Global Competition for Critical Raw Materials: Where Ukraine Could Fit

Critical raw materials are gaining significance in global economic competition, as nations aim to decrease reliance on China for minerals crucial to batteries, electronics, energy, and defense. China maintains dominance in mining and processing, with rare-earth refining accounting for 85% of global production in 2025. Beijing has implemented export controls on gallium, germanium, graphite, and rare-earth elements, making access to critical minerals a key geopolitical instrument.

The United States and European Union are addressing this shift by reforming industrial policies to ensure supply-chain security. The EU's Critical Raw Materials Act seeks to boost domestic extraction and processing while curbing excessive dependence on single foreign suppliers. Similarly, the United States is promoting domestic production and establishing strategic mineral reserves.

This trend presents an opportunity for Ukraine, which possesses deposits of 25 of the 34 critical raw materials classified by the EU, such as lithium, titanium, graphite, beryllium, and rare earth elements. However, it is essential to differentiate between Ukraine's mineral potential and commercially viable reserves. Approximately 20% of the country's mineral resources and half of its rare-earth deposits are situated in occupied territories, and much of the available geological data stems from the Soviet era, necessitating further exploration and assessment.

In 2025, the U.S.-Ukraine Reconstruction Investment Fund allocated part of new subsoil revenues into reconstruction, and in January 2026, Ukraine awarded a production-sharing agreement to a consortium consisting of TechMet and The Rock Holdings for the Dobra lithium deposit in the Kirovohrad region, with an expected investment of over $179 million.

The primary challenge lies in advancing beyond raw material extraction. Converting lithium into hydroxide, graphite into battery anodes, or titanium into higher-value products yields considerably more economic value than exporting ore or concentrates alone. To capitalize on this potential, Ukraine must implement transparent auctions and investment agreements, war-risk insurance and guarantees, adherence to EU environmental standards, and equitable distribution of benefits among the state, investors, and local communities.

The global quest to diversify away from China provides Ukraine with a strategic window of opportunity. However, the true measure of success will not be the quantity of minerals extracted but rather whether those resources lead to processing plants, new technologies, skilled employment, and integration into European supply chains.