After recent announcements of new tariffs, there’s been no shortage of headlines, speculation and market swings as the market reacts to volatility. But as someone who has spent his adult life building companies in the metals sector, I can tell you this: tariffs alone won’t build what America needs – we need capital.
I’ve helped blue-chip clients around the world navigate complex technologies in natural resources, and I love building solutions that matter in critical industries like ours. But to succeed, we need more than just political will and trade barriers. It takes capital, a lot of it. If we’re serious about reshoring manufacturing, securing supply chains and protecting our national interests, now is the time we stop hoping tariffs will do the heavy lifting.
We need to capitalize the builders who are working hard to create the new golden age of American industrialism.
Tariffs are no stranger to the magnesium industry. We’ve lived with them for two decades. As a result, the magnesium industry serves as a bellwether for why tariffs aren’t enough.
For perspective, magnesium metal is perhaps the most important critical material, and it’s the only structural metal you can make from seawater. It’s like aluminum’s lighter little brother and is a key enabler of end products for other metals. It stiffens aluminum in alloys, so you can't make planes or cars without it. It's used to make titanium, which is essential for aerospace. It's essential to make hafnium and zirconium for nuclear applications, and it’s used to make beryllium, essential for electronics manufacturing. It's also used to make boron, which is essential for defense applications. Heck, it’s even used in steel making. Magnesium is the gateway metal to so many other industries, both civilian and defense.
Considering all those essential uses, the scary fact is that NATO has virtually zero primary magnesium metal production. Even worse: China and Russia control over 90% of global magnesium production today. Yikes.
We should never have let this happen, as the US was the world’s largest producer of magnesium metal until the 1990s, where Dow made it from seawater in Freeport, Texas. That smelter was built during WWII when the Department of War gave Dow $9B (2024 dollars, and that’s billion with a “B”) to stand up capacity in 3 years. Oh, how the mighty have fallen…
In 1995, the US introduced >140% anti-dumping tariffs on Chinese magnesium imports to help combat the Chinese Pidgeon process, an environmentally detrimental production method that emits vast quantities of carbon dioxide and relies on questionable labor practices to make this critical metal. In fact, due to Uyghur forced labor, Chinese magnesium companies are barred from selling into the US (DHS Places Additional PRC-Based Companies on the UFLPA Entity List | Homeland Security). Even with these anti-dumping duties in place, only one producer was kept alive until three years ago when they went down to a catastrophic equipment failure. Now, in 2025, President Trump’s Liberation Day tariffs didn’t even include magnesium… it’s exempt, even from China!
Is this a bad thing? Not necessarily. I believe that anti-dumping duties and tariffs against China are a good thing. There are heinous amounts of environmental pollution and human rights issues embedded in most of their critical mineral products, and it's completely unfair that American companies happily pay for strong environment and social protections when the Chinese Communist Party (CCP) does not require their state-owned enterprises to do so. As the magnesium industry has shown in the past, tariffs are simply not enough. Even with a 115% anti-dumping duty today on Chinese magnesium metal, we have zero primary production in the United States. It will take us years to rebuild it even if we had infinite capital available tomorrow.
On March 20, President Trump issued an executive order (Immediate Measures to Increase American Mineral Production) to support the domestic production of critical minerals, including magnesium. This step was a much-needed action. In fact, our team at Magrathea was consulted in its development, as we have been in conversations with the Department of Defense ever since it has become clear that our catastrophic supply failure had exposed how vulnerable America is without magnesium.
But I remain concerned. This order may lead to a few token investments, but we need much more to truly tackle this problem.
Mr. President: I respect your focus on expanding critical mineral supply for U.S. interests. It’s a necessary step to overthrow the stranglehold that Russia’s Putin and the CCP have on the materials that are needed to bolster our national security and protect our borders. This movement goes well beyond magnesium.
What will truly move the needle and ensure America becomes a leader in critical minerals is billions of dollars to fund several projects in the US. This is something I have been communicating to the DOD every time I talk to them. The government needs to understand that they must make capital available in the form of large grants and loan guarantees to build real capacity. There is no other way – private capital allocators are too focused on dog walking apps to take this seriously now, which is when it matters.
America has viable, proven technology solutions for critical minerals production that are available today, but they need capital to reach commercial scale. The CCP understands this concept and they made capital available to build up their industries. However, our government has missed these opportunities over and over again, allowing important technology solutions to die on the vine instead of getting scaled up. This must change now.
If the Trump administration is serious about building critical mineral supply chains domestically, then making hundreds of billions of dollars available for new US metals production is the best first action they can take. It’s not just a good investment decision; it’s a necessity for national security.
Tariffs are an important step; the executive order was too. Now it’s time to really make it happen – inject serious capital into the next-generation of American builders who are solving crucial problems, and making the US the manufacturing hub it once was and needs to become again. Dow did it in WWII, and we will do it for today’s decade of great power competition with the CCP.
Let’s put real capital back into American capitalism.
Alex Grant is Co-founder and CEO at Magrathea, the category leader in rebuilding the U.S.’s magnesium metal supply. He was a 2021 Forbes 30 Under 30 honoree and served as Lithium Partner at Minviro, building environmental impact models of lithium-ion battery supply chain mineral and metal conversion processes including the first carbon model for Tesla's batteries.
