Trump Directs Dept. of Defense to Search for Alternative Sources of Rare Earth Magnets

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Rare earths are coveted around the world for their application in a wide variety of high-tech uses, from consumer electronics to military applications.

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However, a rare earths market dominated for years by China has presented a challenge to the U.S.

Toward that end, President Donald Trump this week directed the Pentagon to search for alternative sources of rare earths magnets, particularly cobalt samarium magnets.

In a determination pursuant to Section 303 of the Defense Production Act of 1950, Trump said the “domestic production capability for Samarium Cobalt Rare Earth Permanent Magnets is essential to the national defense.”

“Without Presidential action under section 303 of the Act, United States industry cannot reasonably be expected to provide the production capability for Samarium Cobalt Rare Earth Permanent Magnets adequately and in a timely manner,” Trump’s determination continued. “Further, purchases, purchase commitments, or other action pursuant to section 303 of the Act are the most cost-effective, expedient, and practical alternative method for meeting the need for this critical capability.”

In a separate letter — addressed to Rep. Maxine Waters, chairwoman of the House Committee on Financial Services, and Sen. Mike Crapo, chairman of the Senate Committee on Banking, Housing and Urban Affairs — Trump said there is a “shortfall in the defense industrial base relating to production capability” for samarium cobalt rare earth magnets.

“The Department of Defense will take actions to develop and purchase equipment and materials needed for creating, maintaining, protecting, and expanding production capability for Samarium Cobalt Rare Earth Permanent Magnets,” Trump said in his letter.

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Last year, the Trump administration omitted rare earths from a $200 billion tariff list on Chinese goods. (Earlier this year, MetalMiner’s Stuart Burns delved into China’s upper hand in the rare earths market and how it could use that as a bargaining chip in its ongoing trade talks with the U.S.)

According to the U.S. Geological Survey, U.S. imports of rare earths in 2018 reached a value of $160 million, up 17% from $137 million in 2017. From 2014-2017, 80% of the U.S.’s imports of rare earths compounds and metals came from China.

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