Title: Washington's New War on China's Mineral Grip
Show: Prinsights (Substack) — written post, paid (Pulse Premium readable)
Author: Nomi Prins
Date: 2026-08-03
URL: https://prinsights.substack.com/p/washingtons-new-war-on-chinas-mineral
Note: Written post — no timestamps. Verbatim body captured via logged-in session. Subtitle: "The latest
      fight between the U.S. and China is taking shape in the critical minerals space. But a key deadline
      is now quickly upon us." No securities are named in the post; the closing "Dig Deeper" note teases
      two companies to be analyzed in this month's Pulse Premium and Founders+ issues — those picks are
      gated and are NOT captured here.

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In the midst of the on-again-off-again Iran War, American leadership in Washington is also fighting a longer-running battle over China's mineral supremacy.

The latest move came on July 30, when President Trump signed a presidential determination that hands the Commerce Department power under the Defense Production Act to keep critical minerals and materials from leaving the country. It came on the heels of Executive Order 14415, ten days earlier, which directed the Pentagon to trace every critical material in its weapons and defense systems back to the mine it came from. The idea is to "secure its supply chains against physical, cyber, and economic subversion." The real translation? To force out suppliers along that chain that are tied to China.

The crucial date that's looming ahead is January 1, 2027. That's when those Pentagon rules will bar Chinese rare-earth magnets from its weapons systems. As of today, the U.S. continues to buy most of those magnets from China. And China has already restricted that supply.

In April 2025, across the Pacific, leaders in Beijing placed export controls on seven rare earths and the magnets built from them that are part of fighter jets, missiles, cars, and wind turbines. That restriction remains in force and will continue to be a factor. When China moved to widen its controls last October, Trump and Xi struck a truce with terms that paused the new measures for one year, to November 10, 2026.

The U.S. has put itself in a catch-up position spanning decades and is now short the very raw and refined metals needed to arm its military and rebuild its energy and infrastructure sectors. That presents a growing economic and national security crisis.

At the moment, the U.S. imports every ounce of the gallium and natural graphite it uses, 99% of its uranium, 91% of its antimony, the hardener in armor-piercing rounds, and 60% of its aluminum. Meanwhile, China refines more than 80% of the world's tungsten and close to 90% of its rare earths. Even enriched uranium, which powers 19% of the American energy grid, still comes in part from Russia, under import-ban waivers that expire in 2027.

China processes or refines most of the world's supply of the metals these new actions target. On the other side, the U.S. produces no gallium or natural graphite and accounts for just 15% of global rare-earth mine production.

This massive gap in the U.S. is forcing billions in federal funding and private capital into the processors, refiners, and alternative suppliers trying to build a supply chain outside China.

These July actions are the latest set of directives in a now eighteen-month campaign aimed at leveling the critical-minerals playing field through U.S. government equity stakes, permit acceleration, trade controls, and other measures.

Back in March 2025, Trump signed an executive order to expand existing mineral-production mandates to cover copper, uranium, gold, and potash. The move invoked the Defense Production Act, the Korean War law from the early 1950s that lets Washington fund and guarantee purchases of domestic output, and redirected the Development Finance Corporation, an agency created to fund projects in developing countries, to lend to domestic mines for the first time.

In February 2026, the White House established Project Vault, a $12 billion mineral reserve built on a $10 billion Export-Import Bank loan, the largest in the bank's 92-year history. The project in action worked to gather delegates and leaders from 54 countries in Washington to discuss building supply chains outside of China.

Then, in June 2026, the U.S. government committed another $2.9 billion to rare-earth and magnet production and, for the first time, opened military bases to mineral processors.

What These Two Recent Actions Do

The reality is that American defense contractors were already prohibited from putting Chinese rare-earth magnets, tungsten, tantalum, and molybdenum in weapons, yet they kept doing it anyway through nonavailability waivers, the claim that the material could not be found anywhere else.

The July 20 order closes that loophole. Starting January 1, 2027, the only way a contractor will be able to secure a waiver is by filing a formal plan showing that it made exhaustive efforts to find a compliant source and setting a timeline to remove Chinese material from its supply chain.

The order states outright that having no U.S. supplier is no longer an excuse. It also gives the Pentagon 180 days to write the rules that will require every prime and subcontractor, at every tier, to map its supply chain down to the raw material and submit a full bill of materials, with suspension or termination for those that do not. Every producer of those metals outside the restricted countries becomes a source the Pentagon's contractors now have to qualify.

The new July 30 determination will now allow the U.S. Commerce Department to block the export of critical minerals, including the metal locked inside dead permanent magnets and spent lithium-ion batteries that can be recycled at home. The move gives Washington the power to keep American scrap and byproducts in the country instead of shipping them abroad for other countries to potentially use, weaponize or redeploy elsewhere.

Copper Funding and Aluminum Controls

Copper is the second-most-used material by weight in the defense sector, ranging from artillery driving bands to aircraft landing gear. The July 20 order's supply-chain mapping covers copper, one of the materials contractors must now trace back to its source. Permitted U.S. copper projects can now qualify for federal financing through programs at the U.S. Department of Energy and the Pentagon's Office of Strategic Capital, which together hold more than $350 billion in lending authority. Copper trades near $6.43 per pound now, just off the record $6.71 it set in May, as AI data centers drive demand well above and beyond what miners can currently supply.

As we've detailed here, aluminum is another major supply chain gap, and both directives now touch it. It is not an explicitly covered industrial material, but the July 20 order forces contractors to trace every material in a weapons system back to its smelter and to qualify a domestic or strategically aligned source for anything coming from a China-linked supplier. That includes aluminum.

The July 30 determination works on the post-production side as well. It lets the U.S. Department of Commerce keep American aluminum scrap and spent material from being exported, so a country down to four operating smelters recycles what it has instead of shipping it abroad.

Tariffs are another part of the same push. China produces about 60% of the world's primary aluminum. In June 2025, the administration doubled the Section 232 tariff on aluminum to 50%, and in July 2026 it added an incentive that gives companies investing in domestic smelting a reduced tariff on the primary metal they still import.

That update is in addition to a 500,000-ton plant backed by a Department of Energy award, the first new U.S. smelter in some 45 years, that is now in development. As the U.S. Secretary of Energy noted, the goal was "revitalizing this country's manufacturing base and reducing our reliance on foreign suppliers."

Dig Deeper: We see these policies driving more capital into domestic and American partner supply chains, particularly where defense and energy infrastructure intersect. That is why this month our research will be focusing on copper and aluminum – and we're directly analyzing key opportunities that tap into this trend. Both our Pulse Premium and Founders+ issues due out later this month will examine two companies operating at different points in those supply chains.