Highlights

• China dominates processing and refining of 19 out of 20 strategic minerals with an average market share of ~70%, creating supply chain vulnerabilities far beyond mining.
• Key minerals impacted by China's dominance include:
  • Graphite: 90% battery-grade production.
  • Lithium: 70% refining capacity.
  • Cobalt: Dominated through the DRC-to-China pipeline.
  • High-purity manganese.
  • Tungsten: 80% production.
• Trump's 2025 industrial policy pivot includes:
  • Section 232 investigation on processed critical minerals.
  • Emergency powers to boost domestic production.
  • 5 million DOE funding.
  • Allied frameworks like the $8.5 billion Australia pipeline.
  • $7.4 billion Tennessee smelter with 40% DoD equity stake.
• Western vulnerability arises from dependence on Chinese refining capacity for materials essential to:
  • EV batteries.
  • Semiconductors.
  • Aerospace.
  • Defense manufacturing.
• Recent export controls on graphite, gallium, germanium, and antimony demonstrate Beijing's willingness to weaponize this advantage.

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China’s most durable leverage over Western industry is not always in mining. It is in processing and refining—the chokepoint where ore becomes usable material, where quality is controlled, and where supply chains can be throttled quietly. The International Energy Agency (IEA) put it bluntly in 2025 (opens in a new tab): China is the leading refiner for 19 of 20 strategic minerals it tracks, with an average market share around 70%.

Exclude rare earths and the pattern still holds.

Five minerals—graphite, lithium, cobalt, high-purity manganese, and tungsten—sit at the center of EV batteries, aerospace alloys, semiconductors (indirectly through hardware and tooling supply chains), and modern defense manufacturing. In 2025, Beijing again demonstrated it is willing to operationalize these advantages through export controls and licensing friction, reinforcing the reality that the “energy transition” and the “arsenal economy” share the same hidden dependency: Chinese processing capacity.

What follows is the updated, accuracy-hardened version of your piece—same thrust, sharper numbers, stronger sourcing.

1) Graphite: The EV Anode Chokepoint

Graphite (opens in a new tab) is the largest single component by weight in most lithium-ion batteries. The U.S. produces effectively no natural graphite and has limited domestic capability to convert graphite into the battery-grade anode materials EV supply chains require. China dominates both upstream and midstream: USGS data show licensing delays tied to China’s graphite export controls reduced spherical graphite exports in 2024 versus 2023—an early warning of how fast this valve can tighten.

Where it’s mined: China remains the dominant producer, with additional production in places like Mozambique, Brazil, Madagascar and others. But the strategic point is that much non-Chinese ore still routes through China for purification, shaping, and coating—steps that turn a commodity into a battery input.

What it’s used for: EV battery anodes, fuel cells, refractories and steelmaking, lubricants, and nuclear applications. If battery-grade graphite flows are disrupted, the immediate effect is not academic: anode production stalls, and EV cell factories downstream idle.

Accuracy update: Use USGS data for the export-control impact and keep the “~90% battery-grade processing” line as an industry estimate, not a courtroom fact.

2) Lithium: Refining, Not Rocks, Is the Point of Control

Lithium is the backbone of rechargeable storage. The West hears “lithium” and pictures mines; Beijing built the advantage in conversion chemistry—turning spodumene and brines into battery-grade carbonate and hydroxide. The IEA and Reuters reporting consistently describe China as the dominant processing hub, commonly cited at around ~70% of global lithium processing, depending on definition and year.

Where it’s mined: The big sources remain Australia (hard-rock spodumene) and the Lithium Triangle (Chile/Argentina/Bolivia brines), plus growing supply from Africa and China. The supply chain vulnerability is that a material can be mined outside China and still be strategically dependent because it must be refined into battery chemicals—often in China.

What it’s used for: EV and grid batteries; consumer electronics; smaller uses in alloys and industrial chemistry. Battery demand dominates.

2025 policy signal: The Trump administration’s emphasis shifted from vague “mining independence” rhetoric toward measures aimed at the processing bottleneck (opens in a new tab)—the stage where China’s advantage is most entrenched.

3) Cobalt: The Congo-to-China Pipeline

Cobalt illustrates how Chinese control can extend far beyond Chinese territory. According to USGS, Congo (Kinshasa) accounted for an estimated 76% of global cobalt mine production in 2024, and the supply chain reality is that much of that feed moves through Chinese refiners.

Where it’s mined: Primarily the DRC Copperbelt, plus by-product cobalt from nickel operations in Indonesia and elsewhere. But the key dependency is the processing step: cobalt concentrate and intermediate products commonly flow to China, where the conversion into battery chemicals and metal is scaled.

What it’s used for: Battery cathodes (especially NCM/NCA chemistries), plus superalloys for jet engines and turbines, catalysts, and specialty applications. Cobalt is also a defense-relevant metal because it shows up in materials where heat tolerance and strength matter.

Why it matters now: Even as battery makers reduce cobalt intensity, the absolute demand remains large, and the supply chain remains brittle. A disruption in refined cobalt availability translates quickly into cathode constraints—not years later, but in procurement cycles.

4) High-Purity Manganese: The Quiet Battery Bottleneck

Bulk manganese is abundant; battery-grade, high-purity manganese is not. This is a critical distinction. High-purity manganese sulfate and electrolytic manganese metal (EMM) are specialty products, and China dominates these processing routes in most market analyses—commonly described as extremely concentrated. Keep the “up to ~90%” framing explicitly tied to high-purity/battery-grade forms, not global manganese ore.

Where it’s mined: Large ore sources include South Africa, Australia, Gabon, and Brazil. China imports ore and upgrades it through energy-intensive refining into high-purity products.

What it’s used for: Steelmaking (the largest end-use), and increasingly battery cathodes as high-manganese chemistries advance to reduce reliance on cobalt and manage cost. The Western bet on “cobalt thrift” often implies more manganese, which can inadvertently deepen another Chinese processing dependency.

5) Tungsten: Defense Manufacturing’s Hard-Metal Dependency

Tungsten is the old-school strategic mineral that never stopped being strategic. USGS notes tungsten concentrate production outside China remained around 20% of global production in 2024—implying China’s dominance near ~80%.

Where it’s mined: China’s tungsten districts (notably Jiangxi) dwarf most peers. Other producers exist (e.g., in parts of Europe and Asia), but scale and processing remain concentrated.

What it’s used for: Tungsten carbide cutting tools, aerospace and industrial tooling, and defense applications including hard-metal components and munitions-related supply chains. In 2025, China expanded export controls to include tungsten and other items, underscoring that supply security here is not theoretical.

What Trump Actually Did in 2025: Industrial Policy, Sharpened

Two moves matter because they target _processing dependency_—the central weakness.

Section 232 on processed critical minerals (April 15, 2025)

Trump signed an order directing Commerce to investigate whether imports of processed critical minerals and derivative products impair national security—explicitly citing foreign overcapacity, price distortion, and export restrictions as tools of leverage. This is the policy architecture for tariffs, quotas, or other restrictions if the investigation supports action.

Emergency-powers push to boost domestic production (March 20, 2025)

Reuters reported Trump invoked emergency powers aimed at increasing U.S. production of critical minerals as part of efforts to offset China’s control of the sector.

The “critical minerals list” expands (2025)

The final 2025 USGS critical minerals list (opens in a new tab) expanded to 60 minerals, adding items such as copper and phosphate—an acknowledgment that modern industrial resilience is about systems, not a short list of celebrity commodities.

Money and muscle: DOE funding + allied frameworks

DOE announced (opens in a new tab) $355 million in late 2025 funding opportunities to expand domestic production of critical minerals and materials, including recovery from industrial and coal byproducts—useful, but not yet the scale of a wartime buildout.

Internationally, Trump and Australia signed a critical minerals framework, with Reuters describing an $8.5 billion project pipeline, plus near-term financing steps including $2.2 billion in EXIM Bank letters of interest and a broader pledge of at least $2 billion in joint investment.

Finally, the U.S. signaled (opens in a new tab) it will take equity-like positions to secure capacity: Reuters reported a planned $7.4B Tennessee critical minerals smelter where the U.S. Department of Defense would hold 40% of the venture.

How Vulnerable Are the U.S. and Allies?

The vulnerability is not simply “we import minerals.” It’s that the West’s industrial base is increasingly built on materials refined elsewhere, often by a geopolitical rival with demonstrated willingness to use trade tools as a strategy.

• The IEA’s headline finding—China as leading refiner for 19 of 20 minerals analyzed—means “friendshoring” without processing buildout is often an illusion.
• Export controls aren’t hypothetical. China’s December 2024 ban on exports of gallium, germanium, and antimony to the U.S. (and tightening on graphite) showed how quickly policy can translate into industrial stress.
• USGS data on graphite export licensing delays and export declines in 2024 demonstrate that even “soft controls” (permits, paperwork, product definitions) can function like a throttle.

The allied position is only marginally better. Europe and Japan can diversify mines; they still compete for the same limited non-Chinese refining capacity. In a tight market, everyone discovers the same unpleasant truth: mines are geography; refining is power.

The Bottom Line

America’s critical minerals problem in 2025 is no longer an “awareness” problem. It is a timeline and capacity problem.

Trump’s 2025 actions—Section 232 targeting processed minerals, emergency-powers language to boost supply, expanded critical-minerals designation, allied financing frameworks, and equity-like government participation—signal a real pivot toward industrial policy.  As Rare Earth Exchanges™ has argued about rare earth element supply chains, however, not nearly enough.

The physics of the supply chain do not care about press releases. Graphite purification plants, lithium chemical refineries, battery-grade manganese processing, and tungsten supply diversification are hard, capital-intensive, permit-sensitive builds.

Until those facilities exist at scale, the U.S. and its allies remain living on a narrow ledge: technologically advanced, militarily active, and materially dependent—not on rare earths alone, but on a deeper set of elements and minerals where China’s near-monopoly is less visible and, arguably, more dangerous.

© 2025 Rare Earth Exchanges™ – Accelerating Transparency, Accuracy, and Insight Across the Rare Earth & Critical Minerals Supply Chain.