By David Shepardson
WASHINGTON (Reuters) -The chairman and top Democrat of the House of Representatives Select Committee on China will announce on Tuesday they are launching a bipartisan working group to reduce Chinese dominance of crucial mineral supply chains.
Reps. John Moolenaar, the committee chairman, and Raja Krishnamoorthi, the top Democrat, said the new working group will help propose policies to reduce U.S. dependence on China for crucial minerals used in a variety of products, from semiconductors and wind turbines to electric vehicles.
The group “will work to create transparency into dependence on the U.S. supply chain for critical minerals and develop a package of investments, regulatory reforms and tax incentives to reduce that dependence,” the committee said in a statement to Reuters.
The Critical Minerals Policy working group will be led by Republican Rep. Rob Wittman and Democratic Rep. Kathy Castor.
“Critical minerals are the building blocks of everything from basic consumer goods to advanced military technology. America’s dependence on the Chinese Communist Party’s control of the crucial mineral supply chain would quickly become an existential vulnerability in the event of a conflict,” Moolenaar said in a statement.
He noted that China has already imposed export restrictions on rare earth elements such as gallium, germanium and graphite, as well as mineral processing equipment.
Last month, the U.S. Treasury Department gave automakers additional flexibility on battery mineral requirements for electric vehicle tax credits for some crucial trace minerals from China, such as graphite. Congress passed legislation in 2022 aimed at decoupling the US EV battery supply chain from China.
New rules came into effect on January 1 and limit Chinese content in batteries eligible for EV tax credits to $7,500.
The Biden administration announced last month that it plans to impose new tariffs on $18 billion of Chinese goods, including electric vehicles, batteries, semiconductors, aluminum, critical minerals, solar cells, ship-to-shore cranes and medical products. Tariffs for certain critical minerals will increase from zero to 25% later this year.
