Critical Minerals Concentration Index

Problem solved

OEMs, governments, and investors need a reproducible single-number concentration score per mineral (lithium, cobalt, nickel, graphite, NdPr, copper, gallium, germanium) at each chain step (extraction, processing, refining), with sensitivity to firm-level concentration and country chokepoint risk. The IEA Critical Minerals Outlook reports HHI but at country level only. CMCI extends to firm level and adds a chokepoint adjustment that flags single-country, single-firm overlaps.

Inputs

• Country-share data for extraction, processing, and refining (USGS Mineral Commodity Summaries, BloombergNEF, Benchmark Mineral Intelligence)
• Firm-level production share at each chain step (Benchmark Source, S&P Capital IQ, company filings)
• Processing and refining share by jurisdiction (Benchmark Mineral Intelligence, BNEF Lithium-Ion Battery Supply Chain)
• Ownership and control disclosures (parent entity, board seats, equity, license rights)
• Sanction and export-control overlay (OFAC SDN, BIS Entity List, EU dual-use, UK OFSI)
• Transit-route dependency (Strait of Malacca, Bab el-Mandeb, Arctic, rail corridors)
• Recycler share by jurisdiction (BNEF, IEA Global Critical Minerals Outlook)
• Forward project pipeline weighted by stage (PEA, PFS, FS, construction, commissioning)
• Recycled-content qualification documentation depth by recycler

Outputs

• Country HHI score per chain step (extraction, processing, refining)
• Firm-level HHI score per chain step
• Weighted CMCI composite score by mineral (default weights: 0.30 extraction, 0.40 processing, 0.30 refining)
• Chokepoint flag where any single country and single firm overlap exceeds 25 percent
• Mitigation route ranking with timeline and cost-to-substitute
• One-source disruption scenario sensitivity (price, volume, downstream throughput)
• Replication package with named source links and recompute scripts

Method

1. Step 1. Lock the mineral and the chain definition. Distinguish ore extraction, intermediate processing (e.g., MHP for nickel, sulfate for cobalt), and final refining (battery-grade, magnet-grade).
2. Step 2. Compute country HHI per step using current-year share data. Apply 10000 normalization so HHI ranges 0 to 10000.
3. Step 3. Compute firm HHI per step. Resolve ultimate parent for joint ventures and subsidiaries; aggregate to parent before scoring.
4. Step 4. Apply jurisdiction risk overlay (sanction exposure, export-control regime, transit-route dependency). Discount the apparent diversification benefit when risk-correlated jurisdictions appear together.
5. Step 5. Compute chokepoint count: number of (country, firm) pairs where both shares exceed 25 percent at the same chain step.
6. Step 6. Run one-source disruption scenarios. Remove the top country share, the top firm share, and the top combined chokepoint; report price, volume, and downstream throughput sensitivity.
7. Step 7. Produce mitigation route table. For each chokepoint, score the substitution route by lead time, capex, and qualification cycle.
8. Step 8. Output replication package. Every score reproducible from the same source files, with version-pinned data snapshots and named citations.

Assumptions

• USGS Mineral Commodity Summaries are the primary country-share source for extraction; BNEF and Benchmark Mineral Intelligence govern refining and battery-grade outputs.
• Firm-level data is point-in-time; the framework re-runs quarterly to capture new project commissioning and divestitures.
• Joint ventures roll up to ultimate parent for firm-HHI scoring, not to operator.
• Disruption scenarios are static (one-shot removal of a node), not multi-period substitution dynamics.
• Chokepoint threshold of 25 percent for both country and firm is the default; users can re-run at 30 percent or 20 percent.

Limitations

• State-owned-enterprise vs. private opacity is severe in some jurisdictions (e.g., DRC artisanal output, Chinese SOE share consolidation). Confidence bands widen in these cases.
• Recycled-content data is sparse pre-2025; pre-2025 baselines understate recycler concentration.
• Midstream substitution dynamics (LFP-to-NMC, sulfide-to-oxide) are not modeled; the framework reports static concentration only.
• Forward project pipeline is weighted by stage but cannot resolve permitting or community opposition risk that often kills late-stage projects.
• Transit-route dependency uses public chokepoint geography; behind-the-fence logistics are not visible.

Example application

Applied to cobalt 2026: extraction is 74 percent DRC at the country level and Glencore plus CMOC plus ERG control roughly half of named-firm output, generating a country and firm chokepoint at the extraction step. Processing is 76 percent China at the country level with three Chinese refiners controlling the bulk, generating a second chokepoint at the processing step. The CMCI composite scores cobalt as the highest-concentration battery mineral chain in 2026 and the mitigation table ranks Indonesian MHP, Australian sulfate, and Canadian refining as the three viable diversification routes. See Cobalt DRC supply chain in 2026: concentration risk and mitigation routes.