The US Badly Needs Rare Minerals and Fresh Water. Guess Who Has Them?

Rain fell for the first time on the highest point of the Greenland ice sheet in August 2021, seen by scientists as a foreboding precedent for sea level rise and the planet. But not everyone was alarmed. The melting of ice caps began exposing virgin ground for mining, including what has been touted as some of the largest deposits of rare earth elements, or REEs, in the world. REEs are a group of seventeen metals with remarkable magnetic, electrochemical, and luminescent properties. They give a smartphone its computing power and electric cars their batteries. They are necessary to make powerful permanent magnets needed by both wind turbines to generate energy efficiently and laser-guided missile systems to stay on target. In 2019, during his first term as US president, Donald Trump mused publicly that Greenland—a semi-autonomous Arctic frontier where almost 90 percent of the inhabitants are Inuit—could be bought outright from Denmark, as a means of securing valuable metals that China otherwise controls globally. The comments were widely dismissed at the time, but early into Trump’s second term, the tone has shifted. The new Trump administration talks less about buying Greenland now and more about simply annexing it. And what has been said about Greenland is also being said about Canada. Canada’s rich deposits of uranium, nickel, potash, and a host of obscure strategic metals, including REEs, could help explain Trump’s persistent but cryptic threats to make Canada the fifty-first US state. His repeated characterization of Canada’s vast amounts of fresh water as a “faucet” that can be activated at will by parched Americans does nothing to dispel the threat. What does Canada have that the US wants? As the global post–World War II order unravels and the validity of the Canadian border is suddenly called into dispute, which natural resources will the US covet? Which Canadian minerals will they need the most moving forward, and by which pathways could Canada’s water most realistically flow south?

• Is Canada Treating Trump’s Annexation Threat Seriously Enough?
• How Much Further Can Mining Go?
• China Stakes Claim in the North, Redefines Arctic Politics

No nation can match China’s REE dominance: not only does it mine more REEs than anywhere else, it currently controls about 90 percent of all processing. The US will need to secure critical minerals from non-Chinese sources because the future will be, by necessity, metals intensive. The term “critical minerals” refers to any mined materials that are irreplaceable for industries like national defence, tech, and energy production but are vulnerable to bottlenecks in supply. In the current political climate, perhaps nothing symbolizes the critical minerals race more than a modern fighter jet: a single F-35 Lightning II needs over 400 kilograms (about 920 pounds) of REEs to make its electronics and engines work, including multiple REEs that are needed to make very powerful magnets. “The US is vulnerable to almost everything in terms of critical metals,” says Gavin Mudd, director of the British Geological Survey’s Critical Minerals Intelligence Centre, noting the US has drawn up a list of fifty indispensable commodities. “There’s not many things you can say they are 100 percent self-sufficient in.”  Canada’s rich mineral endowment promises to supply much of this need. An analysis by the Center for Strategic and International Studies published this year found that Canada can potentially supply seven of the most important metals for US defence—including REEs, gallium, niobium, cobalt, tungsten, bismuth, and indium—“making them prime targets for increased bilateral cooperation.” For most of these metals, an American enemy (mostly China) currently controls production. While the US under Trump is now taking drastic action to ramp up its own domestic mineral production, Canada has long been viewed as a close and friendly source of strategic minerals. The CBC reported that the US government, in an unprecedented move last May, spent $15 million (US) in public funds to mine and process copper, graphite, and cobalt in Quebec and the Northwest Territories. Three months later, the Pentagon announced a $20 million (US) investment to build a cobalt refinery in Ontario. The US military is not alone in looking northward: last February, General Motors paid $150 million to a Canadian mining company to guarantee the delivery of 18,000 tonnes of refined graphite annually, a metal critical for EV batteries. Despite these efforts, the US government and industry cannot compete with China’s near monopoly on all things mining and metals. What the US is missing, explains Mudd, more than deposits in the ground, is the ability to process and refine mineral deposits into usable forms. “Nowhere else has the infrastructure that China does,” says Mudd. “They have been very strategic for decades in building both their mining, smelting, and refining capacity and linking that through to their manufacturing technologies and capacities. They’ve got dominance across much of the periodic table.” He points to California’s Mountain Pass, the only large-scale REE mine in the western hemisphere, which is focused on supplying neodymium-praseodymium oxide, a key ingredient in high-strength permanent magnets. Historically, all of its output has been shipped to China for processing (in mid-April, MP Materials, which operates the mine, announced that it would cease processing the mine’s output in China due to ongoing tariff wars between the two nations). A big reason why REEs have been dominated by China is that deposits are often found intermingled with arsenic and radioactive elements, like uranium and thorium—making the processing of these metals so complex and environmentally toxic that few others have been willing to accept the damage at scale. The world’s biggest REE processing complex, in Baotou in the Chinese autonomous region of Inner Mongolia, for example—which produces more than half of China’s REEs—has also created a five-mile-wide toxic lake of radioactive and heavy-metal slurry six miles upstream of the Yellow River, which supports the livelihoods of over 420 million people. Last December, China banned the export of gallium, germanium (both used in semi-conductors), and antimony (used in explosives) to the US after the Joe Biden administration tightened Chinese access to US semi-conductor technologies. In 2010, China imposed a two-month REE embargo on Japan amid a territorial dispute, highlighting the world’s vulnerability to Chinese supply dominance. And in retaliation to Trump’s tariffs, China, in early April, imposed global export restrictions on seven REEs—threatening to throttle access not just to mined REEs but the made-in-China processed REE products the world needs, like permanent magnets. The trade wars of the future will be battles over access to critical minerals. “Greenland has big deposits,” says Mudd, “but it doesn’t really produce anything. It’s got potential, but it will take years to get those projects off the ground.” He adds that Greenland also has a ban on uranium mining, and that many of the REEs there are tied up with radioactive elements. What the US could exploit through annexation, however, would be the many Canadian sites where we have managed to build a metals processing ecosystem. This includes Rio Tinto Alcan’s vast hydro-powered aluminum smelting complexes in BC and Quebec, and Teck’s Trail smelter in southeast BC—one of the world’s biggest zinc and lead smelting and refining complexes that also produces multiple precious and rare metals, chemicals, and fertilizers. There is nickel refining in Ontario, Alberta, and Newfoundland and Labrador, and Glencore’s Horne Smelter in Quebec is the nation’s lone remaining copper smelter. These are all valuable assets—but they are owned not by Canadians so much as by international investors operating on Canadian soil, including Americans and Chinese. Trump’s fixation on critical metals is so persistent—and haphazardly articulated—that it raises questions about who in his circle of advisers could be whispering ideas into his ear. Billionaire PayPal co-founder Peter Thiel is an influential insider who has invested in Ontario lithium mining and processing plants in Canada and Europe. Scott Dunbar, an engineering professor at the Norman B. Keevil Institute of Mining Engineering at the University of British Columbia and author of How Mining Works, thinks that Elon Musk is the only member of the inner circle who has been forced to think about minerals scarcity in any serious way. Dunbar cites how, in 2020, Musk put out an unusual public call to anyone who could provide an environmentally sound, efficient supply of battery-grade nickel for EV batteries, offering that “Tesla will give you a giant contract for a long period of time . . .” Musk also understands the strategic value of undeveloped critical minerals in the ground. In the aftermath of Bolivia’s presidential crisis in 2019, long-time president Evo Morales was forced to flee the country. In 2020, Musk addressed rumours that the socialist Bolivian leader had been forced out by a US-backed coup aimed at accessing the nation’s immense lithium deposits. “We will coup whoever we want! Deal with it,” he posted on Twitter (now X) at the time. Like Trump’s 2018 offer to buy Greenland, the comments were not taken seriously. Critical minerals will only become more important, especially as the world continues to chase clean energy and Europe races to rearm, but fresh water presents a much more emotional issue to Canadians. Mining is invisible to most of us; threats to Canada’s water from an increasingly thirsty US are more top of mind, and for good reason. On numerous occasions over the past year, Trump has referred to Canada’s water supply as a faucet that can be opened at will, including to supply California, where drought-stoked wildfires in January cost at least $250 billion (US) and 8.5 million acres rely on irrigation. The US water crisis will only grow, particularly in the southwest of the country, where states like California, New Mexico, Arizona, and Utah are expected to suffer ever more frequent, intense, and longer-lasting droughts. With climate change and many decades of surface- and ground-water mismanagement coming to a head, Canada now appears as an enticing source of fresh water. Eileen Delehanty Pearkes, author of A River Captured: The Columbia River Treaty and Catastrophic Change, says the faucet that Trump refers to does not exist. Capturing more of the Columbia River, for example, which flows out of eastern British Columbia into the US Pacific Northwest, does not help the US with water needs in dry states. If anything, she says, dams on the Canadian side of the Columbia currently hold back water to prevent disastrous flooding in US floodplains (e.g., around Portland), where mass development has occurred since the ’60s. If there’s a faucet here, it’s one that the Americans need us to continue throttling. Channelling northern water to the southern and central US would require the expenditure of untold billions of dollars and a complete ecological and hydrological reinvention of the continent. Outlandishly bold continental-scale infrastructure projects were products of the Cold War era—like the so-called North American Water and Power Alliance, or NAWAPA, which proposed to transport water from the north to the lower forty-eighth parallel and Mexico via a continent-long engineered trough. Another plan—the GRAND (Great Recycling and Northern Development) Canal—which was seriously championed by then Quebec premier Robert Bourassa for a time, would supply water by damming and creating a great reservoir at James Bay, delivering the water to the Great Lakes, to be siphoned southward. These radical diversions were never seriously pursued—not because of the mass environmental destruction they would reap but because of the expense. In Cadillac Desert: The American West and Its Disappearing Water, Marc Reisner estimates that operations under NAWAPA would require the energy equivalent of six nuclear power plants. It remains a fantasy: for the cost, California could instead double down on water efficiency and conservation and invest in big desalination plants, like the $1 billion (US) Carlsbad plant just north of San Diego—which uses an energy-intensive reverse osmosis process to produce 50 million gallons of fresh potable water from the Pacific Ocean every day. What’s more likely in the shorter term would be siphoning water out of Lake Michigan to parched areas in the central US. Just outside of Chicago, there are multiple cities residing beyond the Great Lakes basin and drawing groundwater that could be dry by 2030. These communities will likely need to target water from Lake Michigan, which Chicago can legally sell to them through a legal loophole. As US aquifers go dry, the lakes will be a natural place to look. Water activist, author, and Council of Canadians co-founder Maude Barlow says the Great Lakes are particularly vulnerable, despite a 2008 agreement to prevent the diversion of waters out of the watershed. “Trump could just rip up this compact and install a pipeline in any of the lakes,” she says. “The president wants to bring manufacturing back to America as well as grow the high tech, AI, and bitcoin industries, all of which are huge water guzzlers. He needs water, and the amount he might take from the lakes could be a catastrophe.” By disputing the agreements that established the Canada–US border, says Barlow, Trump could try to extend the forty-ninth parallel across the continent and take Lakes Ontario, Erie, and much of Huron. “That would be an act of war.” Is capturing Canada’s water and strategic mineral wealth the endgame of a calamitous trade war? Rob Huebert, author of the 2025 Strategic Outlook for the Conference of Defence Associations Institute, writes that Trump’s talk on annexation is consistent with the philosophy espoused by his 1987 book Trump: The Art of the Deal. “This could be nothing more than his efforts to cause confusion and disruption as he prepares to negotiate with Canada.” It’s also possible that Canada could be economically weakened into a sort of vassal state, without absorption. Under such a scenario, Canada’s resources could be cherry-picked, in much the same way that Inner Mongolia’s vast rare earth deposits were taken by China beginning in the 1950s. Julie Klinger, an associate professor in the geography and spatial sciences department at the University of Delaware—who has documented the Chinese annexation of Inner Mongolia and its REEs—notes in her book Rare Earth Frontiers: From Terrestrial Subsoils to Lunar Landscapes that rich mineral deposits, like those found in Inner Mongolia, are often exploited for more than just economically valuable minerals. Mining can provide a means of imposing direct control by an aggressor state over contested territory—enabling the enclosure of lands, pushing environmental impacts to the fringes, and ultimately wresting control of land. As Klinger writes, in the case of Inner Mongolia, China promised autonomy to the indigenous Mongolian population but, instead, eliminated opponents and assimilated the rest amid massive influxes of Han Chinese farmers, who took over the best land. And they are still mining REEs there. Canada must now confront the very real possibility that the current US federal government could eventually use critical minerals and water as a pretext to take control of North American territory it considers critical to its future security and affluence. Natural resources will always be important, but control over territory could ultimately supersede access to our water and minerals. Canada, like our friends in Greenland and Panama, must now hope for the best and prepare for the worst.The post The US Badly Needs Rare Minerals and Fresh Water. Guess Who Has Them? first appeared on The Walrus.