Globally, China controls most of the processing capacity of lithium and rare earth elements, critical minerals vital to the clean energy transition. This dominance creates a bottleneck between mining raw minerals—often in developing countries—and incorporating refined products into solar panels, wind turbines, batteries and electric vehicles.
A first-of-its-kind report from researchers at Duke University and the University of Cape Town maps the most credible research and development opportunities for lithium and rare earth processing. The researchers offer recommendations to companies and countries trying to go beyond mining and expand their processing capability.
“Meeting international climate targets requires rapid deployment of clean energy technologies that will only increase demand for critical minerals,” said author Sandeep Pai, senior lead for international energy transitions at Duke’s Nicholas Institute for Energy, Environment & Sustainability and the James E. Rogers Energy Access Project (EAP). “Our report identifies promising pilots and pre-commercial efforts from around the world that could help lower barriers for mineral-rich countries in the Global South to get more value out of their resources.”
Report authors reviewed academic and industry literature to identify research and development opportunities across the various steps involved in production of critical minerals. They then grouped each opportunity by technology readiness level (TRL): early-stage research, validation and demonstration phase or implementation.
Recommended Priorities for Private-Sector Investment
The report identifies five priorities for companies making strategic decisions about where to invest in critical mineral processing:
- Capture value at the processing chokepoint. Mining a lithium deposit or rare earth resource without securing conversion, separation or refining capacity leaves most of the margin and strategic leverage with whoever controls the midstream processing. Because processing is concentrated in a few hands, companies should view investment in these chokepoints as a first step toward expanding into adjacent stages of the chain.
- Target the pilot-to-demonstration stage. The most commercially credible innovations across the lithium and rare earth chains are at TRLs where capital availability—rather than technical uncertainty—is the main constraint. Companies able to invest at this stage will secure better technology access and pricing than those that wait for the technologies to become more mature.
- For lithium processing from brine, invest in new technologies beyond traditional evaporation ponds. Conventional brine evaporation recovers only 30% to 50% of lithium over a 12- to 24-month cycle and is exposed to regulatory and water-use constraints. Direct lithium extraction (DLE) technologies now in operation can recover more than 90% of lithium in hours. Many recent projects are adopting hybrid DLE-pond configurations.
- For lithium processing from hard-rock spodumene, prioritize the energy and carbon cost of conversion. Calcination at 1,000°C to 1,100°C is both the largest cost driver and the most energy-intensive step in hard-rock processing. Sulfate and chloride roasting operate at much lower temperatures while using less energy and fewer chemical reagents.
- For rare earths, treat separation and recycling as important priorities. Separation remains the most concentrated and technically demanding stage of the rare earth chain. The report identifies a proprietary solvent-free process as the most credible near-term alternative for new separation capacity outside China. Recycling will become a more viable option in the coming years as first-generation electric vehicle and wind turbine magnets reach the end of their life cycles.
Recommended Priorities for Government Investment
The report also recommends four priorities for governments making strategic decisions about securing critical mineral value chains:
- Fund the commercialization valley, not only laboratory experiments. Government programs in the United States, European Union, Australia and Canada have directed significant funding toward both early-stage research grants and mature facilities. In between, governments can offer loans, pilot plant subsidies and government-backed offtake agreements to catalyze creation of critical mineral value chains.
- Build a shared international evaluation framework for critical mineral processing research and development (R&D). With support by governments, the International Energy Agency’s Critical Minerals Council or other global councils can create a public registry of critical mineral processing R&D technologies. Such a registry would cover technology status, TRL evidence and pilot results rather than proprietary process knowledge, so participating countries could gain coordination benefits without surrendering competitive or strategic advantage.
- Pair supply-side grant funding with demand-side commitments. The most effective recent government interventions have been demand instruments rather than supply-side grants: guaranteed price floors, strategic stockpiles and magnet or content requirements in electric vehicle and defense procurement.
- For emerging economies, support deliberate technology transfer. Several of the most commercially promising technologies could lower capital and skill barriers compared to conventional processing plants. Governments in resource-rich emerging economies should negotiate technology transfer provisions and domestic processing mandates as part of mining agreements from the outset, rather than seeking to add them after production has begun.
The report was developed in partnership with the Council for Critical Minerals Development in the Global South and SEforALL. It is part of the Nicholas Institute and Energy Access Project’s efforts to support decision-makers in emerging economies to strengthen critical mineral value chains and turn mineral wealth into long-term economic growth, resilient energy systems, and shared prosperity. This work also advances the aims of the Duke Critical Minerals Hub.
Report authors are Aashish Yadav, a graduate student in the Master of Environmental Management Program at Duke’s Nicholas School of the Environment; Pai, the Nicholas Institute and EAP senior lead for international energy transitions; and Jennifer Broadhurst, deputy director of the Minerals to Metals initiative at the University of Cape Town in South Africa.
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Yadav, A., S. Pai, and J. Broadhurst. 2026. Beneath the Bottleneck: An R&D and Technology Readiness Review of Lithium and Rare Earth Processing. NI 26-14. Durham, NC: Nicholas Institute for Energy, Environment & Sustainability, Duke University. https://nicholasinstitute.duke.edu/publications/beneath-bottleneck-technology-readiness-review-lithium-rare-earth-processing.
For media inquiries, contact the Nicholas Institute communications team at ni-comm@duke.edu.
