Dash and grab: the risks of the global race to stockpile critical minerals
As the race to secure critical minerals accelerates, uncoordinated national stockpiling risks making the global economy less secure. Pau Morandi and Hugh Miller explain why the solution lies not in abandoning strategic reserves but in anchoring them within a credible international framework.
The race for critical minerals is accelerating as countries pursue increasingly unilateral stockpiling initiatives. A wave of such efforts has contributed to a surge in the price of palladium and cobalt in recent months, and to copper and silver hitting record peaks in early 2026. Governments from Washington to Beijing, Brussels to Canberra, are scrambling to build strategic reserves of the minerals that underpin the clean energy transition, digital infrastructure and defence supply chains. The instinct is understandable. But the approach is self-defeating.
When multiple large economies simultaneously build up buffer stocks in already tight markets, they heighten supply risks. Unilateral stockpiling may drive up prices, distort physical flows and disadvantage smaller economies, and may trigger the very shortages it is designed to prevent. Without coordination, national strategies to secure supply heighten global vulnerability.
A market under structural stress
Demand for critical minerals is entering a period of sustained and broad-based growth, driven by three mineral-intensive strategic domains: the energy transition, digitalisation and defence. In the Net Zero Emissions by 2050 Scenario put forward by the International Energy Agency (IEA), demand for cobalt, nickel, magnet rare earth elements, and graphite will more than double by mid-century, while demand for lithium will increase almost ninefold (see Figure 1).
The energy transition is not the only driver of these trends. The expansion of data centres and advances in artificial intelligence and semiconductors are intensifying demand for high-purity metals and rare earths. New defence spending commitments are increasing demand for specialised alloys, magnet materials and battery chemicals. Therefore, mineral demand is likely to be volatile for years to come, shifting rapidly with technological change, industrial policy and geopolitical shocks.
Figure 1. Mineral demand in IEA policy scenarios
Note: STEPS, APS and NZE are IEA policy scenarios: Stated Policies Scenario, Announced Policies Scenario and Net Zero Emissions by 2050. REEs are rare earth elements. ‘Other uses’ refers to defence and information technologies, among other areas. Source: IEA Critical Minerals Dataset.
Supply, meanwhile, remains highly concentrated and structurally rigid. The production and refining of cobalt, lithium, nickel, graphite and rare earth elements are each dominated by just three countries, which account for more than 75% of global output and are projected to increase their share of these markets. China’s commanding position constrains diversification, as do the length of time required for mine development and the high cost of new refining capacity.
Geopolitical tensions are heightening the structural risks in these supply chains. Trade interventions affecting critical minerals have risen sharply since 2021 (see Figure 2 below). Producer countries are using export restrictions to capture greater downstream value and gain geopolitical leverage, as illustrated by Indonesia’s nickel policies and China’s restrictions on heavy rare earth exports in response to tensions with the US.
Together, the concentration of supply and the fragmentation of trade reduce market elasticity as demand grows in strategically important sectors. Accordingly, mineral supply risks may arise from a variety of evolving factors. This underlines the need for a coordinated policy response to mitigate such risks.
Figure 2. Rise in trade restrictions across green value chains
Source: Global Trade Alert (GTA) database.
Market impact of strategic stockpiling
In response to rising supply risks, several major economies are establishing strategic mineral stockpiles as part of broader economic security strategies. The US, China, the EU, Japan, South Korea, Australia and India have all announced or implemented stockpiling programmes.
Unilateral stockpiling can significantly influence metal markets, particularly when combined with trade interventions. Chinese copper stockpiling has tightened markets and pushed prices up. The US threat of potential tariffs on refined copper in 2025 appeared to be a geopolitical manoeuvre designed to indirectly build domestic inventories by exploiting regional price differences. These developments illustrate how national strategies to secure supply can reshape global price formation and trade flows.
The current situation differs from earlier critical mineral stockpiling episodes in three respects. Multiple large economies are simultaneously accumulating buffer stocks, many mineral markets are already tight, and supply chains remain highly concentrated.
Figure 3. Market impact of global stockpiling initiatives
Note: Accumulative demand from announced stockpiling initiatives and the equivalent share of global annual supply. Sources: BACI International Trade Database at the product level; IEA Critical Minerals Dataset.
If countries’ announced stockpiling programmes purchased the equivalent of 180 days of net imports of the commodities listed in Figure 3 above, this would exceed 10% of the global annual supply of all these products except nickel. Because countries need to rapidly stockpile commodities, the process would create a front-loaded demand shock that placed immediate pressure on already constrained supply chains, particularly in smaller and more concentrated markets such as those for rare earths, cobalt and graphite.
These dynamics point to a major policy dilemma. In isolation, strategic stockpiles may strengthen national resilience, but simultaneous and uncoordinated accumulation across multiple economies risks tightening supply, amplifying price volatility and intensifying competition.
Towards coordinated stockpiling: a framework for institutional design
There is a strong case for coordinated stockpiling: concentration of supply creates systemic vulnerability; national strategies pursued in isolation can intensify shocks; and poorly designed mechanisms for releasing strategic reserves into the market without coordination can destabilise markets. The evolving critical minerals landscape risks all three conditions emerging simultaneously.
Historical events clearly illustrate the risks of this scenario. The main policy challenge is in not whether to stockpile but how to do so within a coordinated institutional framework.
By the end of the Cold War, the US government had built up a vast helium reserve equivalent to roughly ten times annual global demand. Under pressure to recoup costs, the federal government was forced to liquidate quickly and cheaply, which crowded out private investment in new production. When the reserve ran dry between 2011 and 2013, prices quadrupled and the market was left with no buffer to mitigate future shocks. A reserve designed to guarantee supply had instead created fragility.
The European gas crisis of 2022 tells a similar story from the opposite direction: fragmented national responses intensified a regional shock. Lacking coordinated procurement, multiple EU member states independently entered global LNG markets at the same time. This drove prices from around €20/MWh before the crisis began to more than €300/MWh at its peak, while also pricing developing countries out. The EU eventually introduced demand aggregation and mandatory storage targets, which were effective but reactive measures. The EU’s dependence on a single supplier, Russia, was widely acknowledged even before the crisis; it lacked a coordination mechanism capable of preventing multiple national responses from amplifying the disruption they sought to avoid.
Against this backdrop, a broader institutional assessment is required to identify the criteria an institution will need to fulfil to coordinate an efficient, credible and rigorous international critical minerals stockpiling programme – and which existing body most closely meets these criteria. In our assessment, an effective system will need to satisfy five essential conditions.
First, the institution will require the mandate and policy levers to provide security of supply and coordinate collective action, including during crises. Second, it will need the expertise in energy and critical minerals to effectively monitor supply, refining, inventories and risks in real time, and to make evidence-based decisions. Third, the institution will require a membership and governance structure that is broad enough to be legitimate but is still capable of decisive action. Fourth, it will need sufficient credibility and financing capacity to deal with the companies controlling mines, refineries and logistics networks that determine supply. Fifth, the institution will require mechanisms that are transparent and accountable enough to build market confidence and deter freeriding. While no single institution adequately satisfies all five criteria, they clearly point to where coordination should be anchored.
The IEA is the most credible foundation for this architecture. It combines a well-defined energy security mandate with binding policy levers, a proven emergency response system (developed for oil) and the analytical depth to monitor complex mineral markets in real time. At its 2026 Ministerial Meeting, the IEA’s member governments took a significant step in this direction. They formally directed the IEA Secretariat to strengthen its Critical Minerals Security Programme, support countries in coordinating responses to supply disruptions, and provide guidance on the design and implementation of strategic stockpiling systems. This is an important signal of political will. But the IEA’s reach is limited by its current membership, which centres on countries that have joined the Organisation for Economic Co-operation and Development (OECD). Nonetheless, the institution has formal mechanisms for wider participation and is actively broadening its base, with Colombia joining, Brazil beginning the accession process, and India engaging in discussions on membership. An effective coordinating institution would require an expanded ‘IEA membership+’ framework. This would include major import-dependent economies, such as India, while complementary institutions played supporting roles: the World Bank in investment and development finance, the International Monetary Fund (IMF) in macroeconomic surveillance, and UN Trade and Development (UNCTAD) on trade, commodity markets and producer-country engagement.
It remains unclear whether this architecture can be built in an increasingly fragmented geopolitical environment. Our forthcoming report addresses this question directly, applying rigorous criteria to assess which institutional configuration is best placed to coordinate stockpiling and identify the conditions in which it could operate.