Trump Launches $12B Critical Mineral Reserve

A new $12B federal critical mineral reserve aims to curb U.S. reliance on foreign suppliers for lithium, cobalt, and rare earths, securing supply chains for key industries.

Former President Donald Trump has announced the launch of a $12 billion federal initiative to establish a national critical mineral reserve. The program, formally called the Strategic Mineral Security Initiative (SMSI), is designed to drastically reduce U.S. dependence on foreign suppliers  primarily China for minerals essential to defense, technology, and clean energy sectors.

The initiative will use a mix of government-backed financing, long-term purchase agreements, and partnerships with private mining and recycling companies to acquire and stockpile minerals like lithium, cobalt, graphite, and rare earth elements. The stated goal is to create a buffer against geopolitical supply shocks and market manipulation, thereby protecting domestic manufacturing for batteries, semiconductors, permanent magnets, and aerospace components.

"This reserve is about economic security and national security. We will no longer be held hostage by foreign cartels for the materials that power our modern economy and military," President Trump stated at the signing event. The program falls under executive authority via the Defense Production Act, with initial funding drawn from reallocated departmental budgets and a forthcoming supplemental request to Congress.

The SMSI will operate through a new office within the Department of the Interior, which will identify priority minerals, manage stockpile acquisition, and coordinate with the Department of Defense and Department of Energy on release protocols. A key component is the "Mining Finance Corps," a public-private partnership that will provide loans and guarantees to spur the development of new domestic mining and processing projects.

Industry response has been broadly positive but cautious. "This is a monumental signal to the market to invest in domestic supply chains," said the CEO of a U.S. lithium development company. However, a policy analyst noted, "The success hinges on navigating complex permitting processes and environmental reviews that have historically stalled U.S. mining projects. Financing is one piece; operational speed is another."

Critics argue the stockpiling approach could distort global markets and that greater investment should flow directly into recycling innovation and material substitution research. Proponents counter that a physical reserve is a necessary, immediate deterrent to supply coercion while longer-term solutions scale.

The first acquisition targets are expected to be cobalt and rare earth permanent magnets, with initial contracts to be announced within the next quarter.