Guide outlines critical US mineral actions
- 4 March 2025
Douglas Adams’ fictional electronic guidebook for space travellers had, “Don’t Panic”, on the cover. Gracelin Baskaran and Duncan Wood’s 169-page tome, Critical Minerals and the Future of the US Economy, might have just gone with something shorter on the front of what is a survival guide for the world’s main economic and military power.
“The decisions that we make in the next couple of fiscal quarters are going to shape the next quarter century,” said Eric Palomaa, director of the Hess Center for New Frontiers at the Washington-based Center for Strategic and International Studies (CSIS), when he brought centre director Baskaran on stage to talk about the critical minerals book.
Baskaran and Palomaa were joined by Critical Minerals and the Future of the US Economy contributors, Rohitesh Dhawan, Frank Fannon, Adam Johnson and Dr Joseph Majkut, to talk about the book at a Washington launch. CSIS CEO John Hamre earlier admitted he wasn’t a critical minerals aficionado: “When I first heard the term I thought it was a boy band from Los Alamos or something.” But he knew why such a large crowd had turned up. “It’s because of the topic isn’t it?”
Palomaa said: “What we’re talking about today are the building blocks that will lay the foundation for the world that Gen Alpha and Gen Beta inherits. It’s going to define what the economic landscape looks like, what the energy landscape looks like, [what] the security landscape looks like.”
That landscape is currently unfamiliar territory (yet eerily familiar in some ways, according to Baskaran) for the US of A, outpointed at nearly every turn on “critical minerals” by China over the past 40 years. The book lays out the enormous consequences of that with pretty good word economy. Suffice to say its once great trading partner is now an “adversary” but then who isn’t at the moment?
“We don’t have anywhere near enough of most of the critical minerals [we need] so we are – my grandmother would have said – dependent upon the kindness of strangers,” US senator John Hickenlooper said at the event. The former Colorado governor (and geologist and brewer) is a Democrat and not a fan, it must be said, of Donald Trump’s tariffs. Except, he said, key suppliers of the critical minerals the CSIS book says the country needs “are not strangers”.
“They’re our allies. In many cases we’ve had long-standing relationships.”
On critical mineral objectives and bipartisanship and building the supply chains America needs to sustain industrial, technological and security advantages, Hickenlooper said there was “obviously a lot of work to be done”. And little time to do it.
“It’s one thing to agree on an end point. It’s another to get there as quickly as possible,” he said.
“My biggest concern continues to be … I don’t feel the sense of urgency. The temperature gets pretty hot in the senate but never anywhere close to boiling. Usually there’s a sense that, we'll get to it. And now we’re not going to get done this Congress but maybe the next Congress.
“[But] this is stuff that we should be … I mean, each month makes a difference.”
Baskaran said the US today was 100% dependent on imports for 12 of the 50 minerals identified by the US Geological Survey (USGS) as critical and more than 50% import reliant for a further 29 of these minerals. China was the top global producer for 29 of these critical minerals. “Furthermore, China has a stranglehold on minerals processing, refining between 40-and-90% of the world’s supply of rare earth elements, graphite, lithium, cobalt and copper,” she said.
“This dominance is the result of decades of minerals-centred domestic industrial strategy and foreign policy. China has repeatedly shown its willingness to weaponise these minerals. Over the last two years China has rolled out export restrictions, including complete bans, on antimony, gallium, germanium.
“The critical minerals most central to semiconductor production have high-risk supply chains largely concentrated in China. China produces 98% of the world’s refined gallium and controls 68% of refined germanium production, 79% of the world’s silicon, 40% of its arsenic trioxide and 67% of its titanium.”
The US, meanwhile, was reliant on imports to access the materials needed for high-performance semiconductors. In 2022 it produced no arsenic, no gallium, less than 2% of the world’s refined germanium, 3% of its silicon and less than 1% of its titanium. “The semiconductor industry is too central to US economic and national security to allow such an evident vulnerability in its supply chain,” Baskaran said.
“USGS has estimated that just a 30% supply disruption of gallium could cause a $602 billion decline in US economic output, amounting to a 2.1% loss of gross domestic product – a significant economic impact.
“Semiconductor supply chains will not be secure until the necessary mineral supply chains are secured.”
Baskaran said while geopolitical tension and war had spurred critical mineral policy changes to build secure supply chains for nearly a century, wider demand for minerals was driven by industrialisation, technological advancements, decarbonisation and economic growth. Now, for example, data centres that process AI applications could demand up to 200,000 tonnes of copper a year between 2025 and 2028, adding 2.6 million tonnes to a forecast world copper deficit in 2030.
Demand surges and causes were writ large in history, though. And history was repeating in other ways, Baskaran said. In 1939 US president Franklin D Roosevelt wrote to Congress expressing concern about low commercial stocks of minerals vital to fighting a war. In 1981 president Jimmy Carter was apparently deeply worried about US reliance on not only Soviet oil but also certain minerals “and this could pose a critical national security vulnerability”.
“We feel like we’re living in a new era but what we know is actually history is repeating,” Baskaran said.
“We need to do better this time.”
Douglas Adams’ The Hitchhiker's Guide to the Galaxy says it’s important to ask the right questions if you want to get the answers you are looking for and Principal Mineral CEO Adam Johnson had a few of his own when asked about America’s chances of competing, sometime soon, with China as a midstream critical mineral and metal production superpower.
He said: “Do we really have the will to compete? Do we really have a good plan?
“[One] thing we do really well [is] we build markets.
“We’ve sort of moved to the point where … we have decided to let other people do things like mining; let other people do things like industrials. And now we’re seeing ramifications of that. All of these amazing things that we want, going to Mars and having robots do our dishes and being able to communicate in real time so that we can work on the beach: that all relies on critical minerals.
“How on earth do we envision a society 20 years, 30 years, 40 years from now, where everything is robotic … if all of those robots are coming from our global adversary. I don't know if that's going to work out well. This is an existential issue.
“It is not just, what happens if there’s a thing in Taiwan and we have to get minerals for hypersonics in two weeks? That is a point, but it's not the point. The point is, all of our children and our children's children are going to be living in a world where people that we don't trust are selling us the stuff that we rely on that’s smarter than we are. That’s scary.”
Dr Majkut, director of the CSIS Energy Security and Climate Change Program, said 50 years of energy crises, technological change and various security threats had been met, so “why should we care?”
“We’ve gotten along relatively fine. Maybe there’s a kerfuffle about gallium for a few weeks but supplies reroute and then we get along okay.
“[But] the security issues here are not like those we face with oil or natural gas.
“We hear it from policy makers all the time – that we’re sacrificing our national economic sovereignty. We just don't have control of critical inputs into our economy and therefore political decision makers are completely powerless to help fix these problems because we’ve sort of created a non-strategic approach to how we manage these minerals.
“This is an entirely, I regret to say, untrodden intellectual area because the challenge that we now face is, you have got 50 critical minerals so which ones do we prioritise? How do we put relative effort across those: how do we set our priorities? How much are we willing to spend if it requires public capital to make these interventions, to set up concessional mining deals, to build processing units?
“I think these questions are some of the most important ones we face.”
