'This Is A Crisis': Fund Manager's Explosive Forecast For This Critical Sector | Tomasz Nadrowski

Near-total control of key materials

China currently controls approximately 99% of global gallium production, 82% of tungsten, and similar majorities of heavy rare earths, graphite, and antimony.

Escalating export weaponization

Since 2020, Beijing has imposed 24 separate export restrictions, including critical rare earth controls in April 2024 and October 2025, explicitly using supply chains as geopolitical leverage.

Predatory pricing killing competitors

Chinese smelters operate at negative or zero treatment charges (TCRCs), making it economically impossible for Western refiners to compete, leading to the 'slow death' of non-Chinese processing capacity.

Mining alone cannot solve the crisis

Western policy focuses too heavily on exploration while ignoring the 'middle' of the value chain; without domestic smelters, mined ores must still be shipped to China for processing.

Korea Zinc model for reshoring

The deal with Korea Zinc to build a massive multi-metal smelter in Tennessee represents the necessary template for restoring Western refining capacity for materials like indium, germanium, and gallium.

Three decades of dependency

The current supply chain structure accumulated over 30 years and cannot be unwound within a single U.S. electoral cycle without immediate capital-intensive intervention.

Tariff-protected price floors

The West must establish Section 301 tariffs specific to HS codes to create price floors above the 'Chinese price,' as Western demand is inelastic and cannot compete with China's subsidized overcapacity.

Subsidize downstream transition

Revenue generated from tariffs should fund subsidies to help downstream manufacturers gradually wean themselves off Chinese inputs without destroying their cost structures.

Reduce cost of capital

Congress must tweak IRS codes to lower equity and debt costs for mining projects, as current reliance on foreign public markets (Australia, Canada) fails to meet domestic security needs.

No 'fracking' quick fix available

Unlike the 1970s oil crisis solved by fracking— which required short-duration, heavy-capex operations—critical mineral mining requires decade-long development cycles with no technological shortcut.

Dual circulation trap

China's strategy aims to make the world dependent on its economy while achieving self-sufficiency; export controls already force Western OEMs to consider relocating electric motor production to China.

Embargo paradox

While a total Chinese embargo would be devastating, it would likely be the last time Beijing could use this weapon, suggesting they will prefer gradual restrictions over total cutoff.