US Surges Ahead While EU Falters in Critical Minerals Race

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In the global race for critical minerals, the US appears on track to bolster its supply chains while Europe watches from the sidelines, struggling to transform policy into practice. Demand for critical minerals reached new heights recently due to their renewed importance in crucial industries. These raw materials, including lithium, cobalt, copper, graphite and rare earths, form the base layer and backbone of energy independence, defense technologies and artificial intelligence infrastructure — all industries with understandable geopolitical importance. While China still dominates existing supply chains, Washington is carving out its own lines through diplomatic maneuvers, direct investment and private-sector friendly policy. Brussels, on the other hand, continues to fall behind as it announces plans that analysts say lack the necessary commercial enticement and follow-through.

The US has pushed aggressively into Africa and Australia, forging deals aimed to improve its geopolitical positioning and promote commerce in those regions. In Africa, US diplomats helped broker a peace agreement between Congo and Rwanda that will encourage new mineral deals to support regional recovery and secure vital supply routes. President Donald Trump’s administration framed the accord as a strategic win and has indicated continued ambition in Africa. Wayne Wall, senior director for Middle East and Africa affairs, claims Washington is working toward “creating incentives for US firms to invest overseas in ways that create value at home and abroad.”

In Australia, Washington and Canberra signed an US$8.5 billion agreement to fund mining and processing projects. The deal included export credit guarantees and joint ventures in nickel, cobalt and gallium, reinforcing supply chains for both countries. This marks a significant move as part of the coordinated effort to diversify away from Chinese-controlled supply networks.

These strategic decisions from the White House come in wake of Trump’s executive order earlier this year. The order directs the US government to prioritize securing critical supply chains and boost domestic production, citing potential vulnerabilities, such as China blocking exports. The Trump administration has made it clear that it views the critical minerals issue as one of both economic and national security importance.

In parallel, the Pentagon has invoked the Cold War-era Defensive Production Act to invest in US upstream projects. In July, the US Department of Defense signed a multibillion-dollar deal to become a majority shareholder in California-based rare earths producer MP Materials. The previous administration also made investments to bolster onshore production, awarding billions in grants to US battery-making companies.

Private Sector Bets Big on Minerals

In the private sector, corporations have begun turning more to raw material processing. Tesla opened its own lithium refinery in Texas back in 2023, becoming the first North American automaker to do so. Ford has invested billions in nickel processing plants in Indonesia, while General Motors has taken equity stakes in US-sourced lithium production and secured long-term supply deals for future battery plants. These investments reflect the growing sentiment among US manufacturers that securing raw materials is now a crucial component of vehicle production.

Energy companies are expanding as well. BGN Group, a global commodity firm best known for trading crude, LPG and LNG, has recently entered the US critical minerals market. The Geneva-based energy trader has set up a new US entity, BGN USA, which is designed to improve supply flow of minerals from Africa on par with US standards. Energy giant Aramco has also made a push into critical minerals and metals, specifically in copper trading.

One of the most revealing signs of this shift is the increasing willingness of private firms to trade equity for federal support. The US Department of Energy issued Lithium Americas a $2.26 billion loan in exchange for a 5% stake in its Thacker Pass project. NioCorp, which is developing a scandium mine-to-manufacture supply chain in Nebraska, received a $10 million grant from the Department of Defense. The alignment between federal funding and corporate ambition is beginning to define a uniquely American approach to mineral security.

Europe Announces, but Under-Delivers

In stark contrast, the EU has made a series of well-publicized announcements but has struggled to translate these into real-world projects. In March, the European Commission unveiled a list of 47 strategic critical mineral projects across 13 member states, accompanied by various financing guarantees under the EU’s Critical Raw Materials Act that passed in 2024. More recently, Brussels launched RESourceEU, a new initiative aimed at diversifying supply through partnerships with countries like Australia, Canada and Chile. European Commission President Ursula von der Leyen stated that “the aim is to secure access to alternative sources of critical raw materials in the short-, medium- and long term for our European industries.”

Despite this framework, industry observers argue that Europe is lagging behind. TechMet CEO Brian Menell, whose company operates on both sides of the Atlantic, warned that Europe suffers from excessive bureaucracy and a lack of urgency. He noted that while the US government is taking equity positions in projects and driving deals forward, the EU continues to rely on incentives without sufficient financial commitment. His concerns echo across the sector, with European projects often stalled due to regulatory issues and investor hesitation.

Brussels’ Targets Expose Structural Weakness

Even the targets that the EU has laid out in its Critical Raw Materials Act indicate that Europe is losing the race. The framework’s goals state that by 2030, the EU should extract 10% of its strategic raw materials domestically, process 40%, recycle 25% and not import more than 65% from any foreign country. These official benchmarks expose a rather pessimistic outlook — even if achieved, it would mean that 90% of SRMs are still coming from outside Europe. In other words, although the EU has signaled that it understands the importance of securing critical minerals, their current capacity does not allow them to distance itself from Chinese dependence within the near future.

While the EU has laid the groundwork for a long-term critical minerals strategy, its pace of execution is falling behind. The US approach, which blends diplomacy, direct investment and favorable loans, appears to be yielding tangible results. Business-friendly market conditions are now in place that reduce commercial risk for traders who now have a guaranteed buyer in the form of the US government. This has encouraged key actors in the private sector to step in and help accelerate supply chain security.

The US is securing the resources, talent and infrastructure that will define the next generation of energy and technology production. Europe’s challenge is no longer identifying the threat of Chinese dependence, rather, the bloc must now act more decisively to avoid falling behind.