"We won’t be caught out by China again"…US to pour $12bn into stockpiling rare earths

US launches ‘Project Vault’…mineral war intensifies

Securing key raw materials such as lithium and copper

Target: stockpile 60 days’ worth within the US

Investment from 10 companies including GM and Google

Priority supply to members in an emergency

The Donald Trump administration has officially launched a $12 billion (about ₩17.4 trillion) mineral stockpiling project, aimed at countering China’s dominance in global minerals. The goal is to stabilize supply chains for critical minerals such as rare earths—essential for manufacturing advanced weapons, computers and mobile phones.

◇ Stockpiling targets include lithium, copper and rare earths

On the 3rd (local time), President Trump announced ‘Project Vault’ at the White House, under which critical minerals such as rare earths will be procured and stored for US manufacturers. Rare earths are scarce metals found underground and are indispensable inputs used across a wide range of applications—from advanced industries such as smartphones, EV batteries, semiconductor polishing agents and petrochemical catalysts to defense industries including fighter jets and missiles. The core of the project is to stockpile roughly 60 days’ worth of key minerals within the US to cushion against supply shocks originating in China.

Funding totaling $12 billion will be deployed, including $10 billion in long-term loans approved by the Export-Import Bank of the United States and about $1.67 billion in private capital. Commodity suppliers such as Hartree Partners, Mercuria and Traxys will purchase and source essential raw materials—including lithium, copper and rare earths—from global markets. Stockpiled minerals will be supplied on a priority basis to member companies participating in the project in the event of an emergency. More than 10 major companies, including General Motors (GM), Stellantis, Boeing, Google and Lockheed Martin, have signaled their intent to participate. Members can make initial commitments to purchase minerals at designated inventory prices and may also submit a preferred minerals list to Project Vault.

The US already operates a national-level ‘critical minerals stockpiling program’ for the defense industry, but it has lacked a stockpiling system aimed at private manufacturers. The White House emphasized that “this plan to strengthen supply-chain security will reduce dependence on foreign supply chains and bolster the domestic industrial base.”

◇ China accounts for 69% of global rare-earth production

While the White House did not specify, analysts say the “foreign supply chains” referenced are aimed at China. As it fought a trade war with the US in April last year, China placed seven rare earths needed for advanced manufacturing on an export-control list and imposed export licensing requirements. Under an agreement reached at the US-China summit in late October last year, China agreed to suspend rare-earth export controls for one year. Even so, US companies have continued to face significant difficulties due to China’s rare-earth controls.

China dominates global rare-earth production as well as refining and processing. According to the US Geological Survey, China accounted for 68.5% of global rare-earth output (as of 2024), ranking first by a wide margin. President Trump said that day, “We don’t want to go through what we went through a year ago ever again.” He added, “Just as we have long operated the Strategic Petroleum Reserve (SPR) and stockpiled critical minerals for defense, we will now secure a reserve for US industry to prevent problems from arising.”

The Trump administration is also pushing to diversify supply chains to counter China’s “weaponization of rare earths.” Last year, it signed cooperation agreements on critical minerals with resource-rich countries including Ukraine, Australia and Malaysia. It is also accelerating mine development within the US. Last month, the US Department of Commerce announced it would invest up to $277 million in rare-earth producer USA Rare Earth and provide a $1.3 billion loan package. In return, the US government is set to hold 17.6 million shares, including the company’s stock and warrants.

Reporter Kim Dong-hyun 3code@hankyung.com