Ministers from the US, EU, UK, Japan, Australia and New Zealand will meet in Washington this week to discuss a strategic alliance over critical minerals.
The summit is being seen as a step to repair transatlantic ties fractured by a year of conflict with Donald Trump and pave the way for other alliances to help countries de-risk from China, including one centred on steel.
Australia said on Friday it would establish a A$1.2bn (£610m) strategic reserve of minerals it believes are vulnerable to supply disruption from China, which last April restricted exports on rare earths in response to Trump’s “liberation day” tariffs.
It is the second summit on the matter within a month and involves about 20 countries including the G7 members – the UK, US, Japan, France, Germany, Italy, and Canada – along with India and South Korea and Mexico, Australia, New Zealand and possibly Argentina.
One area of discussion will be calls for the US to guarantee a minimum price for critical minerals and rare earths. A report this week that Washington has decided against the idea sent shares downwards in Australia, which has been positioning itself as a critical minerals alternative to China with a decision to stockpile elements such as antimony and gallium.
It follows in the footsteps of Japan, which has actively built reserves for years to build resilience against China’s willingness to switch off supplies to advance its foreign policy.
Canberra’s resources minister, Madeleine King, said a US decision not to offer minimum pricing “won’t stop Australia from pursuing our critical minerals reserve programme”.
The Washington meeting has been convened by the US secretary of state, Marco Rubio, as he and other countries in attendance hope to ramp up non-China supply chains as fast as possible with potential pricing and investment support.
“Strengthening critical mineral supply chains with international partners is vital for the US economy, national security, technological leadership, and a resilient energy future,” the US state department said in a pre-summit statement.
EU sources said that if talks were successful, a joint statement would follow which could be seen as a milestone shift in relations with allies working with the US to de-risk from China instead of constantly fighting off Trump’s tariff threats.
A UK minister will attend, the Foreign Office said, adding: “UK economic security goes hand in hand with national security. That’s why we are working to ensure a diversified critical minerals supply chain – a vital step to securing economic growth in the UK.
“We look forward to continuing these important discussions with key partners.”
The EU is also expected to use the summit to press the US to drop its new global steel derivative tariffs, which would lead to punitive levies on steel content on products that have elements of steel ranging from aluminum doors and bicycles to hair straighteners and offshore wind turbines.
The first derivative tariff list was published in August, after Trump shook hands on the EU tariff deal at his Scottish golf course in July, but before the joint statement on the deal at the end of August.
The Trump administration has threatened to introduce a second list of up to 700 products this January, but the list has yet to appear giving the EU and the UK hope that they could still drive home their point.
“We have complained a lot,” added one EU insider, while another said: “We hope they will take this into account as they are a breach of the deal in August.
“They could argue that the first batch were announced between the deal in Scotland and the US-EU joint statement, but the second batch are a breach of a deal.”
“This is about trust. You sign a deal and you trust it will apply,” said an EU source. “This constant threat of more tariffs, whether 10% because of Greenland or 200% on champagne because they don’t sign up to the ‘board of peace’ has to stop.”
The Trump administration has been convening multilateral consultations since October, when it agreed to a 12-month trade truce with China, which had threatened to choke off rare earth supplies in the escalating tariff dispute between them.
The minerals have become some of the most essential raw materials for modern manufacturing, needed to produce everything from smartphones to fighter jets, to wind turbines to music speakers.
Europe’s supply of permanent magnets, which are made with rare earths which have high magnetic properties, comes almost entirely from China.
According to senior European Commission officials in December, the EU uses 20,000 tonnes of permanent magnets a year, of which 17,000 to 18,000 tonnes come from China, with just 1,000 from the EU.