As the Trump administration pursues an ambitious preferential trading bloc for critical minerals, something unexpected is happening on the diplomatic periphery: its closest allies are quietly building their own networks that exclude both Washington and Beijing. From Canberra to Nuuk, a proliferation of bilateral and minilateral deals is creating a structurally novel patchwork of supply chain agreements, raising serious questions about whether the US-led minerals governance architecture can hold together when its own partners are hedging against it.
Introduction
In the marble corridors of Australia's Parliament House on the afternoon of May 4, Japanese Prime Minister Sanae Takaichi stood beside her Australian counterpart Anthony Albanese and signed her name to a document that, in quieter times, might have warranted a single paragraph in the financial press. The Joint Declaration on Economic Security Cooperation, running to several pages of diplomatic language about gallium, nickel, rare earths, and fluorite, committed Australia to providing up to 1.3 billion Australian dollars in support for critical minerals projects involving Japanese industry. It was, by any measure, the most substantive bilateral minerals commitment the two nations had ever made.
What made it remarkable was not the scale, though that was significant, and not even the timing, arriving one week before the Busan rare earth truce is scheduled for its next review cycle. What made it remarkable was what it did not contain: a single mention of the United States, and no visible architecture connecting it to the American-led preferential trading system that Secretary of State Rubio and Vice President Vance had spent the February Critical Minerals Ministerial assembling with such fanfare. Takaichi had arrived in Canberra directly from Hanoi, where she had been urging Southeast Asian nations to bolster regional supply chains. She would go on to deepen Japan's ties with France. The itinerary read less like the schedule of an ally consolidating within a US-led bloc, and more like a middle power threading its own needle.
This is what the patchwork looks like from the inside. Across the first five months of 2026, a quiet but structurally significant phenomenon has been unfolding in critical minerals diplomacy: countries that are nominally aligned with Washington's vision for a friendshored minerals order are simultaneously constructing their own bilateral and minilateral frameworks, ones that neither require American participation nor Chinese tolerance. The dynamic has caught the attention of analysts who study the architecture of global supply chains, and it is beginning to complicate the assumptions on which US minerals strategy was built.
A Flurry Nobody Planned For
On May 5, Foreign Policy published an analysis with a finding that cut through the noise of the broader trade war: even as the Trump administration was going all-in on critical minerals, there had been, in the publication's words, "a flurry of trade deals that exclude both Beijing and Washington, underscoring just how unreliable of a reputation the United States has developed in the global marketplace." The piece framed a parallel that officials in Washington would prefer not to dwell on: if the Trump administration has been racing to diversify away from China, the rest of the world appears to be diversifying away from Washington.
Cullen Hendrix, a senior fellow at the Peterson Institute for International Economics, put the dynamic in terms that are likely to be quoted for some time. "Because of the political risk associated with aligning with China or with the United States," he told Foreign Policy, "there's developing this patchwork of critical minerals agreements that have nothing to do with either" country. The word "patchwork" is doing serious analytical work in that sentence. It implies not a rival bloc, not a coherent counter-architecture, but something messier and in some ways more durable: a dispersed network of bilateral arrangements, each one calibrated to local political conditions, each one adding another stitch to a fabric that is slowly covering the gaps left by the two superpowers.
Chris Berry, president of House Mountain Partners, an independent metals analysis consultancy, was more blunt. "You're seeing a lot of these countries do one-off deals with each other," he said. "They don't involve China, but they also don't involve the United States." He added, with the candor that tends to characterize people who spend their careers studying the commercial realities of mining rather than its geopolitical optics: "I'm not sure if there's a lot of trust in the United States out there at this point in time."
That trust deficit has been accumulating in layers. The tariff volatility of 2025 and 2026, the on-again-off-again trade frameworks, the explicit use of economic leverage even against formal allies, including Canada and Australia: all of it has registered in the calculations of governments trying to plan twenty-year investments in mines, processing facilities, and refining infrastructure. Critical minerals projects have long lead times. They require policy certainty measured in decades. The current Washington environment offers certainty measured, at best, in news cycles.
The Minilateral Within the G7
The most structurally consequential of these emerging arrangements involves three G7 members who have known each other's governments for decades and are now, with some delicacy, constructing something that functions like a sub-bloc within the bloc. Reuters reported in March 2026 that Japan, France, and Canada were working on alternatives to the US-led critical minerals trade framework, a report that was subsequently confirmed by senior officials from all three governments. The framing was careful: this was not presented as opposition to Washington, but as an additional layer of architecture.
France's position, articulated by Benjamin Gallezot, the country's interministerial delegate for strategic minerals, was characteristically Gaullist in its precision. The US proposal is one way to diversify supply chains, Gallezot said, "but there are other ways to do it. There will not be a general policy, that is our view. Second, it has to be built and discussed between a large number of countries, not only the G7, but G7 plus." The subtext is clear to anyone who has tracked European industrial policy over the past two years: French policymakers have concluded that substituting dependence on American industrial frameworks for dependence on Chinese processing capacity would not constitute a genuine solution. It would constitute a change of landlord.
The Japan-France relationship has moved beyond diplomatic language into concrete project commitments. In April, Prime Minister Takaichi and President Macron signed a road map centered on Caremag, a rare earths refining facility in southern France backed by Japan's state-owned Japan Organization for Metals and Energy Security and the gas company Iwatani. Japan is targeting approximately twenty percent of its future demand for dysprosium and terbium from this single facility: two heavy rare earth oxides essential for the motors in electric vehicles and offshore wind turbines. Takaichi called France a "special partner sharing values and principles," language that was deliberately chosen to invoke a relationship that does not depend on Washington's approval.
An analysis published by the Observer Research Foundation on May 5 captured the significance of what is forming. "What is emerging is not an anti-American coalition, nor an anti-China bloc in the conventional sense," the analysis noted. "Rather, it is a middle-power effort to build supply chain resilience through strategic autonomy." The same analysis observed that Japan's dependence on Chinese rare earths has reportedly fallen from nearly ninety percent to around sixty percent through investments in Australia, Southeast Asia, and recycling technologies. The remaining sixty percent represents both the scale of the problem and the urgency driving Tokyo's dealmaking pace.
Canada, Greenland, and the Arctic Pivot
While the Japan-France-Canada triangle has attracted the most analytical attention, a separate and geographically striking set of arrangements has been forming at the northern edge of the Atlantic world. On March 2, Canada and Greenland signed a Joint Declaration of Intent aimed at strengthening cooperation on critical minerals, energy systems, and Arctic infrastructure. The agreement was signed between Canada's Department of Natural Resources and Greenland's Ministry of Business, Mineral Resources, Energy, Justice and Gender Equality, a pairing that would have seemed almost eccentric in the minerals diplomacy of five years ago.
The context makes the pairing entirely legible. President Trump had, since returning to the White House, repeatedly suggested that the United States should acquire Greenland, and had declined to rule out the use of military force to secure the island. Canada had opened a new consulate in Nuuk, Greenland's capital, in February 2026. Greenland's minister Naaja Nathanielsen was direct about what the declaration represented: "Lately, Greenland has been the subject of international attention. This agreement cements the importance of strong alliances and partnerships." The phrase "international attention" is diplomatic language for a specific kind of threat.
Canada has been moving fast on multiple fronts simultaneously. On the same day it signed the Greenland declaration, Energy Minister Tim Hodgson announced the second round of partnerships under the Critical Minerals Production Alliance, a framework that has now mobilized an estimated C$18 billion in project investments since October 2025, involving twelve allied partners and thirty new deals. Canada has signed a joint declaration with the EU on critical minerals collaboration. It has made deals with Australia. The cumulative picture is of a country that has internalized the lesson of the Trump tariff era and concluded that its mineral security cannot rest on any single relationship, including the one with its southern neighbor.
The Canada-led buyers' club concept, which France has endorsed and intends to advance through its G7 presidency, represents perhaps the most direct institutional challenge to the American bilateral approach. Tim Hodgson has stated plainly: "Canada believes that the best way to address the issue of concentrated supply of critical minerals is through a production alliance or a buyers' club." The design of such a club, with potential import quotas and coordinated subsidies, would give participating countries collective leverage that none of them possesses individually. It would also, structurally, reduce the weight of any single bilateral agreement with the United States.
The Leverage Washington Expected to Have
The February 4 Critical Minerals Ministerial at the State Department was, by any conventional measure, an impressive diplomatic production. Secretary Rubio hosted representatives from fifty-four nations and the EU. Vice President Vance unveiled the preferential trading bloc concept. The US signed eleven new bilateral frameworks or memoranda of understanding, with countries ranging from Argentina to Uzbekistan. Caleb Orr, the assistant secretary of state for economic, energy, and business affairs, described the ministerial as generating twenty-seven deals in total. "The most impactful component," Orr said, "was the sheer size of it."
The problem with leverage, though, is that it depends on the credibility of the party wielding it. And credibility is precisely what is now in question. The Section 232 investigation into critical minerals was designed to give Washington the ability to offer preferential tariff treatment to countries that aligned with its supply chain architecture, a classic reciprocal bargain. But as Gracelin Baskaran, director of the Critical Minerals Security Program at CSIS, has observed, countries are walking a "precarious" line between deepening collaboration with Washington and risking retaliation from Beijing. "Countries want to create a coalition whereby they can work together to build supply chain security," Baskaran said. "However, every country is also cautious of Chinese retaliation."
The logic of that caution is rational. China controls approximately ninety-one percent of global rare earth separation and refining capacity. It dominates processing for cobalt, lithium, graphite, and tungsten. Beijing's April 2025 export controls on seven heavy rare earth elements, followed by its October 2025 controls on lithium-ion battery supply chains, demonstrated its willingness to weaponize that dominance. Licensing approval rates below twenty-five percent for European firms seeking Chinese rare earth exports are not an accident: they are a signal. The signal is that aligning too visibly with Washington carries a measurable price.
But the tariff volatility flowing from Washington carries its own measurable price. The UK Trade Policy Observatory noted in March that the critical minerals agreements proliferating across the globe tend to be non-binding in nature, vague in substance, and incomprehensive in design. The same observation applies with some force to the American bilateral frameworks: they are signals of intent, not durable legal commitments. USTR Greer spoke in February of laying "the groundwork for a binding plurilateral agreement," but groundwork is not architecture, and no timeline has been attached to the binding part. In the meantime, partner countries are making their own calculations.
What a Patchwork Cannot Do
There is a temptation, in tracking the proliferation of bilateral and minilateral minerals agreements, to conclude that the international system is developing a healthy pluralism: multiple frameworks, redundant supply chains, distributed risk. The reality is considerably more complicated. The patchwork that Cullen Hendrix describes is structurally novel, but it has significant limitations that its architects are only beginning to grapple with.
The agreements being signed between Australia and Japan, between Canada and Greenland, between Japan and France, are almost uniformly non-binding. They facilitate investment and coordination, but they do not create enforceable offtake agreements or binding processing commitments. China's dominance in the refining stages, where ninety percent of rare earth processing occurs within Chinese borders, is not addressed by any of these arrangements. The Caremag facility in southern France represents a genuine attempt to build Western processing capacity for dysprosium and terbium, but it covers one plant, in one country, targeting twenty percent of Japan's demand for two specific elements. The gap between that ambition and China's ninety-four percent share of sintered permanent magnet production is not closed by a bilateral roadmap.
The deeper problem is one of coordination. A patchwork, by definition, lacks a center. The US-led preferential trading bloc concept, whatever its credibility problems, at least provided a mechanism for aligning price floors, coordinating investment signals, and creating a coherent demand signal for alternative producers. The minilateral arrangements forming within the G7 are beginning to develop their own coordination mechanisms through the Canadian buyers' club concept and the French G7 presidency, but they remain works in progress. The Observer Research Foundation analysis published on May 5 was optimistic about the Canada-Japan-France alignment, but it also acknowledged that "what is emerging" is still an emerging thing: the architecture is not yet built.
The broader international picture only underscores the complexity. India and Brazil signed a mining pact in February to boost reciprocal investment. Botswana and Oman drew closer on mineral exploration and energy infrastructure. Brazilian President Lula stated in April that his country would not "repeat the role of mere exporters of mineral commodities" and would seek international partnerships that include higher value-added stages. Each of these developments represents a producing country asserting its own strategic interests, which may or may not align with either the American framework or the emerging minilateral alternatives.
The View From Parliament House
When Anthony Albanese stood alongside Sanae Takaichi on May 4 and described the agreement they had just signed as "action to protect our economies from future economic shocks and uncertainty," he was careful not to specify the source of those shocks. He did not need to. The assembled journalists understood that China's export controls had created one category of shock, and that American tariff volatility had created another. Australia has been navigating both simultaneously: a major exporter of minerals to China, a formal ally of the United States, and now the primary supply-side partner in a bilateral arrangement with Japan that commits A$1.3 billion to projects producing gallium, nickel, graphite, rare earths, and fluorite for Japanese industry.
The deal represents, in microcosm, what the patchwork looks like from the inside: a pragmatic, commercially grounded agreement between two countries that share geography, economic complementarity, and a clear-eyed assessment of the risks on either side of them. It does not require Washington's blessing. It does not require Beijing's tolerance. It requires functioning mines, functioning processing infrastructure, and a stable enough diplomatic environment to sustain twenty-year investments. Whether those conditions hold depends on factors that neither Canberra nor Tokyo fully controls.
The afternoon Takaichi arrived at Parliament House, she was, as I noted in my coverage of the Busan countdown in May, operating within a diplomatic environment in which the November 10 deadline on the rare earth truce is only six months away and the fundamental architecture of global minerals governance remains unresolved. The patchwork is real, and it is growing. But as Chris Berry observed, there is not a lot of trust in the United States out there right now, and trust is the one thing a patchwork cannot substitute for. It can distribute risk. It cannot create the durable, enforceable, deeply capitalized infrastructure that the current crisis actually demands. That gap, between what the patchwork can accomplish and what the moment requires, is where the real story is still unfolding.