The United States is using offtake agreements and state-backed financing to compete with China in securing supplies of African copper, cobalt and other critical minerals, diplomats, executives and analysts said ahead of this week’s Indaba mining conference.
Washington’s immediate focus is on Zambia, Guinea and the Democratic Republic of Congo, which produces more than 70% of the world’s cobalt and turned out about 3.3 million metric tons of copper in 2024.
Rather than placing U.S. mining operators in high-risk countries, the strategy relies on offtake and trading arrangements, including a deal with Mercuria and agreements with Congo’s state miner Gécamines, to channel output into U.S.-aligned supply chains that are still largely dominated by Chinese refiners, according to Reuters report.
Offtake refers to arrangements where a country or company secures rights to a portion of a mine’s production in return for financing or other support.
“We’re already seeing U.S. engagement reshape mineral flows out of Africa,” said Thomas Scurfield, a senior analyst at nonprofit NRGI, ahead of the event in South Africa.
“The U.S. is putting money behind its rhetoric, but it remains to be seen whether it can compete with China’s scale and speed,” he added.
Both Washington and Beijing are expected to pursue new commitments at the Indaba mining event in Cape Town this week, with the U.S. sounding out officials on its proposed minerals bloc.
As part of this shift, Gécamines is preparing to ship about 100,000 tons of its Tenke Fungurume copper allocation to U.S. buyers this year after securing broader marketing rights in a 2023 renegotiation with China’s CMOC.
The U.S. approach goes beyond copper. Xiao Wenhao, an analyst at Shanghai Metals Market, said China’s cobalt supply chain also faces risks as Congo’s export restrictions intersect with expanding U.S.–DRC cooperation.
Elsewhere, London-based Pensana dropped plans to build a rare earth refinery in Britain to process material from its Angolan mine and instead moved the project to the United States, citing stronger U.S. incentives and price guarantees.
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“This is the U.S. deploying financial firepower rather than industrial presence,” said Vincent Rouget, an analyst at Control Risks. “With offtake and trading channels, Washington can redirect Congolese copper to American buyers without taking on the political or operational risks of running mines in the DRC.”
Despite this, Chinese companies still control many of Congo’s largest copper and cobalt assets, including Tenke Fungurume and Kamoa-Kakula, and for more than a decade have sent most of the output to China for refining.
Beyond copper and cobalt, Congo is also emerging as a supplier of zinc, germanium and gallium. New offtake arrangements have positioned Gécamines as a major zinc exporter and a key buyer of germanium and gallium concentrates, with the company recently recording its first export of locally processed germanium.
Differences between Chinese and Western investment strategies remain stark. KoBold Metals has secured more than 3,000 square kilometers in the lithium and copper belt but will not move forward with projects tied up in disputes, citing governance standards, its Congo head Benjamin Katabuka said.
Chinese companies, by contrast, have pushed ahead in contested areas, strengthening their speed-to-market advantage.
At Manono, one of the world’s largest undeveloped lithium deposits, KoBold says it will wait until ownership issues are resolved, even as Zijin advances infrastructure on the northern block.
If it secures the southern block without dispute, KoBold says production could begin within three years. In Guinea, the China-backed Winning Consortium Simandou pressed ahead with rail and port construction at the massive Simandou project despite ownership disputes, effectively forcing Rio Tinto to follow suit.
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Image Credit: Tekedia
