US senator Ted Cruz has introduced legislation to end what he describes as the country’s “dangerous dependence” on China for critical minerals and rare earth elements.
He said the Onshoring Rare Earths Act of 2020, or ORE Act, was designed to set up a supply chain in the US, by providing tax incentives to the rare earths sector, requiring the Department of Defense to source the minerals domestically and establishing grants for pilot programs to develop the materials in the US.
He said if China cut off access to these rare earth elements and crucial minerals it would significantly threaten US national security.
Cruz has pushed for further measures to reduce China’s influence, such as introducing a bill called the Stop Higher Education Espionage and Theft Act of 2018 which was not enacted.
Meanwhile the DOD is set to award phase one contracts in April, to plan and design a US-based heavy rare earth separation centre.
Australia-based rare earths producer Lynas (ASX: LYC) said it was told the DOD planned to award it a phase one contract, and MP Materials, which has the Mountain Pass REE mine in California, was also chosen for a contract.
A China-based company has a minority interest in MP Materials, which estimates it produces about 15% of global rare earth material.Its product requires reprocessing in Asia, but the firm has said it is planning to relaunch its onsite processing facilities after a modernisation programme this year.