The United States has launched a strategic reserve campaign for critical minerals, with Trump allocating $12 billion to initiate the ‘Vault Plan’.

President Trump plans to launch a strategic critical minerals reserve program with an initial investment of $12 billion to help manufacturers withstand supply shocks.

According to Zhitong Finance, U.S. President Trump plans to launch a strategic critical mineral reserve with $12 billion in seed funding. The aim is to protect manufacturers from supply shocks as the U.S. seeks to reduce its reliance on China Rareearth and other metals.

The joint venture, named “Project Vault,” intends to combine $167 million in private capital with a $10 billion loan from the Export-Import Bank of the United States to purchase and store minerals for automakers, tech companies, and other manufacturers.

Senior government officials who described the plan’s details stated that this would be the first such reserve in the U.S. private sector.

This effort is similar to the existing U.S. Strategic Petroleum Reserve, but instead of crude oil, the focus will be on minerals used in products such as iPhones, batteries, and jet engines, including gallium and cobalt. The reserve is expected to include rare earth elements, critical minerals, and other strategically important materials subject to price fluctuations.

This represents a significant commitment by the U.S. to accumulate key minerals necessary for the industrial economy, including sectors such as automotive, aerospace, and energy. It underscores Trump’s dedication to reducing America’s supply chain dependence on China, which is the leading global supplier and processor of critical minerals.

To date, more than a dozen companies are involved in the project, including General Motors, Stellantis, Boeing, Corning, GE Vernova Inc., and Google under Alphabet.

Three commodities trading firms—Hartree Partners LP, Traxys North America LLC, and Mercuria Energy Group Ltd.—have signed on to handle the procurement of raw materials needed to fill the reserve.

The board of the Export-Import Bank is set to vote later on Monday to authorize the record-breaking 15-year loan, which is more than double the amount of the bank’s second-largest transaction in its history.

Trump is scheduled to meet on Monday with General Motors CEO Mary Barra and mining billionaire Robert Friedland, representing producers and users of key minerals, respectively.

The U.S. already operates a national reserve of critical minerals serving the defense industrial base, but no reserves exist specifically for civilian needs. Under Trump’s leadership, the U.S. has also taken the unusual step of directly investing in domestic mineral companies to boost domestic production and processing capacity of rare earths.

The government has signed cooperation agreements with countries such as Australia, Japan, and Malaysia regarding this issue. During a multi-country summit scheduled to take place on Wednesday in Washington, the government will pressure more countries to reach similar agreements.

Last year, efforts to reduce risks in the mineral supply chain gained renewed momentum after China tightened export controls on certain materials.

This new joint venture project will provide participating manufacturers with a way to shield their businesses from price fluctuations of critical materials without having to maintain their own reserves.

Such price volatility can expose companies to significant fluctuations in key raw material inputs, thereby disrupting their balance sheets. For instance, shortly after the Russia-Ukraine conflict, nickel prices experienced a historic surge due to concerns that buyers would no longer be able to purchase metal from top supplier Russia.

Certain details of the ‘Vault Project’ structure have not been disclosed immediately, including the institutional investors providing $167 million in funding. Senior government officials stated that the project has been oversubscribed, as investors were attracted by this group of creditworthy manufacturers, their long-term commitments, and the participation of the U.S. official export credit agency.

The specific holding costs charged to these manufacturers, as well as the fees paid to trading companies acting as procurement officers, were not disclosed.

Under this arrangement, companies that initially committed to purchasing materials at a specific inventory price in the future and paid a portion of the upfront costs will be able to submit a list of their preferred materials to the ‘Vault Project.’

Accordingly, the project will seek to procure and store these materials, while manufacturers will bear expenditures related to loan interest and holding elements (i.e., holding costs).

As long as manufacturers replenish materials, they will be allowed to withdraw their stored materials. Officials stated that in the event of a major supply disruption, they will be able to withdraw their entire reserves.

A key element in the design of this plan is that manufacturers who commit to purchasing a specific quantity of materials at a set price also commit to repurchasing the same quantity of materials at the same cost in the future. The government believes this will act as a stabilizing mechanism, helping to suppress volatility.