Which Critical Minerals Matter Most?

Price Volatility Is the Disease. What’s the Cure?

Winter 2026 will be remembered as one of the most consequential periods ever for U.S. and allied critical‑minerals policy. Over the course of several days in the first week of February, a whole‑of‑government architecture took shape at Trump speed:

• Project Vault was announced.
• The Critical Minerals Ministerial convened with more than 50 countries.
• FORGE formally replaced the Minerals Security Partnership as the primary allied coordination framework for financing, permitting, and offtake of non‑China critical‑minerals supply chains.
• Pax Silica was elevated as a core industrial stack aimed at rebuilding allied control over high‑purity silica, silicon, and downstream semiconductor and power‑electronics supply chains.
• The House passed the Critical Minerals Dominance Act, focused on faster permitting.

All this followed January’s introduction of the bipartisan, bicameral SECURE Minerals Act and a series of Commerce and USTR measures focused squarely on minerals processing as the critical chokepoints.

Vice President JD Vance opened Secretary Rubio’s ministerial with laser focus on the West’s core critical‑minerals problem: projects “die on the vine” because of extreme and sustained price volatility. Capital walks away. New supply never materializes.

Which begs two questions:

• If price volatility—and strategic underpricing—is the core disease, which policy tools are the most effective cures?
• And among the United States’ 60 designated critical minerals, which matter most?

Read closely, the 2026 National Defense Strategy, published at the end of last month, is also a critical‑minerals signal. Its emphasis on homeland air and missile defense and rapid industrial scaling implicitly elevates two material categories: permanent magnets and stored energy. The Strategy does not list minerals—but its design makes clear which ones matter.

Three Buckets of Policy Problems

The table below is a first‑pass exercise in prioritizing the USGS’s list of 60 critical minerals.

Bucket 1: Large, mature, markets

Examples include copper, zinc, aluminum, iron ore and metallurgical coal.

These markets generally have deep liquidity, long‑dated forward curves, and functioning price signals. Prices can be volatile, but when prices rise, capital responds. Large, well-capitalized mining companies make final investment decisions on greenfield and brownfield projects. Mine lives extend as lower‑grade ore becomes economic.

Policy priorities here are relatively straightforward: permitting reform, access to power, infrastructure development, and trade enforcement.

Bucket 2: Small, specialty, often by‑product markets

Examples include gallium, germanium, antimony, tantalum, scandium, yttrium, and several other specialty elements.

These markets do not clear via price. Supply is often a by‑product of other metals, demand is lumpy, specifications are tight, customers are few, and volumes are small. No amount of price discovery magically brings forth new supply.

Here, stockpiles and capability insurance—ensuring the availability of qualified production capacity, not just raw material—make sense. But strategies must extend beyond ore and concentrates to refined, qualified forms.

Germanium and gallium illustrate the point. Both can be recovered from zinc processing streams, as proposed by Ivanhoe Mines for Project Vault from its Kipushi project in the DRC. But stockpiling zinc does not automatically create a usable buffer of high‑purity germanium or gallium. These materials still require specialized refining, chemical conversion, and qualification for semiconductor, fiber‑optic, or infrared applications. If Boeing, Corning, Alphabet, Clarios, GE Vernova, GM, and Stellantis are the (so far named) end customers and, say, Korea Zinc separates these streams at its planned $7.4B U.S. smelter, the question remains: who completes the last mile to produce the 4N or 5N gallium or germanium material these OEMs actually require?

The very large number of very small Bucket 2 critical minerals will require a very large number of highly bespoke approaches that are beyond the scope of this paper.

Bucket 3: Medium‑size, fast‑growing, capital‑fragile markets

Examples include lithium, graphite, nickel (sulfate), cobalt (sulfate), high‑purity manganese, non‑fertilizer‑grade phosphates, and rare earths such as neodymium, praseodymium, dysprosium, and terbium.

These markets are too large for simple stockpiles and too volatile and immature for reliable, long-term hedging. Both the mining and processing of these materials are most prone to the financing “valley of death” Vice President Vance described. They are also the materials most central to electricity‑ and energy‑intensive technologies the West must win: AI, data centers, defense systems, and grid infrastructure.

Mission Critical: From Magnet Rare Earths to Battery Materials

Magnet rare earths—particularly neodymium and praseodymium (NdPr)—moved to the front of the line because they have been weaponized repeatedly as part of the evolving geopolitical chessboard. Permanent magnets sit at the heart of electric motors, drones, missiles, and a wide range of defense and industrial systems. The government clearly understands both the strategic importance of these materials and the urgency of rebuilding mine‑to‑magnet capability outside China.

That said, while light rare earths have rightly received attention, heavy rare earths dysprosium and terbium represent a more acute vulnerability. These elements are essential for high‑temperature performance in military‑grade motors and actuators. They are rarer, more concentrated, less substitutable than NdPr.

Why Batteries—and Battery Materials—Come Next

Batteries occupy an equally central position across the same defense and industrial stack. The National Defense Strategy repeatedly emphasizes dispersed operations, autonomy, resilience, and rapid industrial scaling—each of which increases dependence on stored electrical energy. A robust American battery‑materials strategy is therefore no longer a contentious EV or renewables construct; it is a national‑security imperative tied directly to defense platforms and industrial resilience.

Each battery material presents different challenges—and no single tool will solve them all. Several high‑level observations matter for policy design:

• Graphite suffers from downstream choke points (spheronization, purification, coating). Physical stockpiles of raw material alone do little without processing capacity.
• Nickel and manganese face a form‑and‑spec problem: battery‑grade chemicals behave very differently from bulk metal markets, and volatility in intermediates—such as mixed hydroxide precipitate or battery‑grade sulfates—undermines financing.
• Cobalt is smaller and more concentrated, but still subject to extreme price swings that discourage sustained investment.
• Phosphates illustrate the challenge of dual markets: fertilizer‑grade volumes are large, but battery‑grade supply chains are distinct and fragile.

For most of these materials, Project Vault is not an obvious solution. A procurement and continuity‑of‑supply vehicle may help large OEMs manage inventories, but it does not directly address the upstream investment challenge, where price instability and uncertain demand signals prevent new capacity from being built.

Project Vault, Equity Control, and Their Limits

Project Vault is an interesting stockpiling framework, but it is purpose‑built for Fortune 100 end customers and functions primarily as a financing and trading mechanism for those buyers. It does nothing to directly address the pricing behavior of non‑market participants that Vice President Vance correctly identified as the root problem—particularly in mission‑critical Bucket 3 minerals.

Similarly, the Orion–Glencore partnership, backed by the U.S. International Development Finance Corporation, aligns copper and cobalt supply from the DRC through equity ownership and governance rights, but does not address price volatility‑driven underinvestment in capital‑fragile markets.

Enter the Strategic Lithium Reserve

Stockpiles and equity‑plus‑offtake structures protect against short‑term disruption. A dynamic reserve is fundamentally different: it is a market‑structure tool designed to stabilize investment conditions over time.

Lithium stands out among battery materials not because it is the only strategic input, but because it is the most suitable starting point for a stabilization tool. Lithium carbonate (battery and technical grades) is relatively standardized, globally traded and storable.

The lithium market has grown sizeable enough to matter but incumbent producers are relatively small and insufficiently capitalized in comparison to large miners of Bucket 1 minerals. The industry is still too young to offer long‑dated hedging tools, which, coupled with lithium’s highly volatile price history make it largely unfinanceable with traditional project finance tools.

A Strategic Lithium Reserve would directly treat this core price volatility disease.

KISS the SRRC

The SECURE Minerals Act’s Strategic Resilience Reserve Corporation (SRRC) provides a more suitable institutional framework for lithium and other Bucket 3 minerals.

Where Project Vault aggregates demand and Orion–Glencore aligns ownership and offtake, an SRRC‑style entity can operate counter‑cyclically, stabilize prices over time, and crowd private capital back into upstream projects.

Keep it Simple, Stupid. A time‑bound, rules‑based stabilization mechanism is better, faster, and cheaper:

• Better, because it directly targets the core market failure.
• Faster, because it does not require multilateral consensus to begin.
• Cheaper, because preventative stabilization costs less than crisis response.

Sequencing Matters

Rare‑earth magnets are being addressed at speed, though heavy rare earths still require sharper focus.

Batteries must come next, with lithium the most obvious pilot case.

The Strategic Lithium Reserve I have proposed:

• does not require allied consensus to launch;
• can be explicitly time‑bound, like MP Materials’ agreements with the U.S. government;
• requires relatively little new capital at risk and should be profitable over time; and
• is designed to support investment, not just inventory.

Secretary Burgum recently noted that innovation in shale ultimately made the Strategic Petroleum Reserve unnecessary—if oil prices rise, the U.S. can now rapidly tap its domestic unconventional supply.

The same logic can apply to lithium chemicals. Stabilize the market, and within a decade the United States can build enough conversion capacity to serve not only domestic demand but much of allied demand as well.