US seeks to reduce dependence on China for rare earth minerals amid supply challenges

The United States is aggressively pushing to break China's monopoly on critical minerals through billions in federal funding, direct equity stakes, and a $180 million workforce initiative. However, these efforts face severe domestic labor shortages, regulatory delays, and a lack of clear administrative guidance. Consequently, international buyers are turning to Brazil, where rare earth exploration applications have surged, though this rapid expansion is triggering environmental concerns in the Amazon and prompting Brazilian lawmakers to propose strict technology-transfer mandates.

US critical minerals workforce shortage

• ▪The Trump administration pledged $180 million in August 2026 to double the number of skilled mining school graduates in the critical minerals sector by 2028.
• ▪The United States faces a severe shortage of mining engineers, with existing schools graduating 150 to 200 students annually against a demand three to four times higher.
• ▪The number of U.S. mining schools has declined from 25 in 1982 to 14 in 2026 due to historical funding cuts and a plunge in mineral commodity prices in the 1990s.

China's rare earth export dominance

• ▪Chinese exports of rare earth yttrium oxide to the U.S. rose to 29 metric tons in July 2026, the second-highest monthly volume since China introduced export controls in April 2025.
• ▪China halted exports of rare earths essential to civilian and defense manufacturing during the U.S.-China trade war in 2025.
• ▪China has tightly constrained rare earth exports to Japan, sending no dysprosium oxide for nine months and no terbium oxide for eight months as of July 2026.

Brazil rare earth exploration surge

• ▪An analysis of Brazil's National Mining Agency records through June 2026 showed that rare earth exploration applications surged, with over 86% filed in the past three years.
• ▪Brazilian lawmaker Zé Silva proposed pending legislation to establish a federal critical minerals policy, set investment priorities, and mandate technology transfer to Brazil.
• ▪Foreign investors, dominated by Australian and U.S. firms, account for more than 40% of the rare earth exploration applications filed in Brazil as of June 2026.

Trump administration domestic production push

• ▪President Donald Trump issued an Executive Order in July 2026 requiring defense contractors to stop using materials produced by geopolitical adversaries by January 1, 2027.
• ▪Patriot Critical Minerals is applying for U.S. government funding to extract tungsten from a long-abandoned mining site in Nevada, targeting operations by mid-2029.
• ▪The Trump administration has invested more than $10 billion in direct equity stakes in six critical mineral companies over the past year to end reliance on Chinese sources.

Environmental concerns in mining

• ▪An Afro-Brazilian community in Goias state overlaps with mining claims by Canadian firm Aclara Resources, raising local fears of environmental impacts on water springs and wildlife.
• ▪At least 25% of rare earth exploration applications in Brazil overlap with or are within 10 kilometers of protected areas and Indigenous territories, including the Amazon.

Regulatory implementation delays

• ▪Mining school representatives state that the federal government has not provided clear guidance on how the $180 million in workforce funding should be spent across the 14 mining schools.
• ▪Patriot Critical Minerals' mid-2029 target for its Nevada project faces delays due to a shortage of government staff to process environmental assessments, following a 10% cut in federal civilian employment in 2025.

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