Explainer: what Trump 2.0 means for the mining industry

Former US President Donald Trump has been declared the winner of the 2024 US election, after surpassing the 270 votes needed to win the presidency and likely also the popular vote.

Republicans also control the Senate, which they may even hold throughout 2024 having picked up West Virginia, Ohio and Montana from the Democrats, analysts from GlobalData TS Lombard predict.

Control of the House remains a toss-up, with a result potentially weeks away. The Democrats got a head start by flipping at least two seats in New York, although two seats in Pennsylvania may turn Republican. However, several states including Arkansas, California, Maine and Michigan remain battlegrounds.

A Republican-majority Congress would support Trump’s more extreme protectionist and anti-climate policies such as attempts to roll back the Inflation Reduction Act (IRA) and eliminating curbs on emissions.

However, a Republican sweep would likely make the ‘lame duck’ period – after a November election and before the beginning of the new Congress – more difficult, with Congress likely to wait for Trump’s return.

So, what could Trump 2.0 mean for the mining industry?

Bolstering of domestic minerals production

On the campaign trail both Trump and Democratic presidential candidate Kamala Harris asserted their support for mining, with policy proposals looking to address reliance on foreign supply chains for critical minerals.

However, while the Democrat’s approach put “nearshoring and friendshoring” at the centre, Trump is expected to prioritise reshoring.

Critical minerals partnerships/alliances are still expected to move forward under Trump 2.0, but “possibly with less progress” than they would have under Harris, according to Grace Fan, global director of policy and disruptive research at TS Lombard.

Gregory Wischer, founder of critical minerals consultancy Dei Gratia Minerals, also predicts a Trump administration will continue and accelerate bipartisan policies strengthening US mineral supply chains.

“In particular, I think you can expect the [Trump] administration to focus heavily on domestic onshoring of all parts of the mineral supply chain, especially mineral extraction,” Wischer tells Mining Technology.

While the Biden administration’s mineral policy “heavily features international cooperation”, an incoming Trump administration is likely to “significantly prioritise” building more mines, processing facilities and refineries in the US, he adds.

He therefore expects the next administration “to pursue policies streamlining permitting and imposing tariffs – as President-elect Trump has noted repeatedly in his speeches – in an effort to incentivise domestic mineral production.”

Mining permitting reform

Trump’s more relaxed approach to environmental regulation is likely to benefit both the fossil fuel and mining sectors.

The former president has already pledged to overturn a 20-year moratorium on mining in northern Minnesota. During Trump’s pervious term in 2020, a report commissioned by the Nuclear Fuel Working Group looking at how to restore US nuclear energy leadership included objectives to streamline regulatory reform and “expand access to uranium deposits on federal lands”.

“A Trump administration is likely to be pro-mining, which means more mines could be permitted and put into production faster,” says Hugues Jacquemin, CEO of Canada-based mining company Northern Graphite.

In a poll run on Mining Technology prior to the US election, 56% of respondents said a Republican administration would most accelerate the speed of mine licensing and permitting in the US if elected to government, compared to just 15% for Harris’ Democrats.

Tariffs and US-China decoupling

Trump has been vocal about his plans to impose stricter tariffs, and decoupling from China is expected to continue under his second non-consecutive term.  

“Regarding mining, the ongoing US-China decoupling will likely continue along its current trajectory under a Trump presidency, given the sharp increase in tariffs already implemented under the Biden administration,” says Clarice Brambilla, energy transition analyst at GlobalData.

Biden has already raised tariffs on Chinese exports in sectors such as semiconductors (from 25% to 50%), solar cells (from 25% to 50%), electric vehicle (EV) batteries (from 7.5% to 25%) and EVs (from 25% to 100%).

“It is expected that a Trump administration would maintain these high tariffs to further reduce reliance on Chinese imports,” Brambilla notes.  

“However, the US remains comparatively weak in the raw materials aspect of key technology value chains, which will hamper its ability to scale the manufacturing of these technologies domestically.”

Jacquemin of Northern Graphite, the only producer of natural graphite in North America, expects Trump’s stance on China to be stronger than it is today.

“It was the Trump administration that first placed tariffs on graphite from China and if anything, he is seen using tariffs even more to protect US industry,” Jacquemin tells Mining Technology.

“Tariffs help to level the playing field and we can only benefit from a stricter regime on imports of Chinese graphite,” he adds.

Graphite is a crucial component of lithium-ion batteries. Global supply is dominated by China, with the country accounting for 77% of all graphite production last year.

Will Trump repeal the IRA?

Although a Trump White House is likely to be more supportive to the fossil fuel industry, that does not necessarily mean it will withdraw support for the EV sector. However, Trump may try to roll back the 2022 IRA.

The Biden administration championed regulations and incentive-based programmes that prioritise a clean manufacturing agenda and climate protection. This saw nearly $400bn in federal funding directed towards clean energy through the Infrastructure Investment and Jobs Act (2021) and the IRA.

Section 45X of the IRA provides a tax credit for the production and sale of certain components in the US, including critical minerals such as graphite, cobalt, lithium and nickel. However, this only extends to producers who also refine materials, something the National Mining Association says needs to change.  

According to Brambilla: “Under a Trump administration, while the IRA may not be fully repealed, a Republican-controlled Congress could push to scrap certain provisions such as the $7,500 tax credit for EVs.”

However, Jacquemin says that if Trump does repeal the IRA “he will put something in its place to protect American industry”.

He also points out that “under the IRA, billions and billions of dollars have already flowed into the EV sector, with much of that occurring in Republican states”.

Any changes to incentives would, therefore, be sensitive to what has already been achieved to advance electrification and the energy transition.

Power Technology reported earlier this year that despite the fact that no Republican voted for the legislation, nearly 60% of the announced projects are based in Republican congressional districts.

When it comes to the commodity markets, a Trump win is likely to mean some short-term turbulence, says John Sisay, CEO of Consolidated Copper.

Sisay also believes that energy transition metals will remain a priority. He tells Mining Technology: “As a crucial element in everything from electric grids to battery production, America’s demand for copper will remain healthy, and the world is shifting towards renewable energy and EVs.

“Harris may have offered a steadier hand, with a clear green agenda that could have boosted copper demand, though the inflation risks in her spending plans could have held us back.”