How the critical minerals trade is shifting amid rising geopolitical tensions

As supply chains shift and critical minerals rise on national security agendas, a once-overlooked corner of the commodities market is turning into a global economic flashpoint and a rare opportunity for long-term, structural investment.

At the recent 2025 G7 Summit, global leaders launched a Critical Minerals Action Plan to diversify production, strengthen refining capacity among allies and reduce reliance on single regions.

Canada has since deepened bilateral co-operation with Germany, signing a joint declaration in August to co-fund projects, co-develop supply chains, and fuel industries ranging from electric vehicles (EVs) to defence.

“That has shifted the mindset to: How do we secure these minerals? How do we ensure the control of the supply chain and the production?” says Andres Rincon, managing director, head of exchange-traded fund sales and strategy, at TD Securities.

Mining companies are also recognizing the importance of the relevant commodities they produce. London-based Anglo American PLC’s NGLOY recent bid to buy Vancouver-based Teck Resources Ltd. TECK-B-T is driven by the companies’ desire to expand their critical metals operations.

The surge in attention isn’t new. Investors first piled into rare earths years ago during the early wave of EV and chip production, but the conversation has evolved since.

“Now it’s about national security,” Mr. Rincon says. “Technologies that go into satellites, drones, phones — all of that is now considered key to an economy.”

Each country defines critical minerals differently. Canada includes uranium in its list, for example, while the United States doesn’t. China remains the dominant force, not only in mining but especially in refining.

Although dozens of materials fall under the critical minerals umbrella, three stand out for both investor relevance and future demand: copper, lithium and uranium.

Demand for all three is strong, says Raghav Mehta, vice-president and head of ETF product strategy at Global X Investments Canada Inc., with notable upside in lithium after recent price declines resulting from oversupply.

“The long-term structural demand for battery-grade lithium remains intact,” says Mr. Mehta, whose firm offers several ETFs focused on North American and global producers. “That creates a value opportunity not just in the mineral, but in lithium equities.”

On copper, he notes that “forecasts see long-term tightening supply by the 2030s unless new projects or higher grades emerge.” He adds that capital commitments from G7 countries and the U.S. for refining infrastructure are supporting investor interest.

For Mr. Mehta, ETFs are an effective way for investors to access the sector without overexposing themselves to the risks associated with individual mining stocks.

“ETFs let investors gain diversified exposure to producers and processors without assuming the direct operational risks of individual mines,” he says. “They behave like equities, often pay consistent dividends, and give you thematic exposure in a single ticket.”

Jeffrey Johnstone, senior wealth advisor at National Bank Financial Wealth Management in Toronto, notes that the ongoing pace of technological advancements, from artificial intelligence (AI) to electrification, is strengthening the long-term case for critical minerals.

“There are themes that come and go, but I think [AI] is a theme people are realizing is going to be around for a while as part of this cycle that we’re in,” he says. “We’re in a world in which technology is picking up steam. AI seems to be here and part of people’s lives more and more. So, there’s just more technology and advancement in everybody’s day-to-day life. As a result of that, some of those critical minerals are needed to continue that growth and development.”

He also says that ETFs are a good choice for investors looking to get exposure to critical minerals, especially those wanting to dip their toe in the water, as these products provide “diversification and a broad look at a sector that seems to have some runway over the next several years.”

However, Mr. Johnstone acknowledges that geopolitical risk in investments can’t be fully avoided, and is one of the most challenging aspects for retail investors to navigate. He framed volatility as “the price of admission” when participating in the space.

“I don’t think that you can ever remove risk. Unfortunately, that’s one of the things that people who choose to go down the path of putting part of their money in markets take on,” he says.

As demand for critical minerals continues to build, all three experts emphasized that the bottleneck in global production is not only in mining, but in refining and processing capacity — much of which is currently dominated by China.

Now the push to secure domestic or allied refining infrastructure is central to both investment and policy, and ETFs that include what Mr. Rincon describes as “the entire value chain”—from downstream players to infrastructure firms — may offer broader exposure.

As public policy evolves and global supply chains shift, critical minerals no longer occupy the fringes of the market; they’re now embedded in national industrial strategies and energy frameworks.

“There is a lot of interest in this space,” Mr. Rincon says. “And these are trends that have become very popular and will be popular for the foreseeable future.”