- Energy
- June 5, 2025
- Editorial Feature
The Race To Reshore Lithium Supply Has Begun
Breaking China’s Lithium Stranglehold: Washington and GM Position McDermitt as the Frontline of America’s Lithium Defense
The White House and GM's unprecedented backing of Lithium Americas' Thacker Pass project was more than an investment - it was a declaration of economic war.
After a decade of engineered price suppression and market manipulation by China, Washington has identified the McDermitt Caldera as ground zero for America's fight to reclaim control of its critical mineral supply chain and draw attention to the explorer next door.
The White House recently made a power move.
This past Fall, they announced a 5% equity stake in Lithium Americas and another 5% stake in its GM joint venture at Thacker Pass. The package activates a $2.26 billion federal loan, with an initial $435 million draw to accelerate the project into production.i
Once online, Thacker Pass is set to become the largest source of lithium in the Western Hemisphere.
It’s the latest in a series of government-backed moves – on the heels of investments in Intel and MP Materials – as Washington seeks to shore up supply chains vital to national security.
The deal sent LAC up more than 300% in the weeks that followed and marked a clear turning point in U.S. industrial strategy.
Crucially, this isn’t limited to mining.
The Thacker Pass plan also attempts to reshore U.S.-based processing. Federal funds will help establish on-site facilities to convert Nevada’s clay-hosted lithium into battery-grade material on American soil – for the first time in history. Truly American innovation at its finest.
That’s a major step toward ending dependence on overseas refineries, more than 60% of which are controlled by China.iv
And as we’re now beginning to understand, that dependency has come at a heavy cost. While the U.S. built its battery economy on foreign supply, mounting evidence is showing that China was shaping the market behind the scenes.
It appears that the prolonged lithium downturn wasn’t natural at all, but the product of years of strategic price suppression.
The End of Artificial Oversupply, And Beginning of a New Bull Market
For years, analysts suspected that lithium’s extreme volatility wasn’t just the result of normal market cycles. But recent investigative reports are now revealing a concerning reality.
It appears that China has been managing global lithium prices – pushing them down whenever they rise and slowing Western supply.
A bipartisan U.S. House Committee found that China has manipulated global critical minerals prices for decades, specifically naming lithium. The report notes that each time lithium prices rose, the PRC took action to bring them back down, a pattern that has driven American miners out of business and created national-security vulnerabilities.v
After lithium fell nearly 80% from its 2022 highs, Chinese producers supported by state financing, continued ramping up output even at negative margins. Oilprice.com reports that Chinese miners kept expanding production as Western companies shuttered mines and slashed capital spending.vi
Reuters also has confirmed that this oversupply was not purely market-driven. Their analysis has shown that battery makers and miners, many Chinese-backed, kept marginal operations running to secure cheap feedstock, extending low prices far longer than a profit-driven system would allow.vii
But holding prices down carries consequences as well. The IEA now warns that artificially cheap Chinese material has undermined the economics for U.S. lithium production to such a degree that it has created a looming supply deficit.viii
If current investment levels continue, global lithium supply may meet only half of projected 2035 demand.ix
As Western governments race to reshore critical minerals, the market is entering a new phase, where price suppression is no longer sustainable, and lithium is beginning its next move upward.
We’ve seen this cycle before. When suppressed prices finally snapped back, the rebound was explosive. The last time the lithium market emerged from a downturn this steep, the sector delivered 10x–60x equity moves. The solution to low prices is low prices!
From November 2019 – November 2021, early-stage companies saw substantial growth as capital rushed into new supply:
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American Lithium rose +6,844%, from $0.09 to $6.25x
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Standard Lithium shot up +4,089%, from $0.38 to $15.92xi
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Lithium Americas soared +1,731%, from $2.90 to $53.09xii
And with today’s supply gap even deeper, and geopolitical tensions far higher, the setup now looks even more powerful. That’s why Washington is moving aggressively to rebuild a domestic supply chain before prices move higher.
And nowhere is this shift more visible than in Nevada’s McDermitt Caldera, where the first wave of federal-backed projects is beginning to take shape.
With mining and U.S. processing anchored at Thacker Pass, attention is turning to projects with the potential to feed this new strategic mineral hub.
That puts U.S. Critical Metals (CSE: USCM, OTC: USCMF) – with ground just 19 km away and in the same caldera – at the front of the queue.ii
Proximity can shorten haul, lower capex for standalone refining, and pull timelines forward.
Two Strategic Lithium Projects, Within Striking Distance Of Thacker Pass and Silver Peak
U.S. Critical Metals is well-positioned to benefit from these policy shifts and the resurgence of American lithium.
The company holds assets near federally backed projects in both of America’s critical lithium districts: McDermitt Caldera in the north and Clayton Valley in the south.
As federal funding flows into Thacker Pass and new processing facilities take shape, these locations offer a significant competitive advantage. Few juniors sit closer, or offer more district-scale potential, than US Critical Metals.
McDermitt East — 19 km from Thacker Pass
The McDermitt East Lithium Project covers a significant eastern portion of the McDermitt Caldera, an extinct 40×30 km super-volcano that hosts some of the world’s richest lithium clays.
The region was formed about 16.3 million years ago, when eruptions formed a deep crater that filled with an alkaline lake. Lithium concentrated in the sediments, and later uplift and erosion left those claystones near surface – ideal for open-pit targets.
McDermitt East sits on the caldera margin, the same geologic setting as Thacker Pass.
An NI 43-101 technical report points to strong potential for extensive lithium-bearing sediments, and preliminary surface sampling has returned up to 2,129 ppm, confirming strong potential.
With Thacker Pass now advancing construction and processing capacity, McDermitt East sits within striking distance of the first fully integrated lithium clay supply chain on U.S. soil.
Clayton Ridge - Within America’s Only Producing Lithium Region
Further south, Clayton Ridge gives U.S. Critical Metals exposure to Nevada’s prolific Clayton Valley. It’s home to Albemarle’s Silver Peak, the only lithium-producing operation in the United States.
For more than 50 years, the valley has been the epicenter of American lithium exploration and production, and activity is accelerating. The region is now home to 180,000+ active mine claims, 282 active exploration notices, and 198 authorized mining plans.xiii
Like McDermitt East, Clayton Ridge is believed to be part of a caldera-hosted system. Past geophysical scans found a massive “low-density” zone under these claims – exactly the kind you see where lithium tends to collect.
On the surface, the lithium-rich clay layers run for about seven kilometers and sit neatly between two volcanic ash layers. That’s the textbook setup geologists look for in claystone lithium deposits.
Geographically and strategically, Clayton Ridge complements McDermitt East. Together, these projects give U.S. Critical Metals exposure to both ends of the domestic lithium equation.
- McDermitt East – the emerging federal and industrial hub at Thacker Pass, and
- Clayton Ridge – the established lithium corridor anchored by Albemarle’s Silver Peak.
As the U.S. pushes to secure energy independence, U.S. Critical Metals stands exactly where the new supply chain is being built. It’s within hauling distance of the first American lithium processing facility, and in the heart of the nation’s two most important lithium districts.
The Fastest-Growing Driver of New Lithium Demand
Electric vehicles once dominated lithium usage. But the next surge in demand is coming from a different source: utility-scale battery energy storage systems (BESS).
These massive grid batteries are being deployed across the U.S. at an unprecedented rate, turning lithium into a pillar of U.S. energy infrastructure.
Texas, California, Arizona, Nevada, and New Mexico are now rolling out giga-scale installations. According to Rystad Energy, U.S. battery storage installations jumped from 6 GW in 2023 to 10 GW in 2024, a 60% annual increase, and are expected to reach 16 GW per year by 2026.xv
Benchmark Mineral Intelligence calls BESS the fastest-growing segment in the entire battery industry, expanding 44% year-over-year. By 2025, grid storage is expected to represent 25% of all global lithium-ion battery demand, and 35–40% of U.S. demand.xvi
What’s driving the acceleration?
For the first time in nearly two decades, U.S. electricity demand is rising sharply. AI datacenters, reshored manufacturing, and new policy mandates are creating a projected 20-30% increase in U.S. power demand by 2030.xvii Grid operators need massive amounts of storage capacity to stabilize these delicate systems.
And lithium batteries are at the center of this shift: low-cost, reliable, and easily manufactured at scale.
This surge is having a major impact on demand, expected to grow 30-40% just in the next year. Lithium carbonate prices in China have risen 57% over just five months, and analysts now forecast a renewed supply deficit as early as 2026.xviii
With the race on to secure long-term supply, lithium has moved into the core of America’s energy strategy, adding tailwinds for domestic explorers like US Critical Metals.
Proven Leadership With a Track Record of Success
US Critical Metals (CSE: USCM, OTC: USCMF) is guided by a management team whose past achievements speak volumes.
CEO and Director Darren Collins was an integral part of Hercules Metals that surged 40x in 2023—showcasing his ability to bring together assets and people to create significant value.
VP of Exploration Marco Montecinos is a seasoned expert with more than 35 years in the field. Marco’s extensive background includes work with major players like Billiton, Alta Gold, Francer Gold, and Placer Dome.
Top 5 Reasons to Add US Critical Metals (CSE: USCM, OTC: USCMF) to Your Watchlist
Start of A New Lithium Bull Market
Lithium is entering a new cycle as artificial price suppression fades and supply deficits tighten. In the last bull market, early-stage explorers delivered 10x–60x moves. With today’s shortfall even deeper, the next cycle could be considerably more intense.
Strategic Lithium Portfolio in Federally Backed Districts
US Critical Metals holds two lithium projects positioned adjacent to government-backed operations: McDermitt East (19km from Lithium Americas’ $2.26B federally funded Thacker Pass) and Clayton Ridge (in Clayton Valley, home to Albemarle’s DoD-backed operations). These are the two key lithium regions receiving federal investment.
Potential for a World-Class Discovery
Initial sampling at McDermitt East has returned up to 2,129 ppm lithium, and Clayton Ridge surface samples have hit 950 ppm. It’s early-stage, but the indicators are strong, and the district-scale upside is significant.
Experienced Leadership Team
With a CEO who has scaled exploration companies dramatically and a veteran technical team, the company is led by professionals who know how to create shareholder value.
Geopolitical Advantage
In an era of supply chain disruption and increased government incentives for domestic critical minerals, these projects have strategic importance and potential for policy support.
As the U.S. races to secure key mineral inputs, US Critical Metals is developing projects with national strategic relevance. With a diverse portfolio, strong leadership, and projects located in mining-friendly jurisdictions, the company is well positioned to benefit from this accelerating demand.
To learn more and follow US Critical Metals’ progress, visit uscmcorp.com.
i https://finance.yahoo.com/news/us-government-takes-5-stakes-200847907.html
ii https://chinaglobalsouth.com/analysis/chinas-critical-minerals-lead-widens-as-rivals-struggle-to-keep-pace/
iii https://nam.org/house-committee-china-manipulated-critical-minerals-prices-for-decades-35193/
iv https://oilprice.com/Metals/Commodities/Chinas-Global-Mining-Expansion-Accelerates.html
v https://www.reuters.com/markets/commodities/lithium-supply-surplus-set-stay-with-battery-makers-help-2024-12-10/
vi https://www.iea.org/commentaries/with-new-export-controls-on-critical-minerals-supply-concentration-risks-become-reality
vii https://carboncredits.com/americas-lithium-gap-how-surge-battery-metals-could-bridge-the-supply-shortfall/
viii https://finance.yahoo.com/quote/AMLIF/
ix https://finance.yahoo.com/quote/SLI/
x https://finance.yahoo.com/quote/LAC/
xi https://www.blm.gov/programs/energy-and-minerals/mining-and-minerals/about/nevada
xii https://pv-magazine-usa.com/2025/06/13/u-s-battery-storage-market-booming-with-60-annual-growth/
xiii https://investingnews.com/battery-storage-electricity-demand/
xivhttps://www.spglobal.com/energy/en/news-research/latest-news/electric-power/101425-data-center-grid-power-demand-to-rise-22-in-2025-nearly-triple-by-2030
xv https://carboncredits.com/lithium-prices-surge-amid-strong-demand-forecasts-could-reach-up-to-28000-ton-by-2026-nili/
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