The new “Project Vault” critical minerals stockpile launched by the White House and the U.S. Export-Import Bank is “absolutely” needed, but it represents just the first step of many to break China’s supply-chain dominance of minerals, including rare earths, over several years to come, industry analysts said.
The plans for the emergency national stockpile of certain critical minerals, announced Feb. 2, comes after the Trump administration already has taken the unusual step of making direct investments in several U.S. and Canadian critical minerals mining and processing companies over the past 10 months.
While supply-chain disruptions began showing up during the COVID-19 pandemic, the beginning of a tariff trade war with China last year triggered the “weaponization” of the dominance it had built up over several decades in critical minerals mining, processing, and magnet-manufacturing supply chains. Specific minerals, especially the 17 rare earths metals, are vital to manufacturing everything from military equipment to cars to high-powered computing and data centers, said Charles Boakye, energy sustainability and transition analyst at Jefferies.
“Is [Project Vault] needed? Absolutely,” Boakye told Fortune. “Will it be effective? I think we need to wait and see. The initial signs are definitely promising, but the bottleneck is not just the mining and sourcing; it’s also the processing. Even if the U.S. can stockpile many of these materials, how and who is going to do the processing depending on the end-use applications?”
