Is China Winning The Global Minerals War?
Randy Wolken, President & CEO

The U.S. and its allies have been attempting to loosen China’s grip on minerals critical to defense and key manufacturing industry technologies. However, Chinese companies are becoming more, not less, dominant. They have expanded operations, supercharged their supply, and forced prices to drop. China is taking these actions because it is not interested in the West reducing its leadership in critical minerals.

Minerals such as lithium, nickel, copper, and cobalt are in demand, and China largely controls these minerals and their distribution. Last year, according to Darton Commodities, non-Chinese production of refined cobalt declined to its lowest level in 15 years. The share of lithium mining done within China or by Chinese companies abroad has grown from 14% in 2018 to 35% this year, according to Fastmarkets, a commodities information provider. Over the same time, lithium processing done within China has risen from 63% in 2018 to 70%, according to Fastmarkets. This has all occurred due to the massive state subsidies of the Chinese government, which pushes competition out of business.

The U.S. government is getting involved to help turn this situation around. The Biden administration is taking the lead, along with other allies, to create friendly sources for rare and critical minerals. One of the world’s leading companies in copper production, First Quantum Minerals, has hit a financial crunch. The U.S. and its allies are looking to keep this vital source from being controlled by the Chinese. With the bidding expected to be concluded later this year, the goal is to prevent China from controlling even more of the world’s copper supply. Like that processed at MACNY-member Revere Copper, copper is critical for many key industries and such uses as transmission lines, data centers, and electric vehicles.

Much more needs to be done to ensure U.S. growth in advanced manufacturing is supported. Access to critical minerals is crucial to our success. With the reshoring of key industries and the rapid increase in New York State manufacturing, MACNY continues to advocate for strong policies to counter the efforts of China to control critical minerals. Our Congressional delegation is well aware of our state’s potential to become a growing hub of essential industry manufacturing industries. As you identify challenges posed by unfair competition, please let us know so we can join our voice with yours in overcoming efforts by China and others to disadvantage your company’s growth.