IEA Sounds Alarm on Critical Minerals Supply Risks as France Advances Resource Strategy

The International Energy Agency has cautioned that investment in critical minerals declined in 2025 and supply chains have become increasingly concentrated, creating new challenges for France as it works to secure the raw materials required for its industrial and energy transition.

In its Global Critical Minerals Outlook 2026, published on 16 July, the Paris-based agency reported that investment in mining and refining fell by nine percent last year, attributing the drop to geopolitical tensions and price volatility.

At the same time, supply chains have grown more concentrated, with China and Indonesia together responsible for over three-quarters of the increase in refined output during the past two years.

“Concerns about high supply concentration have moved from a theoretical vulnerability into an immediate economic security challenge,” said the IEA’s chief economist Tim Gould.

The report underscores the rising use of export controls, especially by China, as a major risk.

Restrictions on rare earth exports introduced in April 2025 forced some manufacturers to reduce or suspend production.

The IEA estimates that if Beijing widens such measures, up to $6.5 trillion in annual downstream production outside China could be at risk.

Despite these weaknesses, the agency noted some advancement. Public financing commitments for critical minerals projects more than quadrupled between 2023 and 2025, while countries such as the United States and Malaysia have started to diminish China’s lead in rare earth refining.

Nevertheless, the broader outlook remains one of fragile supply chains at a moment when demand is climbing sharply, fueled by clean energy technologies, electric vehicles and advanced electronics.

Central challenge

For France, these global patterns may create difficulties: the nation’s industrial goals rely heavily on materials whose supply is still largely foreign-based.

France’s €500 million critical minerals strategy, launched in 2023 under the France 2030 investment plan, seeks to lessen that dependency. It focuses on 26 raw materials considered vital for industrial sovereignty, including lithium, cobalt, nickel, rare earth elements and semiconductor inputs such as gallium and germanium.

Central to the strategy is the development of domestic extraction and processing capacity. The Bureau de Recherches Géologiques et Minières (BRGM), France’s geological survey agency, has identified lithium-rich geothermal brines in the Alsace region as the country’s most promising domestic resource.

Several projects are now in development. Lithium de France, supported by TotalEnergies and Renault, aims to produce 34,000 tonnes of lithium hydroxide per year by 2028 using direct extraction technology. A parallel initiative, Emili, developed by French industrial minerals company Imerys, targets output from 2027.

If successful, these projects would position France among the first European nations with domestic lithium production, providing a strategic edge for its emerging battery sector.

France is also working to reinforce its processing capabilities. In Normandy, the firm Carester is building a rare earth separation facility able to supply materials for as many as 300,000 electric vehicle motors annually. The effort tackles a key bottleneck, given that China currently processes roughly 85 to 90 percent of the world’s rare earths.

‘Urban mine’

Meanwhile, Paris-based mining multinational Eramet is pivotal in securing upstream supply. Its operations include manganese in Gabon, nickel in New Caledonia and lithium in Argentina. The company is also investing in French refining capacity, particularly in Dunkirk, where it manufactures high-purity manganese for battery cathodes.

However, volatility in global commodity markets highlights the associated risks. The steep decline in nickel prices, driven by rising Indonesian output, has strained New Caledonia operations, leading to French government support to sustain the industry.

Beyond extraction and processing, France is treating recycling as a strategic pillar. Firms such as Veolia, SUEZ and Eramet are building facilities to recover lithium, cobalt and nickel from spent batteries, viewed as a future European “urban mine” — a term describing the recovery of valuable metals from end-of-life products rather than natural deposits.

(With newswires)

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