IEA and Moody's Warn of Critical Mineral Supply Risks

The International Energy Agency (IEA) and Moody's reported this week that global critical mineral supply chains have transitioned from theoretical vulnerabilities to immediate economic and industrial security challenges. In its Global Critical Minerals Outlook 2026, the IEA warned that refined supply remains highly concentrated, with China and Indonesia accounting for over 75 percent of refined supply growth over the last two years. The IEA notes that China's rare earth export controls, introduced in April 2025, have already forced some automakers to suspend operations and could jeopardize $6.5 trillion in annual downstream production globally.

Supply deficits for copper and lithium are projected through 2035, while new export quotas from the Democratic Republic of the Congo have created a supply gap for cobalt. These constraints triggered a price rebound in 2025 and early 2026, with cobalt prices rising approximately 130 percent and tungsten prices surging sixfold. Despite a 9 percent drop in global mining and refining investment in 2025, public financing commitments grew fourfold to $65 billion between 2023 and 2025 as the United States and Malaysia attempt to reduce China's refining dominance.

Concurrent research from Moody's indicates that the demand for these minerals is growing due to artificial intelligence infrastructure, electric vehicles, and renewable energy. Moody's suggests this shift provides resource-rich emerging markets an opportunity to move beyond raw material exports toward higher-value processing and refining, which may ultimately alter sovereign credit profiles and global investment patterns.