Trump Orders Critical Minerals Probe As China Tightens Controls Over Rare Commodities In Retaliatory Move

President Donald Trump ordered a probe into tariffs on critical mineral imports, commodities that are essential for the defense, energy, and technology sectors.

What happened? On Tuesday, Trump signed an executive order directing Commerce Secretary Howard Lutnick to conduct a national security review under Section 232 of the Trade Expansion Act—the same authority previously used to impose tariffs on steel and aluminum. Lutnick has 180 days to report back with findings, including recommendations on whether and how tariffs should be applied.

The probe will assess vulnerabilities in the supply chains of 50 minerals, including all the steps, from raw extraction to producing semi-finished goods like battery cathodes and wind turbines. The list will include rare earth elements and metals like cobalt, nickel, lithium, and uranium.

This order follows China's April 4 move to impose export controls on seven rare earth elements, which has effectively halted global shipments, as China currently supplies 30 of the 50 critical minerals listed by the U.S. Geological Survey.

Why It Matters? The U.S. reliance on imported critical minerals, particularly from geopolitical rivals like China, poses serious security and economic stability risks. These minerals are essential for advanced military systems, electric vehicles, renewable energy infrastructure, and consumer electronics.

Critical minerals experts Gracelin Baskaran and Meredith Schwartz from the Center for Strategic and International Studies warned about the lack of alternative supply chains.

"The restrictions apply to seven medium and heavy rare earths: samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium. The United States is particularly vulnerable to these supply chains. Until 2023, China accounted for 99 percent of global heavy REEs processing," they said in a discussion.

Baskaran and Schwartz noted that these minerals are foundational to advanced military systems, yet the U.S. has no capacity for heavy rare earth separation today.

Trump might find the solution on the seabed floor. His administration is reportedly drafting an executive order to fast-track seabed mining, and potato-sized nodules on the ocean floor contain vast amounts of cobalt, nickel, and rare earths.

"As the Trump administration has done with shipbuilding and critical minerals more broadly, catalyzing US government focus on the areas of greatest vulnerability to PRC (China) ambitions is essential," Alexander Gray, chief of staff to the U.S. national security adviser in the first Trump administration, said for The Financial Times.

The U.S. has been absent from international negotiations on seabed mining as the International Seabed Authority's March conference ended without a go-ahead for mining in international waters, as environmentalists argued a poorly understood impact on the ecosystem.

Meanwhile, Vancouver-based The Metals Company (NASDAQ:TMC) has confirmed that its subsidiary initiated the permitting process for exploring and mining international waters under a 1980 U.S. law. Still, debates persist about whether the U.S. can grant rights over something outside its jurisdiction.

Read Next:

• Tariff Uncertainty Turns Traders Cautious — But Oil, Silver Might Be The Escape Hatch, Says Market Analyst

Image via Shutterstock