US President Donald Trump has directed allies and trade partners to conclude agreements within 180 days to diversify supplies of critical minerals, warning of tariffs and trade restrictions if commitments are not secured, according to the South China Morning Post.
In a proclamation signed Wednesday, Trump declared that US dependence on foreign‑processed critical minerals constitutes a national security risk. Critical minerals such as lithium, cobalt, and rare earth elements are essential inputs for advanced manufacturing, defense systems, semiconductors, and clean energy technologies. China currently dominates global processing capacity, accounting for more than 70 percent of rare earth refining and a significant share of battery‑grade mineral production.
For the auto sector, the move underscores the urgency of building resilient supply chains as demand for EVs continues to rise. Companies may need to renegotiate contracts, diversify mineral sourcing, and adapt production strategies to align with new trade rules. While the proclamation is framed as a national security measure, its impact will be felt across the automotive value chain—from battery makers to car manufacturers, potentially influencing vehicle pricing, production timelines, and long‑term investment in electrification.
The directive tasks US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick with negotiating new or expanded agreements to adjust imports of processed minerals and derivative products. Negotiators have until July 13, 2026, to secure binding or enforceable commitments. While the proclamation does not explicitly require proof that minerals are mined and processed outside adversarial nations, it stresses the need to diversify supply chains away from dominant sources.
Measures outlined in the proclamation include expanding allied processing capacity, securing long‑term offtake agreements to guarantee US access, encouraging investment in non‑Chinese facilities, and deploying trade‑stabilizing tools such as price floors to counter volatility.
If no agreements are reached within the deadline, Trump is authorized to impose remedial measures without further review, including high tariffs, quotas, or mandatory minimum import prices.
The proclamation is part of Trump’s “America First” industrial policy, which seeks to reduce reliance on adversarial nations for strategic inputs and ensure secure supplies for industries critical to national defense and clean energy.