By Mike Clements, manager of the VT Tyndall European Unconstrained fund
Critical minerals have moved to the top of national agendas in both the East and West. Trump’s Liberation Day last April acted as a starting pistol in a race for dominance over supplies of gallium, antimony, graphite and rare earth elements. China’s response to the White House’s ‘America First’ rhetoric was to implement export controls over these strategic minerals. This served as a wake-up call for manufacturers in multiple sectors across the US who now face critical supply disruptions affecting the production of everything from electric vehicle to semiconductors and advanced weapons. Needless to say, this has not gone down well in Washington.
Across the Atlantic, Europe finds itself in a similar position albeit with added nuance. The EU sits in the unenviable position of being caught in a barrage between the world’s two largest economies. The bloc is fully cognisant of the pressing need to drastically reduce its dependence on Chinese supply chains. However, it is being forced to come to terms with Trump’s wavering commitment to NATO, necessitating European capitals to allocate significant and unbudgeted investment into its defence capabilities. The solution to both problems is clear: bolster domestic resilience. But with the US acting more as a competitor than a collaborator, achieving that resilience is an uphill battle.
Europe, however, faces a constraint that the US is unencumbered with – namely the need to reach a consensus among its disparate constituents. Compared to the hyper-proactive US administration, decision making in Brussels seems glacial in its speed and the EU risks being left behind in the race to ensure a supply of strategic minerals sufficient to its needs. This is thrown into sharp relief by the divergent policies either side of the Atlantic.
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In 2025, the US government shifted from grants to direct intervention, making numerous investments in domestic mineral firms. This includes an unprecedented 15% stake in MP Materials, the largest integrated rare earth producer in the US, and a 5% stake in a lithium project in Nevada.
Project Vault is a prime example of this direct intervention. It is a massive Strategic Critical Minerals Reserve combining a $10bn loan from the US Export-Import Bank – the largest in the agency’s history – with nearly $2bn of private capital. Covering all 60-plus minerals on the US Geological Survey’s critical list, the reserve is designed not as a government warehouse but as an OEM-driven, demand-led partnership. Manufacturers such as Boeing, GE Vernova and General Motors commit to purchasing materials at set prices and retain the option to draw from the stockpile in the event of a supply disruption. It is, in essence, a Strategic Petroleum Reserve for the industrial age.
The European Union’s Critical Raw Materials Act (CRMA) feels cautious by comparison. While its targets are lofty, namely that 10% of demand is mined locally and 40% processed within the EU, the associated 47 projects designated as “strategic” are mainly supported by streamlining permits and attracting private capital. The European Investment Bank (EIB) has committed around €2bn in 2025 to bolster investments across the value chain, mostly in the form of loans and advisory support, but this remains a far cry from the US’s more direct investment approach.
To be fair, Brussels is beginning to stir. In December the European Commission adopted the RESourceEU Action Plan, mobilising up to €3bn for critical mineral projects and announcing the creation of a European Critical Raw Materials Centre in 2026. The plan also includes a stockpiling pilot scheme – directly mirroring the American model – and a matchmaking mechanism to connect EU buyers with suppliers of strategic raw materials. These are welcome steps. But the contrast in scale and urgency is stark: where the US commits $10bn in a single instrument, Europe’s €3bn is spread across multiple programmes, institutions and timelines stretching to 2029.
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Worse still, Europe’s own regulatory framework threatens to undermine its ambitions. Take the case of LKAB’s Per Geijer deposit in northern Sweden, the largest known rare earth resource in Europe. The project has been granted “strategic” status under the CRMA, making it eligible for fast-track permitting and EU-backed financing. Yet it now faces years of delays due to the EU’s own environmental protection laws and obligations to the indigenous Sámi people. The irony is hard to miss: Brussels designates a project as strategically essential with one hand, while its own legal architecture blocks it with the other.
Paradoxically, Europe’s muted response is creating a unique opportunity for investors. While MP Materials’ shares have soared on the back of US government backing, European plays such as Vulcan Energy Resources (lithium) and Talga Group (graphite)*, have lagged behind. In a world where supply chains are being rapidly redrawn and resource nationalism is moving up policy agendas, companies that can help increase European resilience may soon become the focus of investor attention in the same way that the defence names did in 2025.
Indeed, the defence parallel may prove instructive. The RESourceEU plan explicitly allows member states to count critical mineral stockpiling towards their NATO defence spending commitments – a clear signal that policymakers view mineral security and military security as two sides of the same coin. Just as defence stocks re-rated sharply in 2025 once the spending commitment became credible, European critical mineral names could follow a similar path once the funding materialises.
The catalysts are lining up: rising geopolitical tension, an increasingly interventionist policy environment, and a widening valuation gap between US and European plays in the same strategic space. For patient investors, this looks like an opportunity hiding in plain sight.
* Both Vulcan Energy Resources and Talga Group primary share listings are in Australia but their operations are squarely focused in Europe.