Rare Earth Exchanges

Coons et al Proposed STRATEGIC Minerals Act Falls Way Short: Political Class Clueless About Scale of Problem

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Highlights

  • Senators introduce legislation to fortify America’s critical minerals and rare earth elements supply chain.
  • The act seeks to create trade agreements with trusted allies to counter China’s mineral processing dominance.
  • Despite potential promise, the legislation falls short of comprehensive strategies needed to truly secure national mineral resources.

The recently reintroduced Securing Trade and Resources for Advanced Technology, Economic Growth, and International Commerce in (STRATEGIC) Minerals Act (opens in a new tab) aims to fortify America’s supply chain for critical minerals and rare earth elements (REEs). Spearheaded by Senators Chris Coons, Todd Young, John Cornyn, and John Hickenlooper, the legislation empowers the president to negotiate trade agreements focused on critical minerals and REEs with trusted allies. The primary objectives are to bolster cooperation, dismantle trade barriers, and enhance economic security by reducing dependence on adversarial nations, notably China.

Background

The STRATEGIC Minerals Act, originally introduced in the 118th Congress, builds upon previous legislative efforts to reduce the U.S. dependence on China for critical minerals, a national security priority.

It aligns with the Global Strategy for Securing Critical Minerals Act (opens in a new tab)-Securing America’s Critical Minerals Supply Act, security of the United States.), a bipartisan initiative aimed at diversifying and securing global supply chains by strengthening cooperation between the U.S., its allies, and strategic partners. Additionally, it incorporates elements of the Critical Minerals Future Act (opens in a new tab), introduced in October, which proposes a pilot program under the U.S. Department of Energy to provide financial support for domestic critical mineral processing projects. This initiative seeks to bolster domestic refining and production capabilities, a critical step in addressing the current vulnerabilities in the U.S. supply chain.

Together, these legislative efforts attempt to create a comprehensive framework for securing critical mineral resources, yet they still lack aggressive measures to rapidly scale U.S. mining, refining, and manufacturing capacity—key factors needed to counter China’s dominance effectively.

Promise?

 At first glance, the STRATEGIC Minerals Act appears to be a proactive step toward securing essential resources. By fostering alliances and streamlining trade, it seeks to mitigate the risks associated with overreliance on foreign adversaries for critical minerals integral to modern technology and defense.

Way Short

However, the legislation falls short of addressing the multifaceted challenges inherent in the critical minerals sector. To genuinely counter China’s dominance, the U.S. must undertake a comprehensive overhaul that transcends mere trade agreements. Frankly, as Rare Earth Exchanges has repeatedly reported, an unprecedented move on par with, say, a national emergency.   This includes the rapid streamlining of government agencies to expedite all the regulatory entanglements, including mining permits, establishing a robust network of partnerships for resource extraction, and developing domestic processing and refining capabilities. Currently, China controls a staggering 90% of the processing capacity for these minerals, a chokehold that cannot be broken through diplomacy alone.

Moreover, the act does not adequately address the need for advancing technological expertise in value-added production, such as magnet manufacturing, where China also leads with 90%+ control worldwide. Without investing in domestic capabilities and infrastructure, not to mention serious technological innovation, the U.S. remains more than vulnerable, merely shifting dependence from one foreign source to another.

While the Strategic Minerals Act is perhaps a step in the right direction, it is emblematic of a broader pattern of U.S. legislation that offers surface-level solutions without tackling the deeper, systemic issues. To truly secure the nation’s future in critical minerals, a more aggressive, multifaceted strategy is imperative—one that prioritizes internal capacity building over external agreements. President Trump is the right personality to drive what is needed, but will anyone tell him the truth?

See the proposed bill (opens in a new tab).

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