China's restrictions on rare earth exports could jeopardise $6.5tn worth of downstream production outside the country annually if fully enforced, the International Energy Agency (IEA) said in its 2026 Global Critical Minerals Outlook.
The report assesses supply, demand and investment patterns across key energy minerals.
It includes copper, lithium, nickel, cobalt, graphite and rare earths, as well as a wider group of strategic materials used in energy, high-tech, aerospace and advanced manufacturing sectors.
IEA executive director Fatih Birol said: “Our latest analysis shows that vast amounts of economic value depend on relatively small volumes of critical minerals, whose supply chains remain highly concentrated and are therefore vulnerable.
“Yet there are encouraging signs of progress – including in rare earth supply chains – where we see targeted policies and investment support starting to make a difference.”
According to the IEA, prices for critical minerals recovered during 2025 and into early 2026, reversing a multi-year decline, as tighter supply conditions emerged following a series of fresh export restrictions imposed by major producing nations.
Investment in the sector dropped by 9% in 2025, halting several consecutive years of expansion, a shift the agency linked to volatile pricing and rising geopolitical friction.
The concentration of mineral supply chains, particularly in refining, deepened over the past two years.
Indonesia, the leading nickel refiner, and China, which dominates refining of other major energy minerals, jointly represented over three-quarters of the total increase in refined output during this period.
The report also found that nearly all supply growth in the manganese, nickel and graphite markets stemmed from each market's leading producer.
Export controls on rare earths that China introduced in April 2025 led some vehicle manufacturers to cut output or halt operations temporarily, the report noted.
China broadened these restrictions further in October 2025, though enforcement was pushed back by a year.
The agency also highlighted positive developments.
Government financial commitments to critical minerals more than quadrupled from 2023 to 2025, climbing to $65bn, reflecting stronger state involvement in backing supply growth and diversification.
Within rare earth refining, new ventures in the US alongside expanded output in Malaysia lowered the dominant supplier's market share from above 90% in 2023 to 85% in 2025, with the IEA forecasting a further decline to 70% by 2035 should planned projects proceed as planned.
Last month, China added ten American companies to its export controls list, including rare earth miners and defence contractors, in retaliation for US restrictions.
China said the move was intended to safeguard national security and uphold international non-proliferation obligations.
