TMC the metals company Inc. (TMC): 5 FORCES Analysis [Nov-2025 Updated]

You're analyzing a company sitting on a theoretical $\mathbf{\$23.6}$ billion asset Net Present Value (NPV), but it hasn't sold a single gram of metal yet. That's the unique, high-stakes spot The Metals Company Inc. (TMC) occupies: a pre-revenue deep-sea miner trying to break into a critical minerals market dominated by terrestrial giants and rapidly scaling recycling. Honestly, the five forces analysis shows a mixed bag: supplier power is low because key partners like Allseas are also investors, but customer power is high, with Glencore already locked in for $\mathbf{50\%}$ of future nickel and copper. The real fight, though, is the intense rivalry for first-mover status against China-backed competitors and the looming threat from battery recycling, which is expected to supply the equivalent of $\mathbf{1}$ million EVs by $\mathbf{2025}$. Before you place your bet, you need to see how these forces-especially the regulatory clock ticking toward the BBNJ Agreement in early $\mathbf{2026}$-will shape TMC's path from exploration contract to commercial reality below.

TMC the metals company Inc. (TMC) - Porter's Five Forces: Bargaining power of suppliers

You're assessing TMC the metals company Inc.'s (TMC) supplier power, and honestly, the picture is quite favorable for TMC right now, largely because the most critical 'suppliers'-those providing access to the resource and the means to process it-are deeply aligned as strategic partners or investors rather than purely transactional vendors.

Resource access is secured through long-term exploration contracts granted by the International Seabed Authority (ISA). TMC, through its wholly-owned subsidiary Nauru Ocean Resources Inc. (NORI), holds the exploration contract for an area in the Clarion-Clipperton Zone (CCZ). Furthermore, TMC is aggressively pursuing the U.S. regulatory path, having submitted applications for a commercial recovery permit and exploration licenses under the Deep Seabed Hard Mineral Resources Act in April 2025. NORI set the date of June 27, 2025, for the expected submission of its ISA exploitation application.

The leverage of key technology partner Allseas is significantly mitigated because they are also an investor. Allseas has been an instrumental partner, dedicating the vessel The Hidden Gem for TMC's exclusive use and designing/fabricating the nodule collector vehicle. Allseas has invested hundreds of millions overall in this project. This deep financial commitment means Allseas' primary interest aligns with TMC's successful commercialization, reducing the likelihood of them exerting significant, purely transactional pressure on pricing or terms for their services.

The strategic $85.2 million investment from Korea Zinc, expected to close on June 26, 2025, further locks in future processing capacity and reduces supplier risk. This transaction secures Korea Zinc a stake of approximately 5% in TMC. Korea Zinc, a global leader in non-ferrous metal refining, is actively evaluating TMC's nodule material to explore joint refining and precursor cathode active material (pCAM) production capacity in the United States. This partnership effectively turns a potential future service provider into a strategic shareholder with a vested interest in TMC's output.

TMC the metals company Inc. is still pre-revenue, which means it is not yet a major demand driver for the operational suppliers it will eventually need for things like onshore processing or logistics, keeping their immediate bargaining power low. The company reported a net loss of $20.6 million for the first quarter of 2025. While this pre-revenue status means TMC is currently dependent on capital markets and strategic partners for funding its development, the recent influx of strategic capital lessens the immediate pressure from any single operational supplier.

Here's a quick look at the financial and partnership context that shapes supplier dynamics as of late 2025:

The current supplier landscape is characterized by a few key relationships where the supplier is also an equity holder, which fundamentally shifts the power dynamic:

• Resource access is secured via ISA contracts (NORI, TOML) and U.S. DSHMRA applications.
• Allseas is a technology partner and has invested hundreds of millions overall.
• Korea Zinc is a strategic investor holding approximately 5% equity, securing future processing alignment.
• TMC remains pre-revenue, limiting leverage over general operational vendors.

Finance: draft 13-week cash view by Friday.

TMC the metals company Inc. (TMC) - Porter's Five Forces: Bargaining power of customers

You're looking at TMC the metals company Inc. (TMC) as it stands in late 2025, and the power held by its potential buyers is a major factor in its risk profile. Because TMC is pre-revenue-reporting a net loss of $184.5 million for the third quarter of 2025-its future revenue hinges entirely on securing favorable, long-term offtake deals with established industry giants. These buyers, primarily in the electric vehicle (EV) battery and metallurgical sectors, are large, sophisticated, and concentrated, meaning they don't need to buy from TMC; TMC needs them to validate its entire business model. The sheer scale of the resource is impressive, with a combined Net Present Value (NPV) of $23.6 billion estimated across its projects, but that value is only realized if a buyer signs on the dotted line.

The customer concentration is immediately clear when you look at the projected output versus the current supply landscape for the United States. TMC plans for steady-state production of 97 ktpa nickel and 70 ktpa copper from its NORI-D project alone, starting around Q4 2027. To put that into perspective for the US market, the nation depends on imports for up to 100% of its nickel and cobalt, and about 50% of its copper. This dependency gives large US-based EV and battery manufacturers significant leverage in negotiations, even if they are eager for a secure, non-terrestrial supply source.

The most concrete evidence of customer power is the existing commitment with Glencore International AG. TMC has locked in a major buyer for a substantial portion of its initial output. Specifically, the agreement covers delivery of 50% of the annual quantity of both copper and nickel produced from the NORI Area nodules. While this secures a baseline revenue stream, it also means that for its most critical metals, TMC has already ceded half of its potential pricing power to a single, massive commodity trader. Glencore can terminate the agreement with twelve months' notice, which is a clear risk factor you need to track.

Still, customers aren't just looking at TMC; they have alternatives, which keeps their bargaining power high. The primary substitutes are the established, albeit environmentally scrutinized, terrestrial mining operations and the rapidly evolving metal recycling industry. The push for domestic supply, evidenced by recent US Executive Orders in 2025 aimed at increasing American mineral production, means that terrestrial projects or advanced recycling facilities-if they can scale quickly-represent a viable pivot for buyers seeking supply security outside of deep-sea mining. The existence of these alternatives forces TMC to compete not just on the 'green' narrative, but on price and delivery certainty.

The regulatory uncertainty surrounding deep-sea mining acts as a multiplier for customer leverage, even if it's a double-edged sword for TMC. Growing corporate calls for a deep-sea mining moratorium increase the procurement risk for any buyer signing a long-term deal today. If a major OEM (Original Equipment Manufacturer) commits to TMC and the ISA (International Seabed Authority) imposes a multi-year delay or outright ban, that OEM faces supply chain disruption. This risk is partially offset by strategic partnerships, like the $85.2 million investment from Korea Zinc, which suggests a downstream buyer is willing to take on some of that risk for access. However, the very real possibility of regulatory roadblocks means customers can afford to wait or demand better terms to compensate for the uncertainty.

• Net loss for Q3 2025 was $184.5 million.
• Glencore off-take covers 50% of nickel and copper.
• US dependency on imports is up to 100% for nickel and cobalt.
• Korea Zinc's strategic investment was $85.2 million.
• Projected steady-state nickel production is 97 ktpa.

Finance: draft a sensitivity analysis on the Glencore off-take terms versus a spot-market sale for the remaining 50% of nickel and copper by next Tuesday.

TMC the metals company Inc. (TMC) - Porter's Five Forces: Competitive rivalry

The competitive rivalry in the deep-sea mining sector for TMC the metals company Inc. is defined by an intense global race for critical minerals, regulatory uncertainty, and the high stakes of establishing a first-mover advantage in a nascent industry.

The global race for critical minerals is heavily influenced by established players. China holds the most International Seabed Authority (ISA) exploration licenses, possessing five out of the 30 total licenses granted to date. This grants China exclusive rights to excavate approximately 92,000 square miles of international seabed, representing about 17 percent of the total area currently licensed by the ISA. Several Chinese entities are targeting test collections in 2025.

Direct deep-sea rivals are actively advancing their exploration efforts. Cobalt Seabed Resources (CSR) progressed with deep-sea exploration in the Cook Islands in 2025. The Cook Islands' exclusive economic zone is estimated to contain around 6.7 billion metric tons of polymetallic nodules, with an estimated potential yield of 20 million metric tons of cobalt alone.

TMC the metals company Inc.'s projected future revenue mix relies heavily on nickel at 45% and manganese at 28% [cite: Outline Requirement]. This focus aligns with the composition of the polymetallic nodules TMC targets in the Clarion-Clipperton Zone, which typically contain 1.0-1.4% nickel and 27-30% manganese.

The zero-sum race for first-mover advantage in this new industry is definitely high, as commercial exploitation permits have not yet been granted by the ISA, making the first to secure a viable operation strategically positioned. TMC the metals company Inc. has invested over $500 million in developing its deep-sea minerals platform.

You are looking at a landscape where milestones are being hit in real-time, which dictates the intensity of this rivalry. Here's a quick look at the competitive positioning and resource focus:

The race to commercialization is compressing timelines, which increases the pressure on all participants. TMC the metals company Inc. announced its intention to file an exploitation application in late June 2025, targeting the start of commercial production from 2026.

The composition of the target resource highlights the value proposition driving this rivalry:

• Polymetallic Nodules: Contain 1.0-1.4% nickel, 0.9-1.3% copper, 0.2-0.25% cobalt, and 27-30% manganese.
• Cook Islands Nodules: Estimated to produce 20 million metric tons of cobalt alone.
• Projected Supply Impact: Deep-sea sources could supply 5-10% of global nickel demand by 2035.

The intensity is further quantified by the capital deployed in this race. TMC the metals company Inc. has invested more than $500 million in its platform development.

Key first-mover milestones illustrate the competitive sprint:

• TMC filed U.S. commercial permit in 2025.
• TMC targets commercial production start in 2026.
• Chinese entities plan test collections in 2025.
• ISA has granted 30 exploration contracts, each lasting 15 years.

Finance: review the capital expenditure runway against the 2026 commercial production target by next Tuesday.

TMC the metals company Inc. (TMC) - Porter's Five Forces: Threat of substitutes

You're looking at the competitive landscape for TMC the metals company Inc. (TMC) and the substitutes for its deep-sea polymetallic nodules are a very real headwind. The threat here isn't just one alternative; it's a multi-pronged challenge from established and emerging technologies, all of which carry less regulatory or reputational baggage right now.

Battery Recycling Scaling

The circular economy is gaining serious traction, meaning less reliance on primary extraction, even deep-sea. By 2025, the EV sector drives 70% of the recycling market, and recycling is forecast to supply 15% of the required cobalt and nickel this year. The global recycling capacity for lithium-ion batteries is approximately 350,000 tons per year, with China holding about 50% of that capacity. In the US specifically, planned recycling capacity by 2030 is set to recycle 1.3 million EV-equivalents annually, which is nearly four times the expected available stock of 341,000 packs that year. The global volume of end-of-life lithium-ion batteries is projected to be only 900 kilotons in 2025.

Alternative Battery Chemistries

Alternative chemistries are eating into the market share that traditionally required TMC the metals company Inc. (TMC)'s target metals. Cobalt-free technologies now account for over 30% of all lithium-based battery production. Specifically, Lithium Iron Phosphate (LFP) batteries control approximately 37% of the global EV battery market as of 2025. The global cobalt-free batteries market is projected to reach $425 Million in 2025. Cobalt itself is facing a demand slowdown; it is expected to have the slowest demand growth among all key lithium-ion battery materials by weight. Here's a quick look at the shift:

This trend shows that battery makers are actively designing away from the metals TMC the metals company Inc. (TMC) targets, especially in the mass market. Still, premium segments maintain high-nickel chemistries, which still require cobalt.

Terrestrial Mining Dominance

Despite the push for alternatives, traditional land-based mining is the established, high-volume supplier today. The mass of metals used in lithium-ion batteries is forecast to be 12 million tons in 2025, climbing to 53 million tons by 2040. The concentration of supply from established producers is high; the average market share of the top three mining countries for key energy minerals rose from 73% in 2020 to 77% in 2024. The industry saw investment in battery metal mines and refineries jump 80% year-on-year in 2024, reaching $29 Billion, showing the scale of the incumbent system. The threat is that this established system is already massive and scaling up rapidly to meet demand.

The comparison between the two supply sources is stark:

• Terrestrial mining supplies the bulk of the 12 million tons of battery metals in 2025.
• Recycling is projected to supply only 15% of cobalt/nickel by 2025.
• Geographical concentration in mining output remains high at 77% for top three countries (2024).

Environmental Scrutiny on Deep-Sea Metals

The environmental and regulatory uncertainty surrounding deep-sea extraction directly benefits terrestrial and recycled alternatives. Seabed mining remains speculative and non-commercial as of mid-2025. Major policy bodies are applying pressure; G7 countries stated that any deep-sea mining must occur under the most strict environmental standards. Furthermore, leading insurers are reportedly refusing to underwrite deep-sea mining activities. This scrutiny has led to financial pressure, evidenced by TMC the metals company Inc. (TMC) surrendering a third of its Clarion-Clipperton Zone claim area. China has labelled the U.S. move to seek permits under an outdated act a violation of international law. If onboarding takes 14+ days, churn risk rises, and for TMC the metals company Inc. (TMC), regulatory delays are a major operational risk.

TMC the metals company Inc. (TMC) - Porter's Five Forces: Threat of new entrants

You're looking at a sector where the barrier to entry isn't just high; it's astronomical, which is a massive tailwind for The Metals Company Inc. (TMC) right now. Honestly, the sheer scale of investment needed acts as a near-impenetrable wall for most potential competitors.

Extremely high capital expenditure is required for specialized collection technology and R&D. We aren't talking about a standard land-based mine startup; this is deep-sea hardware development, which demands serious upfront cash. For instance, The Metals Company Inc. (TMC) itself estimates that mining one of its exploration areas will require a capital investment of $4.9 billion for an 18-year life-of-mine. If you look at their broader resource base, the projected capital expenditure jumps to $8.8 billion across a 23-year life-of-mine.

Here's a quick look at the financial reality for a company like The Metals Company Inc. (TMC) in this development phase, where revenues are still zero:

The regulatory pathway is complex, with the BBNJ Agreement entering force in early 2026. This international framework, which officially took effect on January 17, 2026, after reaching 60 ratifications in September 2025, adds another layer of required compliance and uncertainty for any new entrant trying to operate in international waters. The treaty, signed by 143 countries, governs activities beyond national jurisdiction.

Still, The Metals Company Inc. (TMC) holds key early-mover advantage with the first U.S. commercial permit application filed in 2025. They were quick to act following the April 2025 Executive Order, submitting the first-ever commercial recovery permit application to NOAA under the Deep Seabed Hard Mineral Resources Act (DSHMRA).

• TMC USA LLC filed the commercial recovery permit application (TMC USA-A₂) in April 2025.
• The commercial recovery permit application area covers 25,160 square kilometers.
• NOAA confirmed full compliance for their exploration license applications in 2025.

Finally, the structure of the International Seabed Authority (ISA) framework inherently limits who can even start the process for activities in the Area (international waters). Only sovereign-sponsored entities can obtain the limited ISA exploration licenses. To even apply for an exploitation contract with the ISA, a contractor must be sponsored by a State Party to UNCLOS. As of mid-2025, the ISA has granted 31 exploration licenses in total, with 19 specifically for polymetallic nodules. That limited number shows how tightly controlled the initial access points are.