The new UK Critical Minerals Strategy, launched last weekend, is ambitious in scope – framing critical minerals as a foundation of the UK’s green growth and security agenda.
The justification for the strategy is clear: critical minerals are integral to modern life, from communications, critical infrastructure, defence and renewable energy to electric cars and life sciences. The government identifies that by 2035 annual demand for copper in the UK will almost double, while demand for lithium will increase by 1,100 per cent.
Yet, reliance on a global marketplace is no longer possible: COVID and the war in Ukraine have shown the vulnerability of supply chains; weaponized export controls are an increasing threat, made possible by the concentration of processing and mining supply chains, in particular by China.
The challenge is complex, requiring the UK to develop national industry, support recycling and sustainability, help UK listed companies capitalize on the global demand for minerals, and secure vital supply chains against market and geopolitical shocks.
The latest strategy is an important and welcome document. It marks a step change by talking directly to the UK Industrial Strategy, released in July 2025. (The lack of an industrial strategy was a key criticism of the UK’s first minerals strategy). Its financial commitments to domestic mineral extraction and processing are also important.
But the strategy does not fully engage with the geopolitical challenge created by critical minerals. And a champion is urgently needed to ensure the difficult part – the implementation – is made a success.
Important steps forward
The strategy, building on those published under previous Conservative governments, focuses a lot on domestic production, processing and recycling. Its definition of success is to meet 10 per cent of annual demand through domestic production by 2035 and 20 per cent through recycling.
One of its most concrete new offers to industry is on energy costs, featuring a commitment to increase relief under the Network Charging Compensation Scheme from 60 per cent to 90 per cent from 2026 for around 500 of the most electricity intensive businesses.
For energy hungry mineral processing, this could reduce network charges by an estimated £7–10 per megawatt hour, bringing total relief under the wider British Industry Supercharger package to roughly £78 per megawatt hour – narrowing the competitiveness gap with peer economies.
Alongside this, a commitment of £50 million of new funding for UK businesses across extraction, refining, processing and recycling takes the combined public portfolio in UK critical minerals to around £215 million once existing commitments are counted.
This modest fund is explicitly framed as catalytic capital, to be deployed alongside the National Wealth Fund (NWF), UK Export Finance (UKEF) and other public finance tools rather than as a standalone solution. The NWF has already put £31 million of equity funding towards Cornish Lithium, with an additional £4 million from Tech Met.
The intention is that NWF funding helps de-risk early phases of projects, validating business models and attracting investment. The UKEF’s mandate has already been widened so it can support overseas projects that supply critical minerals into UK supply chains, offering credit guarantees and other instruments to overseas producers, where some of the product then remains in the UK.
These modest but important actions acknowledge that the government must take on more risk if UK critical mineral supply chains are to be reshaped.
Recent experience, notably the collapse of Britishvolt in the EV battery value chain, underlines that early stage industrial bets are inherently risky.
But if the UK is serious about building new capabilities around critical minerals, it must design a policy framework that anticipates such failures, contains their systemic impact, and preserves public tolerance for such risk-taking. It will also require significantly more money than has been pledged to make a real difference – Germany is preparing to launch a €100 billion ($116 billion) investment fund for raw materials.
Building the case for increasing investment and risk-taking in this space requires a clear political narrative explaining why mining and processing matter for jobs, regional development and national security. This should include a more explicit public case for the role of critical minerals in net zero, defence, and technological competitiveness.
More than anything, success will rest on the details on implementation. The new document has a ‘designed by committee’ feel – and has indeed done the rounds of Whitehall and been inputted into by several departments.
It now needs a national champion, whether a department or minister, to generate a sense of unitary purpose and make a solid case for investment into the minerals sector – at a time when government budgets are under stress and there are limited available resources.
International collaboration and confronting global challenges
One weakness of the new strategy is that it shies away from the inherently geopolitical challenge presented by critical minerals.
No country produces everything it requires. Trade and exchange are vital. The West has relied upon Chinese subsidization of processing and is now alarmed by the power China wields over supply chains. Despite this, China is mentioned only four times in the strategy. Key partners, such as Canada and Australia, receive brief treatment – despite their role in important partnerships such as the Global Clean Power Alliance.
The strategy notes the need to work with partners from ‘G7, G20, and the Minerals Security Partnership’. Of these, the G7 Critical Minerals Action Plan is perhaps the most active means of collaborating with friendly nations on a plan that is already translating into action.
