The US president is seeking to tap into Ukraine’s vast reserves of critical minerals and metals

Kieran Kelly

09 February 2025

Shevchenko in Donetsk, south-eastern Ukraine, may at first glance seem like another rural town destined to fall into Russian hands.

But below the surface lies something Ukraine will fight tooth and nail for: lithium deposits holding billions of dollars worth of critical minerals essential for electric vehicles, smartphones and modern energy systems.

Russian troops are just 10 miles away, having recently captured the town of Velyka Novosilka.

But it is not just Vladimir Putin eyeing up these vast reserves. In Washington, Donald Trump has asked for “rare earths” in exchange for military aid.

Caught in the middle is Volodymyr Zelensky, the Ukrainian president, who said on Saturday: “We have mineral resources. This does not mean that we give them away to anyone, even to strategic partners.”

Ukraine’s critical minerals and rare earths could be the key to securing the country’s future.

The country is sitting on more than 20 rare earth elements, including cerium and lanthanum, both vital for a host of modern technologies from flat-screen televisions to low-energy light bulbs.

The country also possesses vast reserves of critical minerals and metals. Titanium, crucial for aerospace and defence industries, and lithium, the backbone of electric vehicle and smartphone batteries, are among Ukraine’s untapped riches.

Mr Trump appears to be eyeing up both. “They’re going to secure what we’re giving them with their rare earths and other things,” he said.

“I want to have the security of rare earths. We’re putting in hundreds of billions of dollars. They have great rare earths. And I want security of the rare earths, and they’re willing to do it,” the US president declared.

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While the US does not disclose its stockpile levels of rare earth minerals, experts believe they are far below what would be needed during war.

Mr Trump’s desire for rare earths – also shown by his desire to “get” mineral-rich Greenland – does not at first seem to square with his scepticism for green energy.

“Most of the demand growth for rare earths has been for offshore wind, which he absolutely hates and has pretty much stopped in the US,” said Dan Marks, an energy security analyst at Rusi.

“He doesn’t hate EVs, but he doesn’t want them to get any preferential treatment. It’s mainly for defence.”

Cobalt is vital to the production of Nato-made jet engines and missiles, while lithium is used to power US F-35 fighter jets.

Mr Trump’s interest in securing these resources also aligns with his broader vision of boosting US manufacturing while reducing reliance on free trade.

On Saturday, Mr Zelensky made his position clear. “We have mineral resources. This does not mean that we give them away to anyone, even to strategic partners,” Zelensky posted on social media, quoting answers he had given in an interview with the Reuters news agency.

“It is about partnership. Put your money in. Invest. Let’s develop this together and make money,” Mr Zelensky said.

The country’s estimated $12 trillion (£9.7 trillion) worth of rare earths are largely concentrated in the east – territory heavily occupied by Russian forces. Roughly 33 per cent of these resources are under Moscow’s control.

Ukraine’s rare earth minerals

Olaf Scholz, the German chancellor, described Mr Trump’s demands as “selfish and self-serving”.

He added: “Ukraine is under attack and we are helping it, without asking to be paid in return. This should be everyone’s position.”

Ukraine’s mineral wealth never appeared to be a primary driver of Vladimir Putin’s invasion. “I doubt Vladimir Putin was sitting there thinking, ‘Ukraine has all these resources, I’m going to take them’ – that’s nonsense,” Mr Marks told The Telegraph.

Seizing these resources may have been a strategic bonus for Putin, though Russia already possesses vast reserves of its own and has failed to exploit the resources in occupied Ukrainian territory.

“Russia doesn’t have big plans to become an electric vehicle hub. If you don’t have plans to become a manufacturing giant like China, then what’s the point?” Mr Marks said.

Mr Trump’s push for a mineral deal is also complicated by the prospect of a frozen conflict.

Keith Kellogg, his former national security adviser, has floated the idea of locking the conflict along its current lines, which would leave much of Ukraine’s mineral-rich land in Russian hands.

But Ksenia Orynchak, the chief executive of Ukraine’s Association of Extractive Industries, argues it would be wrong to discount the country’s resources in the west and centre.

“We have good quality titanium, lithium, cobalt, copper – everything,” she told The Telegraph. “It would be a very long-term strategy for the US, but if you invest in this field, you will make profits.”

Countering the threat of China

If Ukraine’s resources weren’t the catalyst for Putin’s invasion, then the US president’s true motivation likely lies further east, in China.

Beijing dominates the global supply chain for rare earths and critical minerals. It processes around 90 per cent of the world’s rare earth elements and leads in refining other critical minerals, including lithium, cobalt and graphite.

China is also not afraid to weaponise its dominance.

When Mr Trump imposed 10 per cent tariffs on Chinese goods this week, Beijing retaliated by restricting exports of five metals critical to the defence, clean energy and tech industries.

“The Chinese prepared to win this mineral war, starting in 2005,” said Ms Orynchak.

Even if Ukraine grants the US access to its deposits, there is no guarantee Washington could immediately challenge Beijing’s dominance.

“The problem with rare earths is the US does not have the industries to use them yet – there is little to no magnet production in the US,” said Henry Sanderson, executive editor at Benchmark Mineral Intelligence. “China dominates magnet production.”

Ukraine’s resources remain largely undeveloped and extracting them will take time, especially given the ongoing war and the eventual need for reconstruction. Ms Orynchak estimates it could take at least 20 years before the US sees tangible benefits.

Experts believe there remains an opportunity for the US and Ukraine to disrupt China’s grip on the global supply chain.

Before Putin’s invasion, Ukraine was a key producer of graphite, a mineral used in electric vehicle batteries and steel production.

If Mr Trump follows through with plans to impose higher tariffs on graphite anodes from China, Ukraine could emerge as a crucial supplier to both Europe and America, Mr Sanderson suggested.

Whether this plan succeeds depends not just on Ukraine’s resources but on how fast the US can develop the industries needed to process them.

Mr Trump may want security over Ukraine’s rare earths, but securing them is just the first step in a far larger geopolitical contest, where China still holds the upper hand.