US rare-earths investment hits $7.6B as Trump builds China-free supply chain

Defense contractors face 2027 deadline to drop Chinese metals

The Trump administration is leading a multi-billion-dollar, governmentwide effort to loosen Beijing’s grip on critical minerals, and the investment is slowly starting to yield results. U.S. government nonequity investment in rare-earths and magnet projects grew to $7.6 billion over the 18 months ending June 2026, more than four times the amount committed between 2020 and 2024, according to an analysis by the Center for Strategic and International Studies.

The effort moved into high gear after April 2025, when China imposed export controls on key rare-earth elements. By that point, President Trump had already declared the lack of a domestic supply a national emergency. Current and former government officials and mineral experts described the push as one of the most comprehensive, sustained, and focused efforts by the second Trump administration to onshore an essential U.S. supply chain.

The initiative spans the departments of Defense, Energy, State, Commerce, and Interior, as well as new offices and two government banks, much of it coordinated by the White House National Security Council. A White House official said the administration has completed more than 180 critical-minerals-related projects since Trump took office for the second time, though projects still must clear due diligence and meet conditions before receiving funding.

Critical minerals are crucial to the manufacturing of defense, transportation, energy, and computer systems, and they underpin AI and weapons development. Before the mid-1990s, the United States was a global leader in rare-earths production. “It took us 30 to 35 years to lose industrial capacity,” said Tomasz Nadrowski, author of “Mineral War: China’s Quest for Weapons of Mineral Destruction.” Experts told the Journal it will take at least a decade to escape China’s chokehold.

By next year, U.S. defense contractors will be required to eliminate from their supply chains certain metals sourced from adversary countries including China. Many contractors say the requirement is not feasible despite the progress being made. Some Pentagon officials say they are aiming for a “closed loop” of U.S. and allied supply chains for some minerals by 2030. A Pentagon spokesperson declined to comment on specific transactions but said the department’s “priority is securing the end-to-end supply chain for minerals critical to national security.”

In April, Deputy U.S. Trade Representative Rick Switzer said that with help from Japan and Europe, the United States has the capacity to develop an end-to-end critical-minerals supply chain free of China within six to 12 months, if the country were pressed to do so. Recent projections from CRU, a London-based commodities-data provider, show China losing market share by the end of the decade in many of the elements and minerals it had most tightly controlled.

The administration’s push extends well beyond U.S. borders. The United States has struck more than two dozen agreements with countries for mineral development, including a deal with the Brazilian state of Goiás for a rare-earths mine that a U.S. company purchased with Trump administration backing, cooperation on mining and processing in Kazakhstan, and a deal giving the United States long-term access to mining production in the Democratic Republic of the Congo in exchange for security of mineral reserves. Additional agreements cover stockpiling, trade policy, and financial-support mechanisms, with commitments of at least $1 billion for mining and processing projects.

A new State Department-led initiative called Pax Silica coordinates minerals production with U.S. allies such as Greece and Israel. Other nations targeted by China’s export controls, including Japan, are also taking steps to erode Beijing’s dominance, but the United States has done perhaps the most to scramble the global order, according to industry experts cited by the Journal.

Senior Trump officials discussed rare-earths exports with their Chinese counterparts ahead of Chinese leader Xi Jinping’s recent visit to Washington, and China agreed to extend until January a truce to provide minerals to the United States. The administration has also encouraged private investors to join the minerals boom. Among them, President Trump’s sons, Eric Trump and Donald Trump Jr., have deals with companies that the administration has backed.