Project Vault, the US government’s critical minerals reserve, will soon close its first funding tranche and begin helping manufacturers manage supply, processing, storage and supply-chain challenges, US Export-Import Bank president and chairman John Jovanovic said on Monday.
Announced in February by President Donald Trump, Project Vault aims to not only stockpile critical minerals, but alleviate supply crunches for a range of manufacturers that have for years been overly reliant on Chinese supplies.
US critical minerals policy is focused on securing emergency supplies, but industry constraints run far deeper than simply holding metals in reserve.
Jovanovic said Project Vault was designed to address broader market weaknesses including a lack of capital, too few large, creditworthy counterparties and the need for more flexible arrangements that can support processing and long-term supply commitments.
“It was designed not to be a stockpile alone,” Jovanovic told Reuters. “What it was designed to do was actually solve problems that the market faces.”
Project Vault will combine $2 billion in private funding with a $10 billion loan from the EXIM Bank.
It will be run by an independent entity, separate from EXIM Bank, with its own management team overseeing storage and logistics in consultation with manufacturers, Jovanovic said, without naming the entity.
“What we want to do is let it be dynamic and let it help try to solve a bunch of these problems.”
Unlike a traditional reserve, Project Vault is being built to handle both raw and processed materials.
The independent entity will work closely with manufacturers.
Project Vault is designed to let companies convert stockpiles from unprocessed raw material to products. Jovanovic said material could be taken out of Vault, sent to a processing facility and then returned to the system in refined form, while keeping the overall commodity exposure inside the vehicle.
“That also allows manufacturers to think ahead and start to provide demand signals to refining and processing assets.”
Part of the problem for companies in the sector is balance-sheet constraints. Project Vault could be used by manufacturers wanting off-take deals and making long-term commitments.
“You could use Project Vault to make that commitment,” Jovanovic said.
He declined to identify additional participants beyond those already public, but said more suppliers had signed up and that “every leading supplier” serving manufacturers in the United States had discussed taking part.
“We may not have enough bonded inventory, warehousing, and storage facilities in the United States,” he said.
“But if you have a creditworthy entity that has the demand for it, now you invite in the development, the construction, the build-out of more storage facilities.”
(By Pratima Desai and Ernest Scheyder; Editing by Matthew Lewis)
