The U.S. Critical Minerals Dilemma: What to Know

In 2022, the U.S. government identified fifty minerals considered critical to the U.S. economy and national security. These minerals, such as cobalt and lithium, play essential roles in a variety of industries, including energy, defense, health care, and transportation. Yet despite their strategic importance, the United States remains heavily dependent on foreign imports for the majority of them. 

China, in particular, is a top source, dominating refining capacity for cobalt, graphite, and rare earths. This kind of concentration of control has raised alarm in Washington, where the Donald Trump administration has sought to reduce U.S. reliance on overseas supply chains that experts say leave the United States vulnerable. In addition to promoting domestic extraction, the administration is applying diplomatic and economic pressure to expand U.S. access to critical minerals.

What are critical minerals and rare earth elements?

The U.S. government defines critical minerals as nonfuel minerals or materials that are essential to the country’s economic or national security and whose supply chain is vulnerable to disruption—this could be because of limited availability, lack of domestic production, or geopolitical risks. (The U.S. Geological Survey, or USGS, is required to update its list of critical minerals at least every three years.) Many of these minerals are crucial for a range of commercial industries, including automotive, aerospace, and technology, as well as military capabilities.

Among the most important are a group of seventeen metals known as rare earth elements (REEs). Despite their name, REEs are quite abundant in the Earth’s crust, but they are not typically found in concentrated deposits, making their extraction difficult.

Where does the United States source its critical minerals?

According to the 2025 USGS report [PDF], China supplies more than 50 percent of U.S. demand for twenty-one nonfuel mineral commodities—naturally occurring materials typically extracted via mining, such as copper and iron. Canada also supplies twenty-one such minerals, followed by Germany (eleven); Brazil (ten); and Japan, Mexico, and South Africa (seven, each). Data also shows that the United States is 100 percent import-dependent on twelve minerals classified by the U.S. government as critical, and more than 50 percent import-dependent on twenty-eight additional minerals.

Globally, China dominates the critical minerals supply chain. The Bayan Obo mine in Inner Mongolia—an autonomous region of China—is the world’s largest known REE deposit and a cornerstone of China’s rare earth industry. Experts attribute Beijing’s dominance in the critical minerals sector to decades of government support and strategic investment in building out the country’s extraction, processing, and refining capabilities.

Besides China, what other countries have significant critical mineral deposits?

In addition to China, several countries possess substantial deposits. In South America, the so-called Lithium Triangle countries of Argentina, Bolivia, and Chile together hold approximately 50–60 percent of the world’s known lithium, a vital component in electric vehicles and batteries. In Africa, the Democratic Republic of Congo (DRC) is home to the world’s largest reserves of cobalt and coltan, as well as substantial copper and gold deposits. Ukraine also has its own considerable resources, holding an estimated 5 percent of the world’s total critical mineral deposits, including one of Europe’s largest lithium reserves. Other mineral-rich countries and territories include Brazil, Canada, Greenland, India, Indonesia, Russia, South Africa, and Zambia.

How are President Trump’s trade and economic policies affecting access to critical minerals?

The Trump administration is again framing critical minerals as a national security priority, using trade and economic tools—namely tariffs and regulatory action—to secure U.S. access. In April, the administration launched a Section 232 investigation into processed critical minerals imports and their derivative products to determine whether to levy tariffs to protect U.S. supply chains. (A final decision is expected in mid-October.) 

Although the administration has not imposed tariffs on critical minerals under the probe, it has imposed Section 232 tariffs on other materials such as aluminum, copper, and steel. In response to Trump’s initial round of 10 percent tariffs on Chinese goods in February, China restricted exports of five critical minerals to the United States, raising concerns about price increases and supply chain disruptions. Then in April, as part of his “Liberation Day” tariff package, Trump announced duties on several major mineral importers, including Argentina, Australia, Brazil, and Peru. Several targeted countries imposed reciprocal tariffs on the United States, and China further expanded export controls to include more strategic REEs and magnets.

China’s retaliation isn’t new, but experts say countries have been slow to adapt. In 2010, for example, China cut off certain mineral exports to Japan following a territorial dispute over the Senkaku Islands—known in China as the Diaoyu Islands—triggering global price spikes and raising concerns over supply chain vulnerability. “China’s willingness to cut off exports of critical minerals has made it imperative for the United States and its allies to build safer sources of supply,” CFR expert Jonathan Hillman said.

While Trump announced in June that China had agreed to resume exports of rare-earth minerals and magnets to the United States, experts say that future tensions could again trigger restrictions. “The geology itself is geopolitical, and the tariff policies are a challenge,” CFR expert Heidi Crebo-Rediker said. “There’s basically a trust deficit now because there are a lot of the tariffs that are still being used without a lot of clarity as to what the ultimate objective is.”

What other options is the Trump administration pursuing?

Under Trump, and previous administrations, the United States has sought to diversify its critical mineral supply chains to reduce its dependence on foreign imports. Some alternatives include:

Boosting domestic production. In March, Trump issued an executive order calling on federal agencies to “facilitate domestic mineral production to the maximum possible extent.” To do so, the order invokes the Defense Production Act, which gives the president broad authority to direct industrial production for national security reasons; broadens the definition of “minerals” to include copper, gold, potash, and uranium; and expedites permitting for mining projects on federal lands that hold deposits of critical minerals. It also establishes a list of priority mining and energy projects under the National Energy Dominance Council, which Trump created in February, to centralize and expedite the administration’s energy agenda. Trump followed up with another executive order in April establishing a framework for U.S. companies to identify and retrieve offshore critical minerals and resources.

But experts say that ramping up domestic production will not be easy. While the United States produces some critical minerals domestically, such as aluminum and zinc, it does so in limited quantities. The country only has one active rare earth mine—in Mountain Pass, California—and otherwise lacks sufficient infrastructure to refine critical minerals at the scale needed to meet domestic demand.

In July, the Defense Department announced a $400 million investment in Las Vegas-based MP Materials, which owns the mine. “If this deal succeeds, it may offer an expanded playbook for other strategically important areas that are not receiving enough private investment,” Hillman said.

By 2030, the United States is projected to hold less than 2 percent of the global critical minerals market, compared to China’s 31 percent.

Pursuing “friend-shoring.” Another option is to seek out trade agreements with friendlier or ally nations with known critical mineral reserves. This includes Ukraine, which the Trump administration signed an energy and critical minerals agreement with in May 2025. The pact gives the United States preferential access to new Ukrainian minerals deals and establishes a joint investment fund that will be used to aid the country’s postwar reconstruction. By linking its economic security future to the United States, “Ukraine could prove that they were not a burden, but they were an investment opportunity,” said Crebo-Rediker.

The Trump administration has adopted this approach with several other countries. In June, the United States brokered a peace deal between the DRC and Rwanda, aimed at ending decades of conflict in eastern Congo. The deal opens up the prospect of U.S. investment in the DRC’s critical minerals sector. The following month, the United States signed a landmark critical minerals initiative with its Quad partners—Australia, India, and Japan—committing to collaborate on securing and diversifying supply chains to reduce shared dependency on China. A Group of Seven (G7) critical minerals action plan released at the bloc’s summit in June seeks to do the same.

But while “friend-shoring” promotes economic cooperation among countries, it still requires that countries trust each other. “There’s basically a trust deficit now because there were a lot of tariffs levied against our closest friends and allies—agreements torn up—especially with countries rich in those critical minerals and metals the United States requires,” said Crebo-Rediker. Even so, “anything that moves the ball forward beyond rhetoric is helpful,” she said. “I just think we have to be far more urgent about how we as a country are addressing this challenge.”

Michael Bricknell made the map for this article.