Greenland Deal Lifts Critical Metals to $1.3B Valuation
A US-Denmark-Greenland security pact triggered a 35% surge in Critical Metals, highlighting rare-earth ETF exposure.
Key points
- Critical Metals Corp. shares rose 35% to a $1.3 billion valuation following a US-Denmark-Greenland security agreement.
- VanEck REMX focuses on rare earths with a 0.53% fee, while Sprott SETM diversifies into copper and uranium.
- China retains 70-95% of global refining capacity for critical minerals, driving Western investment in Greenland projects.
A new security agreement between the United States, Denmark, and Greenland has triggered a sharp rally in equities linked to Arctic mineral resources. Critical Metals Corp. (NASDAQ:CRML) surged 35% on Monday, lifting its market capitalization to approximately $1.3 billion. This move significantly outpaced the Nasdaq Composite, which rose only 0.2% during the same session.
The rally extends to other Greenland-focused entities, with Greenland Energy Co (NASDAQ:GLND) jumping 126% and Greenland Mines Ltd. (NASDAQ:GRML) soaring 136%. According to Benzinga, the catalyst is the renewed investor focus on Greenland’s mineral reserves as the U.S. seeks to reduce reliance on Chinese supply chains for critical materials.
Tanbreez Resource Drives Valuation
Critical Metals’ valuation increase is anchored by its Tanbreez project in southern Greenland, which holds roughly 45 million metric tons of resources. More than one-quarter of this tonnage consists of heavy rare-earth oxides, a segment where Western supply remains limited. The company holds approximately 93% ownership of the project following earlier government approval.
The firm has secured a 15-year binding offtake agreement with REalloys for rare-earth concentrate, including two five-year extension options. This contract provides a potential revenue stream, although the recent security agreement does not grant new mining rights, government funding, or additional commercial deals.
ETF Structures Differ in Risk
Investors seeking exposure through exchange-traded funds face distinct portfolio compositions. The VanEck Rare Earth and Strategic Metals ETF (NYSE:REMX) holds about $2.3 billion in assets with a 0.53% expense ratio. Its top holdings include Albemarle Corp (7.65%), Pilbara Minerals (7.32%), and Mp Materials Corp (6.78%), creating a concentrated bet on the rare-earth supply chain.
In contrast, the Sprott Critical Materials ETF (NASDAQ:SETM) manages approximately $629.4 million with a 0.65% expense ratio. It offers a broader mix, including Freeport-McMoRan (6.03%) and Cameco Corp (4.89%). This diversification across copper, uranium, and lithium results in different performance metrics, with SETM up 8.4% year-to-date versus REMX’s 5% decline.
China Dominates Processing Capacity
The strategic push toward Greenland stems from China’s enduring dominance in mineral processing. While China’s share of global rare-earth refining dropped from over 90% in 2023 to about 85% in 2025, the International Energy Agency estimates it still controls 70% to 95% of refining capacity for several critical minerals.
Projections indicate China’s rare-earth refining share could remain between 70% and 73% by 2035, even after planned foreign projects are completed. This persistence underscores the geopolitical rationale for developing Western sources like Tanbreez, aiming to secure independent supply chains for heavy rare earths.
