US President Donald Trump on Friday announced a series of mining projects valued at $3 billion, as Washington works to wean itself off Chinese critical minerals imports crucial to the development of defence systems and advanced technologies.
“Critical minerals are the raw materials of American strength that power everything from advanced weaponry to automobiles, and we want these essential products to be mined, refined, and made right here in the USA,” Mr Trump said at a mining roundtable at the State Department.
He added that the Pentagon is signing a $1.4 billion loan agreement with a company to build a battery facility in Washington state, and investing $400 million to expand the production of scandium, a rare earth that can be used to strengthen aluminium alloys for aerospace and aviation materials.
“We're spending hundreds of millions of dollars, and even billions of dollars, in bringing your industry back, and we need your industry. We're not doing you favours. We're doing ourselves favours,” Mr Trump said.
The Pentagon also announced a $150 million conditional loan commitment to scale rare earth-free magnet production capabilities at a facility in Minnesota, and another $80 million for mining schools.
In addition, the US Export-Import Bank is lending $58 million to three critical mineral companies developing projects on copper, graphite, tantalum and niobium. Tantalum is mostly used to produce capacitors for smartphones and other electronics, while niobium is used as an alloy for aerospace applications.
“At the core of this is our industrial strength, but also our national sovereignty,” Secretary of State Marco Rubio said.
The US Geological Survey last year listed 60 mineral commodities on its updated tally of minerals critical to national security and electrification. The US was 100 per cent net-import reliant on 16 of these nonfuel mineral commodities, USGS data showed.
Minerals like tungsten, scandium and germanium are essential for precision-guided missiles and other advanced defence systems components. Reports have recently indicated that the US war with Iran is draining the Pentagon's military stockpiles - something the Trump administration disputes.
A series of Chinese export restrictions in recent years rang alarm bells about the fragility of critical minerals supply chains, prompting western nations and Gulf states to diversify how they acquire these materials.
Rare earths remain a key point of tension between the US and China, which reached boiling point last year when Beijing announced harsh export restrictions for several critical minerals including tungsten. The implementation date was later suspended until this November, roughly two months after Mr Trump is expected to host Chinese President Xi Jinping at the White House.
The Trump administration took equity stakes in companies across the supply chain, established a $12 billion stockpile similar to the nation's oil reserves, and launched diplomatic efforts with partner countries to shore up supply chains and establish price floors.
“We're playing catch-up, but there is an urgent need to play catch up and actually win the game,” Robert Price, president of the Colorado-based USFM Corporation.
USFM Corporation is among a number of companies active in Greenland, an island rich with mineral reserves. Mr Price said the mining project has 28 drill-ready targets for cobalt, copper and nickel. Mr Trump has said that he wants the US to take over the world's largest island in the interest of national security.
“It's imperative that the United States develops their own supplies,” he said.
Beijing last month announced it had added 14 EU companies to its export control list, in a broader blacklisting than it announced in June for two US-backed companies, MP Materials and USA Rare Earth, which are crucial to America's efforts to make rare earth magnets.
Representatives from the two companies attended the Friday roundtable, as well as mining heavyweights Rio Tinto and BHP Group.
