critical minerals

“Does America stand for self-reliance and innovative discovery of critical minerals for our economy and national defense and security? Or will Congress drive the fatal stake through the heart of our struggling domestic metals mining industry?”

According to a new Washington Examiner piece by Cato Institute Adjunct Scholar in Geosciences and ARPN expert panel member Ned Mamula and author Ann Bridges, we will soon find out. 

The authors of “Groundbreaking! America’s New Quest for Mineral Resource Independence” argue that two pieces of proposed mining-related legislation – touted as “modernizations, overhauls or replacements of the Mining Law of 1872” – would do more harm than good. 

Write Mamula and Bridges:

“At first blush, overhauling the Mining Law sounds appealing and overdue. But H.R.2579 seeks to boost royalties to 12.5% on new mining operations and 8% on existing mines for the “privilege” of extracting America’s public lands mineral wealth that is so vital to our nation’s defense, computing, communication, transportation, medical, renewable energy and battery technologies.

Under current mining law, hardrock (metal) producers already pay hundreds of millions of dollars annually in the form of private state royalties, and a variety of federal and state taxes on claim fees, mining activities, products and payroll, plus an existing 2% royalty fee on minerals extracted from Federal lands based on current market value of minerals delivered to a smelter.

To better place America on a path to mineral independence, we should be reducing the overall costs of mining, not adding to them.”

Mamula and Bridges lament that the bills under consideration “appear to dissuade new domestic exploration and production, including the all-important critical minerals and ‘green’ technology metals,” and that proposed fee increases “could well bankrupt existing miners operating on razor-thin margins.”

Already facing competition from massive Chinese and Russian state-owned companies — many of which may not be up to par when it comes to social and environmental standards — and politically-motivated market distortions, U.S. companies would suffer if the above-referenced bills were to move forward, say Mamula and Bridges. They conclude:

“In order to put our country on a course to achieve mineral independence, we should not penalize our mining entrepreneurs. Instead, we should incentivize them by reducing the overall costs of mining, enabling them to compete globally. We should also bring production home, by providing increased access to federal mineral lands.

Both bills would take America’s national interest in the wrong direction, even as China’s overt posturing of its rare earth monopoly bolsters its leverage against the U.S. negotiating position, which is weakened by a lack of any long-term strategic plan for domestic mining and critical minerals production.

To remain strong, our nation needs a dependable supply chain of critical minerals and metals that will only come from a durable Mining Law. The overhauls proposed in the two congressional bills would have crippling consequences that would reverberate through every sector of our economy and undermine our national security.

If passed, these bills would gut the entrepreneurial spirit of the Mining Law by imposing stricter anti-mining regulations, repressive royalties, and impossibly short lifetimes for mining claims. These changes would spell the beginning of the end for domestic hardrock exploration and mining and put thousands out of work. Worse, they would increase our already dangerous dependence on foreign sources for critical minerals.”

Click here for the full piece.

And for more context, see Ann Bridges’s piece – co-authored with Paul Driessen – entitled “Americans Declare Freedom, Not Fights,” in which they call for a “Declaration of Mineral Independence.”

Another trip around the sun, and once again we find ourselves stocking up for barbecues, fireworks and parades in honor of the men and women who have fought on our behalf, and continue our safeguard our freedom today.

We’ve always used the occasion of Independence Day to remind ourselves that “while we cherish the freedom we are blessed with in so many ways, we must not become complacent, as there are areas where we’re increasingly becoming less independent” – with our reliance on foreign mineral resources being a case in point.

For decades, our reliance on foreign non-fuel mineral resources has significantly increased  both in terms of type and percentage of import reliance.  This year’s USGS Mineral Commodity Summaries showed no drastic change — the number of metals and minerals for which we are 100% import-dependent may have dropped slightly (from 21 to 18), but a closer look into the footnotes reveals that this is largely owed to a lack of hard data for at least two of the metals dropping out of the 100% import dependence category. 

The number of metals and minerals for which we are 50% or more than 50% import-dependent is still at 49, down one from 50 – but with the above-referenced caveat of lacking data for two materials – so it may in fact be higher than last year.

Thankfully, there are indications that the tide is turning. 

A year ago today, already, our Independence Day eve post struck a more optimistic tune than previous ones, arguing that the momentum for meaningful resource policy reform that might bring us closer towards greater resource independence has been growing.  This trend has continued, as followers of ARPN know.

Against the backdrop of Chinese-U.S. tensions over REEs and underlying tech war and the global battery arms race, the level of awareness of the challenges associated with our over-reliance on foreign metals and minerals is perhaps higher than ever, which is great news.  However, so are the stakes, especially for the United States.

As we mark this year’s Independence Day, here’s hoping that momentum will be turned into action and policy makers heed Benchmark Mineral Intelligence’s acting manager Simon Moores’s warning that “[t]here is no doubt that if the US acts now and invests wisely in partnerships, it can catch up, (…) [b]ut it really needs to act now.” 

Against the backdrop of the current U.S.-Chinese tensions over Rare Earth Elements and the “global battery arms race,” Morgan D. Bazilian, Professor of Public Policy and Executive Director of the Payne Institute at the Colorado School of Mines, argues that the United States must “widen its consideration of critical materials past a limited understanding of security in [...]

“The specter of using rare earths as an economic weapon makes clear that the current trade war between the U.S. and China is in fact one front in a larger tech war – a competition to see which country will dominate the 21st Century Technology Age,” says ARPN principal Dan McGroarty in a new piece [...]

As the world looks towards Osaka, Japan, where world leaders will gather for the 2019 G20 Summit and Ministerial meetings later this week, former Missouri Speaker of the House Tim Jones discusses the current trade conflict between the United States and China and the implications of the looming supply disruptions for U.S. domestic industries as [...]

Amidst growing concerns over the availability of metals and minerals underpinning the EV revolution, the United States, Canada and Australia have joined forces to encourage the responsible development of said materials. As the Financial Times reported earlier last week, the US state department and its Canadian and Australian counterparts “will work to help countries discover and [...]

The specter of China playing the “rare earths card” is looming larger this week.   According to the Global Times’s twitter feed, U.S. military equipment firms will likely face restrictions of Chinese Rare Earth supplies in the near future, as China’s economic planners will “study and roll out policies on rare earths as soon as possible.”     [...]

Over the past few weeks, China’s threat to play the “rare earths card” has generated quite a buzz and, along with growing concerns over supply chains for battery tech, has directed much-needed attention to our nation’s over-reliance on foreign mineral resources.  As followers of ARPN know, many of these issues are in fact home-grown, as the United [...]

If you looked up the definition of “visionary entrepreneur” in the dictionary, chances are you’d stumble over Elon Musk’s name.  Perhaps like no other CEO today, Tesla’s innovator-in-chief has had his finger on the pulse of time, and has arguably “revolutionized many industries.” And while he continues his “mission is to help save Earth for humanity through sustainable [...]

Bearing testimony to the significance of the looming specter of China playing the “rare earths card,” CBS’s 60 Minutes this weekend aired an update to its 2015 segment on rare earths featuring ARPN principal Dan McGroarty.  You can watch the segment on the CBS website, which also features a written transcript. There is hope that the [...]