[CW42] Our take on the 'trade war week', China tightens Rare Earths, Uranium holds 80, Copper at ATH

Welcome back to CMJ,

Lots to talk about, especially in the REE space.But here are the 20-second highlights of what we’ll cover:

Alright, this is not fresh news, but we need to comment.

Beijing’s surprise expansion of export controls jolted the magnet world. Five new elements joined the forever growing restricted list (Holmium, Erbium, Thulium, Europium, and Ytterbium), alongside tighter licensing for magnet alloys.

China still runs ~90% of global processing and 93% of magnet manufacturing.

Overnight, the world’s tech, EV, and defense supply chains realized just how concentrated their risk is. U.S. officials called it “economic coercion.” Traders called it opportunity. Prices for select oxides spiked; sentiment in Western developers turned euphoric.

We are all seeing (and hopefully you are investing in it too), how the market is rapidly expanding:

And even after that recent run, DCF models still hint at upside, proof that strategic relevance now trumps conventional valuation metrics.

Note: a fellow reader/investor wrote us asking: “why isn’t anyone talking about the REE bubble?”.Our take: as the saying goes, ‘the market doesn’t repeat itself, but it likes to rhyme’. And as humans looking for correlations everywhere, the close history is where our eyes meet: Lithium. It is inevitable to see the resemblance. The supply vs demand imbalance. The race.We are not saying that the REEs future is written, of course not. But as investors we should understand cycles and be alert to subtle signs.

Not forgetting that in the middle of this ‘kaos’, the Pentagon’s rebranded Department of War took a $400M equity stake in MP Materials, locking in NdPr supply for a decade. Offtake pacts from Greenland to Texas tightened into an emerging Western REE bloc.

Spot uranium held near $80/lb after peaking above $83 (its highest since 2010). Demand signals are undeniable: reactor restarts from Japan to Ontario, output cuts at Cameco and Kazatomprom, and a wall of speculative capital from Sprott’s trust and peers.

Uranium Energy Corp is up more than 1,300% in five years; Uranium Royalty Corp hit fresh highs; institutional inflows surged triple‑digits.

The market smells structural deficit: The World Nuclear Association sees a 184 Mlb shortfall by 2035 without new mines. And supply discipline plus fund hoarding have turned uranium from deep‑value to momentum.

Yet the fundamentals still justify it (in our humble opinion). New capacity needs $100/lb to pencil out. AI‑era data centers are driving electricity demand that only nuclear can meet, and the same AI tools are now improving exploration and project developments.Think about it, machine learning is finding ore bodies human geologists missed. This is a powerful feedback loop.

Copper ‘kissed’ its ATH at $11,000/t on October 9 before tariff headlines trimmed the move. The backdrop hasn’t changed: a weakening dollar, disrupted supply, and demand that keeps compounding.

Wood Mackenzie’s latest forecast sees copper demand rising 24% by 2035 to 42.7 Mt, and potentially 45 Mt if AI data centers, EVs, and renewables scale faster than modeled.

Not sure if you knew this by now: Each EV consumes four times the copper of an ICE car; data centers are effectively price‑insensitive buyers. The ‘metal of electrification’ is turning into the market’s bottleneck.

Inventory data masks tightness.

Exchange stocks look adequate but are concentrated in U.S. warehouses, not in Asia where smelters need feed.

Treatment charges are slipping, hinting at looming scarcity. A single mine outage (as seen with Grasberg) can flip the balance from surplus to deficit.

The lithium tape split in two. On one side, project execution. On the other, technological reinvention.

American Battery Technology Co cleared environmental hurdles for its Tonopah Flats project and published a feasibility study showing a $2.6B NPV and 21.8% IRR (enough to earn a preliminary $900M financing pledge).

Lilac Solutions raised $250M to deploy ion‑exchange DLE at Utah’s Great Salt Lake, recycling 99% of water and producing low‑carbon lithium carbonate domestically.

At the same time, valuation fatigue hit incumbents. Lithium Americas dropped 21% after a downgrade despite its DOE‑backed Thacker Pass project, a reminder that policy support can’t outrun investor discipline (or that policy support tends to drive irrational behaviors).

Chinese carbonate prices steadied around ¥73,000/t (~$10,000), suggesting cost‑floor stabilization rather than a new boom.

Meanwhile, the innovation cycle accelerates. MIT and WPI scientists recycled 99.8% of lithium from spent EV batteries into new solid‑state cells. And in the U.K., EQONIC unveiled a lithium‑free, recyclable polymer battery at half the cost per kWh. The future of electrification may diversify faster than models assume.

China’s move wasn’t just economic (of course); it was strategic theater before the Trump–Xi meeting in Seoul.

By tightening controls, Beijing reminded Washington who holds the ‘magnet lever’. The White House hit back with threats of 100% tariffs and new export curbs on advanced software, a tit‑for‑tat escalation that could redefine global trade baselines.

Behind the noise, both sides are executing. The U.S. is reshoring critical mineral production through the Defense Production Act, IRA grants, and direct equity stakes. Europe followed with its Critical Raw Materials Act (CRMA), aiming to source at least 10% domestically by 2030. Japan and Australia are expanding joint refining capacity. Africa and Latin America are aligning policy to capture more value before exporting.

The outcome is a bifurcated system, China and its sphere on one side, Western alliances on the other. Each racing to lock down supply, technology, and talent.

The winners? Who knows… what concerns us is the global inflationary waves it may cause.

Uranium mirrored OPEC behavior: Cameco and Kazatomprom coordinated output trims while the U.S. DOE issued a $1.5B loan guarantee for a reactor restart. Lithium nationalism spread, Chile advancing state stakes, Mexico enforcing nationalization, Zimbabwe banning raw exports. Africa’s coups, from Niger to Gabon, underscored how fragile resource governance remains.

Each regional tremor feeds the same narrative: control over critical minerals equals leverage.

We can expect more bilateral deals, more state equity, and more export rules masquerading as security policy.

Thank you for reading and for being part of the CMJ community.In markets driven by geopolitics, foresight is power. If you found it valuable, share it with a peer who needs the same edge (or keep it close and use it to your advantage).