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While the recent meeting between U.S. President Joe Biden and his Chinese counterpart Xi Jinping on the sidelines of the APEC summit in San Francisco last month was seen by some as a step towards alleviating tension between the two global powers, U.S. Secretary of Commerce Gina Raimondo’s latest speech and subsequent comments at the Reagan National Defense Forum in California left no doubt that, at least on the trade front, all arrows very much point to confrontation.

During her remarks on U.S. Competitiveness and the China Challenge, Secretary Raimondo emphasized that China’s “commitment to using non-market trade and investment practices” and “reprioritization away from economic growth toward national security and its assertive military behavior” has forced the United States to defend U.S. business and workers, and to “rethink how we protect our national security interests while also promoting our interests in trade and investment.”

Raimondo defended the United States’ recently imposed “systematic and technology-specific export controls to limit China’s ability to purchase and manufacture certain very advanced computing chips that are used to train large-scale artificial intelligence models, and which power the country’s advanced military and surveillance systems, as well as the manufacturing equipment used to make these cutting edge-chips,” arguing that “[f]or too long, America’s export control strategy was reactive -focused on preventing China from expanding its technological capabilities after it accessed American intellectual property.”  “The new rules,” she added were “strategic, targeted and designed to protect our national security.”

But it was the comments in response to questions by the moderator that gave us a glimpse into what may be coming down the pike.

Jordan Schneider, host of the ChinaTalk Podcast, recounted some of her comments on X, and it appears that in her Q&A, Raimondo showed less restraint than in her carefully crafted speech.

On the U.S.-China dialogue she said:

“This is the biggest threat we’ve ever had, and we need to meet the moment. The world needs us to manage our relationship with China responsibly. To avoid escalation, we’ve got to do all that, but make no mistake about it, China’s not our friend, and we need to be eyes wide open about the extent of that threat. I am ready to win, and I’m ready to do that with all of you, but it’s time to open our aperture and challenge the way we’ve done business in every way if we’re going to meet the threat China poses. And if we’re going to do what needs to be done with this technology.”

When asked if there were other U.S. origin products or types of technologies that the U.S. Government was “looking at in a similar fashion right now” – i.e. would consider imposing export controls on, she said:

“Absolutely, in biotechnology, AI models, AI products, cloud computing, supercomputing. So short answer is yes.”

As followers of ARPN well know, China is no stranger to playing politics with their own trade leverage, and we have seen a tit-for-tat play out in the critical minerals space, where China has taken several steps to tighten the export control ratchet with restrictions on what we might call the Super Criticals – gallium, germanium, graphite — and has already raised the specter of REE restrictions.

Unsurprisingly, China has already voiced criticism of Raimondo’s comments with Chinese Foreign Ministry spokesman Wang Wenbin telling media at a regular press briefing in Beijing earlier this week that “The U.S. should stick to the right perception and work with China to deliver on the common understandings reached in the San Francisco meeting” and “stop seeing China as a hypothetical enemy and saying one thing but doing another.”  Raimondo’s remarks, according to Wang, exposed the “Cold War mentality” on the part of the U.S. and showed its “desire for hegemony.”

Diplomatic efforts to improve ties between the countries in the wake of Raimondo’s remarks may continue – as with Chinese Vice Premier He Lifeng meeting with Richard Haass, a former president of the Council on Foreign Relations earlier this week –  but to the keen observer it appears all but certain at this point that we’ll be seeing a further escalation of the Tech Wars in the coming months, with the export control ratchet playing a central role.

The question is, which critical mineral will find itself in the crosshairs this time.

As demand for critical minerals continues to surge against the backdrop of the accelerating push towards net zero carbon emissions and supply chain challenges in the face of growing geopolitical volatility, the United States has taken several important steps to strengthen U.S. domestic critical mineral supply chains.

Sometimes the obvious can be overlooked:  As a case in point, consider the human resources required to unlock the natural resources needed to power 21^st Century technologies.  Is the U.S. doing what it must to excite, encourage and educate the next generation of geologists, metallurgists, engineers, materials scientists and the many other disciplines involved in extracting and processing critical minerals?

While much of the Congressional effort has focused on the exploration, development and recycling of critical minerals, the CHIPS and Science Act of 2022 (P.L. 117-167) (CHIPS Law) contains a provision making funding available to bolster the mining workforce.

Late last month, U.S. Senators Jacky Rosen (D-Nev) and Cynthia Lummis (R-Wyo) sent a letter to U.S. National Science Foundation Director Sethuraman Panchanathan requesting an update on what steps the National Science Foundation (NSF) has taken to implement Section 10359 of the CHIPS Act, the inclusion of which the senators had secured at the time of the law’s passage.

The senators lament that estimated enrollment at the 14 mining schools currently accredited by the Accreditation Board for Engineering and Technology, Inc. has rapidly declined from almost 1,500 in 2015 to just under 600 students today, with only roughly 200 students anticipated to graduate with Bachelor of Science degrees in mining engineering from U.S. schools this year.

Section 10359 of the CHIPS Act directed NSF to offer funding to universities and nonprofit organizations to “grow the next generation of mining engineers and support research and innovations that will improve mining technologies, reducing our reliance on China and other adversaries for critical minerals and materials.” 

Write the senators:

“To ensure the United States is able to innovate and compete on a global scale, we must recruit, educate, train, and develop tomorrow’s workforce today, providing them the tools they need to meet the challenge of developing a secure domestic resource supply chain that will strengthen our nation’s future economic and national security. (…)

It is critical that the NSF swiftly implement Sec. 10359, so that the U.S. remains competitive with a strong, skilled, and adaptive workforce to meet the needs of the modern mining industry.”

The senators are “are eager to learn what steps the National Science Foundation (NSF) has taken to implement this provision and engage with communities across the country on available opportunities,” and request an update by Director Panchanathan by January 12, 2024.  ARPN will be sure to keep tabs on NSF’s response, and on the broader effort to encourage the cultivation of the human resources needed to develop the Nation’s natural resources for decades to come.

 With hot wars raging in Central Europe and the Middle East, do we have bandwidth to focus on a war that’s metaphorical – for now, at least:  The Tech War pitting China versus the U.S.? Against the backdrop of China’s recently announced restrictions on graphite exports (see ARPN’s coverage here) set to take effect on Friday, [...]

As China tightens its export control ratchet yet again this week (see our latest post), here comes another visual reminder of why Beijing’s actions are relevant and concerning: Our friends at Benchmark Mineral Intelligence have put together a new infographic illustrating China’s critical mineral supply dominance specifically for graphite anodes. Before Beijing unleashed its latest salvo of [...]

Only weeks before a planned November summit between Chinese President Xi Jinping and his U.S. counterpart, U.S. President Joe Biden, China’s commerce department has announced a new set of critical mineral export restrictions against what Nikkei Asia refers to as “a backdrop of domestic calls for a response to stricter limits on U.S. semiconductor exports to China.” According [...]

In keeping with its known penchant for weaponizing trade, Beijing is tightening its export control ratchet again this week. Now in the Tech War crosshairs:  Graphite. According to Reuters, China announced today that to protect national security, it will require export permits for certain graphite products – a move analysts see as a play “to control supplies of critical [...]

As Western nations continue their push to reduce their over-reliance on China for their critical mineral needs, some of the key players, including the United States and the European Union, have increasingly turned their eyes on Africa, a continent that is home to an estimated 20% of the metals and minerals required in EV battery [...]

At ARPN, we have long highlighted the importance of geopolitics in mineral resource policy.  Recent supply chain shocks, growing trade tensions and ever-increasing critical mineral needs have brought the geopolitical challenges associated countries’ and stakeholders’ efforts to build resilient and diversified supply chains into focus. A new piece by the Office of Applied Innovation at Goldman Sachs illustrates [...]

Against the backdrop of surging demand for critical minerals and increasing geopolitical tensions, the U.S. Department of Defense (DoD) is forging ahead with its efforts to strengthen the U.S. defense industrial base. The Department is stepping up its efforts to award funding for projects to encourage domestic development of the Battery Criticals (lithium, graphite, cobalt, [...]

Earlier this moth, the European Parliament’s industry committee voted to endorse the EU’s draft Critical Raw Materials Act (CRMA – see our coverage here) which sets benchmarks to increase domestic capacity for critical minerals extraction in an effort to reduce the EU’s over-reliance on supplies from China and other countries. The vote is a timely one and [...]