Signal
In October 2025, China extended export controls on graphite, adding to earlier restrictions on gallium and germanium. The EU remains 98% dependent on China for rare earth magnets. Despite billions invested in Western mining and refining, most new projects face delays due to permitting, local opposition, and infrastructure gaps. The US Inflation Reduction Act (2022) and EU Critical Raw Materials Act (2023) have yet to dislodge China’s command over the refining and separation stages. Meanwhile, Africa, Latin America, and Australia become battlegrounds for strategic resource alignment, with state-backed actors securing upstream stakes. The West’s “friend-shoring” model is struggling to keep pace with vertically integrated rivals.
Why it matters
Control over rare minerals shapes who builds the next generation of electric vehicles, missiles, satellites, and semiconductors. Supply bottlenecks translate into delayed capabilities and strategic dependence. Without processing and midstream sovereignty, mining alone offers little security. China's dominance is not just in volume but in value-added control. Emerging alliances such as the Minerals Security Partnership (MSP) offer coordination, but not yet speed. The window to build sovereign supply chains before the next escalation is narrowing.
Strategic Takeaway
Resource control is not a commodity problem. It’s a command problem. Nations that fail to secure upstream access, midstream capacity, and downstream resilience will find their industrial and military autonomy eroded.
Investor Implications
Expect continued volatility and policy intervention in the critical minerals space. Western firms in rare earth refining, such as MP Materials (NYSE: MP) and Lynas Rare Earths (ASX: LYC), will benefit from state incentives and reshoring demand. Mining projects in Africa and Australia with Western ESG compliance may attract premium capital as strategic alignment trumps lowest cost. Infrastructure enablers, rail, port, and energy, around these sites are also investment-critical. Investors should watch for which refining technologies scale fastest and who controls the midstream chokepoints.
Watchpoints
20–22 November 2025 → Critical Minerals Conference, Perth, Australia.
Q1 2026 → EU updates its Critical Raw Materials Strategic Projects list.
2026 → US DoD reports on rare earth supply vulnerability and domestic processing progress.
Tactical Lexicon: Midstream Sovereignty
The ability to control the refining, processing, and separation stages of critical materials.
Why it matters:
Enables value capture beyond raw extraction.
Shields against coercive export controls.
Anchors industrial autonomy in defence and energy transitions.
Sources: reuters.com
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