As the world pivots toward a future powered by clean energy, advanced electronics, and resilient defense systems, the building blocks of that future, critical minerals, have come into sharp focus. These essential elements, including the 17 rare earths, tungsten, lithium, and cobalt, are key to everything from electric vehicles and semiconductors to missile guidance systems and wind turbines. However, the global supply chain for refining and processing these materials has, for decades, been dominated by one country: China.
In a bid to rebalance the strategic landscape, the United States has launched an ambitious and multifaceted initiative to secure critical mineral supply chains both domestically and through global alliances. But dismantling China’s monopoly, particularly over rare earths, will require an urgent, coordinated, and long-term effort.
Pini Althaus, an early actor in this reshuffling of global priorities, saw the writing on the wall back in 2023. The founder of USA Rare Earth left his own company to throw himself into a new venture, Cove Capital, with a specific focus on critical mineral development in Central Asia." I realized we only have a handful of large critical minerals projects that were going into production between now and 2030," Althaus, now chairman and CEO of Cove Capital, told Fortune. "We're going to have to supplement the United States’ critical minerals supply chain with materials coming in from our allied and friendly countries."
China controls approximately 90% of the world's rare earth refining capability, a figure that has sent shockwaves through technology, defense, and energy industries in the wake of escalating U.S.–China tensions. While rare earths are not geologically rare, the capacity to refine them in a chemically challenging, often environmentally hazardous process is what gives China its leverage.
Beijing has regularly used this advantage as a geopolitical tool. Following President Trump's tariffs, China restricted exports of rare earths and strategic magnets in 2015, hoping to sabotage key industries in the West. Amid rising concerns of further restrictions, industry voices and national security experts have labeled critical minerals a matter of urgent strategic priority." Without a coordinated, long-term strategy, the cycle of China extracting concessions on the back of mineral geopolitics is likely to continue,” said Jeff Dickerson, principal advisor at research firm Rystad Energy. “The U.S. must treat this as a wartime effort."
The Trump administration, seemingly awakened to this reality, has taken steps to build a domestic industrial base while aggressively pursuing strategic partnerships abroad. The U.S. has cut deals with mineral-rich, politically aligned countries like Australia, Kazakhstan, Ukraine, and Argentina. In October alone, the U.S. and Australia committed to investing $3 billion in critical minerals by 2026.
More bilateral agreements soon followed in Southeast Asia and Africa, and even through renewed interest in Greenland, which houses vast rare earth reserves. Notably, Critical Metals, now the majority stakeholder in Greenland’s Tanbreez project, recently received a letter of intent for $120 million from the U.S. Ex-Im Bank.
“The U.S. wants over 50% of the supply of rare earths to come from outside of China,” said Critical Metals CEO Tony Sage. “And Greenland is a strong candidate to support that push, even if it doesn’t want to be annexed.” Althaus’s own work focuses on Kazakhstan and Uzbekistan, where the Soviets left behind extensive mining data and infrastructure following decades of exploration. Cove Capital’s tungsten project in Kazakhstan, valued at $1.1 billion, recently secured a $900 million letter of interest from the Ex-Im Bank, with further financing interest from the Development Finance Corporation.
“These countries are sitting on massive potential, and the foundational work has been done already,” Althaus explained. “In contrast, most U.S. projects are greenfield and come with high risks and low investor appetite.”
While government-backed loans and international collaborations are vital, experts say innovation will be key to reducing dependence on China. Recycling is proving particularly promising. Rare earths don’t degrade, unlike oil or plastics, and can be recycled indefinitely. Apple recycles neodymium from old devices, while companies like Urban Mining are scaling up rare earth recovery from scrap electronics.
At the cutting edge, Minneapolis-based Niron Magnetics is developing a new type of magnet made entirely without rare earths. Their iron-nitride material performs well under high temperatures and has already attracted investment from GM, Samsung, and other global players.
Recycling and substitution are further reinforced by targeted investments from federal agencies, including Oak Ridge National Laboratory and Ames National Laboratory, which are supporting Niron’s development.
Despite these advances, one major hurdle remains: risk. Beijing regularly manipulates markets through price dumping, artificially lowering costs to destroy competition and freeze out Western investment. For investors, this is a clear deterrent." Price floors can change the game,” said Althaus. “It removes the instability and gives investors the confidence they need to take a project from geology through to profitability.”
Melissa Sanderson, director at American Rare Earths and a former diplomat, agrees. "Rare earths are a small market. Until we have more transparent pricing, price supports are key.” She also highlighted the need for market mechanisms such as a rare earths index on the London Metal Exchange, which currently remains elusive due to China’s dominance.
A recurring theme among critical minerals developers is the need for faster, clearer financial assistance from the U.S. government. KaLeigh Long, CEO of Westwin Elements, emphasized that government-backed lending from the Ex-Im Bank must streamline its processes and staff up to meet demand. Her company, like Perpetua Resources in Idaho, is waiting on over a billion dollars in requested federal loans.
“They need more processability and more people,” Long said at the Reuters NEXT conference in December 2025. “That’s the bottleneck for getting these crucial projects off the ground.”
Conclusion
China’s dominance over critical minerals isn’t inevitable; it's the result of long-term planning, environmental compromise, and strategic vision. The U.S. doesn’t have to match that model, but it must counter it with its own version: a mix of public-private collaboration, international systemic investment, technology-backed innovation, and clear economic incentives.
The good news? The tide is already turning. New magnet facilities are being built in the U.S., refining capacity is being established in Australia and Jordan, and countries aligned with the U.S. are stepping up. The total rare earth market is small, valued at only $5 to $10 billion annually, and the cost of reclaiming supply chain control is a fraction of what’s spent on defense or even pet food.
As Elaine Dezenski of the Foundation for Defense of Democracies puts it, Beijing’s “trump card” may turn out to be a bluff. With calm, coordinated action, the U.S. and its allies can build a critical mineral future that is secure, resilient, and free of Chinese leverage.
In Althaus’s own words: "I think we'll start to see a lot more happen in the coming months in terms of the U.S. and collaboration with other countries. This is just the start."