Trump Administration Eyes CHIPS Act Funds for Critical Minerals Strategy

CHIPS Act Funds Could Support U.S. Critical Minerals Push

The Trump administration is evaluating a plan to redirect $2 billion in CHIPS Act funding toward U.S. critical minerals development. The proposal aims to reduce reliance on China by investing in domestic mining, processing, and recycling operations. Commerce Secretary Howard Lutnick would assume a central role in allocating these funds, streamlining decision-making across the administration.

This shift would reallocate funds originally designated for semiconductor research and factory development. It would bypass the need for new congressional approval while aligning with the broader goal of building resilient supply chains for defense and electronics. The CHIPS and Science Act, enacted in 2022 under Biden, holds $52.7 billion for domestic semiconductor growth. However, Trump has criticized the legislation as overly generous to chipmakers.

Now, under Trump’s leadership, the administration views critical minerals—such as gallium, germanium, and lithium—as essential to semiconductor security. According to insiders, Lutnick wants to “get the $2 billion out the door” quickly. Discussions remain ongoing, and specific fund allocations—whether in grants or equity—are still undecided.

Critical Minerals Sector Gains Strategic Priority

Trump has signed executive orders to boost deep-sea and domestic mining since January. His recent meeting with CEOs of Rio Tinto and BHP at the White House signals strong support for U.S. mineral independence. Industry leaders like Albemarle CEO Kent Masters have echoed the urgent need for federal support, citing stalled domestic lithium refining projects due to funding gaps.

Meanwhile, the administration has faced criticism over fragmented strategy. A Pentagon-backed investment in MP Materials, including a rare earth price floor, caused confusion over government intentions. To fix this, Trump wants Lutnick to coordinate mineral-related funding across departments, including the Energy and Defense sectors.

The move follows a separate $1 billion Department of Energy proposal—funded by the 2021 Bipartisan Infrastructure Law—to support similar initiatives. Officials believe CHIPS Act funds for critical minerals align with national security goals and semiconductor manufacturing needs.

SuperMetalPrice Commentary:

Repurposing CHIPS Act funding for critical minerals marks a pivotal evolution in U.S. industrial policy. The Trump administration’s approach reflects an urgent shift toward resource sovereignty amid global supply chain vulnerabilities. While coordination across agencies is critical, centralizing oversight under Lutnick may streamline execution. For miners, refiners, and recyclers, this policy pivot could unlock vital capital—but only if bureaucratic hurdles are addressed in time to meet rising market demands.