China’s firms are scouring the world for mineral ores in pursuit of nation’s electric dream

Chinese companies are scouring the world’s mines for lithium, cobalt and other minerals that go into battery packs used in electric vehicles, resuming the kind of voracious hunt for resources that added to economic booms in exporting countries a decade earlier.

They were the first to get off the starting block in getting their hands on these vital minerals, crucial for China’s ambition to lead the world in the production and use of electric and new energy vehicles, where up to 2 million units are expected to ply the nation’s streets by 2020, according to government forecast.

China Molybdenum, a partly state-owned producer of the chemical element, paid US$2.65 billion in 2016 for the Tenke Fungurume Mine in the Democratic Republic of Congo, one of the world’s largest known reserves of copper and cobalt resources.

“Over the past couple of years, we have seen evidence in the automotive industry where Chinese companies have been acquiring foreign assets across both original equipment manufacturing (OEM), components as well as mining,” said JPMorgan Chase & Co’s analyst Nick Lai, in the bank’s 2025 EV Outlook report. “Our view is that vertical integration in the auto industry is not unusual. Many global OEMs have investments or equity stakes in key components.”

Part of the reason for the shopping spree is China’s geological disadvantage, which saw the country contributing to a mere 7 per cent of global lithium output last year, even as Chinese reserves are among the world’s largest, said Zhao Dongchen, head of raw materials research at ICBC International in Hong Kong.