English
The global scramble for lithium, cobalt, rare earths, and copper has escalated into a defining geopolitical struggle by early 2026, with China controlling roughly 70% of global rare earth output and over 85% of processing capacity. This concentration of power has triggered a cascade of policy responses from the United States and its allies, while resource nationalism surges across the developing world. The February 2026 U.S. Critical Minerals Ministerial, China's ongoing export restrictions causing sixfold price spikes, and the World Economic Forum ranking geoeconomic confrontation as the top global risk all make this the defining strategic story of early 2026.
China's Strategic Chokehold
China's dominance in critical mineral supply chains is the result of a decades-long strategy. From 2000 to 2021, Beijing channeled nearly $57 billion into mineral extraction and refining across nearly 20 countries in Africa, Latin America, and Asia. Today, China controls approximately 90% of global rare earth refining, 80% of tungsten processing, and 60% of antimony production. Over 80% of European firms depend on Chinese supply chains for materials essential to defense, electric vehicles, and renewable energy.
Between October 2025 and March 2026, China tightened export controls on rare earths and critical minerals, causing price spikes of up to sixfold outside China. Licensing approval rates for European firms dropped below 25%. According to a multi-institutional analysis, China is weaponizing control rather than scarcity, using temporary, reversible restrictions to maintain pricing power and extract strategic concessions while discouraging large-scale Western alternative investments. The rare earth supply chain crisis has threatened defense systems, EV manufacturing, and renewable energy sectors worldwide.
The U.S. Counteroffensive: FORGE and Project Vault
On February 4, 2026, U.S. Secretary of State Marco Rubio, joined by Vice President JD Vance and other top officials, hosted the 2026 Critical Minerals Ministerial with representatives from 54 countries and the European Commission. The event marked a turning point in Western efforts to counter China's mineral dominance.
Secretary Rubio announced the launch of FORGE (Forum on Resource Geostrategic Engagement) as the successor to the Minerals Security Partnership, chaired by the Republic of Korea. FORGE aims to coordinate 54 nations in strengthening diversified, resilient, and secure critical minerals supply chains. The United States also signed 11 new bilateral critical minerals frameworks or memorandums of understanding with countries including Argentina, Morocco, the Philippines, the United Arab Emirates, and the United Kingdom.
Perhaps most significantly, the U.S. launched Project Vault, a $10 billion initiative backed by the Export-Import Bank (EXIM) to establish a domestic Strategic Critical Minerals Reserve. Overall, the U.S. mobilized over $30 billion in financing for critical mineral supply chain projects over the past six months. Private sector collaborations through initiatives like Pax Silica aim to secure end-to-end supply chains for AI, batteries, and advanced technologies. The U.S. critical minerals strategy represents the most ambitious industrial policy effort in decades.
Rising Resource Nationalism
While great powers compete, resource-rich nations are asserting greater control over their mineral wealth. Indonesia's ban on raw nickel exports, implemented earlier, has attracted $15 billion in processing investments, though largely from Chinese firms. Chile imposed state-control requirements on lithium projects, seeking to capture more value from its vast reserves. Zimbabwe accelerated its beneficiation policy, suspending lithium concentrate exports in February 2026—two years ahead of schedule.
Raw spodumene ore sells for $400–600 per tonne, while battery-grade lithium carbonate commands $15,000–25,000 per tonne, creating powerful economic incentives for domestic processing. However, Zimbabwe faces significant infrastructure challenges, including unreliable electricity supply, water requirements for hydrometallurgical processing, and a scarce technical workforce. Alternative lithium suppliers in Australia, Chile, Argentina, and Canada stand to benefit from supply chain diversification efforts triggered by Zimbabwe's decision. The resource nationalism trend is reshaping investment patterns across the developing world.
Global Economic and Security Implications
The World Economic Forum's Global Risks Report 2026 identifies geoeconomic confrontation as the top risk most likely to trigger a material global crisis in 2026, cited by 18% of respondents. State-based armed conflict ranks second at 14%. The IMF warns that geopolitical fragmentation from mineral supply chain weaponization poses significant downside risks to global growth.
Experts caution that rebuilding independent processing capacity outside China could take 20 to 30 years, far exceeding the current geopolitical window. Western nations face a narrow 12–18 month window to act decisively or accept prolonged vulnerability. The crisis threatens not only defense systems but also the energy transition, as electric vehicles, wind turbines, and solar panels all depend on critical minerals. The geopolitical risks of energy transition are becoming increasingly apparent.
Expert Perspectives
"China's chokehold on critical minerals is the result of a decades-long, state-directed strategy that the West is only now beginning to counter," said a senior analyst at Chatham House. "The question is whether FORGE and Project Vault can move fast enough to make a difference."
David Peck of Delft University of Technology, an expert on critical materials, notes that countries oscillate between those emphasizing economic growth ("tech will fix it") and those arguing that finite resources will be exhausted ("limits to growth"). Both approaches are important, but geopolitical tensions are now driving unprecedented state intervention.
Frequently Asked Questions
What are critical minerals?
Critical minerals are raw materials designated by governments as essential for national economies and security, with vulnerable supply chains. They include rare earth elements, lithium, cobalt, copper, and other materials vital for high-tech industries, renewable energy, and defense.
Why does China dominate critical mineral supply chains?
China invested nearly $57 billion between 2000 and 2021 in mineral extraction and refining across nearly 20 countries, building a vertically integrated supply chain. It now controls roughly 70% of global rare earth output and over 85% of processing.
What is FORGE?
FORGE (Forum on Resource Geostrategic Engagement) is a U.S.-led initiative launched in February 2026 to coordinate 54 nations in securing diversified, resilient critical mineral supply chains. It succeeds the Minerals Security Partnership.
What is Project Vault?
Project Vault is a $10 billion initiative backed by the U.S. Export-Import Bank to establish a domestic Strategic Critical Minerals Reserve, aimed at reducing dependence on Chinese-controlled supply chains.
How is resource nationalism affecting global supply chains?
Countries like Indonesia, Chile, and Zimbabwe are imposing export bans or state-control requirements on critical minerals to capture more value domestically. This is reshaping investment patterns and creating both opportunities and risks for global supply chains.
Conclusion: A New Geopolitical Landscape
The resource wars of 2026 represent a fundamental shift in global power dynamics. China's strategic dominance, the U.S. counteroffensive through FORGE and Project Vault, and rising resource nationalism are redrawing the map of global economic influence. The outcome of this struggle will determine not only the future of the energy transition but also the balance of power in the 21st century. As the World Economic Forum warns, geoeconomic confrontation is now the top global risk—and critical minerals are at its heart.
Sources
- U.S. Department of State: 2026 Critical Minerals Ministerial
- ODI: Critical Minerals Geopolitics in 2026
- Chatham House: America Needs Partners to Challenge China's Critical Mineral Chokehold
- World Economic Forum: Global Risks Report 2026
- Rare Earth Exchanges: China's 2026 Export Controls Redraw Supply Chain Map
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