What are critical minerals and why are they important?

Critical minerals are raw materials essential for modern technology, defence systems, and renewable energy. These include rare-earth elements used in smartphones, electric vehicle batteries, wind turbines, and military equipment. They're called 'critical' because they're vital for economic security but often have limited supply sources.

Why is China's control over rare-earth minerals a concern?

China currently dominates the production and processing of rare-earth minerals, controlling about 80% of global supply. This creates supply chain risks for other countries, as seen when China has previously restricted exports during trade disputes. Diversifying supply sources reduces dependency on a single country.

What are tariffs and how do they affect these investments?

Tariffs are taxes imposed on imported goods to make them more expensive and protect domestic industries. When the US threatens tariffs on Chinese goods, it can disrupt trade relationships and make alternative suppliers more attractive, potentially benefiting non-Chinese mining companies.

What risks should I consider with critical minerals investments?

These investments carry commodity market risks, meaning prices can be volatile based on supply and demand. They're also sensitive to geopolitical developments, trade policies, and international relations. Additionally, mining operations face environmental and regulatory challenges that can affect profitability.

How do supply chain diversification trends affect these companies?

As governments and corporations seek to reduce dependency on Chinese suppliers, they're actively looking for alternative sources of critical materials. This trend could increase demand for companies mining these materials outside China, potentially boosting their revenues and stock prices over time.

17 handpicked stocks

Critical Minerals Supply Chain Diversification 2025

President Trump's threat to increase tariffs on Chinese goods has escalated the trade conflict, highlighting China's control over rare-earth minerals. This creates an investment opportunity in companies that mine and process these critical materials outside of China, securing alternative supply chains.

Han Tan | Market Analyst

Published on October 13

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

MP Materials Corp.

Current price

$96.40

VanEck Vectors Rare Earth/Strategic Metals ETF

REMX

Current price

$42.02

Energy Fuels Inc/Canada

UUUU

Current price

$24.34

Lithium Americas Corp.

LAC

Current price

$8.22

RAMACO RESOURCES INC

METC

Current price

$52.53

5E ADVANCED MATERIALS INC

FEAM

Current price

$4.26

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Your Basket's Financial Footprint

Market capitalisation breakdown for the 'Critical Minerals: Securing The Supply Chain' basket.

Key Takeaways for Investors:

Large-cap dominance tends to reduce volatility, offering more stable, lower-risk performance that tracks broad market moves.
Treat this basket as a core portfolio holding, not a short-term speculative position.
Expect steady, long-term value rather than rapid, short-term gains; growth is generally gradual.

Total Market Cap

MP: $13.87B
UUUU: $4.69B
LAC: $1.14B
Other

12 Month Growth Potential

Use the growth calculator to see how much investing in these assets could return over one year, based on aggregated analyst sentiment provided by Refinitive Ltd.

If you invested across these assets:

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In 12 months it might be worth:

$1,000.00

+2.37%

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About This Group of Stocks

Our Expert Thinking

Trade tensions between the US and China have highlighted the risks of depending on a single supplier for critical materials. This group focuses on companies mining and processing rare-earth minerals outside of China, positioning for potential supply chain diversification as industries seek alternative sources for these strategic materials essential to technology, defence, and renewable energy.

What You Need to Know

This collection includes companies across the critical minerals value chain - from exploration to processing. These materials are vital for modern technology but currently dominated by Chinese suppliers. The group carries commodity market risks and is sensitive to international policy changes, making it a tactical investment tied to geopolitical developments.

Why These Stocks

These companies were handpicked by professional analysts as key players positioned outside China's supply chain dominance. Each firm offers exposure to the growing demand for alternative sources of rare-earth elements and strategic materials, potentially benefiting from the long-term trend towards supply chain security and diversification.

Group Performance Snapshot

2.37%

Average 12 Month Profit

On average, analysts expect assets in this group to grow 2.37% over the next year.

11 of 16

Stocks Rated Buy by Analysts

11 of 16 assets in this group are rated Buy by professional analysts.

47.1% vs 4%

Group Growth vs Bank interest

This group averaged a 47.1% return last month, beating the typical 4% bank rate.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

🌍

Supply Chain Revolution

Global industries are actively seeking alternatives to Chinese suppliers for critical materials. These companies are positioned at the centre of this massive shift towards supply chain diversification.

⚡

Strategic Materials Demand

Rare-earth minerals are essential for everything from smartphones to electric vehicles and defence systems. As technology advances, demand for these materials continues to grow exponentially.

🎯

Geopolitical Advantage

Trade tensions have created a unique opportunity for non-Chinese miners. These companies could benefit significantly as governments and corporations prioritise supply chain security over cost savings.

Get the full story on this Basket. Read our detailed article on its risks and potential.

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