U.S. President Donald Trump is accelerating efforts to secure rare earth minerals from global allies as China continues to tighten its grip on critical supplies.
“In about a year from now, we’ll have so much critical mineral and rare earths, and you won’t know what to do with them,” Trump said Monday, unveiling an $8.5 billion agreement with Australia aimed at developing rare earth projects and guaranteeing U.S. access.
China currently controls over 90% of the global refined rare earths market, essential for technologies ranging from iPhones to electric vehicles. Beijing’s dominance has become a powerful tool in the ongoing U.S.-China trade tensions. Earlier this year, China imposed strict export controls, disrupting supply chains worldwide and triggering fears of economic fallout.
The U.S.-Australia partnership includes more than $3 billion in investments over the next six months, which the White House expects to generate $53 billion in critical mineral projects. The deal also includes a Pentagon-backed gallium refinery in Western Australia capable of processing 100 metric tons per year. Additionally, the Export-Import Bank of the United States is issuing letters of interest for over $2.2 billion in financing to support critical mineral projects.
Kevin Hassett, director of the White House National Economic Council, emphasized Australia’s role in reducing risk. “Australia’s role is instrumental in making the global economy less risky, less exposed to the kind of rare earth extortion that we’re seeing from the Chinese,” he said.
Australia, which holds the fourth-largest rare earth deposits globally and mines half the world’s lithium, has ramped up production in recent years. In May, Lynas Rare Earths became the first company outside China to produce commercial quantities of dysprosium oxide, a critical heavy rare earth element.
However, experts caution that the U.S. supply gap cannot be closed quickly. John Mavrogenes, an economic geology professor at the Australian National University, noted, “I don’t think that the rare earth supply issues can be solved in the short term, period. China is too far ahead of the world. We’d have to make an industry from scratch, and that takes a lot of dedication and long-term planning.”
Rick Valenta, director of the University of Queensland’s Sustainable Minerals Institute, said Australia has mining expertise but building downstream processing remains a challenge. “There’s a refinery being built in Western Australia now that’s targeting production of rare earths in 2027. We have a whole series of projects that are ready to go but needing that last round of financing support to get them across the line and into production,” he explained.
Trump’s announcement follows his push to diversify U.S. rare earth supply chains, with other countries, including Pakistan, also expressing willingness to provide critical minerals. While the deal with Australia is an important step, analysts warn that establishing a reliable supply chain for rare earths will take years of investment, planning, and infrastructure development.
