WASHINGTON, Feb 3 — US President Donald Trump announced plans yesterday to launch a strategic stockpile of critical minerals backed by US$10 billion (RM40 billion) in seed funding from the US Export-Import Bank.

“For years, American businesses have risked running out of critical minerals during market disruptions,” Trump said during an Oval Office event.

“Today, we’re launching what will be known as Project Vault to ensure that American businesses and workers are never harmed by any shortage.”

Washington has been moving to offset what policymakers view as Chinese manipulation of prices for lithium, nickel, rare earths and other critical minerals which are vital to making electric vehicles, high-tech weaponry and many other manufactured goods. That has stymied US mining companies for years.

The project will combine US$2 billion in private funding with a US$10 billion loan from the EXIM Bank to acquire and stockpile minerals for automakers, technology companies and other manufacturers, Trump said. The export bank said it approved the loan on Monday.

Rare earth and critical minerals stocks, including MP Materials and USA Rare Earth Inc, rose on media reports that an announcement on the US$12 billion initiative was imminent.

General Motors Chief Executive Mary Barra and mining billionaire Robert Friedland, who represent both producers and users of critical minerals, attended the Oval Office event.

The project has attracted interest from a wide range of US auto and technology companies.

Commodities trading firms Hartree Partners, Traxys North America and Mercuria Energy Group would manage the procurement of raw materials for the stockpile, a Trump administration official familiar with the plan told Reuters.

Project Vault is intended to help the US auto industry while letting companies keep related risks off their balance sheets, the official said, comparing the logistics of the project to a Costco membership that allows for buying in large volumes.

Another goal is to maintain a 60-day supply of minerals for emergency use, the official said, adding that mineral stockpiling was already under way.

An executive structure is expected to be set up for the project and EXIM is likely to have a board seat, the official said.

Last month, a bipartisan group of US lawmakers introduced a bill to create a US$2.5 billion stockpile of critical minerals, aimed at stabilising market prices and encouraging domestic mining and refining. — Reuters