COLUMN: Indium and rare earths — Beijing tightens its grip on the minerals that run the world

June 2026: indium enters the economic war

In June 2026, amid the noise of the Sino-American trade war over semiconductors and blacklists, a little-known metal entered the conflict: indium. China intensified its control over exports of this critical metal in response to the explosive demand generated by artificial intelligence chips. And that might seem like nothing — until you understand what indium is used for and why the fact that China controls the world's supply is a first-order geostratgic threat.

That is the subject of this column: strategic minerals as the invisible battlefield of an economic war that is, itself, very visible. And Western dependence on China for these minerals as the Achilles heel of a security strategy we believe is more solid than it actually is.

Indium: the metal everyone ignores and everything depends on

Indium is a rare metal used primarily in semiconductors, flat-panel displays based on ITO (indium tin oxide), high-efficiency solar cells and certain military infrared detection systems. Demand for indium has exploded with the proliferation of AI chips — every graphics accelerator, every neural processor requires components in which indium is indispensable.

I find it fascinating that indium — a metal I had never heard of before taking an interest in resource geopolitics — sits at the heart of a global economic war. That is the paradox of our era: the most decisive battles for the future are fought over obscure raw materials rather than on visible battlefields. The invisibility of this war makes it more dangerous.

The mechanics of control

China's tightening of indium export controls in June 2026 fits within an existing regulatory framework: China can require export licenses for minerals it classifies as strategic, subject exports to quotas, and delay or refuse authorizations according to its geopolitical interests. These tools have existed for years. What changes in 2026 is the intensity and the target: indium is subjected to heightened scrutiny at precisely the moment when Western demand for AI chips makes it critical.

This timing is not a coincidence. China has watched American and European plans to develop independent chip manufacturing capacities. It knows these factories — TSMC Arizona, Intel Ohio, CHIPS Act Europe — will need indium. Tightening the tap now is preparation for a pressure lever when those factories become operational.

MP Materials and USA Rare Earth on the Chinese list

On June 22, 2026, among the 10 American companies placed on China's export control list, were MP Materials and USA Rare Earth — the two main American companies seeking to build a rare earth supply chain independent of China. This targeting is surgical: China is hitting precisely the companies that threaten its near-monopoly on rare earths and strategic minerals.

Sanctioning MP Materials and USA Rare Earth is the smartest move Beijing could have made in this context. These companies are the seeds of a Western independence that, if it succeeds, would reduce one of China's most powerful levers of pressure. By targeting them now, Beijing is trying to strangle in the cradle what could become its own weakness. This is geopolitics in its purest form.

A monopoly built over decades

China produces approximately 60% of global rare earths and, more importantly, processes approximately 85% of world production. Even rare earths extracted outside China — in Australia, the United States, Myanmar — are often sent to China for processing. This domination of the value chain — extraction AND processing — is the result of deliberate investment over decades and a consistent industrial policy that sacrificed local environment to dominate the global market.

Rare earths are not geologically rare — they exist on every continent. They are economically rare: their extraction and processing are polluting, costly and complex. China accepted the environmental and social costs that Western democracies, with their regulatory frameworks, did not. The result: a de facto monopoly that has lasted thirty years.

Military applications of rare earths

Rare earths are indispensable in the permanent magnets used in electric motors — from guided missiles to electric vehicles, wind turbine generators and military drones. An American F-35 contains approximately 400 kg of rare earth materials. An American destroyer contains tonnes of them. Western military dependence on Chinese rare earths is not an abstract economic question — it is a concrete operational vulnerability.

400 kg of rare earths in an F-35. I re-read that figure and measure the absurdity of the situation: the most advanced weapon system in the U.S. arsenal depends on materials whose supply is controlled by America's strategic rival. If China decides tomorrow to block rare earth exports to the West, Western military production chains are in danger. This is not a science-fiction scenario. It is a documented vulnerability.

The G7 retaliation

China announced new dual-use technology restrictions in retaliation for G7 decisions. This escalation cycle — Western sanctions on advanced technologies, Chinese counter-sanctions on strategic raw materials — creates a dynamic in which both sides accumulate pressure levers they have not yet deployed at full force.

The logic of this trade war mirrors that of mutually assured deterrence: each side accumulates economic weapons sufficiently devastating to deter the other from escalating to the breaking point. But like nuclear deterrence, the stability of this equation rests on the rationality of the actors — and on the absence of accidents or miscalculations.

The South China Sea vessels as a signal

The military dimension of this economic tension is real. China deploys 40 to 50 vessels daily — naval ships, coast guard vessels and armed civilian boats — in the South China Sea. This massive deployment is not a response to an immediate military threat — it is a demonstration of presence and a strategy of imposing facts on the ground in disputed maritime zones. The resources war and the geographic war are two faces of the same strategy.

China controls rare earths; the West controls advanced technologies and financial markets. This is a kind of economic balance of terror — each side can hurt the other, but neither can "win" without catastrophic losses. The question is whether this balance holds, or whether someone tries to break it. The June 2026 escalation suggests both sides are testing the limits.

The Sino-Korean meeting of June 24

On June 24, 2026, Chinese Premier Li Qiang met with the South Korean Prime Minister and proposed semiconductor cooperation. This offer is strategically calculated: South Korea — with Samsung and SK Hynix — is one of the most critical actors in the global memory and semiconductor supply chain. Seducing Seoul away from the American orbit is a Chinese strategic priority.

China controls rare earths; the West controls advanced technologies and financial markets. This is a form of economic balance of terror — each side can hurt the other. The question is whether this balance holds, or whether the June 2026 escalation is the beginning of a deeper and more painful decoupling for both sides and for the global economy.

For South Korea, the Chinese offer is economically tempting — China is its largest trading partner — but politically risky given American pressure to limit technology transfers to Beijing. Seoul is navigating the same treacherous waters as the Netherlands with ASML. The Korean dilemma illustrates the predicament of many Asian countries torn between their economic interests with China and their security commitments with the United States.

JCET and self-sufficiency in packaging

While China seeks to attract South Korea, it continues to build its independence. The JCET investment of CNY 7.8 billion (approximately USD 1.15 billion) for a new advanced packaging factory in Shanghai is yet another piece in the self-sufficiency puzzle. The strategy is clear: reduce dependence on foreign suppliers at every link in the chain.

Li Qiang offers semiconductor cooperation to Seoul while JCET invests USD 1.15 billion in a factory in Shanghai. Beijing's strategy operates on two simultaneous levels: attract partners who can be won over AND build autonomy so as not to need those who cannot. This is a formidably rational and patient strategy. The West reacts. China plans. The difference is fundamental.

Diversify supply sources

The fundamental response to dependence on Chinese strategic minerals is supply source diversification. Mining projects in Canada, Australia, Africa and Latin America can reduce Chinese dependence over the long term. But they take time — mines take years to develop, processing plants even longer.

Initiatives like the Minerals Security Partnership agreement between the United States and its allies point in the right direction. They are insufficient in scale and speed. China has a thirty-year head start in this race. Closing it requires massive, sustained investment over an entire generation — not political announcements that change with every electoral cycle.

Recyclability and reducing dependence

Another response is recycling strategic minerals already present in end-of-life equipment — phones, computers, electric vehicles. Europe has developed ambitious recycling programs, but volumes are still insufficient to offset import dependence. And the technology for recycling rare earths — recovering indium from used screens, extracting permanent magnets from motors — is still less mature than one would like.

We have built an economy that depends on minerals whose supply is controlled by China, and we recycle less than 1% of the rare earths we use. This is a strategic catastrophe in slow motion. It was not built in a day. It will not be corrected in a day either. But every day we do not start correcting it seriously is another day our security rests in Beijing's hands. I cannot write this without feeling deep frustration.

Beijing's long-term strategy

China understood before the West that natural resources and strategic minerals are instruments of power in the twenty-first century. Its African strategy — massive infrastructure investments in exchange for resource access — has secured supplies of cobalt, lithium, manganese and rare earths that complement China's domestic resources. This long-term vision began twenty years ago, when the West was managing the post-Cold War era with a liberal approach assuming free trade would resolve security problems.

I end this column with an unshakeable conviction: Western dependence on Chinese rare earths is one of the gravest and most avoidable strategic vulnerabilities of our era. It was built through decisions — or non-decisions — going back thirty years. It will not correct itself. It requires political will and investment on the scale of a war plan. Because this is indeed what war looks like.

This liberal assumption was the West's great strategic error. It allowed China to build monopolies in critical technologies and resources while the West believed markets would sort everything out. They did not. And it is now necessary to rebuild a form of strategic sovereignty in critical resources without abandoning free trade principles — a politically and economically difficult balancing act.

The urgency of a Western critical resources doctrine

What this column calls for is a Western critical resources doctrine — a coherent, funded, durable strategy that treats access to strategic minerals as a matter of national security, not merely a commercial supply chain problem. This doctrine must cover source diversification, recycling, innovation in alternative materials and cooperation among allies. It does not yet exist in sufficiently robust form. The time has come for it to exist.

Mines and processing plants as the absolute priority

The real answer to Chinese rare earth dependence is not negotiating with Beijing for better terms — it is building credible alternatives. This means investing in rare earth mines in Canada, Australia, Francophone Africa and Latin America. But above all, it means building the processing plants — rare earth refineries, permanent magnet factories, component manufacturing supply chains — in allied countries where security of supply can be guaranteed politically.

Today, even rare earths extracted outside China are often sent to China for processing, for lack of viable alternatives. This processing bottleneck is as strategic as extraction itself. Urgent investment in rare earth separation plants in Europe and the United States is indispensable — and must be funded by initial public money, because the private sector alone cannot bear the risk in the face of unfair Chinese competition.

Recycling as an urgent strategic secondary source

Rare earth recycling is a secondary source that deserves to be developed far more aggressively. Every end-of-life electric motor, every decommissioned wind turbine, every used phone contains recoverable rare earths. Current recycling rates are below 1% for most rare earth elements. Recycling technologies exist but are not deployed at scale for lack of sufficient investment.

Europe, with its Battery Regulation and its Electronics Equipment Regulation, has laid the foundations of a circular economy for strategic minerals. But moving from regulatory obligations to operational industrial supply chains requires investment in collection infrastructure, advanced separation technologies and reprocessing capacities that markets alone will never deploy quickly enough.

Rare earth recycling at under 1% efficiency — that is the equivalent of leaving gold in mines after extraction. We throw critical metals into landfills while complaining about our dependence on China for those very same metals. The contradiction is so obvious it would be almost comical — if the national security stakes were not so serious. It is time to act seriously on recycling.

One metal, one lesson

Indium is a perfect metaphor for the West's strategic vulnerability. It is a metal most Western citizens have never heard of, yet their phones, their computers, their defense systems and their energy transition depend on it. And it is produced and controlled 80% by China. That concentration did not happen by accident — it is the result of deliberate Chinese strategic decisions and the absence of equivalent Western strategic decisions.

The time for a wake-up call

China's tightening of indium export controls in June 2026 is not an isolated event. It is a signal — among others — that the resource war has already begun. The West can no longer afford to ignore it. The industrial democracies must treat strategic minerals with the same urgency as military defense. Because in the interconnected world of the twenty-first century, the two are inseparable.

By Maxime Marquette, columnist

Editorial stance

I am not a journalist but a columnist and analyst. My expertise lies in observing and analysing the geopolitical, economic and strategic dynamics that shape our world. My work is to take political strategies apart, to understand global economic movements, to put the decisions of international actors in context and to offer analytical perspectives on the changes that are redefining our societies.

I do not claim the cold objectivity of traditional journalism, which stops at reporting facts. I claim analytical clarity, rigorous interpretation and a deep understanding of the complex issues that concern us all. My role is to give meaning to the facts, to place them in their historical and strategic context, and to offer a critical reading of events.

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