The report, titled Beijing’s Critical Raw Material Weapon: And How to Dismantle It, examines China’s dominant role in the mining, refining, and processing of strategic minerals used in advanced industries and defense-related sectors.
According to the study, China currently controls more than 70 percent of global mining or refining capacity for roughly half of the materials identified by the European Union as strategically important. In sectors such as heavy rare earth refining, the report says Chinese production accounts for the overwhelming majority of global capacity.
The report focuses on materials including rare earth elements, gallium, germanium, graphite, tungsten, and antimony. According to the study, these minerals are widely used in semiconductors, electric vehicles, telecommunications systems, satellites, renewable energy infrastructure, radar technologies, drones, missile systems, submarines, and fighter aircraft. The report describes these supply chains as increasingly important to industrial production, technological development, and defense manufacturing.
According to the study, China’s current position is the result of decades of industrial investment and state-backed support for mining, refining, and processing industries linked to strategic minerals. The report argues that while many Western economies shifted toward finance, software, and service sectors over recent decades, Beijing continued investing heavily in industrial infrastructure associated with critical materials.
The report places particular emphasis on refining and processing capacity rather than mining alone. According to the study, even when raw materials are extracted outside China, many intermediate production stages still depend on Chinese industrial infrastructure and technical expertise. The study, therefore, suggests that efforts to diversify supply chains may require broader industrial investment beyond opening new mining projects.
The study also reviews developments during 2025, when China introduced tighter export controls and licensing procedures for several strategic materials following American tariffs and technology restrictions. According to the report, Beijing reduced export volumes and expanded oversight mechanisms for shipments while continuing to allow exports through licensing systems.
According to the study, supply chain restrictions can influence industrial production through delays, shortages, rising costs, and uncertainty in global markets. The report argues that these dynamics may affect manufacturing planning, investment decisions, technological development, and industrial expansion in sectors dependent on critical materials.
The report also notes that export licensing systems require companies to provide information about suppliers, facilities, technologies, and end users. According to the study, this provides authorities overseeing export controls with greater visibility into industrial supply chains and production networks, including some sectors connected to defense manufacturing.
Military applications are discussed extensively throughout the study. Gallium is described as important for radar systems and advanced semiconductors, while germanium is used in infrared imaging and satellite technologies. Rare earth magnets are also widely used in submarines, drones, missile systems, fighter aircraft, and naval platforms. According to the report, these materials have become increasingly important to modern defense-industrial production.
The study links these developments to broader geopolitical and economic trends, including the war in Ukraine, tensions surrounding Taiwan, rising military expenditures, and growing concerns over industrial resilience. According to the report, industrial supply chains and manufacturing capacity are becoming more central to discussions about long-term strategic competition and economic security.
The report also references President Xi Jinping’s emphasis on industrial and technological self-reliance. According to the study, Chinese policy increasingly focuses on strengthening domestic industrial capacity and reducing exposure to external disruptions or technological restrictions.
At the same time, the study notes that China remains deeply integrated into global trade and international export markets. According to the report, this combination of industrial self-reliance and global economic integration has allowed Beijing to maintain an influential position within several strategic supply chains.
The report argues that many Western governments underestimated the long-term implications of these industrial trends. According to the study, Chinese state support, industrial coordination, and lower production costs made competing refining and processing industries outside China economically difficult over many years.
According to the report, the United States and Japan have increased efforts in recent years to diversify supply chains through subsidies, strategic investments, long-term purchasing agreements, and industrial support measures aimed at rebuilding mining and refining capacity outside China.
Europe, meanwhile, is described in the study as moving more gradually despite initiatives such as the Critical Raw Materials Act. According to the report, European diversification efforts have not yet produced enough capacity to significantly reduce dependence on Chinese-controlled supply chains.
Beyond trade and economics, the study argues that industrial ecosystems, logistics infrastructure, advanced manufacturing capabilities, and control over strategic technologies are becoming increasingly important elements of international influence. According to the report, critical raw materials are likely to remain central to discussions about economic resilience and strategic competition in the coming years.
Released as Trump begins his meetings in Beijing, the study concludes that supply chains linked to critical minerals and industrial processing are becoming increasingly significant in shaping the global economic and geopolitical environment. According to the report, access to strategic materials may play a growing role in international relations and industrial policy debates over the coming decades
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