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Posted On: 2/3/2026, 8:55:50 AM
Last Update: 2/3/2026, 8:55:50 AM
Ministers from around 20 countries, including the G7 nations, are set to meet in Washington to discuss a strategic alliance concerning rare earth minerals and potential US guarantees for minimum pricing.
Notably, the summit aims to restore transatlantic relations damaged by conflicts during Donald Trump's presidency and facilitate new alliances, particularly in steel, to help nations reduce reliance on China.
Australia is set to create a A$1.2 billion strategic reserve of minerals to protect against potential supply disruptions from China, following China's restrictions on rare earth exports due to tariffs.
About 20 countries, including G7 members (UK, US, Japan, France, Germany, Italy, Canada), India, South Korea, Mexico, Australia, New Zealand, and possibly Argentina, are attending the second summit on the matter within a month.
Moreover, calls have arisen for the US to ensure a minimum price for critical minerals and rare earths; however, a recent report indicating Washington's rejection of this idea has led to a decline in Australian shares. Australia aims to serve as an alternative supplier to China by stockpiling minerals like antimony and gallium.
Japan has developed reserves over the years to enhance resilience against China's potential supply disruptions as part of its foreign policy strategy.
Canberra's resources minister, Madeleine King, affirmed that a US decision against minimum pricing will not hinder Australia's efforts in its critical minerals reserve program.
The meeting, organised by US Secretary of State Marco Rubio, aims to expedite non-China supply chains with possible pricing and investment support from participating countries.
Strengthening critical mineral supply chains with international partners is crucial for the US economy, national security, and technological leadership, according to the US State Department.
Besides, successful talks could lead to a joint statement marking a significant shift in relations, focusing on collaboration with allies to reduce reliance on China amid ongoing tariff threats.
The UK's Foreign Office announced that a minister will attend discussions focused on diversifying the critical minerals supply chain, linking UK economic security with national security and emphasising the importance of these discussions for economic growth.
Likewise, the EU is likely to urge the US to rescind new global steel derivative tariffs during the upcoming summit. These tariffs impose punitive levies on various products containing steel elements, including aluminium doors, bicycles, hair straighteners, and offshore wind turbines.
The initial tariff list was released in August, following Trump's agreement on an EU tariff deal in July, before a joint statement on the matter later that month.
The EU is expected to call on the US to revoke new global steel derivative tariffs at the upcoming summit. These tariffs affect products such as aluminium doors, bicycles, hair straighteners, and offshore wind turbines.
A preliminary list of tariffs was published in August, following Trump's July agreement on an EU tariff deal and a joint statement later that month.
The Trump administration may introduce a second list of up to 700 products in January, but it has not yet been released, allowing the EU and UK to maintain hope.
An EU insider expressed concerns, stating that prior complaints were made and hoping the US will consider these, as they may breach an August deal.
The first product list was announced between a deal in Scotland and a US-EU joint statement, but the second batch would be a clear breach of that agreement.
Furthermore, the Trump administration initiated multilateral consultations in October following a 12-month trade truce with China, which threatened to limit rare earth supplies amid an escalating tariff dispute.
These minerals are crucial for modern manufacturing, essential for products ranging from smartphones to fighter jets and wind turbines.
Ultimately, Europe relies heavily on China for its supply of permanent magnets, utilising 20,000 tonnes annually, with 17,000 to 18,000 tonnes sourced from China and only 1,000 tonnes produced within the EU.
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