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G7 Leaders Agree Provisional Strategy on Critical Minerals Supply

The G7’s provisional action framework sets standards for market governance, mobilizing financing to shield economies from rare earth supply disruptions.

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Despite their name, most rare earth elements are relatively abundant. The process of mining rare earths and transforming them into usable materials is, however, expensive and damaging to the environment. Credit: VCG.
Raw Rare Earth ore waiting to be processed at Vital Metals in Saskatoon, Saskatchewan, Canada January 16, 2023. REUTERS/Nayan Sthankiya/File Photo
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Overview

  • G7 leaders have provisionally approved a “critical minerals action plan” to diversify supply chains across mining, processing and manufacturing and reduce dependence on China’s rare earth monopoly.
  • The draft framework emphasizes reflecting the real costs of responsible extraction, anticipating shortages and coordinating responses to deliberate market disruptions.
  • EU Commission President Ursula von der Leyen and President Trump both condemned China’s restrictions on magnets and rare earths, although the G7 text only refers obliquely to “non-market practices.”
  • India’s heavy industries minister H D Kumaraswamy chaired inter-ministerial talks to fast-track domestic rare earth magnet production and explore alternative supplies from Australia, Argentina, Brazil and Chile.
  • Despite issuing some export licences, China still controls over 90% of global rare earth processing capacity, preserving significant leverage amid ongoing trade tensions.