IEA says market alone won’t fix China’s hoarding of critical minerals

China has an average share of 70% in its refining and that level of concentration “has only intensified in recent years”

The executive director of the International Energy Agency (IEA), Fatih Birol, warns that in the face of China’s growing monopolization of the refining of minerals essential for the ecological transition, the market alone cannot provide solutions and active policies are needed.

“We need new policies and international alliances between resource-rich countries, refiners, capital providers and consumers” because “markets alone do not offer greater diversity,” Birol said in an interview with Time released by his cabinet. He recalls that in the case of 19 of the 20 minerals closely monitored by the IEA due to their strategic nature for the energy transition, China has an average share of 70% in their refining and that level of concentration “has only intensified in recent years”. And although he notes that governments are becoming aware of the risk posed by such a high concentration and are looking for answers, “it is necessary to act both in the short term, to strengthen preparedness for possible supply disruptions, and in the long term to diversify supply chains and reduce structural risks”. Birol compares the current situation with China with that of 1973, when the situation of dependence on a few crude oil producers, essentially in the Arab world, gave rise to the first major oil crisis when they decided to use this resource as a political weapon due to the conflict with Israel. Above all, he recalls that “diversification is the golden rule in energy security”. The IEA warns that no country has solutions to these challenges on its own, and hence the need for international cooperation to which it offers itself as a forum, given its experience and the studies it has dedicated to the issue.

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