China's 60-year Dominance Over Critical Minerals Is Coming To An End
- 31.10.2026, 14:48
The main goal of the U.S. and Europe is to establish alternative supply chains.
The United States and the European Union are launching large-scale investment programs, building strategic reserves, and joining forces with allies to reduce their dependence on Chinese supplies of rare earth metals and other critical minerals. Washington is allocating $12 billion to build its own reserve, while Brussels is directing 3 billion euros toward the development of raw material extraction and processing, according to CEPA.
The need for such measures became particularly evident after Beijing used export restrictions as a tool to exert pressure. Chinese bans on the supply of rare earth metals and battery components have forced some foreign automakers to cut production and shut down assembly lines.
Currently, China controls about 60% of global rare-earth production, 90% of rare-earth processing and separation, and 94% of permanent magnet production. These materials are essential for the production of electric vehicles, batteries, fighter jets, and modern weapons systems.
In February 2026, the administration of U.S. President Donald Trump launched Project Vault—a public-private reserve of critical minerals with $12 billion in funding. Another initiative, FORGE, brings together 17 participants and is intended to coordinate trade policy, investments, and minimum prices that will protect Western manufacturers from Chinese price pressure.
At the same time, the European Union is implementing the RESourceEU program, worth 3 billion euros. It provides for support for priority projects, joint procurement, and the creation of common reserves of raw materials.
U.S. Vice President J.D. Vance stated that FORGE’s goal is to create a “preferential trade zone” for critical minerals.
However, it will take years to establish fully-fledged alternative production facilities. For decades, China has been developing not only mining but also processing technologies, training specialists, and building industrial infrastructure. Therefore, the success of the Western strategy will depend on whether the U.S. and Europe can agree on common rules, funding, and guarantees for new enterprises without competing with one another.