US to create strategic reserve for rare earths elements
U.S. President Donald Trump’s administration plans to create a strategic reserve of rare earth elements, a stockpile that could counter China’s ability to use its dominance of hard-to-work metals as leverage in trade talks.
The White House on Monday confirmed the launch of Project Vault, which will initially be financed with a US$10 billion ($14 billion) loan from the US Export-Import Bank and approximately US$1.67 billion in private equity.
Minerals held in reserve will help protect auto, electronics and other product manufacturers from any supply chain disruptions.
During trade talks spurred by Trump’s tariffs last year, the Chinese government restricted exports of rare earths needed for jet engines, radar systems, electric vehicles, laptops and phones.
China represents approximately 70 percent of the world’s rare earth mining and 90 percent of global rare earth processing.
This put pressure on the industry, causing the United States to source alternative sources of the elements, creating a stockpile similar to the United States’ oil reserves.
The loan will have a maturity of 15 years.
The US government previously took a stake in rare earth miner MP Materials and provided financial support to companies Vulcan Elements and USA Rare Earth.
Bloomberg News was the first to report the creation of a rare earth strategic reserve.
Trump is scheduled to meet with General Motors CEO Mary Barra and mining industry billionaire Robert Friedland on Monday.
via Reuters
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