TELF AG looks at the US economic initiatives in the mining sector

Minerals for the green transition, a strategic issue 

For a few years now, most nations have developed (or updated) their personal strategy focused on strategic minerals, in the belief that these materials will certainly be able to contribute to a large extent to the success of the ecological transition. Policy initiatives focusing on strategic raw materials have multiplied: in China, strategic planning on the most important minerals has been included in the five-year plans drawn up by the government, while the European Union continues to regularly update its list of strategic materials and add new, ambitious objectives for its energy development program in the name of sustainability. 

Even the United States has not stood idly by. In recent years, it has stood out for various economic initiatives focused on the most valuable minerals to boost clean energy. The strategic nature of the US approach towards raw materials had already appeared evident in 2017, during the Trump administration, when the Department of Commerce was tasked with developing a federal strategy focused on strategic minerals (then issued two years later, in 2019). This strategy was based on the development of the national extractive industry and the consolidation of production capacities. The United States and China undoubtedly represent the two major global players in the raw materials sector, and their initiatives in this sector can certainly offer valuable indicators of the general trend of this sector, which is so essential for the planet’s sustainable future. 

Other initiatives undertaken by the US governments 

Another important step in the raw materials sector was taken in 2021 when the US Department of Energy developed another strategy focused on the supply chains of strategic minerals. The objectives of this strategy were three: diversifying supplies, identifying possible substitutes for the most problematic raw materials, and encouraging practices related to the reuse and recycling of the most important raw materials. It is no coincidence that the American strategy was based on these elements. Over the years, it has been understood that one of the most significant risks for the vitality of the raw materials market (but also for its possible industrial applications) is linked to the security of supply chains, to the economic and geopolitical uncertainties that could characterize certain areas of the world and to the poor levels of diversification in the supplies of some nations. 

This fact was subsequently also reiterated by the Biden administration, which in 2021 issued an executive order focused on the security of supply chains for the most strategic raw materials, highlighting their valuable role in the health of the American economy and the success of the energy transition. 

In the United States, strategic minerals have also found space within specific legislative initiatives: the American Mineral Security Act (which entered into force in 2020) and the Infrastructure Investment and Jobs Act (enacted in 2021). The latter provides for allocating federal funds for the research, extraction, and processing of strategic minerals and for all activities strictly connected to them. Some interesting provisions are also contained in the Inflation Reduction Act of 2022, such as those relating to batteries for electric vehicles. To benefit from the tax advantages provided by the initiative, the consumer will have to choose an electric vehicle whose components (including batteries) have been made with 40% raw materials coming from the United States.