Rare Earth Exchanges

Bipartisan Critical Mineral Policy Working Group’s Recommendations Underestimate Measures Required to Overcome Rare Earth Supply Chain Gaps

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Highlights

  • Bipartisan legislation introduces three bills targeting national security risks in critical mineral supply chains.
  • Proposed initiatives focus on international cooperation, export controls, and workforce development to reduce U.S. dependency on China.
  • Policy efforts aim to balance economic resilience, clean energy objectives, and sustainable mineral resource management.

In response to growing concerns over the U.S. reliance on China for critical minerals, the bipartisan Critical Mineral Policy Working Group (opens in a new tab) has introduced legislation and a report aimed at diversifying and securing the nation’s supply chains. The legislative package includes three bills: the Earth Sciences and Cooperation Enhancement Act of 2024, an amendment to the Export Control Reform Act of 2018, and the Critical Minerals Workforce Enhancement Act. These initiatives collectively target national security risks and economic vulnerabilities by promoting domestic capabilities, sustainable practices, and international partnerships.

The Earth Sciences and Cooperation Enhancement Act facilitates international cooperation through MOUs, enhancing geologic mapping, resource assessment, and workforce training in allied nations. The amendment to the Export Control Reform Act imposes tighter controls on exports of black mass (recycled lithium-ion battery material) and swarf (magnet byproducts) to counter China’s market dominance and improve domestic recycling infrastructure. The Critical Minerals Workforce Enhancement Act focuses on workforce development, easing immigration policies for foreign experts, and expanding educational programs to address labor shortages in the critical minerals sector.

These measures reflect a strategic effort to reduce U.S. dependency on China, aligning national security with economic resilience and clean energy objectives. The proposed policies emphasize sustainability, workforce training, and fostering international collaboration with allies to ensure a robust supply chain.

Critical Questions and Assumptions:

Rare Earth Exchanges critically reviewed these materials, raising some questions for the readers. The first involves geopolitical feasibility. While MOUs with allies are crucial, how feasible is sustained international cooperation in an era of shifting global alliances? It’s not a trivial question, particularly for countries in deep trade engagement with China.

Then, we infuse some economic realism into the topic. Will the proposed $3 million for fiscal year 2025 under the Earth Sciences Act suffice to meaningfully advance its objectives? Is this underfunded, given the scope of the challenge?  We would suggest this demonstrates just how severe the situation really has become.

Then, there is industry readiness. Can U.S. industries quickly scale to process critical minerals, or will the interim period still leave vulnerabilities?  We have reviewed multiple credible reports suggesting the U.S. could be a decade away from being ready at scale. While the report underscores China’s environmental and labor practices, does it adequately address the role of global demand and consumption in perpetuating these issues? Of course, it does not address the U.S. involvement in China’s rare earth rise as well.

While moving to workforce gaps, will reliance on foreign expertise through immigration waivers sufficiently build long-term domestic capacity, or is it a stopgap?

On the one hand, the legislation presents at least a step toward critical mineral independence; however, do these representatives understand what the situation is on the ground? The assumptions about funding sufficiency, implementation speed, and international cooperation warrant closer scrutiny. Comprehensive success will depend on balanced policy execution and addressing these potential blind spots.

See the link to THE SELECT COMMITTEE ON THE STRATEGIC COMPETITION BETWEEN THE UNITED STATES AND THE CHINESE COMMUNIST PARTY CRITICAL MINERALS POLICY WORKING GROUP FINAL REPORT CREATING RESILIENT CRITICAL MINERAL SUPPLY CHAINS (opens in a new tab)

Members involved in the Sect Committee:

Chairman John Moolenaar and Ranking Member Raja Krishnamoorthi of the House Select Committee on the Strategic Competition between the United States and the Chinese Communist Party, the Critical Minerals Policy Working Group (PWG) is co-chaired by Representative Rob Wittman and Representative Kathy Castor and includes the following seven members:

  1. Representative Rob Wittman (R-VA)
  2. Representative Kathy Castor (D-FL)
  3. Representative Blaine Luetkemeyer (R-MO)
  4. Representative Haley Stevens (D-MI)
  5. Representative Carlos Gimenez (R-FL)
  6. Representative Ritchie Torres (D-NY)
  7. Representative Ben Cline (R-VA)

See links:

Click HERE (opens in a new tab) for a copy of The Creating Resilient Critical Mineral Supply Chains Report.

Click HERE (opens in a new tab) for the bill text of The Earth Sciences and Cooperation Enhancement Act of 2024

Click HERE (opens in a new tab) for the bill text of the amendment to the Export Reform Control Act of 2018

Click HERE (opens in a new tab) for the bill text of the Critical Minerals Workforce Enhancement Act

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