US, Philippines Sign Deal to Build Critical Minerals Supply Chain

The United States is speeding up efforts to build a trusted trading network for critical minerals and rare earths, as it tries to reduce global dependence on China-controlled supply chains.

On Wednesday, the Philippines and the US signed a memorandum of understanding (MOU) focused on developing the Philippines’ critical minerals and rare earths sector. Philippine officials said this agreement could help the country become a major global processing hub.

The deal was signed by Philippine Environment Secretary Raphael Lotilla and US Undersecretary of State for Economic Affairs Jacob Helberg. The signing took place during the 2026 Critical Minerals Ministerial, hosted by the US State Department. The meeting gathered ministers and senior officials from 54 countries and the European Commission.

Philippines aims to boost local processing

Philippine officials said the partnership supports the country’s shift away from exporting raw mineral ores. Instead, the Philippines wants to focus on domestic processing and value-added production, which would strengthen its role in global supply chains supported by US-led initiatives.

Lotilla said the goal is to build a Filipino-led industry that processes local resources, creates high-skilled jobs, and improves the country’s position in the global high-tech supply chain. He added that more local processing will help the Philippines keep more economic benefits from mining.

Lotilla also said joining the emerging US-backed minerals network matches the Philippines’ commitments to responsible mining, environmental protection, and safeguarding local communities.

US expanding network of trusted mineral partners

With this agreement, the Philippines joins other US partners such as Australia, Canada, Japan, South Korea, the United Kingdom, and Asean neighbors Malaysia and Thailand.

The US is working to build a broader alliance to secure stable and diversified supplies of critical minerals, which are essential for electric vehicles, renewable energy systems, electronics, and advanced manufacturing.

US proposes price floors and trade protections

During the ministerial, US Vice President JD Vance shared plans to bring partner countries into a preferential trade bloc for critical minerals. This includes introducing coordinated price floors to protect domestic industries from market distortions.

Vance said the goal is to stop markets from being flooded with cheap critical minerals that could damage local manufacturers. Under the plan, the US would set reference prices at different stages of mineral production.

For members of the preferential zone, these reference prices would act as minimum price floors. They would be supported through adjustable tariffs designed to maintain fair pricing.

China’s dominance and export controls driving urgency

China has long dominated global mineral processing and has used this advantage as a geo-economic tool. It has previously restricted exports, suppressed prices, and undercut competing producers.

Recent Chinese export controls on rare earths have disrupted auto production in both Europe and the US. At the same time, an oversupply of Chinese lithium has slowed expansion plans for American producers.

These developments have increased concerns among the US and its partners, who are still struggling to build strong mining and processing alternatives for minerals such as lithium, nickel, rare earths, and other strategic materials.

US strengthens stockpiles with ‘Project Vault’

The US is also increasing its own reserves of critical minerals. Earlier this week, US President Donald Trump announced a new strategic reserve called Project Vault.

The reserve will be backed by $10 billion in seed funding from the US Export-Import Bank, along with an additional $2 billion in private investment.