U.S. efforts to reduce dependence on Chinese critical minerals face a substantial supply shortfall as manufacturers approach a January 1, 2027, deadline to stop purchasing specified minerals from China, Russia, Iran and North Korea. President Donald Trump has directed tens of billions of dollars toward nearly 150 minerals companies, making domestic mining and processing a national-security priority. However, U.S. demand for the most common type of rare-earth magnet was approximately 48,000 metric tons in 2025, while domestic suppliers produced only 300 metric tons. U.S. companies are expected to have capacity for about 5,000 metric tons by the end of 2026, suggesting that production could remain well below demand when the restrictions take effect.
The regulations cover rare earths, magnets, tungsten, molybdenum and tantalum used in weapons and other strategic products. The United States has repeatedly issued waivers because domestic supply has been insufficient, although an executive order signed by Trump has made waivers more difficult for defense contractors to secure. American companies have not produced tungsten since 2015 or tantalum since 1959, while China controls more than 80% of the global minerals-refining industry. Guardian Metal Resources, a company developing a U.S. tungsten mine, is targeting an opening in 2028, while Lion Rock Resources is developing a tantalum project in South Dakota without a stated opening date. Ucore Rare Metals, a minerals-processing developer supported by the Pentagon, has delayed parts of its planned production until at least 2027.
The administration has also launched Project Vault, a $12 billion stockpiling program that officials acknowledged may initially purchase minerals from countries including China. Lockheed Martin NYSE:LMT, a major U.S. defense contractor, has provided the Defense Department with a list of materials it wants included in the stockpile. MP Materials NYSE:MP, a U.S. rare-earth mining and processing company financially supported by the Pentagon, has built a magnet facility in Texas and expects some magnets to receive customer approval by year-end, while another Pentagon-focused facility is scheduled for 2028. Energy Fuels (UUUU), a U.S. minerals company that received a $725 million Pentagon loan, plans to process limited quantities of rare earths by year-end and reach 6,000 metric tons annually by 2029. These timelines suggest waivers, allied supply arrangements or imported stockpiles may remain necessary while domestic capacity develops, creating possible opportunities for U.S. producers but continued procurement uncertainty for manufacturers and defense companies.