The Battle for Critical Minerals: The Urgency and Divisions Within the U.S.-Europe Alliance
14/01/2026
Year, Month, Day, at Shimizu Port in Shizuoka Prefecture, Japan, the research vessel "Chikyu" operated by the Japan Agency for Marine-Earth Science and Technology slowly set sail. Its destination was the waters near Minamitorishima, approximately kilometers southeast of Tokyo, with the mission of conducting the world’s first experimental mining of deep-sea rare-earth mud at a depth of meters on the seabed. Almost simultaneously, U.S. Treasury Secretary Scott Bessent was preparing for a dinner in Washington, D.C., with invitees including finance ministers or cabinet-level officials from the Group of Seven (), the European Union, Australia, India, South Korea, and Mexico. An urgent meeting centered on the security of critical mineral supply chains was about to begin.
From the depths of the Pacific Ocean to the Greenland ice sheet, from meeting rooms in Washington to laboratories in Tokyo, a strategic game reshaping the global resource landscape is accelerating. At its core lies China's near-monopoly position in the supply chains of critical minerals. Data from the International Energy Agency is stark and direct: China refines % to % of the world's copper, lithium, cobalt, graphite, and rare earths. These materials, dubbed the "vitamins of modern industry," are the lifeblood of strategic sectors such as defense technology, semiconductors, renewable energy, and batteries. As economic dependence transforms into geopolitical leverage, the construction of a global resource alliance aimed at "de-risking" or "decoupling" has shifted from concept to urgent action.
Washington's call for "urgency" and alliance building
The Washington meeting on the 1st was described by U.S. officials as having an atmosphere where "urgency was the theme of the day." This gathering, which brought together approximately 80% of the global demand for critical minerals, had a clear and singular goal: to accelerate the reduction of dependence on China. Since presenting a briefing on rare earth issues to leaders at the G7 summit in Canada in June 2018, U.S. Treasury Secretary Janet Yellen has been pushing for such a specialized meeting. Although the summit resulted in an action plan to strengthen supply chains, Yellen has grown increasingly frustrated with the slow progress that followed.
The United States' strategic posture is clearly that of a "convener" and "leader". A senior U.S. official stated that the U.S. is convening all parties, demonstrating leadership, sharing its vision for the future, and is prepared to act together with countries that feel the same sense of urgency. This posture is backed by a series of concrete measures from the Trump administration: signing an $85 billion project pipeline agreement with Australia aimed at leveraging Australia's strategic reserves to counter China's dominance in the critical minerals sector; simultaneously, the U.S. is also promoting domestic production through agreements with other producing countries like Ukraine.
However, the alliance is not monolithic. Apart from Japan—a country that has vigorously promoted supply chain diversification since China abruptly cut off rare earth supplies in 2010—other members remain heavily dependent on China. The meeting is expected to issue a statement but is unlikely to produce a concrete joint action plan. This reflects the early-stage characteristics of the alliance's formation: consensus lies in identifying problems and directions, while disagreements exist over action pathways, cost-sharing, and geopolitical priorities.
A frequently discussed potential tool is setting a "price floor" for critical minerals. German Finance Minister Lars Klingbeil revealed after the meeting that this measure aims to counter China's market dominance and price suppression through dumping, ensuring a minimum profit level for non-Chinese producers, thereby stabilizing investment expectations. Klingbeil emphasized that this is not about confronting anyone, but about strengthening cooperation among partners. Setting a price floor can provide the market with predictable prices and minimize the influence of countries attempting to manipulate market prices. However, the design of this mechanism is complex, involving a balance of interests between producing and consuming countries, as well as how to avoid distorting the global market. Many details are left to be clarified in the coming weeks and may require further involvement from foreign ministers and energy ministers.
Europe's "Diversification" Path and the Adherence to Sovereignty
Compared to the United States' emphasis on speed—even at the expense of projecting a firm geopolitical stance—Europe's response appears more cautious, with its core logic being "diversification" rather than simple "replacement." Before his trip to the United States, German Vice Chancellor and Finance Minister Christian Lindner clearly stated that Germany is willing to engage in "joint action" to strengthen supply chain security, but its primary goal is to "reduce dependencies and enhance supply security."
This caution is particularly pronounced in the context of the Greenland issue. When U.S. President Trump once again raised the idea of acquiring Greenland, directly linking it to countering Chinese and Russian influence in the Arctic, Europe’s response was one of vigilance and principle. In Washington, Klingenberg stated bluntly, "The future of Greenland is for Denmark and Greenland to decide. Territorial sovereignty and integrity must be respected. These principles of international law apply to everyone—including the United States." During his concurrent visit to the U.S., German Foreign Minister Johann Waldpur conveyed a similar message to U.S. Secretary of State Rubio, reminding the United States of its shared responsibility as a NATO ally for freedom, self-determination, and security.
Europe's stance reveals the duality of its strategy: on one hand, in terms of economic security, it is acutely aware of the urgency to break China's monopoly, as the Greenland ice sheet is estimated to contain critical rare earth elements such as dysprosium and neodymium, sufficient to meet over a quarter of the world's future demand; on the other hand, in terms of geopolitics, it firmly upholds the rules-based international order and opposes any unilateral attempts to alter the territorial status quo. For Europe, supply chain security cannot come at the cost of undermining the international legal norms it relies on and the trust within its transatlantic alliance.
Europe's diversified approach may lean more towards technological cooperation and global multi-point deployment. For instance, Japan is regarded by Europe as a key technological partner due to its advantages in rare earth separation and refining technologies, as well as its exploration of deep-sea rare earth mud mining (its mud samples contain almost no radioactive uranium and thorium, facilitating domestic processing). At the same time, European capital has also shown interest in Australia's strategic reserve projects. This path is more costly and time-consuming, but perhaps better aligns with Europe's long-term pursuit of strategic autonomy and rule-based order.
The Real Dilemma of Resource Hotspots: Challenges in Greenland and Deep-Sea Mining
Whether it be the radical concepts from the United States or the cautious planning in Europe, none can avoid a fundamental question: where will alternative resources come from? Greenland and the deep sea are held in high hopes, but the reality is fraught with challenges.
The Allure and Pitfalls of Greenland Trump's fixation on Greenland is seen by analysts as "more of a geopolitical spectacle than a practical supply solution." The challenges in Greenland are comprehensive: extremely harsh environments, nearly non-existent infrastructure (lack of roads, railways), complex mineral occurrences (rare earth elements are often found in hard-to-refine eudialyte rather than common carbonatite), and potential conflicts between the fragile Arctic ecosystem and the emerging tourism industry. Extracting rare earths requires large amounts of toxic chemicals for separation and is often accompanied by radioactive uranium, posing extremely high environmental risks. Diogo Rosa, an economic geology researcher at the Geological Survey of Denmark and Greenland, points out that any mining enterprise must build all accessibility facilities from scratch and solve energy and expert manpower issues on-site.
Although more than a dozen companies are conducting exploration on the island, most remain in the early stages. Even the most promising projects face the challenge of raising hundreds of millions of dollars in funding and may struggle to become profitable at any time due to China dumping excess materials onto the market and driving down prices. Ian Lange, a professor of economics at the Colorado School of Mines specializing in rare earths, analogized, "Everyone is racing toward the finish line. If you go to Greenland, it's like going back to the starting point."
Technological and Commercial Uncertainties of Deep-Sea Mining Japan's deep-sea rare earth mud mining trial represents another cutting-edge path. The rare earth mud resources in the waters near Minamitorishima are vast, and the advantages for environmental processing are evident. Japan plans to assess commercial feasibility through this test, aiming to commence large-scale experiments from February next year, with a daily mining capacity of up to 350 tons of rare earth-bearing sediment. This is undoubtedly an ambitious plan, but the technical challenges of operating at 6,000 meters depth, the high costs, and the long-term impact of large-scale mining on deep-sea ecosystems are all unknowns. This is more akin to a technological reserve and strategic bet for the future, rather than a quick fix for the immediate pressures of the current supply chain.
Pragmatic voices within the industry believe that the United States and its allies should focus resources on companies and projects that have proven viable. For example, the U.S. has directly invested in the country's only rare earth mine, as well as lithium miners and rare earth recycling companies. Scott Dunn, the company's CEO, pointed out that when over % of the world's rare earths come from China, it is difficult to quickly change the status quo, and efforts should start with projects that have a proven track record of successful delivery.
The Future of Alliances: Coordination, Competition, and the Long Road to Decoupling
The Washington Conference has concluded, but the battle for critical minerals has just entered deeper waters. What the U.S. and its partners face is a complex chessboard intertwined with technology, economics, environment, and geopolitics.
First, internal coordination will be a protracted battle. The proposal to set a price floor demonstrates the intent to build a non-China market mechanism, but the specifics of how it will operate, who will lead it, and how costs and benefits will be distributed will test the political wisdom and spirit of compromise of all parties involved. Germany has hinted that the finance minister alone cannot solve all problems, requiring deep involvement from the foreign and energy departments. This indicates that future cross-departmental international negotiations will become more frequent and complex.
Secondly, interactions with China will exhibit a delicate state of "competition without rupture". Although the meeting aims to reduce dependence on China, China is currently still fulfilling its commitments to supply critical minerals to U.S. companies and purchase soybeans. This indicates that within the deeply intertwined global industrial chains, complete decoupling is neither realistic nor comes at an extremely high cost. A more likely scenario is that the Western alliance attempts to establish a "parallel supply chain," seeking autonomy in key strategic areas while maintaining connections with the Chinese market in general commercial sectors. How China responds to this alliance—whether by applying pressure through pricing tools, consolidating advantages through its own technological upgrades, or participating in the formulation of new multilateral rules—will directly influence the trajectory of the game.
Finally, technological breakthroughs will be the ultimate variable determining victory or defeat. Whether it is Japan's exploration of deep-sea mining and refining technologies, or the investments made by various countries in rare earth recycling and the research and development of alternative materials, these may ultimately prove more important than competing for mineral deposits beneath a specific piece of land. The development challenges faced by Greenland and deep-sea resources precisely illustrate that possessing resources does not equate to having supply capability. From the geological "resource quantity" to the economic "recoverable reserves," and further to a stable, competitive "supply chain," there lies a vast chasm of technology, capital, and environmental considerations.
This critical minerals alliance initiative, spearheaded by the United States and pursued by Europe through diversified pathways, is at its core a competition for future industrial dominance and strategic resilience. It reveals the profound anxiety over economic security among nations following the end of the golden age of globalization. Washington’s urgent calls, Europe’s insistence on sovereignty, Greenland’s resource mirage, and the technological gambles in the deep sea together sketch a new landscape of resource politics in the post-globalization era. The establishment of the alliance is only the first step; the real challenge lies in whether these nations, with their divergent interests, can forge a path that transcends zero-sum games and genuinely enhances the overall resilience of global supply chains. This path is destined to be long and arduous, yet its direction will profoundly shape the world’s economic and geopolitical landscape for decades to come.
Reference materials
https://jp.reuters.com/markets/japan/4YTPYQ75ENNOHOMMHTYOTEJJZU-2026-01-12/
https://news.yahoo.co.jp/articles/4f635c8a52657529cd34f0a0074607d4cbd2cd95