The attention of a short-selling hedge fund on US fuel-cell maker Bloom Energy Corp. has thrust one of the world’s smallest and most obscure critical-mineral markets into the spotlight.

Hunterbrook Media published a report Wednesday, alleging Bloom remains reliant on Chinese scandium despite repeated assurances to investors that it isn’t dependent on China for the material. Hunterbrook works alongside an affiliate, Hunterbrook Capital, which has a short position in Bloom. The company’s shares tumbled on the report, before recovering some of the losses Thursday.

Hunterbrook said it based its conclusion on global trade data, Chinese corporate filings, satellite imagery and conversations with Bloom’s suppliers in China. Bloom said Thursday that the report is “false and misleading.”

The dispute highlights the challenges facing US manufacturers that depend on foreign supplies of obscure minerals that aren’t easily substituted. While President Donald Trump’s White House has poured billions of dollars into rebuilding a domestic supply chain for critical minerals, China still dominates production and processing of many of the materials the US relies on for consumer electronics, vehicles, data centers and defense technology.

Bloom has seen its stock soar almost 1,000% over the past year on demand for its products to power data centers. It uses scandium to improve the performance of its fuel cells, allowing them to operate at lower temperatures and with greater durability.

Bloom says it buys scandium oxide from multiple suppliers across multiple countries. “No single supplier determines our destiny,” Chief Operating Officer Satish Chitoori said in a blog post on Tuesday. “No single country does either.”

The company hasn’t disclosed where, exactly, its scandium comes from. Chitoori said the company keeps its sourcing network confidential to protect the resilience of its supply chain.

Bloom said in a regulatory filing Thursday that it has a “sufficient supply of scandium oxide to meet our current fuel cell demand and backlog, and our supply is not dependent on China.” The company added that its supply chain can “support production of 25GW [gigawatts] of fuel cells per year, and we will continue to expand this capacity.”

Even in the world of obscure critical minerals — other examples include germanium, gallium and rare earth elements like neodymium — scandium is especially niche. It’s one of the smallest mineral markets globally, with just 30 to 40 metric tons consumed worldwide each year, according to the US Geological Survey.

Tiny amounts of scandium improve the strength of aluminum alloys, making them attractive for aerospace and defense technology. Lockheed Martin Corp. is trying to use aluminum-scandium alloys in its fighter jets and Formula One teams have experimented with the material to reduce weight without sacrificing strength.

China has spent years expanding its capacity to recover and refine scandium, and companies such as Hunan Oriental Scandium say they now supply more than half of the world’s fuel-cell-grade scandium oxide.

Its outsize importance has put it at the forefront of US-China trade tensions. Earlier this year, Beijing added scandium to a growing list of strategic minerals requiring export licenses alongside gallium, germanium and several rare earth elements.

Outside of China, production is limited. Russia and the Philippines produce small quantities, according to the US Geological Survey. Closer to the US, Rio Tinto Group has started recovering scandium from its titanium dioxide operations in Canada. Australian developer Sunrise Energy Metals Ltd. is also seeking to expand supply of the mineral. 

Bloom’s Chitoori said the company can get scandium from mining waste streams outside of China.

The Trump administration has focused its funding on rare earth elements and critical minerals like lithium and copper, but so far, little domestic funding has gone towards scandium production. Last year, the Pentagon awarded $10 million to NioCorp Developments Ltd. to produce scandium alongside minerals like niobium and titanium from a yet-to-be-developed project in Nebraska. 

Most projects are years away from significant production, and until then, China remains the leading producer of the mineral, leaving US companies reliant on the country’s supply. 

Bloom shares closed down 5.7% Wednesday at $254.29 on the Hunterbrook report and were up roughly 3.1% on Thursday. 

Ben Kallo, an analyst at Baird Equity Research, recommended buying Bloom shares on “weakness” in a note he sent to clients on Wednesday.

“We think the scandium concern the short report called out isn’t a major risk,” Kallo wrote in the note, adding that “the constraint the short report describes is one the supply chain has been actively resolving for years.”