US Proposes Critical Minerals Trading Bloc with Allies

The move aims to counter China's dominance in supplying elements essential for modern technologies.

Published on Feb. 5, 2026

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The Trump administration has announced plans to establish a critical minerals trading bloc with allies, seeking to stabilize prices and ensure access to these vital resources. The initiative comes after China restricted the flow of critical minerals in response to U.S. tariffs, highlighting the widespread dependence on materials largely controlled by Beijing. The administration is also launching "Project Vault" to create a U.S. strategic stockpile of rare earth elements, funded by a $10 billion loan and private capital.

Why it matters

Establishing a reliable supply chain for critical minerals is a matter of national security, impacting both defense capabilities and the competitiveness of key industries. The success of this initiative will depend on sustained commitment and cooperation from allies, as the U.S. seeks to diversify its supply chains and reduce reliance on China.

The details

The proposed trading bloc aims to counter China's dominance, which currently controls 70% of the world's rare earth mining and 90% of the processing of these critical materials. The administration is responding with a multi-pronged approach, including bolstering domestic production and forging new international partnerships. The European Union, Japan, and Mexico have already announced agreements to work with the U.S. on coordinated trade policies and price floors.

  • On February 5, 2026, the Trump administration announced the plans to establish the critical minerals trading bloc.
  • Last year, China restricted the flow of critical minerals in response to President Trump's tariffs, even after a truce was reached to roll back some of those taxes.

The players

JD Vance

The Vice President stated that the recent U.S.-China trade war highlighted the widespread dependence on critical minerals largely controlled by Beijing, and emphasized the need for collective action to bolster Western self-reliance.

Marco Rubio

The Secretary of State hosted a meeting with officials from dozens of nations to discuss the proposed critical minerals trading bloc.

Lin Jian

The China Foreign Ministry spokesperson responded to the proposed trading bloc by stating that Beijing opposes any effort to undermine the international economic order through 'rules set by small cliques.'

Ian Lange

An economics professor at the Colorado School of Mines, who cautioned that preventing countries from seeking cheaper materials from China will be a challenge, and that enforcement will be easier for defense contractors than for manufacturers like electric vehicle companies.

President Trump

The President announced "Project Vault," a plan to create a U.S. strategic stockpile of rare earth elements, funded by a $10 billion loan and private capital.

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What they’re saying

“We want members to form a trading bloc among allies and partners, one that guarantees American access to American industrial might while also expanding production across the entire zone.”

— JD Vance, Vice President

“Beijing opposes any effort to undermine the international economic order through 'rules set by small cliques.'”

— Lin Jian, China Foreign Ministry spokesperson

What’s next

The administration's efforts are unfolding against a backdrop of strained relations with some allies, and the success of this initiative will depend on sustained commitment and cooperation from allies.

The takeaway

Securing a reliable supply chain for critical minerals is a matter of national security for the U.S., impacting both defense capabilities and the competitiveness of key industries. The proposed trading bloc with allies is a strategic move to reduce reliance on China's dominance in this vital resource.