EXPLAINEREconomy|Business and EconomyWhat is the US strategic minerals stockpile?President Donald Trump said the stockpile would ‘ensure that American businesses and workers are never harmed by any shortage’.
The United States has announced the establishment of a strategic minerals stockpile named Project Vault. This initiative involves $2 billion in private investment alongside a $10 billion loan from the US Export-Import Bank. The project aims to secure…
The United States has announced the establishment of a strategic minerals stockpile named Project Vault. This initiative involves $2 billion in private investment alongside a $10 billion loan from the US Export-Import Bank. The project aims to secure rare-earth minerals essential for manufacturing semiconductor chips, smartphones, and electric vehicle batteries.
In 2025, the US government acquired equity stakes in seven companies by converting federal grants into ownership. Key investments include:
A 10% stake in USA Rare Earth to develop rare-earth element and magnet production facilities, funded by $1.6 billion under the CHIPS Act. A 10% stake in Korea Zinc for a $7.4 billion smelter in Tennessee, with operations set to begin in 2029. A $35.6 million investment in Trilogy Metals to support the Upper Kobuk Mineral Projects (UKMP) in Alaska. A 5% stake in Lithium Americas for the Thacker Pass lithium mine in Nevada. A 10% stake in Intel to support domestic semiconductor manufacturing. A 15% investment in MP Materials, the only active rare-earth mine in the US.
Following the announcement of the stockpile plan, there was a mixed response in the market. MP Materials and Intel saw a rise of 0.6% and 5%, respectively, whereas Lithium Americas, Trilogy Metals, USA Rare Earth, and Korean Zinc experienced declines in their stock values.
The United States has announced the establishment of a strategic minerals stockpile named Project Vault.
Historical Context and Political Implications
The US government's acquisition of equity stakes in large companies is atypical but not without precedent. Historical examples include the Troubled Asset Relief Programme (TARP) during the 2008 financial crisis, where the government acquired stakes in General Motors, Chrysler, and various financial institutions.
The strategic stockpile initiative reflects a shift in US policy towards securing domestic control over critical minerals. This move aligns with efforts to reduce dependence on foreign sources, particularly China, which dominates global rare-earth mineral production. The approach has sparked debate, with differing views on government ownership among political figures.
Professor Babak Hafezi emphasized the importance of domestic control to mitigate reliance on China's dominant position in the global rare-earth market, highlighting the potential impact on US foreign policy.
Based on reporting by Al Jazeera.
