China's Mining Sector Expands Global Footprint in Gold and Energy Transition Metals

China Intensifies Overseas Mining Investments for Critical Resources

Chinese mining companies are significantly expanding their global presence, primarily targeting gold, copper, and lithium assets in Africa and Latin America. This strategic push aims to secure key resources vital for the energy transition and bolster China's market position in essential raw materials.

Strategic Acquisitions in Africa and Latin America

Data from 2020 onward indicates that Chinese companies' merger and acquisition (M&A) activities in Africa and Latin America account for 49% and 30%, respectively, of their total overseas M&A spending, which has reached $14.6 billion year-to-date in 2025. This geographical focus reflects a concerted effort to secure raw materials. Historically, China's overseas mining investments began in December 1988 with the Channar iron ore mine in Australia, jointly owned by Rio Tinto Group (RIO) and Sinosteel Corp., and expanded with the acquisition of the Chambishi copper mine in Zambia in 1998 by China Nonferrous Mining Corp. Ltd.

The resource focus is heavily skewed towards gold, copper, and lithium, which together comprise 86% of these transactions. Leading this charge are companies such as Zijin Mining Group (ZIJMF) and CMOC Group (CMCLF), which have been instrumental in driving copper production growth and securing hard rock lithium assets, leveraging China's advanced and cost-effective lithium refining capabilities.

Market Implications and Corporate Performance

This aggressive acquisition strategy is expected to intensify competition for global mineral assets and introduce volatility into commodity prices for gold, copper, and lithium. The "Go Out" policy continues to propel Chinese firms to explore and expand international opportunities, strengthening their attributable production of critical metals.

The financial performance of key players underscores the impact of this strategy. Zijin Mining Group reported robust H1 2025 results, with net profit attributable to shareholders surging 54.4% year-on-year to RMB 23.3 billion (US$3.25 billion). Revenue also increased 11.5% to RMB 167.7 billion. The company's A-share and H-share prices rose approximately 31% and 44% respectively since the end of 2024, reflecting strong capital market recognition. Mine copper output broke the one-million-tonne mark, with 570,000 tonnes produced in H1 2025, an over 9% increase. Mined gold now contributes 38.6% of the company's gross profit, nearly matching copper's 38.5%.

Broader Context: Global Critical Minerals Landscape

China's systematic approach has established significant dominance in critical minerals processing, supported by an estimated $87 billion in global project financing and extensive domestic subsidies. This has created a near-monopoly in certain sectors, including over 90% of global rare earth processing capacity, fundamentally altering global market dynamics.

The strategic importance of critical minerals for modern technologies, national defense, and the green energy transition is increasingly evident. Recent events, such as China's tightening of rare earth export controls in October 2025, have further highlighted supply chain risks and spurred demand for non-Chinese sources. This led to significant gains for non-Chinese mining companies and critical minerals exchange-traded funds (ETFs), with the VanEck Rare Earth and Strategic Metals ETF gaining 91% year-to-date following these announcements.

Outlook: Continued Strategic Competition and Commodity Volatility

Looking ahead, the landscape for critical minerals is likely to be characterized by continued strategic competition for high-quality assets and potential volatility in commodity prices. The ongoing pursuit of energy transition metals by China and other nations suggests that securing reliable and diversified supply chains will remain a paramount concern for industries globally. Market participants will closely monitor geopolitical developments and economic indicators that could further influence the supply and demand dynamics of these essential resources.