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The G7 draws a red line: by 2030, China should not supply more than 60% of the rare earth elements fueling the green transition
Published On: July 2, 2026 at 1:45 PM
The world’s richest democracies are trying to make sure one country can no longer hold so much power over the minerals that run modern life.
At the G7 summit in Évian, France, leaders agreed to reduce dependence on any single supplier outside the G7 and partner countries for rare earths and permanent magnets to under 60% by 2030, with a longer-term ambition of reaching 50% as soon as possible.
That may sound like a technical supply-chain target, but the stakes are much bigger. Rare earth magnets help power electric vehicles, wind turbines, smartphones, industrial motors, data centers, and advanced defense systems, which means a shortage can quickly move from a factory problem to a national security problem.
A deadline aimed at dependence
The G7 declaration does not name China directly. Still, the message is hard to miss, since China dominates several stages of the rare earth and permanent magnet supply chain.In practical terms, the G7 wants fewer factories, defense contractors, and technology companies to wake up one morning wondering whether a single foreign licensing decision could stop production. The target covers rare earths and permanent magnets, while ministers were asked to set specific dependency targets for other critical minerals before the end of the year.
The group also pointed to 195 projects announced since the start of 2026, representing about $74 billion in investment across critical mineral value chains. That money is meant to support mining, processing, recycling, and manufacturing capacity in G7 and partner countries.Why rare earths matter
Rare earths are not household names, but they sit inside products people use every day. They help make the magnets that turn electricity into motion, whether in a car motor, a factory robot, or a wind turbine spinning miles from home.For defense planners, the issue is even sharper. The International Energy Agency says China accounted for around 91% of global production in the separation and refining of magnet rare earths in 2024, and about 94% of production of rare earth-containing permanent magnets.
That kind of concentration leaves little room for error. A delay in export approvals, a diplomatic dispute, or a sudden price spike can ripple through sectors that are already under pressure to build faster and spend smarter.
China’s controls changed the mood
This is not just a theoretical worry. On April 4, 2025, China’s Ministry of Commerce and customs authorities announced export controls on several medium and heavy rare earth-related items, including samarium, terbium, dysprosium, and certain permanent magnet materials.The IEA later said export volumes fell sharply in April and May 2025, leaving some carmakers in the United States, Europe, and elsewhere struggling to obtain permanent magnets. Some manufacturers had to cut utilization rates or temporarily shut down factories.
That is the part that gets attention in boardrooms. Nobody wants the assembly line to stop because one small component is missing, especially when the finished product might be a vehicle, a radar system, or equipment for the power grid.
Japan knows the risk well
Japan has already lived through this problem once. After a maritime dispute in 2010, Tokyo began a long effort to reduce its dependence on Chinese rare earths, but that experience also showed how hard diversification can be.The tension returned this year after China tightened controls on dual-use exports to Japan. Beijing said the move applied to Japanese military users, military uses, and other end users or uses that could enhance Japan’s military capabilities, after remarks by Japan’s leader about Taiwan.
Reuters reported that China later said civilian users would not be affected, while also noting uncertainty about whether rare earth elements would be covered. That uncertainty is exactly what makes governments nervous.
Building alternatives will not be easy
The G7’s plan is ambitious, but ambition is not the same as production. New mines can face financing problems, permitting delays, environmental concerns, local opposition, and technical setbacks.Refining is a particular challenge. The IEA’s 2025 outlook found that China was the dominant refiner for 19 of 20 energy-related strategic minerals analyzed, with an average market share of about 70%.
And then there is cost. Diversified projects can be more expensive than established supply chains, which is why the G7 is discussing tools such as joint procurement, price-gap subsidies, quotas, and price floors. The trick is to improve security without making clean energy, electronics, or defense equipment much more expensive for everyone else.
Recycling becomes part of the answer
The G7 is not only looking underground. Leaders also committed to sharply increasing recycling rates for critical raw materials and working toward recycling targets for selected minerals or derivatives by the end of the year.That may sound less dramatic than opening a mine, but it matters. Old electronics, industrial equipment, batteries, and magnets can become a secondary source of materials, reducing waste and easing pressure on new supply.
Still, recycling cannot solve everything on its own. At the end of the day, the G7 is trying to build a full supply chain, from extraction to processing to finished magnets, and that takes years of steady investment.
Beijing pushes back
China has rejected the idea that its export controls are improper. After the G7 statement, Chinese Foreign Ministry spokesperson Lin Jian said Beijing’s efforts to standardize and improve its export control system were in line with international practice and aimed at safeguarding peace, stability, and non-proliferation obligations.He also urged G7 countries to stop using what he called “small cliques” that undermine the international economic and trade order. So the mineral issue is no longer just about supply chains. It is now part of a wider argument over trade rules, security, and industrial power.
For the G7, the next few years will show whether the 60% target is a serious turning point or just another promise made at a summit. The pressure is real, but so is the clock.
