President Donald Trump's administration is likely to take stakes in more companies following China’s latest rare earth export limitations, Treasury Secretary Scott Bessent said Wednesday.
- CRML stock is falling Wednesday. See the chart here
Bessent told CNBC that he "wouldn't be surprised" if the U.S. bought equity shares in other companies, but only in strategic industries.
"When we get an announcement like this week with China on the rare earths, you realize we have to be self-sufficient, or we have to be sufficient with our allies," Bessent said.
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The Trump administration has already taken stakes in MP Materials Corp. (NYSE:MP), Trilogy Metals, Inc. (NYSE:TMQ) and Lithium Americas Corp. (NYSE:LAC)—and more could be coming, according to Bessent.
Price Floors
Bessent said the administration also plans to introduce price floors across multiple sectors to counter China's market manipulation.
He explained that China has driven global rivals out of the rare earth industry over the last 20 years by exploiting its dominance in refining and processing to undercut prices.
"When you are facing a nonmarket economy like China, then you have to exercise industrial policy," Bessent said.
"So we're going to set price floors and the forward buying to make sure that this doesn't happen again and we're going to do it across a range of industries," the Treasury secretary added.
Strategic Reserve
The U.S. should also build a strategic reserve of critical minerals, Bessent noted, adding that JPMorgan Chase & Co. (NYSE:JPM) has expressed interest in partnering with the administration on that effort.
On Monday, JPMorgan announced a $1.5 trillion initiative to invest in industries critical to U.S. national and technological security.
JPMorgan said that it will focus on four key areas—with critical minerals listed first—and support companies by offering advice, providing financing and investing capital.
“Our security is predicated on the strength and resiliency of America’s economy. America needs more speed and investment," JPMorgan CEO Jamie Dimon said in a statement.
Rare Earth Stocks
Rare earth and critical mineral stocks, like Critical Metals Corp. (NASDAQ:CRML) and USA Rare Earth, Inc. (NASDAQ:USAR) pulled back on Wednesday after rallying on heavy volume for the past several sessions.
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