Trading metals for security: which resources interest Trump, and what can Ukraine offer?

What are Ukraine's mineral resources and what can the country offer the world?

The world is in the midst of a race for rare metals – dozens of elements essential to global technological progress.

The ambitions of major powers are outpacing the development of deposits. The United States aims to lead in artificial intelligence and semiconductors, the EU pushes for a greener energy sector and a transition to electric vehicles, and China seeks technological independence in key industries and to maintain its role as the world's factory.

In the race for raw materials, major powers impose tariffs on one another while seeking suppliers of rare metals scattered across the globe. For years, Ukraine has strived to join this competition and become a key source of valuable resources for its Western partners who are eager to abandon Chinese raw materials.

Ukraine's metal deposits are an asset with unrealised potential. This resource has recently caught the attention of US President Donald Trump who views it as a way for Kyiv to "pay" for American aid. Meanwhile, Ukraine is seeking to leverage these raw materials to attract Western private investment and obtain security guarantees.

Why does everyone need these metals?

Technological progress is impossible without a number of metals. For instance, lithium, cobalt and manganese are used in battery production; silicon and gallium are essential for semiconductors; titanium and aluminium are needed for aircraft fuselages; and rare earth metals are crucial for most household appliances.

However, supply chains for these raw materials are unstable. Mining and processing of metals is scattered around the globe, particularly in rather unstable nations. For example, 70% of cobalt is mined in the Democratic Republic of Congo (DRC), 20% of manganese in Gabon and 15% of uranium in Namibia and Niger.

Another factor contributing to instability is China, which, after investing heavily in the extraction and processing of critical raw materials, has gained a monopoly in the market and is now using this dominance for political leverage.

Beijing controls 70% of the world's rare earths mining and a significant portion of lithium, copper, cobalt and aluminium processing. Chinese firms oversee 75% of nickel processing capacity in Indonesia, 80% of cobalt production in the DRC and about a third of global lithium production. They are also investing in deposits in Australia and eyeing opportunities in Greenland.

China is using its monopoly position as a weapon in trade wars with the US and EU. In 2023, Chinese authorities banned the export of technologies for processing rare earth metals and restricted the export of graphite. In 2024, they restricted the sale of antimony, gallium and germanium and tightened control over processing companies.

In 2025, Beijing introduced export controls on tungsten, indium, bismuth, tellurium and molybdenum. The country's authorities also plan to ban the export of lithium and gallium processing technologies. These restrictions threaten not only the economies of Western countries but also their national security, as these metals are used in producing high-tech weapons. Some alloys are made only in China.

In recent years, the US and EU have been working to build up stockpiles of strategic raw materials and diversify supply channels to reduce their dependence on Beijing. However, finding non-Chinese sources of rare earths is challenging. Since 2018, the US has increased its share of global production of these raw materials from 9% to 12%. China's share remains at 68%, and in terms of processing, it stands at a dominant 90%.

Strategic metals are not as rare as they may seem, with proven reserves found in many countries. For example, Brazil and Vietnam possess rare earth metal deposits comparable to China's, though they are mined in relatively small volumes. Bolivia holds one of the world's largest lithium reserves, yet the country hardly exports it.

Problems arise at the stage of transforming a metal source into a profitable business venture. Mining companies encounter challenges in setting up extraction, processing and logistics, as well as in finding common ground with local regulators.

For an investor, a country must be politically stable, safe and bureaucratically transparent, with adequate infrastructure and proximity to the sales market. If this is not the case, the investor will look for a more favourable jurisdiction.

For example, Greenland holds large reserves of rare earth metals, but investors cannot develop competitive deposits there due to the lack of roads and sea routes. The island's authorities have even revoked the licences of some companies for failing to initiate full-scale production.

Strategic raw materials are becoming less about economics and more about politics, with prices for metals gradually rising. As a result, countries with less-than-ideal investment environments and infrastructure are improving their prospects of attracting significant foreign investments to develop their own deposits.

Ukraine also wants to benefit from the enormous demand and disputes between major powers. It boasts some of the largest deposits in Europe in several respects.

What does Ukraine's soil hold?

Ukraine offers the US valuable fossil resources for the aerospace, military, electronics, nuclear and chemical industries. What kind of subsoil is the country rich in?

Ukraine's State Service of Geology and Mineral Resources presented a comprehensive list of the country's critical minerals in its Investment Atlas of Subsoil Users before the full-scale Russian invasion. American partners are particularly interested in rare earth metals.

Reserves of tantalum pentoxide, niobium and beryllium in Ukraine have been recorded at six complex deposits. Tantalum and niobium are mined in non-commercial volumes, primarily as associated components of titanium placers. The prospects for rare earth metal mining are mainly tied to the development of the Novopoltavske apatite deposit and several other ore deposit occurrences.

Ukraine has one beryllium deposit with reserves of 13,900 thousand tonnes, along with related elements. In 2019, BGV Group, a Ukrainian company owned by Hennadii Butkevych, co-owner of the Ukrainian retail trade company ATB Corporation, and his partners received a special permit for it.

Lithium

Currently, lithium is not mined in Ukraine, although its reserves account for about a third of proven deposits in Europe and nearly 3% of the world's total. There are three deposits which have already been explored, another site that has had a preliminary exploration and several lithium ore deposit occurrences. All reserves are located in hard rock.

Graphite

Ukraine is one of the world's top five countries in terms of graphite reserves, with around 19 million tonnes. There are currently six known deposits, one of which is commercially exploited by the Australian company Volt Resources. BGV Group and Türkiye's Onur Group are operating explorations at three deposits. The remaining deposits and more than ten prospective deposit sites are open for licensing.

Titanium

Ukraine is one of the ten countries with the largest proven titanium reserves in the world, accounting for about 7% of global production. Currently, 28 placer (accumulations of rare metals mixed with sand deposits) and indigenous deposits are registered. The main minerals containing titanium– ilmenite and rutile – are often found along with the associated mineral zircon.

In October 2024, Ukraine's State Property Fund sold 100% of United Mining and Chemical Company, Ukraine's largest titanium ore concentrate mining and processing company. The auction was won by Cemin Ukraine, a company owned by Azerbaijani businessman Nasib Hasanov. The company operates the Vilnohirskyi Mining and Metallurgical Plant in Dnipropetrovsk Oblast and the Irshanskyi Mining and Processing Plant in Zhytomyr Oblast.

Another major player in the titanium industry is Velta, a private firm. Before the full-scale invasion, it mined about a third of Ukraine's titanium and even explored the production of finished products from its own titanium powder. Velta's CEO, Andrii Brodskyi, noted that the company is currently operating at 50-60% of capacity due to energy and logistics issues. 

Nickel, cobalt, copper

Ukraine has 12 silicate-nickel deposits containing cobalt (9,000 tonnes) and nickel (215,000 tonnes), which can be extracted as accompanying elements. The most promising cobalt deposits are Kapitanivske and Prutivske.

Uranium

Ukraine ranks first in Europe and eleventh in the world (about 2%) in uranium ore reserves. The state balance of uranium reserves includes 21 deposits, four of which are being developed (accounting for 45% of the country's reserves), while the rest are proposed for production-sharing agreement (PSA) tenders.

Uranium ore extraction and processing are carried out exclusively by the state enterprise SkhidGZK. All explored reserves are concentrated in the Kirovohrad, Dnipropetrovsk and Mykolaiv oblasts.

Prospects

Ukrainian companies lack the capital needed to fully develop the potential of the country's mineral deposits, so the government is focused on attracting foreign investment. Due to growing global interest in this sector, lithium prices surged tenfold in 2021-2022.

Two weeks before the full-scale Russian invasion, the Ukrainian Business Council held a roundtable discussion with geologists, politicians and investors. Speakers identified several reasons for the industry's lack of success, including the absence of a state list of minerals eligible for benefits, a non-transparent licensing system, outdated classification and reserve data, frequent regulatory changes and a poor reputation among Western investors.

Nathan Calvert, Vice President of Privateer Capital Management, which had planned to mine lithium in Ukraine, believes bureaucratic issues caused more concern among investors than the threat of a Russian invasion.

Three years on, the topic of developing Ukraine’s strategic metal deposits has gained traction at the highest level. The interest shown by American partners and statements from US President Donald Trump signal a positive development for Ukraine.

"If we had heard such statements from the leaders of powerful nations since 1991, we wouldn’t be at war with Russia today. Every foreign investment in our land and resources is a security guarantee. Investors will be interested in protecting both Ukraine and their assets", says Kseniia Orynchak, head of the National Association of Extractive Industries.

"A strong interest from the US president and his team should boost confidence and ensure the arrival of investors. This indicates that we are moving in the right direction", agrees Roman Opimakh, former head of the State Service of Geology and Subsoil of Ukraine.

Mykhailo Honchar, President of the Centre for Global Studies Strategy XXI, says that the developments surrounding Ukraine’s rare earth metals remain largely a virtual project that requires deeper study.

"The available geological data dates back to the Soviet era, so to start with, everything must be thoroughly examined before determining the commercial viability of these projects," says Honchar.

What potential models of cooperation between Ukraine and its partners could be possible? Volodymyr Boiko, founder of the Nadra.Info news agency, outlined several possible scenarios in a conversation with Ekonomichna Pravda.

The first scenario involves the state putting up special permits for the use of areas containing rare earth elements for auction "as is", relying on Soviet-era geological data without additional exploration. The permits would go to the highest bidder. However, Boiko considers this option unlikely if a political decision is made to attract businesses from strategic partner countries.

The second scenario envisions the government announcing tenders for long-term (e.g. 50-year) production-sharing agreements for deposits in their current state.

The third scenario would see Ukraine investing in further exploration first, then auctioning off sites with reserves confirmed according to international standards.

"The third option seems the most logical," Boiko warns. "It would prevent selling 'a pig in a poke', improving the negotiating position of both the state and local communities regarding the benefits of cooperation. These are projects that will last for decades, so it is crucial to establish clear, transparent, and favourable terms for Ukraine in future agreements from the outset."

What scale of investment is needed? The initial stage of raw material production alone requires an estimated investment of over US$100 million.

"Producing even an intermediate product would cost US$250–300 million. Over the past five years, we have been seeking partnerships that can bring both investment and necessary technologies. Any partners who come in must have experience in development, processing, enrichment, and final product manufacturing. The US certainly has both the investment capacity and expertise", Opimakh explains.

Establishing the full process will take at least four years.

"This is not a quick endeavor – not because Ukraine is doing something wrong, but because it is a complex process that develops this way worldwide", explains the former head of the State Service of Geology and Subsoil.

While the prospects in this sector are enormous, barriers to investment must first be dismantled. One such challenge is engagement with hromadas (a hromada is an administrative unit designating a village, several villages, or a town, and their adjacent areas), says Orynchak.

"People still react negatively to the news that someone will be extracting resources on their land. We need to work from the hromada level up to higher political circles to understand how we will welcome these investors. At the local level, investors are often seen as a threat – regardless of whether they come from the US or the UK", said the head of the association.

Other challenges in the sector include difficulties in verifying the accuracy of mineral reserve data and the need for exploratory drilling, the necessity of modernising equipment, frequent regulatory changes and gaps in industry regulation.

"For now, these are just slogans, but it is good that such statements are being made. They can serve as a foundation for further cooperation. The key is to ensure that everything doesn’t remain just talk, as often happens in Ukraine", Honchar concluded.

Translation: Artem Yakymyshyn and Anastasiia Yankina

Editing: Shoël Stadlen