19 August 2026
Executive Summary
Businesses attempting to reduce critical-mineral risk frequently diversify where raw materials are mined.
That may solve only half the problem.
The International Energy Agency’s Global Critical Minerals Outlook 2026 warns that concentration has increased particularly at the refining and processing stage. Over the past two years, the dominant refiners — China for most key energy minerals and Indonesia for nickel — accounted for more than three-quarters of growth in refined supply.
The UK government’s Critical Minerals Strategy illustrates the scale of that concentration particularly clearly for rare earths.
China accounts for approximately 70% of rare-earth mining but around 90% of rare-earth refining.
So a company can successfully purchase its mineral from somewhere other than China and still discover that the material must travel through China before it becomes usable.
The hidden risk is therefore:
Mining diversification does not necessarily mean supply-chain diversification.
UK Impact
Critical minerals sit inside products and infrastructure used throughout the UK economy, including:
- Electronics.
- Batteries.
- Renewable energy.
- Defence.
- Aerospace.
- Telecommunications.
- Automotive manufacturing.
- Medical technology.
- Industrial machinery.
The UK government says Britain will continue to rely upon imported critical minerals and identifies growing concentration within both mining and processing supply chains as a vulnerability.
OECD data make the UK exposure particularly striking.
Its 2026 review estimates that 22.7% of UK critical-raw-material imports were exposed to at least one export restriction during 2022–2024, above the global average.
Companies therefore need visibility beyond the name and country of their immediate supplier.
Global Impact
Export restrictions are increasing as governments seek to retain strategically important materials domestically.
The OECD reports that restrictions on critical raw materials have increased fivefold since 2009. Around 70% of global cobalt and manganese exports were subject to at least one restriction during 2022–2024, together with approximately 47% of graphite and 45% of rare-earth exports.
The IEA says recent export controls have converted concentration risk from a theoretical concern into an immediate economic-security issue. It notes that Chinese controls introduced during 2025 caused some downstream manufacturers, including automotive producers, to reduce utilisation or temporarily halt operations.
This demonstrates why understanding the mine alone is insufficient.
Critical-material supply chains may involve:
Mine → concentrator → processor → refiner → component manufacturer → final supplier.
Risk can concentrate at any one of those stages.
Our View
Businesses should map critical-material dependencies all the way through processing and refining.
Companies should ask:
- Which critical minerals exist inside our products?
- Where are they mined?
- Where are they processed?
- Where are they refined?
- Are supposedly different suppliers using the same refiner?
- Could an export licence be required at any stage?
- Which countries could introduce restrictions?
- Are substitutes technically possible?
- How long would requalification take?
- Can strategic inventory be held?
- Does recycling provide an alternative source?
- Have suppliers disclosed their own upstream concentration?
The supplier’s address is not the supply chain.
A component may arrive from Germany, Japan or the United States while depending upon a mineral mined in Africa and processed somewhere entirely different.
The most important dependency may therefore be several tiers upstream and completely invisible to the buyer.
Risk Indicator: HIGH
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The information contained within these Market Alerts is provided for general market awareness and informational purposes only. It does not constitute financial, legal, investment, regulatory or insurance advice. Whilst every effort has been made to ensure accuracy at the time of publication using multiple reputable and independently verified sources, geopolitical events, legislation, regulation and market conditions may change rapidly. Readers should obtain appropriate professional advice before acting upon any information contained herein.
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