“China’s been capturing that market for a long time and the U.S. has let a lot of their mines and other things kind of shut down.” – 01:37
Jeff Gitterman, CEO of Gitterman Asset Management, joins Remy Blaire to discuss the ongoing U.S.-China trade war and its implications for the rare earth minerals market.
Remy opens the conversation by highlighting President Trump’s assertion that the U.S. is in a trade war with China, noting that while tariffs are a significant concern, the real battleground may be the dominance of rare earths. Jeff explains that China currently holds over 90% of the market share in these essential minerals, prompting the U.S. to invest in its own rare earth companies to reduce reliance on Chinese imports. He clarifies that rare earths, despite their name, are not particularly rare but are difficult to mine and refine, making them crucial for various technologies, including smartphones and military applications.
The discussion delves into the historical context of China’s strategy, particularly its “One Belt, One Road” initiative, which aims to secure market dominance in rare earths. Jeff points out that the U.S. has allowed many of its mining operations to decline due to China’s ability to produce these minerals at lower costs. However, with rising tensions and export controls from China, the U.S. faces an urgent need to revitalize its mining and refining capabilities.
Remy and Jeff also explore the environmental implications of shifting rare earth production back to the U.S. Jeff emphasizes that the process is not only time-consuming—potentially taking 10 to 20 years to establish new mines and refining facilities—but also complicated by stringent environmental regulations. This interconnectedness of the global economy makes a swift transition challenging.
The conversation shifts to precious metals, where Jeff notes the significant rise in gold and silver prices. He explains that gold is currently viewed as a hedge against the weakening U.S. dollar, with potential prices soaring as high as $5,000 to $10,000 an ounce, driven by global demand and investment strategies from central banks.
As the episode concludes, Remy asks Jeff about the potential impact of U.S.-China tensions on markets as they approach year-end. Jeff expresses concern about the MAG-7 countries, which require substantial energy and rare earth minerals, and how rising prices could affect their operations. He shares that his firm is heavily investing in rare earth minerals, gold, and grid infrastructure, aligning with a broader climate change thesis that is now being accelerated by advancements in AI and ongoing trade disputes.