium, another by-product of copper that is
essential for specialised heat-resistant steels. The region is also a
major producer of silver, accounting for more than half of global
supply, mainly from Mexico, Peru, Bolivia and Argentina, despite
holding one-third of global reserves.
Lithium resources are concentrated in the so-called “lithium triangle”,
comprising Argentina, Bolivia and Chile. However, these resources
have not been developed equally across the three countries: Chile is
an established lithium producer, while Argentina is rapidly emerging as
a major producer, with several projects at the production stage or in
the early stages of development. The two countries together account
for more than one-third of global lithium reserves and one-quarter of
total production. Bolivia, by contrast, has not yet fully exploited its
lithium resources, despite large, estimated resources. Several earlystage projects are underway, aiming to develop lithium production in
the country. Beyond lithium, the region also offers additional
opportunities to expand mineral production, including sizeable
resources of graphite, nickel and rare earths, predominantly in Brazil. Download: Global Critical Minerals Outlook 2026.pdf
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 310
4. Special focus on Latin America and the Caribbean
Outlook
Looking ahead, the copper project pipeline suggests mounting
difficulties in sustaining current production levels, with constraints
visible in Chile and Peru and major implications for the global copper
mining industry. Lithium mining, by contrast, benefits from a strong
pipeline of investment in Argentina, as well as scope to increase
production in Chile and Brazil. Overall, regional output is expected to
grow by close to 50% between today and the end of the decade. The
region’s share in global copper and lithium mining, currently 40% and
25%, respectively, is projected to remain broadly stable to 2040.
Additional production, especially if combined with investment in
refining facilities, would support economic diversification and
increase global supply security, which remains highly concentrated in
a small number of countries.
IEA. CC BY 4.0.
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4. Special focus on Latin America and the Caribbean
Exports of critical minerals account for a large share of total exports in many Latin America and
the Caribbean economies
Shares of selected critical minerals exports in total export value in Latin America and the Caribbean, 2024
IEA. CC BY 4.0.
Notes: 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
mined material over total export value. Total values include mined and refined materials. Aluminium includes bauxite. “Other” includes chromium, cobalt, titanium,
graphite, niobium, platinum group metals and vanadium.
Source: IEA analysis based on data from Harvard University (2026), Growth Lab Trade Data (database), accessed 15 June 2026.
10% 20% 30% 40% 50% 60%
Colombia
Mexico
Argentina
Ecuador
Venezuela
Jamaica
Cuba
Brazil
Bolivia
Peru
Chile
Share of exports
Copper
Lithium
Molybdenum
Iron
Silver
Zinc
Aluminium
Lead
Manganese
Nickel
Silicon
Tin
Tungsten
Antimony
Other
Share of mined output
IEA. CC BY 4.0.
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4. Special focus on Latin America and the Caribbean
Raw materials remain central to LAC’s exports, resulting in lower economic complexity than in
other regions where exports have increasingly diversified towards higher value-added products
Economic complexity index in selected regions
IEA. CC BY 4.0.
Note: 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
products that few other countries can produce tend to have higher economic complexity.
Source: IEA analysis based on data from Harvard University (2026), Growth Lab Trade Data (database), accessed 15 June 2026.
– 0.5
0.5
1.0
1.5
2000 2008 2016 2024
Economic complexity index
LAC
Higher complexity
Lower complexity
2000 2008 2016 2024
SoutheastAsia
2000 2008 2016 2024
India
2000 2008 2016 2024
China
IEA. CC BY 4.0.
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4.Special focus on Latin America and the Caribbean
Latin America and the Caribbean currently refines a low share of the minerals it produces
Production of mined and refined material in the Latin America and the Caribbean region, 2025
IEA. CC BY 4.0.
26%
2
4
6
8
10
MiningRefining
Mt
Copper
84%
20
40
60
80
100
MiningRefining
kt Li
Lithium
63%
40
80
120
160
200
MiningRefining
kt
Nickel
10%
2
4
6
8
10
MiningRefining
kt
Cobalt
0%
20
40
60
80
100
MiningRefining
kt
Graphite
7%
1
2
3
4
5
MiningRefining
kt
Rare earths
IEA. CC BY 4.0.
Global Critical Minerals Outlook 2026
PAGE | 314
4. Special focus on Latin America and the Caribbean
Progress along the critical minerals value chain would increase economic benefits for the
region
Several LAC countries rely on critical minerals for a substantial share
of their export revenues. In Chile and Peru, these minerals account
for 55% and 40% of export revenues, respectively. However, exports
remain concentrated in raw or minimally processed forms, limiting
domestic value addition and participation in higher-value segments
of global supply chains. Download: Global Critical Minerals Outlook 2026.pdf
This export structure is reflected in relatively low levels of economic
complexity. The Economic Complexity Index (ECI), which reflects the
productive capabilities of an economy, inferred from the diversity of
its export basket and the ubiquity of the products it exports globally,
remains below that of other emerging markets and developing
economies, including in Southeast Asia, India and China.
Over the period from 2000 to 2023, economic complexity in LAC
declined, largely driven by an increasing concentration of exports in
unprocessed commodities, including mineral and energy products.
Despite a modest improvement in complexity in 2024, the region
continues to face structural constraints in moving up mineral value
chains. In 2025, countries in the region refined just 26% of the
copper they extracted, 10% of cobalt and 7% of rare earths, and
there are no graphite refining facilities in LAC countries. The lithium
value chain is slightly different, as full chemical transformation is
only needed when lithium is extracted from spodumene rocks,
whereas lithium from brines is already in ionic form. Most lithium
extracted in LAC comes from brine.
While opportunities for value addition vary across countries
depending on their resource base and existing industrial capabilities,
further development of refining, processing and manufacturing of
intermediate and finished products would enable higher local value
added and strengthen linkages with domestic industry. In
resource‑rich regions with polymetallic deposits, expanding the
recovery of by‑products from existing operations represents an
important option. Such efforts would also enhance resilience to
commodity price volatility and position LAC more favourably within
rapidly expanding energy supply chains.
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4. Special focus on Latin America and the Caribbean
Local refining of regional mining output would increase sectoral economic benefits by one-fifth
Economic value of critical minerals production in the base case and the Latin America and the Caribbean local refining case
IEA. CC BY 4.0.
Notes: 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
copper, 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
mining and refining.
50 100 150 200 250
2035
2035
2025
Billion USD
Copper mining
Copper refining
Lithium mining
Lithium refining
Nickel
Cobalt
Graphite
Rare earths
LAC local
refining
case
Base
case
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4. Special focus on Latin America and the Caribbean
Expanding to downstream processing and beyond
There is a clear opportunity for the region to move beyond extraction
into higher-value activities. Recently, policy attention has turned to
smelting and refining, lithium hydroxide processing, cathode and
precursor production, and stronger domestic manufacturing and
mining-service industries. Chile is looking into expanding local
refining and greater value addition in both the lithium and copper
sectors, including through partnerships between the state-owned
Codelco and private companies. Brazil’s Nova Indústria policy targets
batteries, electric vehicles (EVs) and strategic mineral processing as
priority sectors. Brazil has undertaken efforts to move up the mineral
value chain into the midstream and downstream segments through
strategic initiatives. The MagBras Project aims to establish a
complete domestic value chain for rare earth permanent magnets,
securing technological autonomy and mastering the entire production
cycle from mineral extraction to manufacturing and recycling. The
state-owned company CEITEC is upgrading its industrial
infrastructure to produce power components based on silicon carbide,
directly linking advanced materials processing to high-tech industrial
applications. In Argentina, the new Incentive Regime for Large
Investments seeks not only to support mining-related activities but
also to support infrastructure for mining project development, as well
as the technology sector, including clean energy technologies.
Potential benefits for LAC economies
Based on the distribution of the base case project pipeline, the LAC
region has the opportunity to capture around USD 185 billion of
economic value by 2035. Of this, only one-fifth is expected to come
from refining, as most extracted material is exported for processing
abroad. An analytical case study that assumes all mined lithium,
nickel, cobalt, graphite and rare earths and two-thirds of mined
copper are refined locally suggests that local refining can significantly
increase benefits for local economies. If local refining were to be
expanded to its full potential, the economic benefit would rise to
around USD 220 billion in 2035.
Potential benefits for global supply security
Increasing regional refining capacity for critical minerals extracted in
LAC could also strengthen global supply security and reduce
exposure to highly concentrated supply chains. In the base case,
today’s leading refining country, China, is projected to account for 91%
of battery-grade graphite production in 2035, alongside 66% of
lithium and 50% of nickel refining. This high degree of concentration
points to persistent global imbalances. For graphite, nickel and
lithium, refined material available outside the dominant supplier
covers around 28%, 36% and 82% of demand, respectively, in
regions outside the dominant suppliers (see the N-1 analysis in
Chapter 2).
In the LAC local refining case, global supply imbalances would
improve. Additional regional refining capacity could contribute around
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4. Special focus on Latin America and the Caribbean
10 kt of lithium, 55 kt of nickel and close to 70 kt of graphite to
diversified supply sources by 2035. While modest, these additions
would help narrow projected supply gaps and enhance resilience
against disruptions.
Global N-1 supply-demand balance for selected critical minerals,
2035
IEA. CC BY 4.0.
Notes: The N-1 supply excludes production volumes from the largest producer
from total global supply, and N-1 demand excludes consumption by that
country from total global demand. The LAC local refining case assumes a
major expansion of regional refining capacity, enabling local processing of
base-case mined production by 2035. LAC: Latin America and the Caribbean.
20% 40% 60% 80% 100%
Graphite
Nickel
Lithium
Demand
Demand Supply: Base case LAC local refining case
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4. Special focus on Latin America and the Caribbean
Latin America and the Caribbean has structural advantages that enable lower emissions
intensity compared with other producing regions, but growing water demand poses a rising
challenge
GHG emissions reduction
Mining and processing activities are energy intensive activities that
can generate substantial greenhouse gas (GHG) emissions,
particularly where operations rely on fossil fuel-based energy sources.
With renewables accounting for more than 60% of electricity
generation, driven primarily by hydro-rich countries such as Brazil
and Colombia, and an increasing contribution from solar and wind in
Chile, the LAC region holds structural advantages, with mineral
production involving notably lower emissions intensity than in other
producing regions. Download: Global Critical Minerals Outlook 2026.pdf
Several mining companies in the region are increasingly integrating
renewable energy into their operations as part of their
decarbonisation strategies. Recent examples include projects by
Vale in Brazil and by Codelco in Chile. Chile’s Atacama region, with
some of the world’s highest solar irradiation levels, offers particularly
strong conditions for low-emissions electricity and more sustainable
practices. In Argentina, at the Lindero mine, the integration of solar
power generation and battery storage into the existing energysystem
has succeeded in reducing annual diesel consumption by
approximately 40%. Beyond the electrification of facilities, further
emissions reduction measures in the mining sector include the
electrification of vehicles such as heavy-duty trucks, energy-efficient
crushing technologies and the optimisation of processing. However,
the deployment of these solutions remains uneven, as many mining
operations are located in remote areas with limited grid access and
therefore continue to rely heavily on fossil fuels for operational
reliability.Continued infrastructure investment and supportive policy
frameworks will be essential to further reduce the region’s emissions
intensity. In particular, expanding access to renewable electricity,
strengthening transmission infrastructure and facilitating long-term
power purchase agreements will be critical.
Water usage
In LAC, water demand in mining is increasing due to a combination
of structural factors. Declining ore grades have led to higher volumes
of ore being processed, which in turn increases water demand. A
rising share of sulphide ores in copper production is further increasing
the water requirements associated with flotation processes. For
instance, total water demand from copper mining in Chile is projected
to increase notably, reaching over 650 million m³ by 2035.
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4. Special focus on Latin America and the Caribbean
Water consumption in copper production in the high-production
case in Chile, 2015-2030
IEA. CC BY 4.0.
Note: The high-production case considers projects at a reasonably advanced
stage of development.
Source: IEA analysis based on data from the Chilean Copper Commission.
While mining is becoming more water‑intensive, many mines in the
region are located in arid deserts and mountainous areas, where
water resources are already scarce and essential for local
communities, agriculture and ecosystems. This makes securing a
sufficient water supply an urgent challenge and raises concerns
around competing uses. In response, some companies are
implementing measures to reduce dependence on freshwater. For
example, the Quellaveco copper project in Peru has achieved lower
water-use intensity through high recirculation rates of approximately
85%. The project is also supported by multipurpose water storage
infrastructure, which contributes not only to mining operations but
also to local water management, including flow regulation and the
supply of water for agricultural use, developed through a multistakeholder dialogue involving government authorities and local
communities. In Chile, there has been a pronounced shift towards the
use of desalinated seawater for mining operations, helping to reduce
freshwater consumption. This transition is being supported by public
policy, with a recently established framework that regulates the use
of seawater for desalination. However, desalination and longdistance water transport are both capital and energy intensive,
highlighting the close linkages between water use, energy
consumption and GHG emissions.
In lithium extraction from brine, concerns persist regarding
groundwater depletion and impacts on ecosystems. Brine extraction
in high-altitude salt flats can affect interconnected water systems
that support local biodiversity and communities, highlighting the
need for careful resource management and improved monitoring. In
Chile’s Atacama salt flats, around 70% of the water footprint per
tonne of lithium product is associated with concentrated brine
production, while in the conversion to lithium carbonate, the final
stage of lithium production, the use of desalinated water helps
mitigate pressures on scarce freshwater resources. In recent years
in Atacama, operational improvements, including higher brine
200
400
600
800
’15 ’20 ’24 ’30 ’15 ’20 ’24 ’30
Freshwater Seawater On-site Concentrator Refining Services
By type
Million cubic metres
By processing step
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4. Special focus on Latin America and the Caribbean
recovery rates and lower energy consumption in processing stages,
have contributed to reducing water intensity.
Water scarcity remains one of the most significant constraints on
mining expansion in the LAC region. Addressing this challenge will
require a combination of infrastructure investment, technological
innovation, such as through further adoption of direct lithium
extraction technologies, and strengthened governance frameworks
to ensure sustainable water use. Promoting dialogue and
co-ordination with other water-intensive sectors such as agriculture,
as well as with local communities, is also essential. Comprehensive
approaches to ensure the long-term sustainability of water use will
reduce project-level uncertainty and strengthen the social
acceptance of mining projects in the region.
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4. Special focus on Latin America and the Caribbean
Latin America and the Caribbean countries have policy tools to overcome the risks and
challenges that hinder the development of critical minerals projects, but stronger
implementation efforts are needed
IEA. CC BY 4.0.
Note: ECLAC = Economic Commission for Latin America and the Caribbean; RD&I = research, development and innovation.
Chile’s centralised
permittingsystem
Peru’s updated mine
closure law
Argentina’s Incentive Regime for
Large Investment
Chile’s Northern District
desalinationproject
Peru’s VAT incentives
for exploration
Colombia’s Minerals
TraceabilitySystem
Argentina, Brazil, Paraguay and
Chile’s bi-oceanic corridor
Argentina, Bolivia, Brazil, Chile and
Mexico’s Permanent Forum for Technical
Dialogue on Lithium,organised by ECLAC
Mexico’s simplification of patent
registration in its National Plan
Policy tools in the region target
key risks and challenges:
• Cost of capital
• Market and price risks
• Environmental management
• Regulatory uncertainty
• Infrastructure
• Technology gaps
Brazil’s funding of RD&I
projects from development
bank and innovation agency
Peru’s Digital Single
Window one-stopshop
Mexico’s reform for
water management
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4. Special focus on Latin America and the Caribbean
Policy pathways to address market, regulatory andtechnological barriers
A broad set of risks creates challenges for expanding the critical
minerals value chain in LAC. These range from regulatory uncertainty
to technology gaps and affect both the timing and scale of private
investment. Enhanced policy frameworks can reduce uncertainty,
lower financing costs and improve project bankability. Download: Global Critical Minerals Outlook 2026.pdf
Cost of capital. Reducing the cost of capital is critical for scaling up
investment in critical mineral projects, as elevated risk perceptions,
particularly in emerging regions or new segments of the value chain,
often translate into high financing costs. Policy instruments such as
public credit guarantees can lower lender risk and improve project
bankability, while public-private partnerships allow governments to
share risks with private investors, especially for large or strategic
projects, helping to crowd in private capital. For example, Argentina’s
Incentive Regime for Large Investments offers tax reductions and
other benefits to facilitate the realisation of long-term investment,
while Chile’s Novandino Litio is an example of how public-private
partnership can support financing for mineral development projects.
Market and price risks. Managing market and price risks is essential
for the viability of critical mineral projects, as commodity price
volatility and uncertain demand, particularly for downstream
processing, can weaken investment incentives. The development of
processing hubs in the region, including by leveraging existing
regional and international collaboration platforms, can create
economies of scale, lower unit costs and improve resilience to price
swings. Regional and international traceability systems in support of
diversification and sustainability would also be beneficial for projects
in the region, especially if they are extended beyond mining to
support the development of refining and processing facilities. For
example, Colombia’s Mining Traceability System introduced a digital
platform to track mineral origins and could be used to foster
diversified projects and incentivise sustainable practices.
Environmental management. While the region has extensive
experience in large-scale mining, particularly for bauxite, iron, gold
and copper, new critical mineral projects may emerge in new
locations, requiring careful environmental planning and management
of impacts related to water, emissions, noise, dust, and mine closure
and rehabilitation. LAC countries already have environmental
regulations applicable to mining, and some have recently updated
their policy frameworks. Mexico’s 2023 mining reform increased
water and socio-environmental scrutiny in the awarding of mining
concessions, and Peru’s updated mine closure law makes mine
closure and rehabilitation a continuous legal obligation, requiring
upfront financial guarantees and regular updates of mine closure
plans. Brazil’s National Policy on Critical and Strategic Minerals
embeds environmental criteria into the selection of priority projects.
Colombia, Chile and Brazil are also advancing emissions trading
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4. Special focus on Latin America and the Caribbean
systems, creating incentives to reduce emissions across industrial
sectors. Industry standards complement regulatory measures.
Chile’s mining sector is targeting carbon neutrality, while its two
largest lithium producers, Albemarle and Novandino, have completed
independent audits of their Salar de Atacama operations against the
Initiative for Responsible Mining(IRMA) standard, lending a higher
degree of transparency to environmental and social performance.
Permitting and regulatory uncertainty. Unpredictable and
fragmented regulatory frameworks can delay the development of new
projects and undermine investor confidence. The total time for
permitting and project development in Chile can span between 54
and 139 months for exploration, mining and desalination projects,
depending on project complexity, with the longest time frames
associated with desalination plants and tailings storage facilities.
Governments, however, have access to a range of policy instruments
to help reduce permitting times. Establishing centralised permitting
authorities, one-stop shops or dedicated agencies to co-ordinate
regulatory approvals can reduce institutional fragmentation and
accelerate permitting timelines by limiting duplication across
institutions. At the same time, efforts to streamline permitting
processes need to ensure that environmental and social safeguards
are upheld, as insufficient consultation or impact assessment can
lead to project delays, social opposition and cost escalation over the
project life cycle. Examples in this direction include the Environmental
Impact Assessment System centralised permitting system in Chile. In
addition, permitting processes are often structured sequentially,
meaning that delays or bottlenecks at a single stage can slow overall
project progress. Allowing key regulatory and administrative
processes to proceed in parallel, where appropriate, can accelerate
decision-making while maintaining robust regulatory oversight.
Peru’s Digital Single Window serves as a one-stop shop, integrating
nine public entities involved in mining permitting and helping to
streamline processing times.
Infrastructure. Transport, energy, water and logistics infrastructure
can constrain the development of critical mineral projects, as weak
connectivity and limited access to resources raise costs and project
risks. Regional integration through cross-border infrastructure
planning and harmonised standards can help LAC countries improve
connectivity and facilitate trade. Co-ordinated and targeted public
investment via direct financing or co-financing of enabling
infrastructure, such as roads, ports and power supply, can reduce
upfront risks, attract private capital and ensure reliable access to the
necessary infrastructure for mining and processing operations. New
infrastructure projects can be designed to deliver tangible benefits for
local communities, including employment and skills development,
while strengthening the foundation for broader regional economic
development. Examples of shared infrastructure include Brazil’s
Carajás corridor, including railway and port development, and Chile’s
solar-powered ENAPAC desalination project.
Technology gaps. While the region is in some cases at the forefront
of deploying new mining technologies, technology gaps could still
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4.Special focus on Latin America and the Caribbean
constrain the development of midstream refining and processing
projects. For metal refining and product manufacturing, advanced
processing operations are required, such as the production of battery
precursors and cathodes, rare earth separation and magnet
manufacturing. These generally require advanced manufacturing
know-how, access to specific material inputs and proprietary
knowledge. Addressing these gaps will require sustained investment
in research and development, skills and innovation ecosystems,
alongside stronger collaboration with chemical and processing
companies.
Public investment in research and development (R&D). Support
for applied research, pilot projects and demonstration plants can help
de-risk emerging technologies and accelerate their adoption.
International collaboration with advanced economies, multilateral
institutions and industry partners can also facilitate technology
transfer, skills development and institutional learning. The Brazilian
Development Bank and the Brazilian Innovation Agency have
provided funding for R&D and innovation activities, including in
midstream and downstream supply chain segments. In 2026, the
Chilean Production Development Corporation awarded three R&D
projects focused on recovering cobalt and rare earths from tailings
and mine waste as part of the programme “R&D Challenges for
Sustainable Productive Development”. The IDB LAC Minerals by the
Inter-American Development Bank (IDB) aims to mobilise financing,
knowledge and connections in the region to support the innovation
cycle of critical mineral projects from early stages to scale-up,while
also providing a linkto the IDBInvestfinancing scheme.
Potentialforregionalsynergies
Chile and Peru have mature copper industries supported by
specialised suppliers, geological expertise and export infrastructure.
Brazil combines diversified mining output with metallurgical
capabilities, while Mexico’s automotive and electronics
manufacturing base could support deeper downstream integration.
These advantages, if combined, could help reduce barriers to
investment in critical mineral projects, although transport, power and
water infrastructure will still need to expand in key mining corridors.
Regional co-ordination and partnerships are becoming more
important as countries seek finance, technology and market access.
Institutions such as the IDB, Economic Commission for Latin America
and the Caribbean(ECLAC), the Development Bank of Latin America
and the Caribbean, and the Latin American and Caribbean Energy
Organization can facilitate co-ordinated mining and industrial
strategies across the region. For example, the Permanent Forum for
Technical Dialogue on Lithium, established and operated by ECLAC
since 2022, promotes sustainable extraction and industrial activities
through regional integration, technical exchange and lesson sharing.
It brings together state-owned enterprises and technical agencies
from Argentina, Bolivia, Brazil, Chile and Mexico, while regularly
inviting subnational authorities and private actors and fostering
dialogue with countries outside the LAC region. Download: Global Critical Minerals Outlook 2026.pdf
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4. Special focus on Latin America and the Caribbean
Latin America and the Caribbean countries are developing dedicated critical mineral policy
strategies and updating policy frameworks to attract investment and better integrate into global
supply chains
Countries in the region exhibit diverse critical mineral policy
strategies, reflecting differences in resource endowments and
positions in value chains. Many producers are seeking to strengthen
international partnerships to attract investment and improve
integration into global value chains. This section provides an
overview of recent policy developments in the region, with a focus on
investment promotion, as well as on key regional and international
partnerships. Risks and challenges to policy implementation are
discussed in more detail later in the chapter.
Argentina
Since 1993, Argentina’s Mining Investment Regime has provided
incentives such as a 30-year guarantee of fiscal and foreign
exchange stability for new projects. In 2024, Argentina launched the
Incentive Regime for Large Investments, aimed at attracting
investment in large projects, including in the mining sector. Building
on existing incentives, the initiative progressively eliminates the
requirement to repatriate export proceeds and sets a maximum
corporate income tax rate of 25%, in addition to providing benefits
including accelerated depreciation and exemptions from import and
export duties. It will remain open for applications until July 2027,
providing additional opportunities compared with the existing mining
investment framework. It also establishes minimum investment
thresholds for eligible projects. As of June 2026, nine mining projects
had been approved for a total of USD 10 billion, mainly for lithium,
copper and gold.
Argentina is also actively advancing bilateral co-operation aimed at
integrating its critical mineral production into global supply chains.
Since 2023, Argentina has signed memoranda of understanding
(MoUs) with a diverse set of partners, including Canada, the
EuropeanCommission, India and the United Arab Emilates (UAE),
highlighting its multi-regional engagement strategies. In February
2026, it also concluded a landmark framework with the United States
on mining and refining. Co-operation among provincial governments
has also been strengthened; in April 2026, the governors of Salta,
Catamarca and Jujuy signed a joint agreement to enhance
governance, infrastructure and the development of the lithium value
chain under the current regulatory framework.
Bolivia
Bolivia has sought to promote investment in mineral exploration by
adjusting its regulatory framework and signing bilateral agreements.
In April 2026, the government convened regional dialogues on lithium
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4. Special focus on Latin America and the Caribbean
development in Potosí, Uyuni, and Oruro which informed a strategic
roadmap emphasising environmental safeguards, water resource
protection and inclusive regional development, alongside efforts to
strengthen the legal framework governing the sector. At the end of
2025, a supreme decree established that investment in the mining
sector qualifies as a strategic priority, granting eligible projects
access to incentives including a 15-year fiscal stability period,
reduced taxes and a fast-track approval procedure.
Brazil
Brazil aims to further develop domestic supply chains, including by
officially launching its National Mining Policy Council, which sets
long-term guidelines for the mining sector and strives to position the
country as a key global supplier of critical minerals. In 2026, the
government is updating its National Mining Plan 2050, following
public consultation. The Ministry of Mines and Energy and the
Brazilian Geological Survey also launched the 2026 edition of the
Overview of Critical and Strategic Minerals Potential of Brazil to
present Brazil’s potential for critical minerals with up-to-date data on
production, reserves, national programmes and thematic studies. In
May 2026, the Critical and Strategic Minerals Bill, which establishes
the country’s first National Critical and Strategic Minerals Policy, was
sent to the Senate. The policy focuses on accelerating supply chain
development through nine policy instruments. In June 2026, Brazil’s
Ministry of Mines and Energy, in partnership with the Inter-American
Development Bank, launched a technical study to support the
development of a national rare earth strategy.
To promote foreign direct investment, the Ministry of Mines and
Energy launched Brazil’s Critical Minerals: A Guide for Foreign
Investors 2026, providing an overview of administrative processes,
regulatory frameworks, public support for new mining projects, and
environmental, social and governance considerations.
Chile
Ongoing reforms of Chile’s regulatory framework aim to attract
private investment while promoting value addition and sustainability
in mining. Its National Mining Policy 2050 from 2022 targets a halving
of environmental and sector-specific permitting times by 2050. Its
2024 National Lithium Strategy includes special provisions to ensure
that a portion of lithium produced is sold at a preferential price when
used by refining and battery industries. The 2025 Framework Law on
Sectoral Authorizations aims to reduce permitting times between 30%
and 70%. In January 2026, Chile launched its National Critical
Minerals Strategy to consolidate its role in global supply chains
through five strategic pillars, one of which includes attracting
responsible investment. In April 2026, the National Reconstruction
and Economic Development Bill, which includes a proposed
reduction in corporate taxes along with employment incentives and
faster environmental permitting, was submitted to Congress for
approval. In May 2026, a bill was introduced to reform Chile’s mining
concession maintenance regime, simplifying compliance
requirements and expanding eligibility for reduced mining licence
fees to provide greater legal certainty and support mining project
development.
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4. Special focus on Latin America and the Caribbean
At the regional level, Chile has advanced three major corridor
projects to strengthen regional connectivity, reduce transport costs
and enhance access to global markets. These include three
bi-oceanic corridors, Capricorn, Central and Northern Patagonian,
which connect the Atlantic and Pacific Oceans through a network of
roads and infrastructure, facilitating the movement of critical minerals
across participating countries such as Argentina, Bolivia, Brazil and
Peru. In 2026, Chile and Argentina agreed to reactivate the
Administrative Commission of the Chile-Argentina Mining Integration
and Complementation Treaty to foster mining co-operation. At the
international level, since 2025, Chile has signed MoUs with India and
the United States to promote investment, exploration, value-added
processing and technology transfer.
Colombia
Colombia’s critical minerals strategy is framed by its National Mining
Development Plan 2024-2035, which identifies copper, nickel,
phosphates and manganese as priority strategic minerals and
promotes their development through streamlined permitting
procedures, competitive bidding rounds and enhanced traceability. In
2025, the country launched its first tender round, offering 14 strategic
mining areas for the development of copper, gold and polymetallic
minerals.
Colombia is seeking to improve the efficiency and transparency of its
mining governance framework through a combination of regulatory
reforms and institutional initiatives. In 2026, the National Mining
Agency introduced two draft regulatory resolutions to streamline
permitting procedures, including shortening consultation periodsfrom
216 to 90 days, while maintaining inclusive stakeholder engagement,
and revising the assessment of financial viability for mining
concessions. In parallel, in May 2026, Colombia launched the Mineral
Traceability Platform to strengthen compliance and transparency
mechanisms across the value chain. In 2025, the Colombian
Commission of Mineral Resources and Reserves updated the
Colombian Standard for the Public Reporting of Exploration Results,
Mineral Resources and Reserves (ECRR), strengthening
sustainability requirements for mining projects.
Mexico
Stated policy objectives in Mexico focus on reinforcing critical
minerals as a strategic and sovereign resource while promoting
stronger environmental and social requirements. Amendments to the
Mining Law approved in May 2023 expand consultation rules and
processes, prioritise water for domestic use, and require all mining
concessions to be allocated through public bidding following approval
of necessary environmental, social and labour permits. Originally
established in 1992 as a structural reform of the sector’s governance
framework, the Mining Law seeks to enhance environmental and
social safeguards. It introduces consultation and compensation
requirements for Indigenous communities, prioritisation of water use
for human consumption and requirements to recycle at least 60% of
concessioned water. Downstream processing developments are also
encouraged under Mexico’s National Plan 2025-2030, which
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4. Special focus on Latin America and the Caribbean
promotes increased investment in scientific and technological
research and reduced patent registration times. Mexico seeks to
strengthen international co-operation, with the aim of consolidating
mining-related value chains to foster greater regional integration
beyond the national level. These efforts aim to address supply chain
risks while promoting value creation and retention in both Mexico and
the North American region.
Peru
Peru’s current efforts are focused on promoting investment in mining
exploration. In 2022, the VAT refund for mining exploration was
extended until 2027 to attract new investment. To reduce uncertainty
during the exploration phase, Peru is finalising its National Geological
Map, which will provide complete coverage of its territory by the end
of 2026. It has also established international partnerships to support
the mining sector. In 2025 and 2026, Peru signed MoUs with Canada,
the United States (one in the context of the Critical Minerals
Ministerial and another with Proinversion) and Chile to advance
investment and access to technology, information and expertise
exchange. Furthermore, the Ministry of Foreign Affairs, along with the
Canada-Peru Chamber of Commerce, published Peru’s Mining &
Metals Investment Guide 2025/2026 with an updated overview of the
sector, its potential and the applicable tax and legal frameworks.
Venezuela
Venezuela enacted the new Ley Orgánica de Minas [Organic Mining
Law] in April 2026, opening the mining sector to foreign and private
investment while maintaining state ownership of mineral resources.
The law grants strategic mineral ownership to the state and allows
domestic and international companies to operate through
concessions and joint ventures, with renewable mining rights granted
for up to 30 years. It also introduces clearer licensing procedures,
royalty regimes and international arbitration mechanisms to
strengthen investor confidence.
Caribbean countries
Countries in the Caribbean region are intensifying international
co-operation to attract investment in critical minerals and strengthen
their role in emerging supply chains. In the Dominican Republic,
efforts are focused on exploring rare earth potential as a key
economic opportunity. The country is strengthening mining
governance with the creation of the Dominican Mining Company,
Emidom, in 2024 and plans to adopt new mining legislation to support
critical mineral investment. Jamaica approved an Industrial Minerals
Policy in 2024 to attract investment into its mining sector. In addition
to supporting investment in its established bauxite and alumina
industries, the policy has helped attract major international partners
exploring for gold and copper. Download: Global Critical Minerals Outlook 2026.pdf
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Achieving social acceptance and delivering high-quality projects require sustained, transparent
and inclusive engagement with local stakeholders
The importance of involving local communities when developing new
projects is at the centre of regional frameworks such as the Escazú
Agreement, a treaty supporting the rights of individuals and
communities to access environmental information and participate in
decision-making processes. In many countries across the region,
public participation is embedded within environmental impact
assessment processes, with a strong emphasis on the rights of
Indigenous peoples. The United Nations and the International Labour
Organization also recognise the principle of free, prior and informed
consent for Indigenous communities in relation to authorisation for
mineral exploration and project development.
Specific consultation and stakeholder engagement frameworks vary
across the region in terms of legal requirements, implementation
capacity and conflict intensity. The Escazú Agreement, built on
binding principles of access to information, public participation and
environmental justice, is progressively reshaping how LatinAmerican
states govern stakeholder engagement, including in extractive
industries. Chile’s Senate ratification in June 2022 strengthened
public consultation requirements in environmental licensing
processes. Colombia’s Pollutant Release and Transfer Register,
phased in from 2025, provides affected communities with the right to
access data on industrial emissions for the first time. Colombia’s Law
2273, upheld as constitutional by the Constitutional Court in August
2024, makes treaty obligations directly enforceable in national courts.
Cutting across all pillars, Mexico’s SEMARNAT implementation
roadmap and the regional 2024-2030 Action Plan on Environmental
Defenders establish protective mechanisms for environmental
defenders.
Countries in the region have specific frameworks supporting the
participation of Indigenous or Native Peoples. In 2011, Peru enacted
the Law on the Right to Prior Consultation of Indigenous or Native
Peoples, which provides guidelines for structured dialogue between
the state and Indigenous communities. In Mexico, the National
Institute of Indigenous Peoples launched guidelines in 2019 for
implementing the right to the free, prior and informed consent of
Indigenous peoples. In 2018, Paraguay enacted the Protocol for the
Process of Consultation and Free, Prior and Informed Consent with
the Indigenous Peoples Living in Paraguay.
Mining companies play a significant role in shaping stakeholder
engagement practices. For instance, some have developed their own
community consultation frameworks and defined how the views of
affected communities are incorporated into operational
decision-making. The Somos Choapa programme in Chile
demonstrates the efforts that the private sector can make to facilitate
multi-stakeholder dialogue.
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There are still areas for improvement, alongside accumulated
lessons on effective stakeholder engagement in the region. In
particular, engagement as a first step and greater accessibility of
information, covering not only project benefits but also environmental
risks, are essential for enabling local communities to make informed
decisions. Best practices, which can be grounded in the principle of
free, prior and informed consent, should ensure that information is
transparent, culturally appropriate and available in the native
languages of affected communities, with clear and accessible
explanations of technical aspects. Strengthening these elements can
enhance the effectiveness of consultation processes and positively
influence project viability and continuity. Such practices include
sustained engagement, not only prior to project initiation but
throughout the entire project life cycle, including post-closure, and
may entail participatory monitoring mechanisms during project
implementation and the delivery of tangible benefits to local
communities. Social inclusion in projects is crucial to support the
sustainable growth of the sector in the region.
Beyond consultation and participation mechanisms, ensuring that
local communities benefit from mining activities is another important
area of policy action. Across LAC, governments have established a
range of legal and fiscal frameworks to channel a share of mining
revenues to subnational authorities and affected communities. While
approaches vary, these mechanisms aim to strengthen the local
value generated by mining projects and help align community
interests with project outcomes. This is the case in Peru, where
mining revenues including royalties are allocated to subnational
governments based on production levels. However, challenges can
remain in ensuring that benefits are distributed equitably and
effectively, highlighting the need for continued improvements to
benefit-sharing frameworks.
Overall, meaningful engagement with local communities requires
both public and private actors to strengthen sustained, transparent,
inclusive, culturally appropriate and genuine mechanisms that enable
communities to exercise their rights while supporting stable and
resilient mineral supply chains.
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New exploration, mining, refining, manufacturing and recycling technologies can be key drivers
of economic development in the region, if supported by enabling policies
From upstream exploration and mining to refining, manufacturing and
recycling, a range of emerging technologies can enhance efficiency,
deepen value addition and promote economic development.
Supportive policies will be crucial for deploying these innovations.
Upstream
Direct lithium extraction (DLE) is among the most promising
technologies for delivering new projects and production in the region.
Existing projects extract lithium from brines in evaporation ponds,
where the brine is allowed to evaporate and the resulting solution is
then refined into lithium carbonate or lithium hydroxide. In contrast, in
a typical DLE process, lithium ions are extracted from brine through
adsorption, ion exchange, solvent extraction, or membrane and
electrochemical methods. Once lithium ions are recovered, they are
converted into lithium carbonate or lithium hydroxide. DLE
technologies aim to achieve over 90% recovery, significantly higher
than the 40-60% recovery typically achieved in conventional brinebased extraction. Additionally, DLE offers the potential to access
lithium deposits that were previously hard to reach or too costly to
extract. However, new DLE projects will need to overcome cost and
operational challenges that have slowed adoption to date.
Lithium production in LAC by project type
IEA. CC BY 4.0.
Globally, DLE accounts for almost 10% of lithium supply, although in
most cases it is combined with traditional evaporation ponds. The
main large-scale DLE projects outside China are currently located in
Argentina. The Fénix facility, acquired by Rio Tinto in 2025, has been
operating for more than 30 years, combining adsorption DLE with
conventional pond evaporation. Two new DLE projects are being
developed in Argentina: Eramet’s Centenario (planning 24kt Li
production capacity by 2027) and Rio Tinto’s Rincón (planning
60kt Li production capacity when fully expanded). In Bolivia, a
consortium including CATL and Uranium One Group aimed to build
50 100 150
2035
2025
kt Li
Conventional brine Spodumene Direct lithium extraction
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4. Special focus on Latin America and the Caribbean
DLE plants in the Salar de Uyuni region, but the project has been
suspended following a court order. In Chile, Albemarle has started
the environmental review for a DLE project in the Antofagasta region,
and the Novandino partnership between Codelco and SQM is
planning new projects in the Atacama Desert.
Ionic adsorption clay is a method used to extract rare earth
elements from ionic adsorption deposits. Brazil is at the forefront of
the development of ionic adsorption clay projects, as Serra Verde
aims to produce 6.4 kt of rare earth oxides from the Pela Ema deposit
by the end of 2027 using ionic adsorption clay technology and lowemissions electricity. Further potential has been identified in the
country, with projects in the advanced permitting or feasibility stages.
Integration of renewables and advanced water management is
key for the region to leverage its comparative advantages and
develop shared infrastructure that would contribute to countries’
development and economic growth. The region already hosts
innovative facilities that integrate mining operations with renewable
energy production and advanced water management systems, such
as Teck Resources’ Quebrada Blanca Phase2 copper mine in Chile.
Among other innovative technologies, the University of Concepción
is developing hydrogen-based processes for copper concentrate,
which have the potential to significantly reduce emissions.
Digitalisation and the integration of artificial intelligence (AI) in
critical mineral development can bring significant benefits along the
value chain. AI can support mineral exploration by creating mineral
perspective maps based on geology. The Instituto de Tecnologías
Limpias in Chile is developing digital twins and modular water
solutions to optimise mining operations and resource use. The
Chilean National Mining Society is also working on district-level digital
mapping to integrate information on ownership and facility type with
infrastructure data. In Brazil, a project developed in collaboration with
Canada is using AI to model nickel deposits, with initial findings
expected by 2027. AI-optimised drilling can lift output, reduce costs
and enable the development of deeper or lower-grade deposits.
Automation improves operational safety by reducing manual work in
hazardous tasks. Innovative technologies also have the potential to
improve tailings management, unlocking new resources and reducing
environmental impacts. The emergence of a digitally educated
workforce is likely to support a gradual expansion in the adoption of
digital solutions. Download: Global Critical Minerals Outlook 2026.pdf
Midstream
Advanced hydrometallurgical routes, including new heap leaching
techniques, pressure leaching and bioleaching, are particularly
relevant for LAC producers facing declining ore grades and rising
costs. In Chile and Peru, where copper production is increasingly
constrained by lower grades and water stress, such methods can
support the economic processing of low-grade sulphide ores and
historic tailings while reducing reliance on energy-intensive smelting.
In Brazil and Colombia, where nickel laterite deposits are present,
bioleaching has potential applications for nickel laterites and
polymetallic residues, supporting higher recovery rates and
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4. Special focus on Latin America and the Caribbean
extending mine life. The successful deployment and commercial
viability of these technologies will depend on market conditions, as
well as progress in scaling up deployment and reducing costs.
New rare earth separation technologies, including alternative
solvent systems, ion exchange processes and membrane-based
techniques, could lower environmental impacts, improving the
feasibility of local or regional rare earth processing hubs. One key
challenge in rare earth separation is the concentration of
technological knowledge, machinery manufacturing and skilled
workforces in incumbent producing regions (see Chapter 3).
Investment in technological development programmes can play a
critical role in building local capabilities, supporting the development
of domestic knowledge and manufacturing bases, and facilitating the
gradual localisation of separation and processing activities.
Microwave-assisted calcination and heating is an emerging
technology with potential applications in selected mineral processing
steps. While these technologies are still at the early stages of
commercial readiness, they could contribute to incremental energy
efficiency gains for LAC producers operating in power-constrained
systems or regions with high electricity costs, such as parts of the
Caribbean and remote mining regions in SouthAmerica.
Downstream
Innovative anode technologies could be particularly relevant for
LAC, where resource endowments and low-emissions power sources
create opportunities for value-added battery supply chains. In Brazil,
collaborative efforts between domestic and international firms have
explored alternative anode chemistries, including lithium-ion batteries
based on niobium-containing materials, illustrating the potential for
leveraging the country’s unique mineral base.
Beyond niobium, Brazil hosts established production of graphite and
silicon, highlighting potential for the development of silicon-carbon
anode composites. These materials are attracting growing interest as
battery manufacturers seek higher energy density and improved
performance. In addition, Brazil’s relatively low-emissions electricity
mix adds to the advantages of domestic graphite processing and
anode manufacturing, particularly as battery manufacturers seek
lower life cycle emissions and higher sustainability standards.
Recycling
Recycling can offer significant opportunities in the region. The
e-waste collection rate is currently at just 3%, lower than the global
average of 22%, with some high-performing regions reaching 58%.
Innovative technologies can also support additional recovery: battery
recycling through hydrometallurgical processes, which recover
lithium, cobalt and nickel through acid leaching and selective
separation, has the potential to achieve high recovery rates with
lower energy intensity than traditional smelting. Pyrometallurgical
routes are still relevant where there is smelting infrastructure, as in
Chile and Peru, but are more energy-intensive and prone to material
losses, while emerging direct recycling approaches aim to restore
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4. Special focus on Latin America and the Caribbean
cathode material with minimal processing. Urban mining of e-waste
can tap into growing electronic waste streams, such as portable
electronics, EV batteriesand motors, and wind turbines, where
valuable materials, including battery minerals, rare earths and other
minerals, are often present at higher concentrations than in extracted
ores.
Policy tools to support innovation
Targeted policy instruments are essential to support innovation in
critical mineral production and processing in LAC, particularly when
deployed as part of co-ordinated industrial and innovation strategies.
Financial tools play a central role, including direct R&D funding,
co-financing through public innovation agencies and blended finance
mechanisms from development banks, which help de-risk early-stage
technologies and crowd in private investment.
Country experiences highlight how these instruments can translate
into innovation outcomes. In Brazil, the SENAI-led lithium-ion battery
project (2024-2027), supported by funding of around
USD 12.5 million, combines applied research funding with industry
co-investment to establish pilot production lines and develop
domestic technological capabilities. The programme brings together
a consortium of industrial partners, enabling knowledge transfer
across the battery value chain and supporting the development and
testing of locally adapted technologies.
Similarly, development finance institutions are supporting innovation
by linking funding with technical assistance and capability building.
The IDB, through initiatives such as LAC Minerals, provides blended
finance and technical support to improve project design,
environmental standards and local supplier integration. In Argentina,
for example, IDB-supported financing for the Rincón DLE project is
coupled with measures to strengthen local supply chains and
operational capabilities, contributing to the diffusion of knowledge
and innovation across the sector.
Beyond funding, a strong focus is needed on enabling firms to
innovate by improving capabilities and the broader ecosystem.
This includes investments in skills and human capital, the
development of research and technology institutions and expansion
of existing programmes, and policies that encourage collaboration,
such as cluster initiatives and regional innovation programmes.
Finally, LAC countries can leverage demand-side policies and
international collaboration to accelerate innovation uptake and
diffusion. Public procurement, standards and lead market initiatives
can create early demand for new technologies, while foreign direct
investment, participation in global value chains and collaboration
within the region can foster knowledge transfer and skills
development.
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4. Special focus on Latin America and the Caribbean
From innovation to industry
Innovation could be a major source of value creation for LAC, but only
if it is embedded in broader industrial, infrastructure and skills
strategies. The region benefits from strong foundations: major mining
companies already originate from the continent, including Chile’s
Codelco and Brazil’s Vale, and mining technology and service
providers can help directly deploy solutions in operations. This
provides a platform to scale technologies that raise recovery rates,
improve water and energy management, enhance safety and reduce
environmental impacts. However, the scope to innovate in other parts
of the value chain varies by segment. In areas where domestic
capabilities are more limited, including advanced battery materials,
rare earth separation, specialised equipment and some digital and
automation technologies, attracting partners and firms with advanced
technological expertise can be valuable to complement local
innovation. Policy has a crucial role to play. Building capacity in
geological services and technology centres, targeted R&D support,
actions to support technology transfer and demonstration projects,
investment in education and international partnerships can help
strengthen innovation capabilities and enhance operational efficiency. Download: Global Critical Minerals Outlook 2026.pdf
