[CW14] Rare Earths, Real Wars: The U.S.-China Tariff Tangle and the Global Scramble for Critical Minerals
Welcome to This Week in Critical Minerals — where subterranean resources increasingly dictate the dynamics of geopolitics, markets, and corporate strategies.
If semiconductors were once considered the "new oil" of the 21st century, rare earth elements (REEs) are rapidly emerging as the linchpin of modern technological advancement.
This week witnessed a significant escalation in the ongoing trade tensions between the United States and China. The U.S. imposed a fresh round of tariffs on Chinese imports, prompting a calculated and strategic retaliation from Beijing, specifically targeting rare earth exports. This move underscores a shift from conventional economic disputes to a more intricate form of supply chain warfare, where elements from the periodic table become instruments of geopolitical leverage.
Let's delve into this complex interplay of politics, economics, and the critical materials fueling the global clean tech revolution.
Chapter 1: The U.S.-China Tariff Tangle
Geopolitical Earthquakes: U.S. Tariffs and China's Rare Earth Retaliation
In the intricate chess game of global trade, the U.S. and China have positioned critical minerals at the center of their latest confrontation.
U.S. Initiates Tariffs: President Donald Trump announced a substantial increase in tariffs on Chinese goods, elevating levies from 20% to an unprecedented 54%, effective April 9, 2025. This aggressive move aims to address trade imbalances and assert economic dominance.
China's Strategic Countermeasure: In response, China implemented a uniform 34% tariff on all U.S. imports, commencing April 10. Beyond these tariffs, Beijing has wielded its dominance over critical minerals as a strategic tool, imposing stringent export controls on rare earth elements essential for advanced technologies.
A Growing List of Restricted Minerals
China's strategic maneuver includes an expanding roster of minerals under export restrictions:
Rare Earth Elements: Effective April 4, 2025, China imposed export controls on seven categories of medium and heavy rare earths, including samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium-related items. These materials are vital for missile-defense systems, submarines, and F-35 jets. Exporters must now seek government approval, granting Beijing significant influence over global supply chains
Gallium and Germanium: In December 2024, China banned exports of gallium and germanium to the U.S. These elements are crucial for semiconductors and fiber optics, directly impacting U.S. tech industries
Antimony: Also in December 2024, China prohibited the export of antimony to the U.S. This metal is used in semiconductors and military applications. The export ban has propelled antimony prices to unprecedented levels, with reports indicating a surge to $39,500–$40,000 per metric ton by the end of 2024 — a staggering 250% increase from earlier in the year
Tungsten, Tellurium, Bismuth, Indium, and Molybdenum: As of February 2025, these five critical metals have been placed under export controls, requiring licenses for overseas shipments. These materials are vital for defense, clean energy, and various high-tech applications
Market Turbulence: The Ripple Effects
The immediate aftermath of these developments has been tumultuous:
Stock Market Decline: Major indices like the Dow Jones plummeted over 2,200 points, with the S&P 500 and Nasdaq dropping nearly 6%. Companies such as Apple, Nike, and Amazon brace for increased production costs
Agricultural Impact: U.S. farmers face mounting losses as China suspends imports from select poultry suppliers, citing banned substances
Technological Disruption: The semiconductor industry, already reeling from supply chain disruptions, confronts further challenges due to restricted access to essential Chinese minerals
Critical Minerals meltdown: the opportunity we were looking for? (graph is not pretty — below)
Reading Between the Lines
Exposed Supply Chain Vulnerabilities: China's calculated restrictions have illuminated the fragility of global supply chains, particularly for nations heavily reliant on Chinese exports. Industries spanning defense, electronics, and renewable energy now face the daunting task of securing alternative sources for these critical materials. The immediate impact is a surge in prices and a scramble to diversify supply chains — a wake-up call for policymakers and industry leaders alike.
Strategic Stockpiling and Policy Shifts: In response to these disruptions, countries are likely to accelerate efforts to bolster domestic production and processing capabilities. The U.S., for instance, may revisit and revitalize its critical minerals strategy, emphasizing the need for self-reliance and resilience in the face of geopolitical uncertainties.
Global Alliances: The actions of the U.S. and China may also prompt a realignment of global alliances, with affected nations seeking to forge new partnerships to mitigate their dependence on Chinese minerals. This could lead to increased collaboration among countries rich in these resources, potentially reshaping the geopolitical landscape.
Looking Ahead Considerations
For stakeholders across the spectrum — from investors to policymakers — the mandate is clear: adapt swiftly, innovate relentlessly, and strategize proactively to navigate the complexities of this new era.
Key Questions:
How will emerging markets position themselves in this shifting landscape?
How can international collaborations be leveraged to create more resilient supply networks?
What role will technological innovation play in mitigating supply chain risks?
To what extent do policy and government support the private sector in balancing the scales and reducing supply chain vulnerability? (Recap: China is 30–40 years ahead in the rare earths game)
Chapter 2: Global Scramble for Critical Minerals (last but not least)
The Battery Revolution Isn’t in the Ground — It’s in the Lab
While the global elite pour money into rocks, some of the most disruptive action is happening above ground — in the lab.
This week, the University of Surrey dropped a game-changing battery recycling tech: microbial electrochemical recovery that gets 95% of lithium out of used EV batteries. That’s up from today’s average of... 5%.
Let that sink in, 95% against current 5%.
This breakthrough from the BELIEVE project (yes, that’s the actual acronym — scientists do have a sense of humor) could redefine resource security. Instead of chasing new lithium mines, we might just harvest old Teslas.
Meanwhile, Porsche launched its own battery circularity program, recycling cobalt, nickel, and lithium from used packs — a nod to the fact that the future of minerals might be more about recovery than discovery.
Africa Rising: Bezos, Gates, and the Billionaire Mining Bet
While Washington and Beijing played tariff ping-pong, two of America’s richest decided to go digging. Literally.
KoBold Metals — the AI-powered mining startup backed by Gates and Bezos — announced a $537 million investment in Africa’s rare earth and battery metal deposits. The flagship project in Zambia is slated for production by 2030 and aims to fast-track mineral development with digital geology.
What makes this interesting isn’t just the scale. It’s the strategy: partner with governments, promote local processing, and beat China at its own game — creating not just mines, but value chains.
This isn’t old-school colonial extraction. It’s geopolitics with an ESG filter.
Greenland’s Billion-Dollar Bet: Tanbreez Drops Its PEA
In calmer but equally seismic news, Critical Metals Corp dropped the long-awaited Preliminary Economic Assessment (PEA) for its Tanbreez rare earth project in Greenland — and it’s a blockbuster. A $3B NPV with a 180% IRR based on just 1% of the deposit? That’s not a typo (at least it’s what they are saying). If true, that’s a signal flare.
The deposit has scale, access, and (relatively) low environmental baggage. It’s got deep-water port potential and sits under a mining license good till 2050. For Western governments desperate for non-Chinese rare earths, this is a tantalizing prospect.
But here's the rub: high IRR projects in the Arctic sound great until the weather hits and the ice gets political. Let’s just say that “logistics” in Greenland is code for “pray it doesn’t snow sideways all year.”
Meanwhile in America: Permitting Purgatory and Political Theater
On U.S. soil, it was another week of whiplash.
President Trump (yes, he’s back in the news again) signed an executive order to boost domestic mineral production — fast-tracking permits and invoking the Defense Production Act. The new National Energy Dominance Council will supposedly fix America’s glacial approval timelines.
Translation? Less red tape, more red earth.
But let’s be real: executive orders don’t move bulldozers. Until permitting reform becomes more than political wallpaper, the U.S. remains an ambitious miner with no shovel.
The Other Contenders: Canada, Serbia, Texas & the Great Domestic Pivot
Canada made fresh waves with its critical minerals strategy — again. With a $4B federal push and rising junior exploration activity, the country’s trying to build a vertically integrated supply chain. But the jury’s still out on whether the provinces can play nice with Ottawa’s green ambitions.
Meanwhile, Serbia continued its lithium charm offensive in Europe, aiming to become the continent’s battery heartland. And Texas? It’s fighting over who owns lithium in produced water. Yes, oilfield brine is now a potential goldmine — legally and chemically.
This is the new mineral arms race: everyone wants a piece of the periodic table.
A controversial week, with impacts yet to come
Stay ahead with Critical Minerals Journal — where insight meets impact.