Europe needs to develop a transparent pricing system for rare earths and specialty metals to reduce reliance on China and support investment in domestic mining and processing, according to senior leadership at EIT RawMaterials. Speaking to Reuters, CEO and Managing Director Bernd Schaefer said Europe’s dependence on opaque pricing mechanisms largely controlled by China is creating barriers for investors. He also linked the pricing situation to slower development of new critical mineral projects across the region.
China’s pricing influence and supply chain dominance
China dominates global critical mineral supply chains, particularly for rare earth elements used in electric vehicles, wind turbines, electronics and defense technologies. The country also influences pricing through domestic trading systems that lack full transparency. Schaefer warned that this opacity affects how Western developers assess market conditions.
Without clear and reliable market benchmarks, project profitability becomes harder to evaluate, financing is more difficult to secure, and long-term investment into high-cost mining and processing projects in Europe is less attainable. The resulting gap is between Europe’s strategic goal of raw material independence and the financial realities faced by mining companies operating in the region.
EU targets for 2030 critical raw material supply
The European Union has set diversification goals aimed at reducing vulnerabilities in critical raw material supply chains. By 2030, the EU aims to produce at least 10% of its annual critical raw material demand domestically. It also plans to limit reliance on any single non-EU country to no more than 65% of total supply.
The EU’s targets are intended to reduce exposure to external supply shocks and strengthen industrial capacity in sectors including clean energy, automotive manufacturing and advanced technology production. Industry experts cited transparent pricing mechanisms as a key missing component for building a functional European critical minerals market.
European benchmark index with Metalshub
EIT RawMaterials, an organization partially funded by the EU, is working with digital trading platform Metalshub to develop a European benchmark index for critical minerals. The initiative seeks standardized, market-based pricing for materials traded outside of China’s influence. Schaefer said the absence of reliable price benchmarks has been a major obstacle to faster growth in Europe’s critical minerals sector.
The proposed index is intended to provide clearer investment signals for mining and processing projects. It would also aim to improve pricing transparency across the supply chain, support stronger financial planning for long-term resource development, and increase investor confidence in European raw materials projects.
Potential expansion beyond the EU
Schaefer said an effective pricing system may need to extend beyond the EU even though the initiative focuses on Europe. Collaboration with markets in the United States, Australia, Canada and the United Kingdom could help create a more globally representative benchmark for rare earths and specialty metals. He said such coordination could improve liquidity and reduce regional pricing distortions.
The same approach is described as providing a more stable foundation for long-term investment decisions in the global raw materials market. Schaefer also pointed to challenges tied to data availability, including limited reliable information on global production volumes and demand growth.
RESourceEU plan and stockpiling pilot
In December, the European Union introduced its €3 billion RESourceEU initiative to accelerate diversification of critical mineral supply chains and reduce dependency on external suppliers, particularly China. The program focuses on strengthening domestic sourcing, expanding recycling capacity and supporting new mining and refining projects across Europe.
Implementation has been relatively slow with limited large-scale progress reported so far. One concrete development described is a pilot joint strategic stockpiling program led by Italy, France and Germany, which identified materials including tungsten and gallium for initial storage.
Investment barriers tied to pricing benchmarks
Schaefer linked Europe’s effort to secure independence in rare earths and critical raw materials to a dual challenge involving both physical supply capacity and financial infrastructure for investment. He said investors struggle to assess risk and return without transparent pricing benchmarks. This can slow project development as competition for critical minerals intensifies globally.
Demand growth continues for materials used in electrification, defense systems and advanced manufacturing. The ability to establish a credible and transparent pricing system is presented as important alongside mining targets as Europe works toward reducing dependence on China.
