Department of Commerce report concludes that import reliance poses a threat to national security; leaves the door open for tariffs at a later stage.
The U.S. administration has held off on imposing immediate tariffs on imports of processed critical minerals following a comprehensive national security review. The U.S. Department of Commerce concluded that imports of processed critical minerals and their derivative products pose a significant risk to national security due to heavy reliance on foreign suppliers and limited domestic processing capacity. These materials are essential for defense systems, advanced technologies, and critical infrastructure, underscoring the strategic vulnerability created by current supply chains.
The review found that, as of 2024, the U.S. was fully import-reliant for 12 critical minerals and at least 50% reliant for another 29. It notes that even where domestic mining exists, limited processing capacity forces materials to be exported for refining before being reimported.
However, rather than resorting to tariffs at this stage, the administration will seek negotiations with foreign trading partners to secure reliable material streams and strengthen supply-chain resilience. The presidential proclamation authorizes the Secretary of Commerce, Howard Lutnick, and U.S. trade representatives to explore mechanisms such as price floors for critical mineral imports. A measure that the G7 finance ministers also discussed this week regarding rare earths. However, tariffs remain a potential measure if negotiations fail to yield substantial results within 180 days.
The review was initiated last April following China’s export controls on seven rare earth elements. China dominates the processing of rare earths and numerous other critical minerals, leaving the United States and much of the world highly import-dependent. Drawing on the findings of the investigation, the Trump administration aims to diversify supply sources and reduce strategic dependence on single-country providers.
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