President Donald Trump has invoked the Defense Production Act (DPA) to accelerate the development of the domestic mineral industry, aiming to reduce the reliance on imports and bolster supply chains.
By signing an executive order on Thursday, Trump used the DPA, originally conceived by President Harry Truman, to mobilize industrial resources for national security. The act allows the government to provide financing, issue loans, and invest in projects that strengthen domestic mineral production and processing capabilities.
His action calls for an expedited permitting process for domestic mining projects, which are among the slowest in the world, along with increased federal land access for mineral extraction.
The U.S. International Development Finance Corporation, in coordination with the Department of Defense, is also set to provide financial support for new mining ventures.
Trump's action goes further by expanding the list of priority minerals to include uranium, potash, and possibly coal – which he plans to leverage to bring down the cost of energy, helping industrial competitiveness.
While China's 70% control over rare earth processing has been a concern, recent export restrictions of elements such as gallium and germanium have worsened the situation, raising concerns over supply shortages for U.S. manufacturers.
Besides boosting domestic production, Trump is also pursuing international agreements, including a potential deal with DR Congo (the leading exporter of cobalt) and Ukraine.
"One of the things we are doing is signing a deal very shortly with respect to rare earths with Ukraine… They have tremendous value in rare earths, and we appreciate that," Trump said per Al Jazeera.
Price Watch: Sprott Critical Materials (NASDAQ:SETM) is up 3.89% year-to-date.
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