Trump digs in: how the critical minerals war is rocking the mining world

As the world hurtles into 2025, the mining and metals sector is bracing for a seismic shift—one fuelled by none other than Donald Trump. The former, and now current, US President is back in the White House, and if his first stint was a geopolitical rollercoaster, his return is shaping up to be a full-blown earthquake.

At the heart of this upheaval? Critical minerals. The lifeblood of the green energy transition, defence industries, and high-tech manufacturing, these metals—lithium, copper, rare earths—are now pawns in an escalating game of economic warfare. And Trump, never one to shy away from a bold move, has made it clear: America First is back, and that means tariffs, trade wars, and a massive shake-up of global supply chains.

In the recent BMI Webinar: Mining and Metals Key Themes for 2025, analysts warned that Trump’s return could “significantly reshape critical mineral strategies” and lead to “a wave of trade protectionism” that will have ripple effects across the global mining industry.

A Tariff Tsunami: The New Rules of Engagement

On 1 February, in true Trumpian style, the US slapped a fresh wave of tariffs on imports from Canada, Mexico, and China. The 10% increase on Chinese critical minerals—stacking on top of an already hefty 25% tariff—has Beijing seething. Meanwhile, Canada and Mexico, traditional allies in the mining world, have also been caught in the crossfire, forcing them into retaliatory measures.

Amelia Haines, a metals and mining analyst at BMI, flagged that Trump’s tariffs threaten to fracture critical mineral alliances, explaining that “these recent tariffs extend beyond Mainland China and now include key allies like Canada and Mexico, disrupting supply chains that were carefully cultivated under previous administrations”.

The irony? These tariffs don’t just target adversaries; they hit some of America’s closest trade partners—the very countries it relies on for securing a stable critical mineral supply. While China has long been the bogeyman in US mining policy, Canada and Mexico’s inclusion in Trump’s latest tariff blitz signals something bigger: a full-scale trade protectionism blitzkrieg.

The “America First” Mining Playbook

Beyond tariffs, Trump is taking a sledgehammer to US critical mineral policies. His first executive order of 2025, titled “Unleashing American Energy”, has already:

• Scrapped Biden-era tax incentives for electric vehicles reliant on foreign minerals
• Suspended funding from the Inflation Reduction Act, which had funnelled billions into mining and refining projects
• Fast-tracked US mine development, cutting red tape and throwing open more federal lands for mineral extraction

BMI Senior Analyst Olga Savina highlighted how Trump’s approach is “shifting towards an aggressive push for domestic production”, but warned that “his policies could sacrifice environmental and social protections in favour of rapid resource extraction”.

The message is clear: Trump wants the US to be self-reliant in critical minerals. But this comes with its own risks. As Haines pointed out, “Trump’s policies could trigger a cascade of retaliatory measures globally, escalating tensions with key mining partners and disrupting critical mineral supply chains”.

What This Means for Aussie Miners

For Australia’s mining sector, the ripple effects of Trump’s policies will be felt across the board. While Australia remains a key supplier of lithium, rare earths, and critical minerals, Trump’s push for US self-sufficiency could see American miners given preferential treatment, squeezing out foreign players in key supply deals.

At the same time, China—a major buyer of Australian iron ore, lithium, and other resources—is now under even more pressure. With Beijing threatening its own countermeasures, including potential export restrictions on critical minerals, we could see yet another escalation in the long-running trade war, with Australia caught in the middle.

Sabrin Chowdhury, BMI’s Director and Head of Commodities Analysis, highlighted how these global trade dynamics will shape the industry in 2025:

“We expect 2025 to be a cautious year, driven largely by investor sentiment. The mining sector will need to navigate new supply chain dynamics, severe trade tensions, and policy uncertainty, with the industry waiting to see if Chinese stimulus will provide some relief”.

On the flip side, Trump’s hardball stance with Canada and Mexico could open doors for Aussie exporters, giving them an edge in US supply deals as Washington scrambles to secure new trade partners. But let’s not get ahead of ourselves—if there’s one thing Trump loves, it’s an unpredictable twist.

The Big Question: Who Wins and Who Loses?

The winners? US mining companies set to cash in on government backing, and countries willing to play hardball on trade negotiations. The losers? Global supply chains, investors who banked on stable policies, and anyone who thought the world’s transition to clean energy was going to be smooth sailing.

For the mining sector, 2025 will be a high-stakes game of resource nationalism, tariffs, and corporate power plays. Whether this results in a new era of protectionist prosperity or a global metals market in disarray, one thing is certain:

“Trump has just rewritten the rulebook—and the mining world is on notice”.

Buckle up. It’s going to be a wild ride.