U.S. House launches caucus to boost strategic minerals production

By Ernest Scheyder

July 24 (Reuters) - The U.S. House of Representatives launched a bipartisan caucus on Friday to focus on ways to increase domestic production of specialized minerals used to make missiles, cell phones and other high-tech equipment.

The Critical Materials Caucus is the latest effort by officials in Washington to blunt China's prowess as the world's largest producer or processor of rare earths, lithium, titanium and other niche but important minerals.

Representative Eric Swalwell, a California Democrat, and Representative Guy Reschenthaler, a Pennsylvania Republican, will chair the group, which was approved by the House Administration Committee's leadership.

The Pentagon and a rising number of U.S. tech companies have grown concerned that China could cut off exports of the minerals to the United States - which it did to Japan in 2010 - if relations between Beijing and Washington deteriorate further.

"All of us want to make sure America addresses this national security issue," Swalwell told Reuters. "I don't consider China an ally country."

The United States has large reserves of many of these minerals and several smaller companies are working to develop them. U.S. scientists are also studying ways to recycle the minerals from old electronics.

Caucus members plan to initially focus on legislation Swalwell has introduced to permanently fund rare earths research at U.S. Department of Energy laboratories.

China became the top global producer of many of these minerals only in recent decades. The rare earths industry, for instance, began in the United States during World War Two as part of the Manhattan Project, but the technology gradually moved overseas to China.

"It is more important than ever for our nation to work towards achieving critical material independence," said Reschenthaler.

The caucus will start in the House and could potentially expand to the U.S. Senate, staffers said. (Reporting by Ernest Scheyder; Editing by Cynthia Osterman)