Trump trade conflict casts shadow over tech sector’s access to vital elements

Lithium and other elements the US needs for vital defence, energy and other applications could become harder to obtain if the Trump administration goes ahead with tariffs and other protectionist policies aimed at China.

China refines more than 90% of the global supply of so-called “rare earth elements”, which include neodymium and dysprosium. Not actually rare, these 17 elements are difficult to mine and refine because they are not often found in concentrated deposits.

Some elements, such as Lithium, are usually mentioned along with rare earth elements, because they are also critical for the tech sector.

Without them, mobile phones would not vibrate and computer hard drives would not operate. They are used in wind turbines, electric cars and other industries the US has sought to develop.

US president Donald Trump imposed 10% tariffs on all Chinese imports to the US earlier in February. This was on top of existing tariffs on specific Chinese goods dating back to Mr Trump’s first term.

China has since retaliated with up to 15% tariffs on a range of US goods and more export controls on elements critical to the production of modern high-tech products.

Development and growth plans for smartphone makers, renewable energy companies and the broader technology sector all depend in part on access to rare earth elements. Apple has been increasing its use of recycled materials for its batteries and devices to help lower its need for newly mined and refined materials.

The International Energy Agency expects total demand for rare earth elements to surge 72% to 134 kilotons between 2021 and 2030. Supply requirements are expected to rise at roughly the same rate, but the total amount would lag demand at 98 kilotons.

Rare earth metals have been behind some recent geopolitical issues as the US and other nations try to access sources outside of China. The US is the world’s second biggest producer of rare earth metals, with about 12% of the global total.

Mr Trump’s pitch to acquire Greenland comes amid climate change that is expected to make more of the Arctic island’s resources available. Melting ice is expected to make rich deposits of rare earth elements, lithium, and other natural resources more accessible.

Mr Trump has also mentioned future aid deals with Ukraine, another source of rare earth elements.