Key Takeaways
- Cleveland-Cliffs plans to launch rare earth mineral production at sites in Michigan and Minnesota
- The move aims to reduce US dependence on China for critical minerals
- President Trump threatened tariffs amid China’s rare earth export controls
Major US steel producer Cleveland-Cliffs is venturing into rare earth minerals production as China tightens its export controls. The Ohio-based company announced this strategic pivot during its quarterly earnings call, targeting domestic self-sufficiency in these critical materials.
CEO Lourenco Goncalves stated: “Beyond steelmaking, the renewed importance of rare earths has driven us to re-focus on this potential opportunity at our upstream mining assets. It is our obligation to do so as a company with our geological footprint.”
The company identified two promising locations in Michigan and Minnesota where geological surveys indicate significant rare earth mineralization. These minerals are essential components in everything from consumer electronics to advanced military systems.
Aligning With National Security Interests
Goncalves emphasized that this initiative supports the Trump administration’s push for critical material independence. “If successful, it would align Cleveland-Cliffs with the broader national strategy for critical material independence, similar to what we achieved in steel,” he noted.
He added firmly: “American manufacturing shouldn’t rely on China or any foreign nation for essential minerals, and Cliffs intends to be part of the solution.”
Diplomatic Tensions Over Rare Earths
The corporate move comes amid escalating trade tensions between Washington and Beijing. Administration officials confirmed that President Trump is prepared to meet with Chinese President Xi Jinping later this month to address trade issues, including rare earths.
Treasury Secretary Scott Bessent stated the US doesn’t want to escalate trade conflicts but remains prepared for discussions. Meanwhile, U.S. Trade Representative Jamieson Greer told FOX Business that balanced trade relations remain possible.
Greer expressed frustration with the ongoing rare earth discussions: “To paraphrase the secretary in one of our recent meetings with the Chinese, this is the last time we want to be talking about rare earths with the Chinese. Unfortunately, that is not the last time they want to be talking about it.”
He highlighted the trade imbalance issue: “The reality is, there are a lot of areas where we can trade with the Chinese. Our trade is wildly imbalanced. So it needs to be more balanced.”
Tariff Threats and Strategic Implications
Earlier this month, President Trump threatened “massive” tariffs against China after Beijing signaled plans to implement rare earth export controls. The president characterized China’s move as a “sinister and hostile move” that could hold the world “captive.”
Following China’s export control announcement, Trump indicated there seemed to be “no reason” to meet with Xi, underscoring how rare earth minerals have become a central friction point in US-China relations.
