By Romel S. Gurky
Growing geopolitical tensions and trade restrictions are heightening risks to the global supply of critical minerals, despite current market stability, according to industry analysts.
Prices for lithium, nickel, cobalt, and graphite have dropped significantly since 2023 due to strong supply growth, particularly from China, Indonesia, and Africa. However, projections indicate that future supply shortages, especially for lithium and copper, could create serious vulnerabilities.
A recent analysis by the International Energy Agency (IEA) warns that over-reliance on a small number of suppliers increases the risk of major supply shocks. Currently, 75% of refined lithium, nickel, and cobalt projects and over 90% of battery-grade graphite developments are concentrated in the top three producing countries. If supplies from key producers like China and Indonesia were disrupted, markets could face significant shortfalls.
Read also : Supply strains loom despite declines in critical mineral prices: IEA
China has already imposed multiple export restrictions on key minerals, including gallium, germanium, and graphite, with additional controls announced in early 2025. Such disruptions could sharply raise the cost of batteries and electric vehicles, widening price gaps between China, the U.S., and Europe, and undermining manufacturing competitiveness in Western economies.
The IEA’s Critical Minerals Security Programme, established in 2022, is working to mitigate these risks by strengthening supply chain resilience and promoting diversification strategies. An international summit on energy security, co-hosted by the IEA and the UK government in April, will focus on critical mineral security and emergency preparedness.
Editing by Reiner Simanjuntak
