China’s dominance in the rare earth sector dates back to the 1980s, when the country began building what would become a near-monopoly in both rare earth extraction and crucially, refining – the intensive process that separates them from other minerals.
By 2024, China accounted for roughly 60 per cent of global rare earth mining production and 91 per cent of refining output, said the International Energy Agency (IEA).
A Reuters report published on Nov 19, citing Benchmark Mineral Intelligence, projected that Western markets would still depend on China for 91 per cent of their heavy rare earth supply by 2030.
Against this backdrop, China’s new mineral diplomacy takes on added significance, experts said.
“The primary aim is to ease the growing concern that some of its allies in the G20 framework were starting to have about the unilateral sort of actions by China to control the volume of critical minerals export,” said Jane Nakano, a senior fellow in the Energy Security and Climate Change Program at the Center for Strategic and International Studies (CSIS).
“It’s to mitigate its critical mineral supply chain dominance from becoming sort of a liability in international relations,” Nakano said, adding that it’s so China would “not lose allies and partners”.
For instance, past reports pointed to 2023 Chinese export controls on metals like gallium and germanium as Beijing used critical mineral supplies as leverage.
Analysts and governments have flagged them as potentially disruptive to global supply chains for chips, optics, and other high-tech applications reliant on those elements.
Language used by China’s International Economic and Trade Cooperation Initiative on Green Mining and Minerals leans heavily on words like “open”, “fair”, “sustainable” and “inclusive”, analysts noted.
The framework promises green mining, R&D incubation platforms, and trade facilitation aligned with World Trade Organization (WTO) rules.
The message, analysts suggest, is that China seeks not to dominate global minerals through coercion, but through cooperation and shared standards.
Beijing is seeking to “dispel the sense” that it is weaponising the dominance of Chinese companies in critical mineral supply chains, said Triolo, especially as China tightens control over the rare earth sector amid trade tensions.
China’s strategy and approach is likely to resonate and “find sympathetic ears” with Global South partners, he said, pointing to the Belt and Road Initiative (BRI) as a key vehicle of influence.
“China is viewed as more sympathetic to the needs of developing countries, while suspicions of US motives remain high,” he said, also noting that Chinese firms had “already built substantial infrastructure”.
“Beijing wants to use the green minerals initiative to help solidify the ability of its companies to continue to have access to raw materials critical to key supply chains,” he added.
Nakano from CSIS echoed that assessment.
“China has every reason to want to extend its dominance of the global supply chain,” she said.
“But at the same time, in order to have more of a sustained presence, because they also want to probably reach many of these G20 and to some extent, BRICS markets … (that) are huge export destinations.”
https://www.channelnewsasia.com/east-asia/china-rare-earths-g20-green-minerals-global-5496736
