Kazakhstan holds significant reserves of rare metals and rare earth elements, sometimes referred to as the “new oil” due to their increasing importance in global industries. However, experts say the country remains far from becoming a major supplier, as geopolitical tensions and a lack of large-scale investment continue to hinder development.
Global Context: Rare Earth Metals in Geopolitics
U.S. President Donald Trump has called for a rare-earth deal with Ukraine, raising international public interest in these minerals. While the specifics of the deal remain unclear, Trump has estimated its potential value at a trillion dollars. Meanwhile, Russia, which holds the world’s fourth-largest rare earth reserves, has expressed interest in cooperating with the U.S. in this sector.
Experts argue that large-scale mining operations in Ukraine are currently unprofitable and impractical. The rare metal sector includes 60 elements, such as lithium, titanium, beryllium, gallium, and tungsten, while rare-earth metals include 17 elements, such as scandium, yttrium, and lanthanides. Their high production costs, complex extraction process, and long payback periods have made large-scale commercial extraction difficult despite growing global demand.
Is Kazakhstan a Promising Market?
China remains the dominant global producer of rare earth metals, followed by Brazil, India, Australia, and Russia. Despite its extensive natural resource base in oil, gas, uranium, and non-ferrous metals, Kazakhstan has yet to prioritize rare-earth extraction.
However, international interest in Kazakhstan’s deposits is growing. France, Germany, and South Korea have already initiated exploration projects in the country. Germany’s HMS Bergbau AG, in collaboration with Qazaq Lithium, is developing lithium deposits in East Kazakhstan Oblast (EKO). Meanwhile, South Korea’s KIGAM has conducted exploration at the Bakennoye lithium deposit, leading to a memorandum of cooperation. The U.S. Embassy in Kazakhstan has also announced upcoming mining and processing projects for critical materials, such as lithium and titanium, involving American companies.
President Tokayev has stated that Kazakhstan’s subsoil contains 50,000 to 100,000 tons of lithium, but substantial investment in exploration and development is required. Kazakhstan already holds an 11% share of the global titanium market, rising to more than 20% in the aerospace industry.
Newly identified rare earth deposits were announced by the government in early 2025, totaling 2.6 million tons, including 400,000 tons of tungsten and 500,000 tons of niobium.
Calls for Stronger State Control
As international interest in Kazakhstan’s resources grows, concerns about foreign control over strategic assets have intensified. Financial analyst Rasul Rysmambetov has warned that major international players, particularly from Russia, may seek to dominate Kazakhstan’s rare-earth sector. “Several large Russian companies already operate in Kazakhstan. It is crucial to ensure that control over these resources remains in the hands of the state,” he said.
Rysmambetov has proposed the creation of a state agency for strategic assets or expanding the jurisdiction of existing institutions, such as the National Security Committee and the Ministry of Finance. He also suggested that sales of strategic resources should require oversight from the Security Council or Parliament.
“We can expect attempts by foreign firms, particularly Russian and Chinese companies, to acquire major Kazakh mining assets. The U.S. is unlikely to compete directly, but its companies may be indirectly involved,” Rysmambetov added.
Experts believe that unused mining waste from Kazakhstan’s industrial sector could also contain significant amounts of rare-earth elements, providing an alternative path to increasing production.
Rare Earth Metals: Economics vs. Politics
Economist and political analyst Peter Svoyk argues that geopolitical uncertainty remains the biggest obstacle to investment in Kazakhstan’s rare-earth sector.
“Mining rare earth metals is labor-intensive, expensive, and requires long-term planning. Just exploration, feasibility studies, and equipment installation can take up to ten years. Investors will only enter the market if they have confidence their projects will remain stable for at least 25-30 years,” Svoyk explained, adding that current geopolitical shifts are delaying new investment across the world.
“For the next 5-10 years, serious investments in rare earth metals will be limited. Instead, countries will focus on strengthening their existing supply chains and securing resources within their geopolitical blocs,” he said.
Svoyk also downplayed recent geopolitical announcements involving rare earth deals by the U.S. and Russia, arguing that they are more about securing strategic influence than about actual mining projects.
“For Kazakhstan, discussions about increasing rare earth extraction have been ongoing for 15 years, with President Tokayev pushing for progress over the last five years. Yet, large-scale development remains stalled, as the sector requires massive financial and technological investment,” Svoyk concluded.
According to the International Energy Agency (IEA), global demand for lithium has tripled over the past five years, while demand for cobalt has increased by 70% and nickel by 40%. Kazakhstan’s subsoil contains 99 of the 118 elements in the periodic table, meaning that if investment challenges are addressed, the country could become a key supplier of critical and rare-earth metals to global markets.
