US Critical Minerals Supply Chains: Allegiance or Alliance?

Catherine Maltman | United States Fellow

Image sourced from Clint Budd via Wikimedia Commons.

The critical minerals supply chain, though not as visible or public-facing as global conflicts, might be the most concerning national security issue faced by the United States (US). Every country is struggling to meet the increasing demand for critical minerals (CMs), with estimates that demand could more than double by 2030 and outpace supply chains. With private investment mostly driving the critical minerals sector, government intervention is essential to establishing a balance between supply and demand.

Ensuring the US’ long-term access to these CMs must start with greater public sector investment to bolster domestic CMs manufacturing, but cannot stop there. The US must acknowledge that the global supply chain is interdependent – that all roads in the supply chain lead through one another – and account for this by diversifying through strategic trade and investment.

Domestic Resource Limitations and Growth

While countries have increasingly recognised the importance of CMs over the last century, strong import markets masked longer-term domestic vulnerabilities and slowed meaningful action. As a result, prior to the 2010s, CMs played a limited role in the domestic policy agenda of many countries, especially the US. While countries such as China saw an investment opportunity, seizing over 90 per cent of the market, others were slow to progress domestic capabilities and classify these minerals as ‘critical’.

By defining a mineral as ‘critical’ only once insecurity was perceived, the US failed to anticipate vulnerabilities in advance, leaving them already on the back foot as supply chains faced greater pressure. Over time, this has both contributed to and intensified pressures stemming from limited domestic extraction and deposit stores, growing reliance on critical minerals for vital markets, and restricted trade options.

Under Executive Order 13817, President Trump pivoted the US’ import-reliant strategy, directing agencies to focus on technological development and topographical exploration, later decreeing that US economic and military strength cannot depend “on foreign adversaries”. Coupling his strategy reorientation with the recently imposed tariffs sets the stage for further diversification and reduced reliance on foreign actors, especially those posing national security threats. 

Although domestic steps are important to ensure the US’ access to minerals is not destabilised by global conflicts, state-based threats, and trade wars, the US has a long way to go domestically before reaching CMs sovereignty. US production of some minerals has idled, others are oversaturating the market, and 12 mineral commodities still rely on 100 per cent net imports. Most of the world’s cobalt comes from the Democratic Republic of the Congo, Australia is the major source of lithium, and Ukraine is home to five per cent of the world’s rare earth deposits. While Trump would prefer an America independent from a reliance on other countries and boasting a strong manufacturing and processing market, he cannot ignore the role those countries will play in accounting for shortcomings in US production, and should look towards the stability provided by allies.

Import Necessities and Allied Opportunities

A more resilient trade agenda can fill the gap in the domestic sector in the US and ensure that private sector investment in foreign projects is supported. Perversely, Trump’s domestic agenda may be compromising the possibility of stronger strategic trade negotiations by failing to differentiate between allied potential and the foreign risk posed by adversarial or unstable nations.

Although a critical minerals deal has now been signed, earlier negotiations between the US and Ukraine could have seen a long-sought agreement where the US took a direct ownership stake in Ukraine’s CMs industry, providing the US with an ongoing access point for these essential minerals. Instead of focusing on those CMs benefits and access, the original deal was used as a means for the Administration to negotiate broader geopolitical tensions around the war with Russia, a position so unpopular in the eyes of Ukraine that it ultimately undermined the deal's negotiations and progression. 

Similarly, during recent tariff negotiations, the Trump Administration rejected a proposal to trade Australia’s critical minerals for a waiver of the now-imposed tariffs on their domestic goods. With key critical trading partners – especially China – reconsidering elements of their relationship with the US due to the new tariffs, and Trump further probing tariffs on critical minerals imports, negotiations to protect the future of US industry have never been more uncertain, yet necessary. 

Trump has been intent on his broader domestic and presidential goals, neglecting to recognise that both Australia and Ukraine present a compelling opportunity: strengthening trusted allies’ economies to further diversify US supply chains and domestic reliability. A more coordinated approach to these partnerships, including trading off on some agenda items for strengthened critical minerals agreements, ensures mutual economic and security benefits, balancing the US domestic agenda with its need for stable, diversified supply chains.

Diversification: An Allied and Domestic Future

‘Critical’ is not just a category of resources – it’s a warning. The US Government knows their importance, defining critical minerals’ nature as “essential to the economic or national security of the United States”. Although domestic production should be a strategic goal for the US, it cannot avoid the need to protect strategic relationships, both for trade and private sector investment in foreign mining projects. A coordinated, ally-driven approach can ensure the ‘critical’ nature of these minerals is not felt across their key industries while they pursue domestic diversification, and that the US will meet the rising demand and remain competitive and resilient into the future.

Catherine Maltman is the United States Fellow for Young Australians in International Affairs. She holds a Bachelor of Arts, a Master of International Relations, and a Master of International Law from the University of Western Australia. Passionate about U.S. politics and international affairs, Catherine is eager to contribute to discussions about the United States' evolving role on the global stage under the incoming administration, particularly its implications for security and trade.