US Plans Reallocation of $2B CHIPS Act Funds to Critical Minerals

The Trump administration is considering reallocating $2 billion from the CHIPS and Science Act, initially designated for semiconductor research and manufacturing, to support critical minerals projects vital for reducing U.S. reliance on China. These minerals, including gallium and germanium, are essential for semiconductor, electronics, and defense industries, with China currently dominating their global supply. The reallocation plan aims to empower Commerce Secretary Howard Lutnick's role in the sector and may involve providing grants or taking equity stakes in minerals companies, reflecting a broader strategy to strengthen domestic mining and processing capabilities. This move follows executive actions by President Trump to increase deep-sea and domestic mining efforts, alongside recent Pentagon investments in critical minerals firms. The administration seeks to avoid fresh Congressional funding requests by repurposing existing CHIPS Act allocations, signaling a shift in how funding authorization might be managed. While details remain tentative and the White House has not publicly commented, this approach underscores a strategic pivot to bolster U.S. supply chains amid ongoing trade tensions with China.