Commerce Secretary Howard Lutnick says China ‘weaponizing’ rare earths

Commerce Secretary Howard Lutnick said this week that China is “weaponizing” its control over rare earth minerals and other goods and the Trump administration is taking steps to counter the problem.

Mr. Lutnick said in a speech Tuesday that the administration will use its economic power — pricing, tariffs and industrial policy actions — to bolster the security of critical minerals supply chains and keep them in U.S. and allied control.

The Commerce secretary told a gathering of business leaders hosted by the Center for Strategic and International Studies that the administration also wants to secure access to advanced microchips that are threatened by China in Taiwan, a world leader in advanced chip fabrication.

“Critical minerals is just the name that everybody understands that’s been weaponized,” he said. “We’ve made it clear to everybody that we’re going to be there across critical minerals and across all the other choke points that we are studying and we are seeking to address.”

China announced in October an expansion of restrictions on the export of rare earth minerals and permanent magnets needed for key civilian and military industrial products.

The action prompted President Trump to scale back high U.S. tariffs imposed on China by the administration and tone down the tough rhetoric directed at Beijing.

“We need to bring semiconductors to America,” Mr. Lutnick said. “You can’t have all semiconductor manufacturing 80 miles from China. That’s just illogical, right?”

Mr. Lutnick said in the next three years his goal is to achieve a 40% market share in leading-edge semiconductor production.

“That means we’re going to see $1.2 trillion of semiconductor manufacturing,” he said. “This is not datacenters, right? This is wafers that then create trillions of dollars of GDP while those datacenters buy those chips that are now made in America.”

America is currently producing 2 million high-end Nvidia Blackwell chips used in artificial intelligence and in the past produced zero, he said.

Key chemical ingredients for the chips are needed “because if we make it, like you all know with critical materials, if you want to make semiconductors but you don’t have gallium or yttrium, then you need to solve for the full bill of materials so that you’re not subject to the whims of others,” Mr. Lutnick said.

The United States is now moving to prevent “choke points” from being used by adversaries to limit U.S. economic power, he said.

“We did a critical mineral stockpile, not for the military, we already have that, but for business, so that if it gets weaponized, the government can be there to support our industry,” he said.