Beijing’s nickel glut leaves America penniless

America’s vast mineral wealth has underwritten our nation’s evolution into an economic and military superpower. From the gold rush that fueled the race westward almost 200 years ago to the iron ore and coal miners that powered the construction of bridges, skyscrapers, rail lines and military vessels, mining has been central to American prosperity.

Sadly, America’s commitment to mining its resources has fallen victim to progressive dogma. Now, Beijing’s vast influence over global mineral supply chains poses an economic threat to the United States. While the Biden-Harris administration is hamstringing American mining projects in red tape, Chinese miners are preemptively flooding the global market to keep American minerals in the ground.

The market for nickel, which is a vital input for electric vehicle batteries and stainless steel, offers an instructive example. Nickel is so crucial that it was designated a critical mineral by the U.S. Geological Survey in 2022 and again by a Democrat-controlled Congress and signed into law by President Biden.

Yet, despite the United States’ significant nickel resources, we only have one active nickel mine.

Plans to unlock this wealth have been entangled in the byzantine federal permitting process. A proposed $1.7 billion copper and nickel mine in northern Minnesota was relegated to the slag heap when the Biden-Harris administration canceled its leases and declared a 20-year moratorium on mining in the area. They then raised the regulatory hurdles even higher by undoing the Trump administration’s historic permitting reforms through rulemaking.

At the whims of capricious regulators, it is little surprise that it takes an average of 29 years to move from mineral discovery to production in the United States. As a result, the United States imports around nine times the nickel it produces.

As other project developers inch toward the regulatory finish line and Congress once again debates reforming permitting rules, Beijing is turning its vast international influence to drown the market and wither American projects on the vine.

Thirty billion dollars of Chinese investment in the Indonesian nickel industry has helped to increase output fourfold over the past decade, establishing the Southeast Asian country as the world’s unrivaled dominant force.

Profiting from destructive environmental practices and cruel labor abuses, Chinese-backed Indonesian nickel producers enjoy such a steep price advantage that Western miners are calling for commodity exchanges to distinguish between “dirty” and more expensive “clean” nickel.

Not only does this glut of cheap nickel keep America hooked on Beijing’s supply chains, but it also denies American workers and communities the benefits of rebuilding the domestic mineral industry. A wealth of economic literature shows that natural resource projects within advanced economies create both immediate jobs onsite and jobs in the surrounding community. This prosperity drives the creation of local manufacturing jobs and reduces poverty rates.

While the Chinese Communist Party floods the market to keep American mines on the drawing board, the Biden-Harris administration is sitting on its hands. Tariffs on nickel unveiled earlier this year were blunted by the fact that they only applied to minerals coming directly from China, of which the United States imports very little.

Rather than the White House, vocal support for American miners has come from a bipartisan group of senators, who have rebuffed Indonesia’s calls for a minerals-free trade agreement. That agreement would make Indonesian nickel eligible for electric vehicle subsidies and further whittle down America’s mineral industry while offering next to no tangible benefit for American companies in Indonesia.

Beijing’s global glut of poorly regulated nickel poses a threat to the environment, the plight of workers’ rights and American economic security. And this global flood of nickel is just the latest example of the Communist Party’s weaponization of its mineral dominance to undercut and stymie America’s strategic industries.

It is beyond time for the Biden-Harris administration to unleash America’s mineral wealth through sensible permitting reforms and a trade policy that supports American workers and their communities.

Oliver McPherson-Smith, Ph.D., is the director of the Center for Energy & Environment at the America First Policy Institute.

Date:

Save story

Topics

More from The Hill

Politics - The Hill
Biden makes first briefing room appearance as president to tout economy, port deal

President Biden on Friday made his first appearance in the press briefing room since taking office to tout strong jobs data and the resolution of a strike at East and Gulf coast ports that ...
27 minutes ago - Joe Biden
Politics - The Hill
Harris to bash Vance over Michigan EV plant jobs at rally

Vice President Harris on Friday is set to bash former President Trump and Sen. JD Vance (R-Ohio) over auto worker jobs at her campaign rally in Flint, Mich., according to a senior campaign ...
32 minutes ago
Politics - The Hill
Task force requests documents from authorities on second Trump assassination attempt

The House task force investigating the assassination attempts on former President Trump's life sent two letters to Biden administration officials in September, requesting documents and information ...
32 minutes ago - Donald Trump
Politics - The Hill
Donald Trump’s tariff plan could bring us back to the 1930s

Donald Trump's proposed tariffs on imports would likely lead to a depression similar to the Great Depression, as seen in the Smoot-Hawley tariff act of 1930, which caused the global trade to ...
49 minutes ago - Donald Trump
Politics - The Hill
Social media suspensions may be linked to misinformation, not platform bias: study

Social media platforms’ suspensions of accounts may not be rooted in political biases, but rather certain political groups’ tendency to share misinformation, according to a new study. The study, ...
51 minutes ago