U.S. Rare Earth Race Squeezes European Allies
Claire Weston
The US has poured roughly $46 billion into critical-mineral projects over five years — eight times the EU's outlay — leaving Europe squeezed between breaking free of Chinese rare earths and falling behind its closest ally.
$46 billion versus the EU — how wide is the gap?
Data from France's IFRI: over roughly five years the US committed about $46 billion to critical-materials projects through subsidies, loans, tax breaks, and priority-purchase deals with resource nations.
The EU spent roughly one-eighth of that. Its current plan: a €3 billion financing platform and a cap of 65% on any single country's share of supply.
This means → Europe recognizes the risk, but its spending is an order of magnitude behind America's.
Why would allies compete for the same resources?
Andrea Paolo Lai, global operations president at Swiss firm Oerlikon — which serves aerospace, energy, and defense — put it bluntly: "The US is far ahead in building non-China supply chains."
Camille Grand, head of Europe's aerospace and defense industry body, noted that the US can be a partner or a rival. If supply tightens, Washington will almost certainly secure its own needs first.
In plain terms = allies share a market in peacetime, but when minerals run short, alliance ties do not automatically mean priority delivery.
How critical are rare earths to modern militaries?
A single Arleigh Burke–class destroyer requires roughly 2.3 tonnes of rare-earth elements. The F-35's power system uses magnets containing cobalt and samarium — a rare-earth element.
Tank gun barrels, armor, and precision-guided warhead seekers all depend heavily on titanium, tungsten, and related critical materials — none easily replaced with off-the-shelf substitutes.
This reflects a hard constraint: rare earths are not ordinary commodities — they determine whether advanced weapons can be built at all.
What has the West done since Beijing restricted supply?
Beijing restricted rare-earth magnet exports last year during the trade dispute, directly accelerating the West's search for alternatives.
The Pentagon has told contractors to strip Chinese rare earths from the magnet supply chain by next year.
The US and EU signed a critical-materials memorandum of understanding in April. European officials hope it becomes a bright spot in transatlantic ties — yet some remain wary: US punitive tariffs and threats over Greenland have already eroded allied trust.
How much runway does Europe have left?
Europe's core problem: its funding lags far behind the US, and top-quality non-China mineral projects are being locked up fast by American capital.
This means → the question for Europe is no longer just "whether to invest" — it is that the investable targets themselves are shrinking.
Put simply = the US is not waiting for Europe to catch up. It is already running, and the resources it passes through become much harder for anyone else to reach.
Content is for reference only, not financial advice.