A Deep Dive on Critical Minerals

**SPEAKER_1** (0:02)
Bloomberg Audio Studios, Podcasts, Radio, News.
This is Bloomberg Businessweek Daily, reporting from the magazine that helps global leaders stay ahead, with insight on the people, companies, and trends shaping today's complex economy. Plus, global business, finance, and tech news as it happens. The Bloomberg Businessweek Daily podcast, with Carol Massar and Tim Stenovec on Bloomberg Radio.

**Tim Stenovec** (0:32)
Joe Deaux is Bloomberg News Senior Economic Statecraft Reporter. He is here with us. We're talking everything when it comes to rare earths and critical minerals, a crucial part of the supply chain for everything from electronics to weapons systems. Joe, we've wanted to do this for so long and we're glad you can do it.
I have to say, we're happy to have you, Kristine. Carol is so sad she's out today. But Joe is making it up to her because next week when I'm out, I guess Joe is stepping in a little bit. I think he's going to be here. We got my Joe. Okay, so Joe, I want to start with you. Then we're going to bring in this fantastic lineup that we have for the next hour. And a lot of it is, all of it is thanks to you and the people you've brought us over the last few years. So we are grateful to you for that. I just want to start, Joe, with a general question about critical minerals and rare earths because when I met you, you were a metals and mining reporter. And we talked to you sometimes about heavy equipment. And then something happened, something changed.
What was it? And why did rare earths and critical minerals become this conversation that investors, the administration, and we're so focused on?

**Joe Deaux** (1:41)
I mean, if we really go way back, right? The pandemic hits in 2020, in case we forgot. And supply chains became a story, like actual supply chains. And like, you know, those of us who were in the commodity space had covered actual supply chains, you know, understanding the procurement officers at various big companies you've heard of, right?
Soda companies, beer companies, car companies.
And then if we just move from there, it becomes very apparent to investors in a big way why supply chains matter. Fast forward to a couple of years later, three years later, China, in the middle of the summer of 2023, shocks a lot of close watchers by saying they're putting export controls on Gaium and Germanium. And these are two elements that are absolutely essential to defense technologies, right? Defense, right? Like, it's not a Silicon Valley thing, it's not Apple and Google, it is very much these are defense applications. And we had some reporting shortly after that time, we did a big take that said when those export controls were announced, it sent off alarm bells throughout the Biden administration. And we had a senior administration official tell us for that story, that was the moment that all of the concerns that various agencies had had, in particular the Pentagon, and trying to warn big players in Congress, the President of the United States, that it was there. And that is where we are now. So the Biden administration moves on, Trump administration comes back in, they had long had this conversation about the importance of rare earths and critical minerals. In some ways, it was Trump and Trump 1 that put this on the map.
It got supercharged, right? Liberation Day happens. The President of the United States puts tariffs on every imaginable country in the world, and he goes hard on China. And China responds just a few days later. Initially, nobody heard about it because it just happened in the middle of the night on a Thursday. And they said, we are putting export controls on rare earths, the important rare earths, but also permanent magnets. And this is when it went from becoming a defense technology problem to an all-out tech war.

**Tim Stenovec** (4:05)
You bring up exactly what we're going to do right now perfectly, Joe, because you fast forward from then to today. And we're regularly hearing from the President about this meeting with executives from the mining and critical minerals industries, including on Friday, when he had them down in Washington, DC. Check out what he had to say about the US versus China.

**SPEAKER_5** (4:27)
Accredited mining programs in the United States now graduate less than 170 mining engineers each year, while China graduates more than 3,000, and half of our current mining workforce is set to retire within the next three years.

**Tim Stenovec** (4:42)
Well, that was President Trump on Friday. Joe, jump in here.

**Joe Deaux** (4:47)
Yeah, I mean, his wow at the end, right, is again a conversation that you've been hearing in the world that I've been covering for a long time. I mean, I remember sitting in this office, call it three or four years ago, with the now former CEO of Rio Tinto. And we would catch up with them every so often. And one of the things that he pointed out was, Joe, one of the big problems we have is a lack of geologists and a lack of people who want to come in to the mining space. Rio Tinto is the second largest mining company in the world. Well, who were they losing that talent to?