Trump Takes Aim at Chinese Minerals Chokehold, Paving Path for Increased Investment

Washington is finally trying to free itself from China’s mineral chokehold. On March 20, President Trump signed an executive order seeking to accelerate mining and processing projects, which are essential to American defense and industry. Chinese dominance on a wide range of key minerals, including rare earths, gallium, germanium, lithium, cobalt, and graphite, directly threatens American industry, defense, and livelihoods.

To counteract this, the White House aims to streamline — or, in some cases, eliminate — regulations and permitting requirements for critical mineral projects. The order directs federal agencies to establish offtake agreements; enable the Export-Import Bank to purchase raw feedstock minerals on the global market for domestic processing; identify all federal land with significant mineral reserves; provide regulatory clarity to support the recovery of critical minerals from existing mining waste; and offer federal financing — such as loans, equity investments, and other funding — to advance these projects while encouraging private investment.

China Controls Mines and Processing Capacity

Critical minerals are essential components in nearly every modern technological and defense product — from smartphones to jets. While China does not possess significant domestic reserves of these minerals, Beijing has secured control over a steady influx of critical raw materials through strategic investments and acquisitions in countries like Chile, Australia, and the Congo.

Even more problematic is China’s overwhelming control over the processing of these minerals. China processes 98 percent of the world’s gallium, 90–99 percent of the graphite, 91 percent of the germanium, 85 percent of the rare earths, 83 percent of the cobalt, and 72 percent of the lithium.

China Weaponizes Critical Mineral Control Against U.S. Interests

China’s stranglehold on critical minerals supply chains is not merely a theoretical risk. Beijing is already weaponizing this control against the American economy and defense-industrial base. In December 2024, China imposed bans on the export of gallium, germanium, and antimony to the United States, as well as restrictions on graphite. These minerals are indispensable for semiconductor manufacturing and defense technologies like radars and infrared sensors for ships, missiles, and tanks. The restrictions sent antimony prices through the roof, soaring more than 300 percent compared to 2023.

In addition to explicit export controls, China’s near-monopoly on critical minerals leaves U.S. businesses vulnerable to Beijing’s state-led price manipulation and other non-market practices. By adjusting production levels, buying up large chunks of international stockpiles, and misreporting prices to international mercantile exchanges, China routinely influences prices in dangerous ways that harm America’s ability to compete and access the resources it needs.

U.S. Should Mine, Refine, and Recycle at Home … and Abroad

While the Trump administration’s efforts to diversify the domestic supply of extracted critical minerals are desperately needed, Washington should also look to advance the capacity of partners in other market-based economies to counter China’s dominance. Developing cutting-edge processing techniques and establishing processing facilities will take time, even with streamlined regulations. Moreover, the cost of establishing processing facilities at home is estimated to be three times higher than in China, making the development of refining capacity in lower-cost countries an appealing option. 

The administration should also support domestic recycling technologies that keep already extracted and processed minerals within America’s economy. While often disregarded as an environmental issue, recycling critical minerals — most of which can be reused indefinitely with little loss — is a cost-effective way to bolster American economic and national security.

Elaine Dezenski is senior director and head of the Center on Economic and Financial Power (CEFP) at the Foundation for Defense of Democracies (FDD), where Alexander St. Leger is a research analyst. For more analysis from Elaine, Alexander, and FDD, please subscribe HERE. Follow Elaine and Alexander on X @ElaineDezenski and @AlexStLeger. Follow FDD on Twitter @FDD and @FDD_CEFP. FDD is a Washington, DC-based, nonpartisan research institute focused on national security and foreign policy.