China controls over 90% of the processing for key minerals like rare earths and permanent magnets. That single fact explains why the world's richest democracies spent three days on the shores of Lake Geneva this week trying to rewrite the rules of the global minerals trade.
G7 leaders agreed on June 17 to step up coordination to cut their countries' reliance on China for critical minerals , launching a new alliance with teeth: an IEA-led coordination platform and pilot stockpiling mechanisms for lithium and nickel , with a target to reduce dependence on any single non-G7 supplier of rare earths and permanent magnets to below 60% by 2030. The move follows Beijing's export curbs on permanent magnets last year that disrupted industries , exposing just how little alternative processing capacity exists outside China. Some Western supply chains came close to halting.
But the real story isn't happening in France. It's unfolding in Zimbabwe's lithium fields, Kenya's negotiating rooms, and China's futures exchanges—where the fight over who captures value from the energy transition is being decided one processing plant, one export ban, and one bilateral deal at a time.
Can Africa Keep the Value This Time?
Only one of Zimbabwe's seven major lithium producers—China's Zhejiang Huayou Cobalt—is currently ready for the transition to lithium sulphate production , according to Innocent Rukweza, chairman of the Lithium Association of Zimbabwe. That's a problem, because the government's quota-based system allows six producers to continue exporting concentrate only until January 2027 , when a full ban on raw lithium exports takes effect.
The industry is now pleading for an extension to June 2027. Sinomine's Bikita Minerals and Sichuan Yahua's Kamativi lithium mines are building lithium sulphate plants, while the state-owned Sandawana mine is conducting a processing feasibility study , Rukweza told a mining conference in Victoria Falls this week. The ask is simple: "just a little bit of leeway," he said, because the deadline might be tight.
The tension is real. In February, the government suspended exports of lithium concentrates citing mineral leakages and export malpractices, and also introduced a 16% export tax on the mineral.
Compounding this is a difficult pricing environment for lithium globally, which has reduced cash flows and made it harder to fund and accelerate construction simultaneously. Zimbabwe wants to climb the value chain. The question is whether its miners can build fast enough to avoid a revenue cliff.
Kenya is taking a different approach. President William Ruto said in an interview with Reuters that an agreement with the U.S. covering rare earths and other strategic minerals was already in the works and could be concluded soon, with minerals to be processed in Kenya , following discussions with G7 leaders including President Trump. In addition to rare earths, Kenya has large untapped deposits of niobium, lithium, graphite, copper and nickel.
Ruto said he agreed with Trump that partnerships should be based on investment rather than aid, adding that the continent no longer wanted relationships built on dependency or resource extraction. It's a striking shift in tone—and one that mirrors the broader push across Africa to process more minerals domestically. The era of shipping raw ore to China and buying back batteries may be ending.
Who Sets the Price?
While the West builds alliances, China is building infrastructure—the kind that matters. China's Guangzhou Futures Exchange will open its lithium carbonate futures and options to overseas traders from July 3 , giving global investors direct access to hedge in the world's largest lithium market. Overseas traders will be able to post US dollars as margin for the yuan-denominated lithium futures, subject to a 5% haircut , the exchange said.
China's securities regulator had earmarked both contracts for internationalization at the start of this year, as Beijing pushes wider use of the yuan and seeks greater influence over commodity pricing.
The West has sought to establish its own benchmark pricing for critical minerals such as lithium to cut dependence on China, but has struggled because China accounts for both the bulk of output and consumption for many key materials.
The timing is no accident. As the G7 announces stockpiling plans, China is cementing its role as price-setter. GFEX has rapidly emerged as a reference price for the lithium market, as China is the world's biggest consumer of the battery metal and home to two major producers, Ganfeng Lithium and Tianqi Lithium.
Beijing's response to the G7 alliance was measured but firm. China defended its export control measures on critical mineral supplies and urged the Group of Seven nations to respect market economy principles and international trading rules rather than favoring "small cliques," its foreign ministry said Thursday. Foreign ministry spokesperson Lin Jian said China's efforts to standardize and improve its export control system are in line with international practices.
