China Classifies Phosphate Rock as Strategic Mineral and Restricts Exports

On June 15, 2026, China brought phosphate rock under formal state control by classifying it as a strategic mineral. The designation came through State Council Order No. 839, the Regulations for the Implementation of the Mineral Resources Law, which the State Council approved on May 9, 2026 and released on May 20. Phosphate rock now sits alongside lithium, cobalt, rare earths and other materials on the national strategic mineral list, a group of 36 resources placed under coordinated oversight across exploration, mining, production, reserves and sales.

The reclassification moves phosphate rock from the status of an ordinary agricultural input to a resource tied directly to food security and the new energy industry. China produced about 110 million tonnes of phosphate rock in 2025, close to 44 percent of global output, which makes any shift in its supply policy a worldwide concern.

The most consequential part of the new framework is the export regime. High-grade phosphate rock with a P2O5 content at or above 30 percent is now barred from direct export in principle. Only medium and low-grade ore can apply for export licenses, and companies seeking to ship high-grade material must prove a specific end use and clear approval from several ministries, including the Ministry of Commerce and the Ministry of Natural Resources. Pure trading firms can no longer export raw ore, with shipments reserved for integrated miners that also process the material at home.

On the mining side, the rules impose annual volume quotas and move approval of new mining rights up to the provincial level and the Ministry of Natural Resources. New standalone phosphate mines will generally no longer be approved, and scattered small operations must merge or integrate by the end of 2028. Producing provinces such as Hubei, Yunnan and Guizhou, which together hold most of the country reserves, have been designated as national planning areas where new small mines are prohibited.

This move did not appear in isolation. It is the latest step in a tightening cycle that began in December 2024, when Beijing first paused new phosphate export applications. In December 2025 the National Development and Reform Commission suspended phosphate fertilizer exports through August 2026, and in March 2026 it widened the restrictions to additional fertilizer blends. By the time Order No. 839 took effect, between half and three-quarters of the country fertilizer exports were already restricted.

The timing has sharpened the impact. The Strait of Hormuz has been closed since late February 2026 because of the conflict involving Iran, cutting off Middle Eastern sulphur shipments. Sulphur and sulphuric acid are essential for turning phosphate rock into phosphoric acid and finished fertilizers such as DAP and MAP. In April 2026 China announced it would also halt sulphuric acid exports from May, removing one of the last flexible supply valves. Against this background, the average price of diammonium phosphate rose above 700 US dollars per tonne in April 2026, and analysts expect phosphate prices to stay elevated through at least the end of the year.

Beijing frames the controls around two security goals.

The first is food security, since phosphate is a core ingredient in the fertilizers that underpin domestic agriculture.

The second is the new energy sector, where lithium iron phosphate batteries consume large volumes of high-grade rock. In the first quarter of 2026, Chinese energy storage battery shipments rose 139 percent year on year, adding fresh demand pressure. China also faces a resource constraint of its own, as high-grade ore makes up only about a fifth of national reserves and the mineable life at current rates is under 40 years.

For buyers outside China, the consequences are already visible. Importers in India, Southeast Asia and parts of Africa face higher input costs ahead of key planting seasons. Makers of lithium iron phosphate batteries must compete for a tighter pool of high-grade material. The restrictions are accelerating a search for alternative supply, with attention turning to Morocco OCP, the Saudi Ma'aden complex and new projects in Brazil, although most of that capacity is not expected to come online in volume before 2027 and 2028.

As of late June 2026, the regulation is fully in force and there is no sign that China plans to loosen it in the near term. The industry agreement to avoid new export scheduling runs through August 2026, and the structural drivers behind the policy, namely resource conservation and surging battery demand, are unlikely to reverse quickly. For the global phosphate market, the practical result is a continued shift toward a seller market in which China holds growing influence over pricing and availability.