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MPs warn the UK government cannot demonstrate it passes any of the ten tests they say are needed for secure critical mineral supply chains in a report published 5 November by the House of Commons Business, Innovation, Science and Trade Committee.
Benchmark’s Chief Operating Officer Caspar Rawles gave evidence as an expert witness in which refining is identified as the key chokepoint for critical mineral supply chains and recycling an opportunity for the UK.
“Critical minerals are the alpha of the new economy,” said Committee chair Liam Byrne. “We cannot re-arm Britain, build AI or deliver net zero unless we secure the minerals these technologies depend on.”
Refining is major bottleneck
Across strategic supply chains, refining is often the crucial bottleneck to supply security rather than mining. For example, Benchmark’s Rare Earths Service data shows that whilst China accounts for around two-thirds of rare earths mining in 2026, the country is forecast to produce 87% of global rare earths refined output. This trend is even starker for heavy rare earths: China accounts for 38% of mined dysprosium but 97% of the processed material.
The UK has no primary rare earths mining or refining, though HyProMag opened the UK’s only commercial rare earth magnet recycling and manufacturing facility in January this year with an eventual capacity of 300 tonnes of NdFeB magnet production per year.
For lithium, China produces 66% of the world’s lithium chemicals despite only accounting for 25% of primary lithium output.
The UK’s refined lithium output is forecast to rise from 3,900 tonnes LCE in 2026 to around 20,000 tonnes by 2030. This is less than a fifth of the 112,800 tonnes LCE of UK lithium demand expected by 2030, according to Benchmark’s written evidence to the Committee.
Energy costs are a major concern for British refineries. One UK nickel refiner who gave evidence for the report said electricity at its UK site costs nearly 60% more than in France.
Recycling could help the UK maintain competitiveness
As part of his evidence to the Committee, Rawles said that, as a “relatively wealthy” nation, the UK has lots of minerals “in the products we buy, whether that is EVs, energy storage or people’s batteries at home.”
Once these batteries reach end-of-life, they become a valuable source of minerals. Benchmark’s Recycling Service shows the UK has around 22ktpa of pre-treatment capacity installed today which can shred batteries to turn them into black mass. However, the UK has no black mass refining capacity, meaning the value contained within the material is lost across the border typically to refiners overseas. There is 58ktpa of refining capacity in the 2030 pipeline, but there is no guarantee this capacity will come online unless there is a supportive business environment.
“Our energy costs make processing uneconomic, we're exporting valuable metal waste, and our public finance institutions are shackled by outdated rules,” Byrne said.
The need for new critical minerals finance
A key conclusion of the report is the need for a Critical Minerals Finance Facility “capable of bringing together the UK’s public financial institutions and deploying grants, equity, debt, guarantees and offtake agreements needed to accelerate strategically important projects at home and abroad”.
The proposed facility would have the ability to take equity stakes in projects, enter long-term offtake agreements, and put in place price floors. These instruments have been deployed in the US, especially in the rare earths space, for example, with the US government taking a stake in MP Materials and setting a PrNd price floor of $110,000/t.
“De-risking even a prudent proportion of our supplies will take over a decade. Britain cannot afford to drift,” Byrne said. “We must act now before dangerous dependencies become strategic liabilities.”