Most investors hear the words artificial intelligence, electric vehicles or clean energy and immediately think of software, chip makers, battery or car companies. Fair enough. They are the visible parts of the story. But beneath it all is a less glamorous layer: the metals and minerals needed to build hardware, networks and machines.
This is why precious metals are getting more attention. They are very close to the beginning of the supply chain, but they help make possible a surprising number of modern industries. If you want to understand why investors, governments and fund managers are suddenly talking about rare earths, lithium, nickel and copper in the same breath as AI and defense, it helps to start there.
This is where products like the Global X Rare Earth and Critical Metals ETF (ASX:GMTL) come into the conversation. But before getting to the ETF itself, it’s worth understanding the broader theme. Otherwise it’s easy to confuse a good story with a good investment.
What are the major metals?
There is no single absolute definition, but critical metals are generally minerals and metals that are considered economically important and strategically difficult. They matter because modern industries depend on them, while supply can be concentrated, politically sensitive or difficult to expand rapidly.
Rare earths often grab the headlines because they are used in high-performance magnets and other advanced applications. But the wider universe of critical metals is much wider than that. GlobalX says GMTL has exposure to 10 mineral groups: rare earths, platinum group metals, copper, lithium, cobalt, nickel, manganese, zinc, aluminum and chromium.
That list is useful because it shows that it’s not just an EV story. Copper matters for power and grid investment. Lithium, cobalt, nickel and manganese are linked to battery chemistry. Rare earths are important for magnets used in motors, turbines and defense technologies. Platinum group metals remain relevant in industrial systems. In other words, this theme sits across multiple industries, not just one.
Why demand may continue to grow.
The simple version is that more advanced technology usually means more specialized content. As industries move from prototypes to mass adoption, demand for inputs can grow exponentially. A new technology can be exciting. Multiple industries are pulling the same supply chain together where investors start paying serious attention.
This is part of the case presented by GlobalX in its GMTL specifier. The firm argues that clean energy, battery storage, robotics, artificial intelligence, hydrogen and defense systems all rely on key materials. If those industries continue to expand at the same time, producers and processors of these metals could become more important than many investors currently realize.
GlobalX highlights forecasts compiled from groups including the International Energy Agency, the US Geological Survey and McKinsey that suggest demand for 10 mineral groups in the GMTL could grow by an average of 42% by 2030 and reach 90% by 2040. Within it, demand for lithium was prominently displayed and possibly even highlighted as cobble. Strong long-term demand growth.
You don’t have to believe every prediction to get the big idea. If the world wants more batteries, more grid capacity, more data centers, more robotics and more defense capability, it probably needs a lot more upstream stuff, too. This is a pick and shovel argument here.
Why is the supply side so important?
Demand is only half the story. The other half is supply, and this is where things get more interesting. Unlike many consumer-facing industries, primary metals are not produced and refined uniformly throughout the world. In some cases, supply chains are highly concentrated among only a few countries.
Global X argues that for every mineral in the GMTL universe, more than 50%—and in some cases close to 100%—of global refined production can be found in just two producer countries. The chain is particularly important in large parts of the complex. This concentration matters because it poses strategic risks to countries and businesses that depend on reliable access to these materials.
This is why the theme is no longer just about commodity prices. It is also about industrial policy, trade frictions, national security and supply chain flexibility. In 2025, China once again imposed restrictions on rare earth exports, reinforcing the idea that the material now sits within a geopolitical competition as well as an economic one.
Why investors keep hearing the word ‘strategic’
Many objects are cyclical. Precious metals can also be cyclic. But what makes this area different is that governments consider some of these materials to be strategically important rather than merely useful. Access to this information is critical if a country wants to build a defense system, electrify its economy, support domestic manufacturing or reduce dependence on geopolitical rivals.
This can lead to two broad reactions. There is a hoarding. Another is investing heavily in domestic or allied supply chains. Both can benefit parts of the precious metals ecosystem, whether that means established producers, refiners, recyclers or new projects in jurisdictions deemed politically credible.
For investors, this creates a theme with more moving parts than a standard resource cycle. You’re not just asking if industrial demand will increase. You are also asking whether governments will continue to direct capital, subsidies and policy support towards more secure supply chains. This is a major reason why this area has become more interesting.
So where does GMTL fit in?
The Global X Rare Earth and Critical Metals ETF (ASX:GMTL) is a way for investors to gain exposure to this theme without trying to pick a single mining company or a single metal price. That’s probably the neatest academic way to think about it. The ETF itself is not a theme. This is a wreath built around a theme.
This difference matters. If you buy a thematic ETF, you’re still making a portfolio decision, not just agreeing to the macro story. You need to look at holdings, weightings, countries, fee structure and concentration risk. You should also check if you already own similar exposure through other mining, resource or thematic funds.
In other words, GMTL may be interesting, but that doesn’t automatically make it suitable for every investor. For many, it makes more sense as a small satellite position than as a primary holding. The real job is to decide whether the theme adds something useful to a portfolio, not whether the story looks interesting on LinkedIn.
Rask Takeaway
The easiest mistake in the markets is to fall in love with the shiny end of a trend and ignore the less glamorous parts that actually make it work. Precious metals are a good reminder that technological change does not happen in a vacuum. It requires real-world inputs, and those inputs can become incredibly valuable when demand is high and supply is tight.
This does not mean that every rare earth or precious metals investment will work. Some will be too expensive, too risky or too reliant on perfect execution. But as an academic theme, it is worth understanding because it sits at the intersection of technology, industrial policy and geopolitics. And that’s why investors are paying more attention.
Source material used for this article includes Global X ETFs Australia’s “Introducing GMTL: Investing in the Materials Frontier” published on 22 May 2026 alongside the current GMTL fund page. This article is general information only and not a recommendation.
