Critical Minerals Report (10.24.2025): Follow the Yellow Brick Road — China’s Squeeze Turbocharges Western Resolve to Weaponize Capital

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The past week delivered a cascade of strategic moves in critical minerals, underscoring an accelerating global realignment. In Washington, U.S. President Donald Trump hosted Australian Prime Minister Anthony Albanese to seal a landmark critical minerals partnership worth US$8.5 billion. The deal commits each country to invest at least US$1 billion in new mining and processing projects within six months and even introduces price floors to shield Western producers from China’s predatory pricing. The Export-Import Bank of the United States (EXIM) promptly issued letters of interest totaling US$2.2 billion for seven Australian projects, including Arafura Rare Earths Ltd. (ASX: ARU) and Northern Minerals Ltd. (ASX: NTU). The allies also unveiled support for Alcoa Corp. (NYSE: AA) to build a gallium extraction plant alongside its alumina refinery in Western Australia, aiming to supply 10% of global gallium demand. Gallium, critical for semiconductors and defense, has been in the crosshairs of Chinese export curbs. Australia will invest up to A$300 million in the Alcoa project (with offtake rights) and the U.S. will take an equity stake, partnering with Japan’s Sojitz Corp. (TYO: 2768) to bring the plant online. Notably, the U.S.–Australia agreement marks the first time Western governments have explicitly committed to price support mechanisms for critical minerals – a step long sought by non-Chinese miners to prevent Beijing from driving prices artificially low.

This diplomatic breakthrough was foreshadowed by Wall Street’s own pivot. In a signal that private capital is aligning with geopolitical goals, JPMorgan Chase & Co. (NYSE: JPM) launched a US$1.5 trillion “Security and Resiliency” initiative earlier this month, earmarking financing for supply-chain industries including critical minerals. Within that plan is US$10 billion for direct equity investments – exemplified by JPMorgan’s recent partnership with the Pentagon and MP Materials Corp. (NYSE: MP), which combined government offtake guarantees with bank financing to expand the Mountain Pass rare earth magnet supply chain. Now, JPMorgan’s template of blending commercial capital with strategic policy is being scaled up across sectors from rare earths to batteries. As the Critical Minerals Institute (CMI) Co-Chair Melissa “Mel” Sanderson put it, the money is finally moving “where the metal runs” lowering the cost of capital for projects that diversify supply.

New critical minerals funds also debuted this week, adding to the momentum. In Washington, the U.S. International Development Finance Corp (DFC) partnered with Orion Resource Partners and Abu Dhabi’s sovereign wealth fund ADQ to launch the Orion Critical Minerals Consortium, with US$1.8 billion in initial government funding and a target of US$5 billion (Source). The fund – led by Trump’s former energy envoy Frank Fannon – will pour capital into “production-ready” lithium, rare earths and battery-metal assets that can quickly supply the U.S. and allies. Orion’s CEO Oskar Lewnowski noted the group will “go where the rocks are,” investing not just in mines but also processing plants essential for end-use industries (Source). Importantly, the consortium’s mandate extends beyond the usual battery metals; it explicitly includes copper and uranium, signaling recognition that base metals and nuclear fuel are also strategic. Just days earlier, a similar venture was unveiled by the International Finance Corp. (IFC) and London-based Appian Capital, who launched a US$1 billion fund to develop critical mineral projects in Africa and Latin America (Source). Taken together, these public-private vehicles underscore the West’s new willingness to deploy heavy capital in what was once considered a niche, volatile sector. They also highlight a more inclusive approach: the Orion fund even brings in Gulf petrodollars via Abu Dhabi, a notable blend of Western and Middle Eastern interests in securing mineral supply chains.

All this activity comes as China’s tightening export restrictions raise the stakes. Early this month Beijing expanded its export controls to cover nearly all 17 rare earth elements and related items, after already imposing curbs on magnet alloys in the spring (Source). Under the new rules, foreign companies must obtain Chinese government approval to import any product containing more than trace amounts (0.1%) of controlled rare earths, and exports destined for defense use are outright banned. Beijing justified the move on national security grounds, pointedly noting the military importance of heavy rare earths. The reaction in the West has been acute. EU leaders, meeting in Brussels, put China’s rare earth “squeeze” on the agenda. While a formal joint EU response is not yet agreed, officials from France and Poland pushed for language condemning China’s tactic. Germany – the EU’s industrial core – signaled it would raise the issue, amid warnings that Europe “cannot afford to fall into new and dangerous dependencies” (Source). The European Commission is weighing its Anti-Coercion Instrument, a trade weapon of last resort, but consensus on deploying it is uncertain. For now, Brussels is pursuing urgent diplomacy: trade chief Maroš Šefčovič announced he will meet Chinese Commerce Minister Wang Wentao in Brussels for talks focused on rare earths and “cooling down the temperature” (Source). Washington, D.C., meanwhile, has taken a more confrontational line. President Trump blasted Beijing’s policy as “extortion” and threatened to retaliate with 155% tariffs on Chinese goods if critical mineral supplies remain weaponized (Source). U.S. officials argue that China’s actions validate the very alliance-building and stockpiling efforts that America and its partners are now accelerating (Source).

On the industry front, manufacturers are scrambling to get ahead of China’s November 8 implementation date for the new export curbs. Global automakers, for example, have been scouring the globe for rare earth supplies to avoid production disruptions. The powerful permanent magnets in vehicle motors and sensors depend on neodymium (Nd), praseodymium (Pr), terbium (Tb) and dysprosium (Dy), which the CMI classifies as “The Core Four” – and companies fear parts shortages and assembly line shutdowns if Chinese magnets are suddenly hard to obtain. Inventories that were built up after China’s initial controls in the spring have already been drawn down, and obtaining fresh export licenses from Beijing has become increasingly difficult.

Automakers like BMW and General Motors are racing to develop rare earth free motor designs, exploring induction systems and alternative magnetic materials, but those technologies remain years away from large-scale production. Recycling, too, is still in its early stages. A Renault-backed recycler in France currently processes magnets from about 400,000 end-of-life vehicles each year — a tiny fraction compared with the tens of millions of cars produced globally. In the United States, Cyclic Materials and magnet maker VACUUMSCHMELZE have announced a partnership to recycle rare earth magnet manufacturing waste, a meaningful step toward closing the loop domestically.

Time, however, is running short. Even if Chinese suppliers rush shipments before the latest export restrictions take effect, long transit times to Europe and North America mean any delay could idle production lines. Meanwhile, Beijing’s trade offensive has widened beyond rare earths, with new curbs on graphite — vital for EV batteries — and veiled threats targeting certain semiconductor materials. The cascading nature of these restrictions is forcing Western boardrooms to confront supply chain fragility in ways not seen since the pandemic.

Financial markets are already repricing the sector’s risk and opportunity. Rare earth equities outside China have rallied sharply in recent weeks as investors anticipate higher prices and increased government support. Major producers such as Lynas Rare Earths Ltd. (ASX: LYC) have drawn renewed attention from institutional investors, while smaller developers including Arafura Rare Earths Ltd. and Australian Strategic Materials Ltd. (ASX: ASM) have seen trading volumes surge on speculation that new financing and offtake agreements could accelerate their projects.

These market movements coincide with China’s tightening export controls and the subsequent wave of Western policy announcements, including new U.S.–Australia critical minerals funding initiatives and financing commitments from EXIM. Investors interpret these developments as an inflection point for the sector — one that could reshape global supply chains and pricing power over the next decade.

Goldman Sachs’ commodities team this week quantified the risk, warning that even a modest disruption in rare earth supply could erase tens of billions in global economic output due to downstream bottlenecks. Analysts underscored China’s overwhelming leverage: roughly 69% of mining, 92% of processing, and 98% of magnet manufacturing capacity worldwide. They also flagged specific vulnerabilities in elements such as samarium, terbium, and lutetium — all critical for defense and high-tech applications — along with natural graphite, another domain where China dominates.

Other critical minerals, so far spared from export restrictions, may not remain exempt as Beijing continues to calibrate its strategy. Goldman concluded that investments in non-Chinese producers — such as Iluka Resources Ltd. (ASX: ILU), Lynas, and MP Materials — represent one of the few practical hedges for manufacturers seeking secure alternative supply. Yet building new mines and refineries outside China will be a long and costly process, constrained by permitting, environmental hurdles, and the geological scarcity of heavy rare earth deposits.

All of this suggests that while Western financing initiatives mark genuine progress, the path to meaningful diversification remains measured in years — not months — leaving global manufacturers exposed to continued supply shocks in the interim.

Amid this bifurcating market, several corporate developments stood out. Aclara Resources Inc. (TSX: ARA) announced plans to build the first U.S. heavy rare earth separation facility by 2028, a project that speaks directly to the supply gap in elements like dysprosium and yttrium. Aclara will invest roughly US$277 million to establish a separation plant in Louisiana’s Gulf Coast, leveraging feedstock from its ionic clay deposits in South America (Source). This Louisiana facility – complete with direct port access and proximity to chemical reagents – will be integrated “mine-to-magnet”, including a downstream alloys plant on site. Once operational, it is expected to be the only integrated heavy REE producer in the Western Hemisphere, a milestone made possible by Aclara’s sustainable extraction technology and a supportive local incentive package. The State of Louisiana is providing tax abatements and infrastructure grants to fast-track the project, underscoring U.S. states’ eagerness to attract critical mineral investment. In Southeast Asia, Malaysia moved to clarify its rare earth policy. Investment Minister Tengku Zafrul Abdul Aziz said Kuala Lumpur welcomes foreign joint ventures to develop Malaysia’s sizable rare earth reserves – but only if value-add processing is done onshore. Malaysia last year banned exports of unprocessed rare earth ore effective Jan 2024 (Source), aiming to cultivate a domestic refining industry. Now, Zafrul is inviting international partners to build midstream plants with local firms, ensuring Malaysians hold equity stakes in these ventures. The policy is already in motion: Malaysia’s sovereign fund Khazanah is in talks with Chinese companies on rare earth downstream opportunities. And in a notable signal to existing players, Zafrul affirmed that Lynas Rare Earths Ltd. – which operates a major processing facility in Malaysia – can continue exporting its processed output freely, as Malaysia positions itself as a “neutral” hub serving all market. As an aside, Trending #1 this week on InvestorNews.com From Survival to Strength – How Amanda Lacaze Transformed Lynas Rare Earths.

Energy security is also shaping critical mineral demand. In Tokyo, newly installed Prime Minister Sanae Takaichi has made nuclear power revival a pillar of her economic program. Takaichi is pushing to restart Japan’s idled nuclear reactors to cut reliance on costly fossil fuel imports, seeing nuclear energy as vital for both inflation relief and decarbonization (Source). Her pro-nuclear stance implies a stronger appetite for uranium in the years ahead – notable given uranium’s place in the critical minerals list and China’s efforts to dominate that supply chain as well. Japan’s turn back to nuclear (after a post-Fukushima hiatus) could support uranium development projects in friendly countries, aligning with U.S. efforts – through the Orion fund and others – to invest in uranium production capacity. Takaichi’s government also signaled wariness of over-reliance on Chinese energy tech: she opposes large-scale solar farms that use Chinese-made panels, preferring to focus on advanced reactors and homegrown clean tech. That stance may further tighten the link between energy policy and critical mineral strategy in U.S.–Japan cooperation (with Treasury Secretary Scott Bessent urging Japan to cut Russian fuel imports in favor of allied sources — Source).

Meanwhile, the United States is not only subsidizing mines but also taking direct stakes in high-tech supply chain nodes, blurring the lines between industrial and technology policy. After having quietly acquired equity stakes in Intel Corp. (NASDAQ: INTC) (10%) and MP Materials (15%) in recent months (Source), the Trump administration was reported to be eyeing similar investments in quantum computing firms – an effort to ensure U.S. leadership in a field deemed strategic. A Wall Street Journal report claimed Washington had considered injecting capital into quantum start-ups like IonQ, Inc. (NYSE: IONQ), Rigetti Computing, Inc. (NASDAQ: RGTI), and D-Wave Quantum Inc. (NYSE: QBTS). The Commerce Department swiftly denied any active talks, but not before shares of those companies spiked on speculation of federal backing. Officials like Commerce Secretary Howard Lutnick (formerly a Wall Street executive) have argued that if taxpayer funds drive innovation, the government “should benefit” from the upside – a rationale underpinning these unprecedented federal equity positions. The scope of such intervention is widening: first rare earths and semiconductors, now potentially quantum computing and beyond. It highlights how national security investment is extending downstream into manufacturing and even R&D, complementing upstream mineral development. This week also saw a more traditional capital markets vote of confidence: Australian Strategic Materials (ASM) Ltd. raised A$55 million in a private placement to accelerate its “mine-to-metals” strategy (Source). ASM – which produces rare earth alloys – will use the funds to double output at its Korean metals plant to 3,600 tpa of NdFeB alloy (the feedstock for magnet makers) and advance plans for a U.S. alloy plant. Notably, U.S. institutional investors anchored the placement (investornews.com), attracted by ASM’s unique position as a non-Chinese integrated supplier. ASM’s CEO highlighted that in the past six months, “geopolitical tensions, trade disputes and tightened export controls have shaken global supply chains,” spurring Western manufacturers to seek secure alternatives (investornews.com). With its Korean facility already producing metal, ASM is offering immediate capacity at a time when new Western refineries are still on the drawing board – a fact not lost on investors.

In the graphite market – another critical material under Chinese sway – a notable U.S.–Australia collaboration emerged. Brisbane-based Graphinex secured a US$860 million funding commitment (A$1.32 billion) from EXIM for its Esmeralda graphite project in North Queensland (Source). This financing, essentially a U.S. government-backed loan, will help develop a major new source of natural graphite anode material for EV batteries. Queensland officials touted it as a sign that investor confidence is returning to the state’s critical minerals sector, crediting a business-friendly push by the new government. The Graphinex project is expected to include not just a mine but a downstream processing plant to produce battery-grade graphite – again illustrating the trend toward integrated, onshore value addition. The scale of EXIM’s letter of interest (nearly US$1 billion) makes it one of the largest single financing packages for a critical mineral project outside China, and it comes on the heels of the U.S. agreeing to treat Australian minerals as domestic for the purpose of American EV subsidies.

Across the board, the critical minerals landscape is being reshaped by policy and capital. In a single week, we witnessed U.S. and allied governments muscling up with funding commitments, big banks and private equity mobilizing trillion-dollar war chests, and companies from mining juniors to tech start-ups jockeying for position in this new strategic race. The flurry of deals and joint ventures – from Louisiana to Kuala Lumpur – underscores that “friend-shoring” of mineral supply chains is no longer just a slogan but is translating into concrete projects. Still, the time lag remains a central challenge. As the Critical Minerals Institute Directors will attest to, building independent supply chains will “face barriers,” with new mines taking 8–10 years and new refineries about 5 years to bring online. In the interim, China’s near-total grip on certain resources (for example, heavy rare earth refining is 99.8% China-controlled) means supply disruptions are a real and present risk. This precarious balance was evident in the auto industry’s anxious stockpiling and the EU’s diplomatic urgency this week.

For investors, the takeaway is that critical minerals have moved to the center of geopolitics and global markets. Government policy – from Washington’s equity stakes to Tokyo’s reactor restarts – is now a key driver of resource allocation. Market prices and corporate valuations are increasingly sensitive to policy announcements, not just geology. The past week’s developments suggest that while China’s actions have in some ways “turbocharged” Western resolve, the road to supply-chain resilience will be long, capital-intensive, and not without setbacks. Yet the direction of travel is clear: a more fragmented but also more invested critical minerals ecosystem is taking shape, with new alliances being forged atop old rocks. In the words of ASM Managing Director, Ms Rowena Smith, this is nothing short of a “seismic shift” in how the world powers its advanced economies (investornews.com) – a shift that will continue to unfold in real time, from one weekly headline to the next.

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InvestorNews Critical Minerals Institute (CMI) Directorial Headline Picks for the Week:

  • October 24, 2025 – Aclara To Build First Heavy Rare Earths Separation Facility in U.S. With a Secured Sustainable Ionic Clay Feed by Mid-2028 (Source)
  • October 23, 2025 – Follow the Money: Did JPMorgan’s $1.5T Push Set the Stage for the U.S.–Australia $8.5B Pact (Source)
  • October 23, 2025 – Australia’s ‘rock star’ rare earth miners profit from US-China tensions (Source)
  • October 23, 2025 – US, Orion Form Critical Minerals Fund Targeting $5 Billion (Source)
  • October 23, 2025 – Trump Administration striving to strike critical minerals deal with Kazakhstan (Source)
  • October 23, 2025 – First rare earths and chips, now quantum computers: Trump reportedly eyes new U.S. stakes (Source)
  • October 22, 2025 – EU countries mull response to China’s squeeze on rare earths (Source)
  • October 22, 2025 – Nuclear power at heart of new Japan prime minister’s energy policy (Source)
  • October 22, 2025 – Malaysia open to downstream rare earth element JVs with foreign companies — Zafrul (Source)
  • October 22, 2025 – US invests $1 billion in Graphinex’s new Queensland mine (Source)
  • October 21, 2025 – IFC, Appian launch $1 billion critical minerals fund in Africa, Latam (Source)
  • October 21, 2025 – Concerned carmakers race to beat China’s rare earths deadline (Source)
  • October 21, 2025 – EU trade chief to meet China’s Wang to discuss rare earths (Source)
  • October 21, 2025 – Goldman Sachs flags risk of disruption in supply of rare earths, key minerals (Source)
  • October 20, 2025 – US, Australia to invest $2 billion in critical minerals, advance Alcoa gallium project (Source)
  • October 20, 2025 – Rare earths shares soar as US and China battle over export controls (Source)
  • October 20, 2025 – ASM successfully raises A$55M to ramp-up alloy output and drive metallisation growth initiatives (Source)

InvestorNews.com Media Updates:

  • October 23, 2025 – Follow the Money: Did JPMorgan’s $1.5T Push Set the Stage for the U.S.–Australia $8.5B Pact https://bit.ly/47ulCfU
  • October 22, 2025 – West High Yield (W.H.Y) Granted Permit for Record Ridge Mine and Moves Toward Critical Mineral Production https://bit.ly/4o3C9hC
  • October 21, 2025 – At Last Money Hits the Critical Minerals Table https://bit.ly/4opKtIm
  • October 21, 2025 – When Carbon, Nickel, Cobalt — and Iron — Crash the Party and Remind Us Why Science Can Be Fun https://bit.ly/4nc4Ac1
  • October 21, 2025 – U.S.-Australia Deal Aims to Rein in China’s Rare Earth Dominance https://bit.ly/3IUAoEr
  • October 19, 2025 – UAMY vs Larvotto – Empty Vessels Make the Most Sound https://bit.ly/4nxmDK9
  • October 15, 2025 – Power Metallic Aims Big — Billionaire Backing, Drill Strategy, Institutional Entry https://bit.ly/48xGEMD

InvestorChannel.com (YouTube) Interview Updates:

InvestorNews.com News Release Updates:

  • October 24, 2025 – American Tungsten Provides Operation and Development Update https://bit.ly/47DPxmO
  • October 23, 2025 – Voyageur Pharmaceuticals Ltd. Strengthens Board of Directors with Wall Street Expertise to Facilitate U.S. Market Expansion https://bit.ly/3WZnxUx
  • October 23, 2025 – SEETEL New Energy, Energy Plug and Quantum eMotion Launch 261-kWh Breakthrough Battery Storage System for Worldwide Markets https://bit.ly/4hkfPha
  • October 22, 2025 – Appia Begins Diamond Drilling to Extend and Delineate the Highgrade Mineralization at PCH Target IV in Goias State, Brazil and Announces Acceleration of 2024 Warrants https://bit.ly/47CeaAj
  • October 22, 2025 – American Tungsten Announces Completion of $16.8 Million; First Tranche of LIFE Offering https://bit.ly/4ht8iNo
  • October 22, 2025 – Energy Fuels Announces Call Details for Q3-2025 Earnings https://bit.ly/4qshfdY
  • October 22, 2025 – Resouro Strategic Metals Inc. (ASX:RAU) (CVE:RSM) Completes Final Tranche of Private Placement https://bit.ly/47jWE2m
  • October 21, 2025 – West High Yield Resources Receives Green-Light Permit for Record Ridge Industrial Mineral Mine – Advancing Canada’s Domestic Critical Mineral Refining https://bit.ly/49fnfQQ
  • October 21, 2025 – Romios Begins New Round of Fieldwork on the Kinkaid Copper-Gold-Silver Project, Walker Lane Trend, Nevada https://bit.ly/4oPNLVN
  • October 21, 2025 – Resouro Strategic Metals Inc. (ASX:RAU) (CVE:RSM) Completes First Tranche of Private Placement https://bit.ly/4nYg5F9
  • October 20, 2025 – Export Finance Australia issues Conditional Letter of Support for the Donald Project https://bit.ly/4ozRJSi
  • October 20, 2025 – American Tungsten Reprices Non-Brokered LIFE Private Placement to $2.58 per Share https://bit.ly/4nm6wih
  • October 20, 2025 – ASM successfully raises A$55M to ramp-up alloy output and drive metallisation growth initiatives https://bit.ly/43mn5U0
  • October 17, 2025 – Nord Precious Metals Closes Fully Subscribed Non-Brokered LIFE Financing and Concurrent Non-Brokered Private Placement Raising an Aggregate of $4,000,000 https://bit.ly/4qgv7aW
  • October 17, 2025 – American Rare Earths Limited: Quarterly Activities Report for the Period Ending 30 September 2025 https://bit.ly/4onC3RR
  • October 16, 2025 – Spartan Metals Commences Exploration Program at the Eagle Tungsten-Silver-Rubidium Project, Nevada https://bit.ly/4qchwS3
  • October 16, 2025 – Appia Closes Non-Brokered Private Placement, Completes Auger Drilling at Gaia, Ships Samples to the Lab, and Advances a New Auger Phase at Taygeta – PCH Project (Goiás, Brazil) https://bit.ly/48yXsmC
  • October 16, 2025 – Panther Metals PLC: Winston Project Update https://bit.ly/46VhiXY
  • October 16, 2025 – Power Metallic Initiates Metallurgical Testing of Lion Deposit Phase 1 Metallurgy Recovery Contracted to SGS Canada Inc., Quebec City, QC and Lakefield, ON https://bit.ly/3KSnoji
  • October 15, 2025 – American Tungsten Upsizes Non-Brokered LIFE Private Placement to $20 Million https://bit.ly/476y6d9
  • October 15, 2025 – West High Yield (W.H.Y.) Resources Ltd. Announces Exercise of Warrants https://bit.ly/47bTdeo
  • October 14, 2025 – Western Uranium & Vanadium Closes Brokered LIFE Financing of $5.9 Million https://bit.ly/4n8Msjn
  • October 14, 2025 – Spartan Metals Appoints of Rebecca Ball as Vice President, Exploration https://bit.ly/4qcAfNi
  • October 14, 2025 – Energy Plug and Malahat Battery Technology Announce Strategic Alliance with Quantum eMotion on Energy and Defence, Including NATO-Aligned Initiative https://bit.ly/4hg1vGM
  • October 14, 2025 – Western Uranium & Vanadium Corp. Announces Closing of Mineral Lode Claims Acquisition https://bit.ly/4mZDSTT
  • October 14, 2025 – Resouro Strategic Metals Inc. (ASX:RAU) Update on Private Placement https://bit.ly/47pla3u
  • October 14, 2025 – Appia Receives Notice of Intention to Close from Ultra in Relation to the PCH REE Project Transaction https://bit.ly/3L7Clhc
  • October 14, 2025 – Romios Appoints Trish Jacques and Kevin Keough to the Board https://bit.ly/4hacMrL
  • October 14, 2025 – American Tungsten Announces $10 Million Non-Brokered LIFE Private Placement https://bit.ly/4o0Dgyw
  • October 13, 2025 – Allanite Rare Earths Processing Breakthrough: Successful Completion of Impurity Removal Neutralization Tests https://bit.ly/4h8OSNr

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