Amidst growing concerns over China’s dominance in the critical minerals sector, both Europe and the United States are ramping up efforts to reduce their dependence on the Asian giant. With China supplying about 90% of global processed rare earths and two-thirds of processed lithium, Western countries are feeling the pressure to secure their own sources of these vital minerals.
The CEO of U.S. government-backed investment vehicle TechMet, Brian Menell, highlighted the challenges faced by Western start-ups due to low prices for critical minerals like lithium, cobalt, and rare earths. Oversupply in the market has led to a significant drop in prices, making it difficult for Western companies to compete with China’s long-term investment strategy in the sector.
Despite the tough market conditions, TechMet, with a valuation of over $1 billion, is looking to capitalize on the current weakness in the market. The company plans to invest in more firms involved in lithium and tin, seizing the opportunity presented by the short-term stress in the market.
TechMet’s efforts are supported by major investors, including the U.S. government’s International Development Finance Corp and commodity trading house Mercuria. With an additional $300 million in funding on the horizon, TechMet is optimistic about its prospects in the critical minerals sector.
As both Europe and the United States strive to reduce their reliance on China for critical minerals, the race to secure alternative sources and investment opportunities heats up in a market plagued by oversupply and weak prices.
