U.S.-China Trade War Escalates, Highlighting Critical Mineral Vulnerabilities

The U.S.-China trade war has intensified, with the Trump administration imposing a sweeping 104% tariff on Chinese goods. This escalation comes after Beijing refused to remove retaliatory levies on U.S. exports, prompting fears of further disruptions in global supply chains, particularly for critical minerals like lithium and rare earth elements. China dominates the global production of critical minerals, controlling 60% of raw material output and 85% of processing capacity.

The latest tariffs underscore the urgency for the U.S. to secure domestic sources of critical minerals essential for clean energy technologies and electric vehicles. In response, Texas-based GeoFrame Energy is advancing its lithium extraction project in the Smackover Formation, East Texas. GeoFrame plans to produce 83,500 metric tons of battery-grade lithium carbonate annually by 2029, enough to meet 100% of U.S. demand.

GeoFrame’s project utilizes Ekosolve Direct Lithium Extraction (DLE) technology, which boasts a 92–95% lithium recovery rate while minimizing environmental impact through closed-loop processes powered by geothermal energy. The company aims to begin production at a Phase 1 plant by early 2026, producing 3,000 metric tons annually. This initiative represents a critical step toward reducing U.S. reliance on Chinese lithium imports.

Meanwhile, China has retaliated by imposing export restrictions on seven rare earth elements vital for high-tech applications, including dysprosium and terbium used in EV batteries and military hardware. These measures are expected to disrupt global markets further and raise costs for Western manufacturers.