THE CRUNCH
The UK is dangerously dependent on China for critical raw materials needed for defence, AI and renewable energy, according to a parliamentary investigation by the business select committee. MPs want an urgent centralised policy and a critical minerals finance facility to fund mines and speed up diversification.
The committee heard that the real bottleneck is processing rather than mining: China dominates the refining of seven categories of minerals, including the refined lithium needed for electric vehicles and rare earths used in military aircraft fuselages. Demand for lithium is expected to rise 45-fold by 2030, and demand for rare earths used in permanent magnets 16-fold, as Britain rebuilds its military capabilities.
That reliance is a strategic vulnerability because China can abruptly cut supplies, as it did in 2025. A separate dispute over the China-owned chipmaker Nexperia left the European car industry days away from stoppages last October. Donald Trump secured a one-year reprieve on rare earth export restrictions from Xi Jinping, since extended to January 2027, but the report suggests this leaves the UK at the mercy of US-China relations.
The committee's preferred fix is for the UK to work with G7, European and Indo-Pacific partners to aggregate demand and attract new suppliers. Its 10-point plan covers domestic mining, refining and recycling, reducing procurement from China, unlocking investment and easing planning barriers. It also criticised government opacity, saying parliament has no visibility of the vulnerabilities identified or the projects being backed.
A government spokesperson denied the criticism, pointing to £400m being delivered to ramp up domestic production and recycling, plus targets for 2035: meeting 10% of demand through domestic production and 20% through recycling, with no more than 60% of any critical mineral coming from a single country.