It is early 2026, and the headlines are reporting on a new global trade conflict that involves access to rare-earth elements (REEs). In January, the US government announced a massive $1.6 billion investment for a “mine-to-magnet” supply chain, a crucial step toward achieving mineral supply independence from nations like China. Days earlier, US Treasury officials met with G7 finance ministers (including from the EU), urging faster action through the Mineral Security Partnership (MSP) to break reliance on Chinese critical minerals.
REEs are now a central focus for global superpowers because they are foundational to the modern world. Beyond the usual focus on tariffs and taxes, the underlying importance of REEs is critical: they are essential building blocks for everything from smartphones and LED screens to EV motors and wind turbines. Consequently, the digital world and the green transition are fundamentally dependent on their availability.
For Europe, the unfolding trade war over rare-earth access is not a spectator sport. The escalating trade war between the US and China has placed the EU’s industrial future in a precarious position. To understand why projects like REMHub (Rare Earths and Magnet Hub for a Resilient Europe) are critical right now, we first need to understand the war being fought over the smartphone in your pocket and the EV in your driveway.
The US-China trade war didn’t start with minerals; it started with tariffs. In 2018, the US began imposing tariffs on Chinese goods such as solar panels, steel, and aluminum to protect domestic industries. China retaliated with its own tariffs, and for years, this tit-for-tat escalation was measured in dollars and percentages.
But recently, the conflict shifted from cost to access. The US moved to restrict China’s access to advanced computer chips, fearing they fueled China’s military modernisation. In response, China turned to its most powerful card: its dominance over the raw materials needed to build those chips and almost everything else high-tech.
Despite their name, REEs aren’t particularly rare. They are found worldwide. The problem is that separating the useful metal from the rock is difficult, dirty, and complex. Over the last few decades, while the rest of the world closed its mines, China mastered this processing technology. Today, China controls approximately 90% of the world’s processing capacity for critical minerals.
This dominance allows China to turn off the supply tap. We saw a preview of this in 2023 and 2024, when China restricted exports of Gallium and Germanium (used in chips) and Antimony (used in ammunition and batteries).
The fear in 2026 is that the next target will be REE-powered permanent magnets. These magnets, made from rare-earth elements such as Neodymium and Dysprosium, are the “muscles” of the green transition. They are essential to electric vehicle motors and wind turbine generators.
A standard EV motor contains about 1 kg of rare-earth magnets. Without that 1kg, the 2,000 kg car doesn’t move. That is the leverage China holds. As of January 1, 2026, the US has already slapped a 25% tariff on these magnets coming from China, further fracturing the global market.
While the US has adopted a strategy of “decoupling” (cutting ties) and direct government ownership of mines, the European Union is taking a different approach. The EU lacks the US’s vast mineral reserves (such as those in Texas or Wyoming), making recycling not just a green choice but a survival strategy. Europe relies on imports for 98% of its rare-earth magnets, primarily from China. A full trade war would be disastrous for European industry.
Instead, the EU is pursuing “de-risking.” Through the Critical Raw Materials Act (CRMA), the EU has set bold targets for 2030:
The goal isn’t to close the door to the world, but to ensure that Europe can stand on its own two feet if supply chains break.
This is where REMHub becomes relevant. We cannot solve this problem simply by digging more holes in the ground; we need to out-innovate the bottleneck.
REMHub is an EU-funded flagship initiative designed to secure this supply chain through technology and circularity, rather than brute-force mining. Bringing together 24 partners from 6 countries, the project is tackling the trade war’s pressure points directly:
As we move through 2026, the trade war over resources is likely to intensify. The tariffs on magnets entering the US are set to rise, and export controls may tighten further. But by investing in a resilient Europe, projects like REMHub are ensuring that, whether through a mine in Finland, a recycling plant in Italy, or a magnet factory in Estonia, Europe holds its own cards in this high-stakes game.
REMHub is a Horizon Europe innovation project establishing a Digital Innovation Hub to boost EU excellence in REEs and magnets. By connecting partners across the entire value chain (from exploration and mining to magnet manufacturing and recycling), we are accelerating the technologies needed to power Europe’s green and digital transition.