China’s dominance in the global critical minerals sector, particularly in battery metals like cobalt, is facing significant challenges as export restrictions from the Democratic Republic of Congo (DRC) disrupt supply chains. In 2024, China produced approximately 78 percent of the world’s refined cobalt, solidifying its pivotal role in the electric vehicle supply chain. However, this reliance on Congolese cobalt reveals a critical weakness: China’s limited domestic mining capacity and heavy dependence on imported intermediate cobalt products.
Export Controls Lead to Market Disruption
The DRC’s recent imposition of export controls, including a temporary suspension and a quota system initiated in October 2025, has drastically reduced shipments to China. By the end of 2025, exports had nearly ceased, with Congo limiting shipments to 18,125 tonnes for the fourth quarter and 96,600 tonnes for the entire year of 2026, reserving part of this for strategic allocation. The implementation delays exacerbated the situation, with the first shipment under these new rules only departing in January 2026. Consequently, refined cobalt prices surged from around $10 per pound to $25, while cobalt hydroxide payables soared from approximately 55 percent to 100 percent of benchmark prices. In response to acute shortages, Chinese buyers have increasingly tapped into domestic inventories.
Challenges from Limited Supply Alternatives
China faces a scarcity of viable alternatives to Congolese cobalt. Although Indonesia is ramping up cobalt production as a by-product of nickel mining, these additional volumes are insufficient to compensate for the shortfall created by DRC’s export restrictions. Historically, Chinese firms have held significant sway over Congo’s mining sector, securing access to both copper and cobalt resources. However, this dominance is waning as Congo aims to restructure its resource sector and enhance domestic value capture.
Simultaneously, geopolitical dynamics are shifting. Increased Western involvement, including potential U.S. investments in mineral marketing initiatives, is altering the competitive landscape. Infrastructure projects like the Lobito rail corridor to Angola’s Atlantic coast are also emerging as alternative export routes that could undermine Chinese logistical networks.
China’s Dependence on Foreign Raw Materials
The recent disruptions in cobalt supply highlight a broader strategic vulnerability: China’s heavy reliance on foreign raw materials. Despite leading globally in sectors such as rare earth processing, China continues to depend on imports for essential inputs. As demand for battery materials escalates, this reliance is expected to deepen, heightening exposure to geopolitical risks and resource nationalism.
The situation in Congo serves as a stark reminder that dominance in refining does not equate to secure supply chains. While China remains a central player in the global battery ecosystem, its dependence on external sources represents a significant Achilles’ heel—one that could influence future trends within the electric vehicle and energy transition sectors.
