U.S. Mineral Probe

Key Takeaways

• U.S. Reliance on China: China controls 30 of 50 critical minerals essential to the U.S.
• Supply Chain Gaps: The U.S. has one rare earth mine, no cobalt refinery, and two copper smelters.
• 180-Day Review: The probe will take 180 days to assess tariff options and supply risks.

Trump Launches Probe into Critical Mineral Tariffs

On Tuesday, U.S. President Donald Trump ordered a sweeping national security review into potential new tariffs on all critical mineral imports, signaling a sharp escalation in trade tensions with global partners and taking direct aim at China’s dominance in this sector. The order, signed at the White House, instructs Commerce Secretary Howard Lutnick to begin the investigation under Section 232 of the Trade Expansion Act of 1962—the same provision used previously to justify 25% tariffs on global steel and aluminum.

The probe will evaluate market dynamics for critical minerals, including cobalt, nickel, uranium, and the 17 rare earth elements. It will assess how foreign actors may be distorting markets and determine the steps needed to strengthen domestic supply chains. Within 180 days, Lutnick is expected to report findings, including whether to impose tariffs that could override existing reciprocal tariff structures.

U.S. Dependency and China’s Strategic Leverage

The move underscores long-standing warnings from industry consultants, academics, and manufacturers about the U.S.’s heavy reliance on foreign, especially Chinese, sources for processed critical minerals vital to national security and economic resilience. China is the leading global producer of 30 of the 50 minerals deemed critical by the U.S. Geological Survey and has tightened export controls in recent months. Earlier this month, Beijing imposed export restrictions on rare earths—used in defense, electric vehicles, energy, and electronics industries—in retaliation for Trump’s recent tariffs.

The U.S. currently has only one rare earth mine, with most processing still reliant on China. In addition, the U.S. has no domestic cobalt mine or refinery, only one nickel mine with no smelter, and two copper smelters despite having multiple copper mines. Lithium extraction remains minimal. This precarious landscape highlights the vulnerability of U.S. supply chains and the strategic urgency behind the administration’s latest directive.

Allies, Alternatives, and Strategic Responses

Amid growing concern over the weaponization of mineral supply chains by China, which last year banned the export of three metals and added controls on others, Trump’s administration is also targeting loopholes in global mineral processing that could undermine tariff policies. The White House emphasized that an effective response must address the entire supply chain, which often spans multiple nations. The move has opened doors for allies like Australia, a trusted supplier of critical minerals, to negotiate favorable trade frameworks.

Tania Constable, CEO of the Minerals Council of Australia, stressed the importance of mutually beneficial agreements and strategic partnerships, while Australian Strategic Materials, supported by U.S. funding, offered to replicate its Korean rare earths processing plant on U.S. soil. However, experts warn that building new mining and processing infrastructure takes years, and with limited alternative sources, China’s current dominance poses a significant risk. As Gracelin Baskaran from the Center for Strategic and International Studies noted, “Ultimately, the U.S. gets certain minerals from China because there are no alternative supplies elsewhere.”