Cooperation with Canada is Essential for the United States to Free Itself from China’s Grip on Critical Minerals  – Canadian Mining Magazine

By Lewis Black, Chairman, President and CEO, Almonty Industries 

The challenge of securing reliable access to critical minerals has become acute just as the incoming Trump administration prepares to assume office in the United States. The United States faces the dual challenges of reducing dependence on China for vital minerals and the urgent need to strengthen its domestic industrial base, two challenges made more difficult by China’s export controls and bans. Successful policies addressing these challenges will have to balance self-sufficiency in American mining and mineral refining with a sober evaluation of the limits of what the United States can do alone.  

While President-elect Donald Trump’s offhand comments about Canada becoming a US state sparked an angry reaction, that rhetoric and the reaction are sure to fade. Neighbors often squabble but they invariably band together when the neighborhood is threatened, and China’s domination of the global supply of critical minerals is a threat to us all. The reality is that securing reliable supplies of essential minerals will be difficult for the United States to achieve without Canada, a long-time ally, trading partner, NATO founding member, and trusted neighbor. 

Tariffs as a policy lever 

Tariffs have long been a favored tool in United States’ trade policy, particularly under the first Trump administration. The Biden Administration has imposed tariffs on critical mineral imports from China, which the Trump Administration can leave in place or ratchet up or down as it sees fit. Trump’s proposed expansion of tariffs – potentially imposing baseline rates of 10 per cent on all imports and up to 60 per cent on Chinese goods – would incentivize production and refining of critical mineral in both the United States and the nations it has trade agreements with to supply key sectors like defense and green energy. 

However, tariffs on imports from Canada are another matter entirely. Canada is a critical supplier of uranium, potash, and nickel – resources the United States cannot feasibly source domestically. Alienating allies through aggressive trade policies risks undermining existing supply chains and fracturing the cooperative frameworks essential to counterbalance China’s dominance. A better approach would be to grant tariff exemptions or preferential treatment for Canadian and allied imports to both strengthen strategic alliances and achieve economic goals. 

Streamlining Domestic Mining Regulation 

The incoming Trump administration can advance mining projects in the United States by removing the regulatory and permitting bottlenecks that delay development. Permitting delays in the United States routinely stretch the timeline for new mines to over a decade. Both Canada and Australia, two large mining nations with environmental laws and policies on par with the United States, have national mining agencies to coordinate mining regulation. The Trump administration could establish a streamlined federal permitting process under a renewed Bureau of Mines to ensure that projects critical to national security move forward efficiently. 

Financial incentives, such as grants and concessional loans, would further stimulate domestic production. The Defense Production Act (DPA) and programs like Title 17 and the Advanced Technology Vehicle Manufacturing (ATVM) program already offer significant untapped potential for supporting domestic mining and refining projects. 

Expanding the National Defense Stockpile through DPA funds, with a focus on ready-to-use materials like tungsten powder and rare earth magnets, would bolster supply chain resilience. The bipartisan Critical Minerals Policy Working Group, led by Rep. Rob Wittman, R-VA, and Rep. Kathy Castor, D-FL, has proposed a comprehensive legislative package that would supercharge American efforts to wean itself from China for vital metals. It is worth noting that China, despite its vast minerals mining and refining capacity, is furiously stockpiling those minerals. 

But no amount of money or policy flexibility can change geology. No nation, even one as large as the United States, contains every mineral required for a modern economy. Collaboration with allies, particularly Canada and South Korea, but also the African nations China is wooing with its Belt-and-Road initiative, is necessary to secure minerals, such as tungsten, cobalt, graphite, and rare earth elements, that either are not found in the United States or not currently mined. Strengthening bilateral agreements with allies would facilitate joint exploration, data sharing, and development of transparent supply chains. 

For Canada in particular, the U.S.-Canada supply chain integration under the USMCA provides a robust framework for mutual benefit. By refraining from tariffs on Canadian imports and instead deepening trade and infrastructure ties, the second Trump Administration could enhance supply chain security and maintain good neighborly relations. 

My own company, Almonty Industries, is a prime example. We recently completed a decade-long project to renovate the Sangdong tungsten mine in South Korea. Completion of the mine renovation coincided with the United States imposing tariffs on tungsten from China and with China banning tungsten exports to the United States. Sangdong is the largest tungsten mine in the world, and while we cannot match China’s total production, the strategic importance of a large, secure tungsten supply simply cannot be overstated. 

Addressing China’s dominance 

China’s recent escalation in the tech trade war – including export bans or stringent export controls on tungsten, gallium, germanium, antimony, and other critical minerals – underscores the urgency of reducing reliance on adversarial supply chains. These minerals are indispensable for defense technologies, semiconductor production and the energy transition. China’s control over their global supply is a significant vulnerability for the United States. 

A multipronged, all-of-the-above strategy is the only effective way to counteract the Chinese Sword-of-Damocles hanging above America and the West. Expanding investments in recycling and substitution technologies, such as battery material recovery and alternative semiconductor materials, can reduce dependency on raw imports. 

Placing tariffs on adversarial imports, fostering domestic mining, and collaborating with allies are complementary policy tools. While tariffs shield domestic industries, expedited permitting and funding initiatives are essential to building the capacity needed for American self-sufficiency. Similarly, international cooperation with allies ensures access to resources unavailable domestically without alienating key partners. 

Navigating public messaging 

The income Trump administration must communicate its critical minerals policy carefully. Publicly emphasizing tariffs as a tool against adversaries, rather than allies, would demonstrate a commitment to fair trade practices while highlighting the need for secure supply chains. Reassuring Canada of its strategic importance to the United States’ supply chains is merely acknowledging reality. Whatever the rhetoric of the moment, the Trump administration’s messaging should underscore the importance of allied collaboration to counterbalance China’s influence and secure shared prosperity. 

President Trump faces an urgent imperative to secure critical mineral supply chains in the face of rising global competition and geopolitical tensions. By leveraging a balanced mix of tariffs, domestic incentives, and international collaboration, the United States can fortify its industrial base while preserving vital alliances. Canada is a key partner in this endeavor. Maintaining a cooperative approach with allies, and particularly a friendly neighbor with whom the US has fought side-by-side, is critical to achieving long-term resilience and security in critical mineral supplies. 

In navigating these challenges, the administration must wield its policy tools with precision, ensuring that efforts to achieve mineral independence strengthen rather than disrupt the broader economic and geopolitical landscape.