The global fight for control of rare earths and other critical minerals is intensifying—and it’s set to become one of the defining investment themes of 2026.
The United States and China are now engaged in a full-blown economic arms race over the materials that power the modern world: electric vehicles, smartphones, wind turbines, and advanced weapons systems.
Rare earths have moved from the periphery of the commodities market to the centre of global strategy. The battle to secure them will shape trade, technology, and investment decisions for years to come.
For decades, China has dominated this space. It controls roughly 70% of global mining and close to 90% of processing capacity. That concentration has left manufacturers—from carmakers to defence contractors—highly exposed to Chinese policy decisions. When Beijing tweaks export quotas or tightens environmental standards, prices surge and supply chains quiver.
But that dominance is now being challenged. The Trump administration has made rare earths a national priority.
Washington is pouring money into domestic and allied production, taking stakes in North American miners, and advancing proposals for a government-backed price floor to stabilise supply. It’s also building a strategic mineral reserve and fast-tracking permitting for new mines under the administration’s so-called “mine, baby, mine” policy.
This intervention marks the beginning of a new industrial cycle. The US is attempting to reclaim control of its supply chains and reduce its vulnerability to Beijing. This is not symbolic politics; it’s the most coordinated push for resource security in a generation. For the first time since the Cold War, industrial capacity and geopolitical power are being planned in tandem.
China, meanwhile, is not standing still. Beijing has imposed new export controls that require companies to obtain approval before shipping magnets containing even trace amounts of Chinese-sourced rare earths.
It’s also added five more elements—holmium, erbium, thulium, europium, and ytterbium—to its restricted list. These measures have sent a clear signal to global markets: control of supply means control of outcomes.
The result is a global scramble to develop alternative supply chains. Western governments are now funnelling capital into resource projects across Australia, North America, and parts of Africa.
Private equity funds, sovereign wealth investors, and multinational corporations are following the same trend, seeking early stakes in the mines and processing plants that will underpin the next decade of industrial growth.
The financial markets are following the geopolitics. Investors are beginning to recognise that rare earths are no longer a niche story about electric vehicles; they’re the backbone of 21st-century power, both economic and military. The scale of capital inflows we’re witnessing suggests this transformation is only in its early stages.
The investment implications are profound. This is a multi-year structural shift, not a speculative trade. Building the infrastructure and refining capacity to rival China will take time and massive investment. Those positioning early stand to benefit from the sustained capital flows that are now being unlocked across strategic resource markets.
However, volatility will be the rule rather than the exception. These markets will not move purely on earnings or demand forecasts—they will move on policy. Every export restriction, every government stake, and every strategic partnership will send ripples through the market.
This volatility, while unsettling for some, creates opportunity for disciplined investors who understand the interplay between politics and profit.
Diversification across the supply chain will be essential. Investors should look beyond mining to refining, recycling, and technological innovation. The companies finding cleaner, cheaper, and faster ways to extract and process critical minerals could become the new blue chips of the coming decade.
Equally, those developing recycling systems for magnets and batteries will play a vital role in reducing dependence on primary extraction.
This “rare earths arms race” represents more than just a shift in commodity prices—it marks a turning point in how the global economy is organised. Control of the resources that make modern life possible is becoming the new frontier of economic power.
Rare earths now sit at the intersection of industrial policy, clean energy, and national security. The competition to control them will define 2026 and beyond. The speed at which governments and corporations are redirecting capital reveals how rapidly the world is adjusting to a new economic reality.
This is a once-in-a-generation shift in where value is created and who commands it.