G7 Finance Ministers Tackle Strategic Rare-Earth Supply Issues

Finance ministers from advanced economies discussed a possible price floor for rare earths and partnerships for strategic supplies. The topic will be central under France's G7 presidency. The discussions also included securing supplies outside China and ensuring stable prices despite market fluctuations due to China's dominance.

Finance ministers from a cadre of advanced economies convened in Washington to deliberate on strategies for setting a price floor and building partnerships to secure strategic rare-earth supplies, according to Germany's Lars Klingbeil. While the discussions are in their early stages, numerous questions remain unresolved and will be addressed in the weeks ahead with both foreign and energy ministers joining the conversation.

The issue of rare-earth supplies is slated to become a focal point under the French presidency of the Group of Seven this year. The Washington meeting included finance ministers from the G7, as well as representatives from Australia, Mexico, South Korea, and India. Klingbeil noted that an upcoming meeting focused on rare earths among foreign ministers is anticipated soon.

The price floor discussion aims to guarantee that producers outside of China receive a minimum price level, serving as a counterbalance to China's market influence and supply capabilities. Klingbeil clarified that the initiative is about bolstering partner cooperation, not counteracting China. While China has not responded to this initiative, Germany's approach is to mitigate risks with China rather than sever ties.

(With inputs from agencies.)