Trump Delays Critical Mineral Tariffs, Eyes Global Partners

US President Donald Trump announced that the administration will temporarily delay imposing tariffs on rare earths, lithium, and other critical minerals. Instead, he directed senior officials to explore sourcing these materials through international trade partners to reduce vulnerabilities and ensure stable access.

Trump instructed US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick to “enter into negotiations with trading partners to adjust the imports of (critical minerals) so that such imports will not threaten to impair the national security of the United States.” 

He emphasized that these discussions should promote the adoption of price floors for critical minerals, a strategy long advocated by Western miners and policymakers. The president noted that if negotiations fail, the administration could impose minimum import prices or “may take other measures,” though he did not specify what these measures might entail. 

This approach aligns with recommendations from Lutnick, who conducted a national security review under Section 232 of the Trade Expansion Act of 1962. US Secretary of Commerce Howard Lutnick’s report, submitted last October, found that the United States is “too reliant on foreign sources” of critical minerals, faces “unsustainable price volatility,” and lacks secure supply chains, creating a “significant national security vulnerability that could be exploited by foreign actors.”

Trump underscored the importance of domestic processing. “Mining a mineral domestically does not safeguard the national security of the United States if the United States remains dependent on a foreign country for the processing of that mineral.” 

China’s Dominance in Critical Minerals and Strategic Risks

Critical minerals are central to energy technologies, high-tech industries, defense, and advanced manufacturing. However, global supply chains are heavily dependent on China, creating strategic vulnerabilities. The International Energy Agency’s Global Critical Minerals Outlook 2025 shows that China dominates the refining of 19 out of 20 key strategic minerals, with an average market share of 70%, a concentration that has grown in recent years. This reliance on a single supplier exposes industries to geopolitical tensions, trade disruptions, and technical failures.

China’s control is particularly pronounced in rare earth elements, which are critical for permanent magnets used in electric vehicles, wind turbines, industrial motors, defense systems, and data centers. In 2024, China accounted for about 60% of global rare earth mining output and 91% of refining capacity. Its share of permanent magnet production has increased from 50% two decades ago to 94% today. This concentration makes global supply chains in energy, automotive, defense, and advanced technology highly susceptible to disruption.

Export controls have further intensified these risks. In April 2025, China imposed restrictions on seven heavy rare earths and related products, leading to shortages for United States and European manufacturers and driving European prices up to six times domestic Chinese levels. By October, these controls expanded to include foreign-made products containing Chinese-sourced rare earths, additional elements such as holmium, erbium, and ytterbium, and essential processing equipment. These measures threaten production across sectors reliant on rare earths, including defense, aerospace, semiconductors, industrial motors, and AI data centers.

China also dominates lithium-ion battery supply chains. It controls over 80–95% of midstream and downstream production, including cathode precursors, anode materials, LFP cathodes, and battery cells. IEA stressed that new export restrictions could increase costs for electric vehicles and energy storage systems while creating vulnerabilities for strategic sectors such as defense, aerospace, AI, and medical devices.

Efforts to reduce dependency on China face structural challenges. Mining, refining, and magnet production projects outside China remain limited, and lead times for new projects often exceed eight years. Midstream battery material production outside China is insufficient to offset reliance on Chinese sources.

Some initiatives aim to diversify global supply chains. For example, France and Japan are collaborating to produce rare earth oxides in Lacq, France, linking different parts of the supply chain. Additional mining and refining projects are underway in the United States, Australia, Brazil, Tanzania, and India, and several permanent magnet manufacturing plants are starting operations in the United States, Estonia, Korea, Vietnam, and Germany. However, the pace of development remains slow relative to demand, and permanent magnet capacity outside China is still notably lower than for mining and refining.

Diversification of battery supply chains faces similar constraints. While downstream battery cell production has expanded, midstream materials such as cathode precursors, anode materials, and LFP cathodes remain concentrated in China. Korea currently leads midstream production outside China but still depends on imports of key upstream inputs. The United States and Europe are expected to account for roughly 40% of capacity outside China by 2030, with projects under development to produce LFP cathode and anode materials. Despite these initiatives, reliance on Chinese supplies persists, underscoring the need for further investment, policy support, and international cooperation.

Global Coordination on Critical Mineral Security

Recognizing the risks of concentrated supply chains, global leaders are taking coordinated action. This week, Mexico’s Minister of Finance Édgar Amador participated in a high-level meeting in Washington, D.C., with finance ministers from Australia, Canada, France, Germany, Italy, Japan, South Korea, the United Kingdom, the European Commission, and India. Discussions focused on diversifying supply chains and developing financial mechanisms to improve resilience, essential for modern technology, clean energy, and national security.

Officials emphasized the strategic importance of minerals such as lithium, cobalt, aluminum, and uranium, many of which face supply vulnerabilities due to scarcity, reliance on a limited number of sources, or lack of viable substitutes. The meeting highlighted the need for international cooperation and investment to strengthen the security and stability of critical mineral supply chains.

The 2025 US Critical Minerals List and Domestic Efforts

On Nov. 6, 2025, the US Geological Survey released the final 2025 List of Critical Minerals, identifying 60 minerals vital to the US economy and national security that face potential supply chain risks. The update added 10 new minerals, including boron, copper, lead, metallurgical coal, phosphate, potash, rhenium, silicon, silver, and uranium. Rare earth elements remain a primary concern due to their critical role in technologies such as smartphones, hard drives, and advanced defense systems.

In 2024, the United States imported 80% of its rare earth needs. To reduce dependence, the federal government is expanding domestic production and securing access through international partners, including Australia, Japan, Malaysia, and Thailand. Additionally, the USGS is mapping new domestic deposits and conducting research to better understand geology’s impact on mineral quality, size, and extractability.