FORGE vs. Dominance: $30B US Bloc Reshapes Critical Minerals

On February 4, 2026, the United States launched the Forum on Resource Geostrategic Engagement (FORGE) at the inaugural Critical Minerals Ministerial in Washington, D.C., backed by over $30 billion in mobilized capital. The initiative represents the most aggressive Western countermeasure yet to China's stranglehold on refined critical minerals—a dominance projected to reach 60-80% by 2035. FORGE replaces the Minerals Security Partnership (MSP) as a plurilateral trade-and-investment zone, tying 21 bilateral framework agreements into a coalition covering roughly two-thirds of the global economy.

What Is FORGE and Why Does It Matter?

FORGE is a U.S.-led plurilateral coalition designed to create a preferential trade-and-investment zone for critical minerals, with coordinated price floors and adjustable tariffs to counter adversarial market manipulation. Chaired by the Republic of Korea through June 2026, FORGE operates on a 'membership by trade' model, where participation requires adherence to shared trade rules rather than joint capital deployment. The initiative succeeds the MSP, which critics had deemed too weak to counter China's aggressive state-backed mining and processing expansion.

The February 4 ministerial, hosted by Secretary of State Marco Rubio and Vice President JD Vance, brought together representatives from 54 countries and the European Commission. Six U.S. cabinet members attended, underscoring the administration's prioritization of critical minerals as a national security imperative. The event produced 11 new bilateral critical minerals framework agreements with countries including Argentina, Morocco, Peru, the Philippines, the United Arab Emirates, and the United Kingdom, bringing the total to 21 deals signed in just five months.

The $30 Billion+ Financing Arsenal

The U.S. government has mobilized over $30 billion in letters of interest, investments, and loans for critical mineral projects over the past six months. This financing package includes several key components:

• Project Vault: A $10 billion Export-Import Bank (EXIM) initiative to establish a U.S. Strategic Critical Minerals Reserve. Approved in February 2026, the transaction includes a direct loan of up to $10 billion and brings together leading OEMs and key suppliers to store essential raw materials across U.S. facilities. EXIM President John Jovanovic called it a deal that 'revitalizes America's industrial base and strengthens supply chains while delivering an expected positive return for taxpayers.'
• Pax Silica Fund: A $250 million public-private partnership announced in March 2026 to support critical minerals extraction, processing, infrastructure, and manufacturing assets among partner nations. Pax Silica, launched in December 2025, focuses on securing supply chains from raw materials through semiconductors to AI infrastructure.
• Additional financing: Loans and investments from the Development Finance Corporation (DFC), Department of Energy (DOE), and Department of Defense, alongside expanded EXIM authorities.

Coordinated Price Floors: A New Trade Weapon

A defining feature of FORGE is its mechanism of coordinated price floors for critical minerals at each production stage, enforced through adjustable tariffs under Section 232 of the Trade Expansion Act. Vice President JD Vance stated at the ministerial that the bloc would establish reference prices that operate as price floors, preventing China from undercutting competitors through subsidies and dumping.

This approach marks a significant departure from traditional trade policy. Rather than relying solely on U.S.-funded subsidies, FORGE internationalizes price supports among partner nations, creating a self-reinforcing system where market access is tied to adherence to shared pricing rules. The adjustable tariff mechanism allows the coalition to respond dynamically to Chinese pricing strategies, which have historically used below-cost sales to drive competitors out of markets.

China's Critical Minerals Stranglehold

The urgency behind FORGE stems from China's overwhelming dominance in critical mineral processing. According to the International Energy Agency, China controls 19 of 20 strategic minerals in refining with an average 70% market share. Specific figures include:

• 90% of global rare earth processing
• 80% of tungsten processing
• 60% of antimony processing
• 60% of lithium processing
• Over 70% of cobalt refining
• 94% of sintered permanent magnet production (up from 50% two decades ago)

China has invested over $120 billion overseas in critical mineral projects since 2023, further entrenching its supply chain dominance. In April 2025, Beijing imposed export controls on seven heavy rare earth elements, causing sharp export declines and forcing automakers in the U.S. and Europe to cut production. By October 2025, controls expanded to five additional elements and now apply to 'internationally made' products containing Chinese-sourced rare earth materials. Export licensing approval rates for European firms have fallen below 25%, triggering price spikes of up to sixfold.

From Bilateral Deals to a Strategic Bloc

FORGE represents a strategic shift from the previous administration's approach of negotiating individual bilateral deals toward a coordinated plurilateral framework. The Minerals Security Partnership had been criticized for lacking enforcement mechanisms and failing to attract sufficient investment. FORGE addresses these shortcomings by creating a self-reinforcing trade bloc with enforceable price floors and tariff mechanisms.

The 21 bilateral framework agreements signed in five months provide the foundation for FORGE's plurilateral structure. These agreements cover a diverse set of partners, including resource-rich nations in South America, Africa, and Southeast Asia, as well as technology leaders in Europe and Asia. The U.S. critical minerals strategy now encompasses everything from exploration and extraction to processing, refining, and manufacturing of end-use products like batteries, magnets, and semiconductors.

Project Vault: Building a Strategic Reserve

Project Vault, announced by President Trump alongside FORGE, establishes a U.S. Strategic Critical Minerals Reserve managed by EXIM Bank. The $10 billion initiative is designed to stabilize prices for minerals including rare earths, lithium, and copper, while ensuring domestic manufacturers have access to essential materials during supply disruptions.

The reserve operates as a public-private partnership, with leading OEMs and key suppliers storing raw materials across U.S. facilities. This model allows the government to leverage private sector expertise and capital while maintaining strategic control over critical stockpiles. The initiative is expected to deliver a positive return for taxpayers through price stabilization and strategic trading.

South Korea's Chairmanship: A Strategic Bridge

South Korea's appointment as FORGE chair through June 2026 is strategically significant. As a major manufacturer of batteries, semiconductors, and electronics, South Korea is heavily dependent on critical mineral imports—primarily from China. Seoul has pursued import diversification, strategic stockpiles, and recycling to reduce this dependence, but analysts argue these efforts remain insufficient.

By chairing FORGE, South Korea positions itself as a key player in strategic mineral cooperation, enhancing its resource resilience while deepening ties with the U.S. and other partner nations. The South Korea critical minerals strategy under FORGE focuses on collaborative exploration, processing, and stockpiling of lithium, nickel, and rare earth elements needed for batteries, EVs, and defense systems.

Challenges and Criticisms

Despite its ambitious design, FORGE faces significant hurdles. Lengthy permitting processes in the U.S. and partner countries remain a major bottleneck for new mining and processing projects. China's entrenched processing infrastructure, built over decades with state support, cannot be replicated quickly. The IEA warns that independent alternatives to Chinese supply chains could require 20-30 years to rebuild.

Additionally, the crowded multilateral landscape—including the G7's Production Alliance, the EU's Critical Raw Materials Act, and various bilateral initiatives—creates coordination challenges. Sustained engagement across diverse partners will be critical to FORGE's success. Some analysts question whether the coalition can maintain cohesion when member economies face competing pressures from Chinese trade relationships.

Expert Perspectives

'FORGE represents a fundamental shift in how the U.S. approaches critical minerals policy,' said a senior State Department official speaking on condition of anonymity. 'We are moving from a reactive, deal-by-deal approach to a proactive, system-wide strategy that aligns trade policy, financing, and market access across partner economies.'

Ellen Kim of the Korea Economic Institute of America noted: 'South Korea's chairmanship of FORGE is a double-edged sword. It offers Seoul an opportunity to lead on supply chain security, but the country's deep economic ties with China create inherent tensions that will test the coalition's resolve.'

The Atlantic Council's analysis described FORGE as 'practicing statecraft through markets,' emphasizing that the initiative's success depends on its ability to create tangible economic incentives for partner nations to align with U.S. strategic objectives.

Frequently Asked Questions

What is FORGE?

FORGE (Forum on Resource Geostrategic Engagement) is a U.S.-led plurilateral coalition launched in February 2026 to create a preferential trade-and-investment zone for critical minerals. It succeeds the Minerals Security Partnership and includes coordinated price floors and adjustable tariffs to counter China's market dominance.

How much funding backs FORGE?

The U.S. has mobilized over $30 billion in government support for critical mineral projects, including EXIM Bank's $10 billion Project Vault initiative for a domestic strategic reserve and the $250 million Pax Silica Fund for supply chain investments.

Which countries are part of FORGE?

FORGE builds on 21 bilateral framework agreements signed in five months with countries including Argentina, Morocco, Peru, the Philippines, the UAE, the UK, and others. The coalition aims to cover two-thirds of the global economy, with South Korea serving as chair through June 2026.

How does FORGE differ from the Minerals Security Partnership?

Unlike the MSP, which lacked enforcement mechanisms, FORGE includes coordinated price floors enforced through adjustable tariffs under Section 232. It operates on a 'membership by trade' model where participation requires adherence to shared trade rules rather than joint capital deployment.

What is China's share of critical mineral processing?

China controls approximately 90% of rare earth processing, 80% of tungsten, 60% of antimony and lithium, and over 70% of cobalt refining. Its share of sintered permanent magnet production has surged to 94%.

Conclusion: A Defining Geopolitical Contest

The launch of FORGE marks a pivotal moment in the global struggle for critical minerals. With over $30 billion in financing, 21 bilateral agreements, and a coalition covering two-thirds of the global economy, the initiative represents the most comprehensive Western response yet to China's strategic dominance in rare earths and battery metals.

However, success is far from guaranteed. China's decades-long head start in processing infrastructure, its willingness to use export controls as a geopolitical weapon, and the inherent challenges of coordinating diverse national interests all pose significant obstacles. The critical minerals supply chain race will likely define the geopolitical landscape of the coming decade, with implications for AI, defense, renewable energy, and the broader energy transition.

As Vice President JD Vance stated at the ministerial: 'We are building a system that rewards friends and penalizes adversaries. FORGE is not just about minerals—it's about the future of economic security in the 21st century.'

Sources

• U.S. Department of State - 2026 Critical Minerals Ministerial
• Atlantic Council - US Critical Minerals Policy Goes Collaborative with FORGE
• CNBC - US Allies Critical Minerals Price Floors FORGE
• IEA - Supply Concentration Risks Become Reality
• Korea Economic Institute - South Korea's Strategy as FORGE Chair
• EXIM Bank - Project Vault Announcement
• U.S. Department of State - Pax Silica