U.S. Government Invests in E-Waste Recycling to Reduce Dependence on China
The U.S. government is making significant investments in the recycling of electronic waste as a strategy to reduce its reliance on China for critical materials. This move comes after the Pentagon acquired a substantial equity stake in MP Materials, the sole company currently extracting rare earth elements from U.S. soil. The initiative is part of a broader effort to secure key resources that are essential for military and industrial applications.
This development coincides with President Trump’s imposition of a 50% import tariff on copper, which has driven prices to record highs. While mining operations take decades to scale, the U.S. is turning to an existing resource: the vast quantities of e-waste piling up in warehouses and landfills. This includes old smartphones, broken electric vehicle batteries, discarded servers, and outdated laptops.
The core idea is to extract valuable metals such as neodymium, praseodymium, and terbium from e-waste rather than waiting for new mines to come online, which can take up to 30 years. The race to recycle these materials is already intensifying, with several companies vying for a share of this growing market.
Companies Leading the Charge
According to CNBC, companies like Glencore, Full Circle Electronics, Cyclic Materials, and startups such as Illumynt are actively pursuing e-waste as a source of raw materials. These metals are crucial for a wide range of high-tech applications, including fighter jets, power tools, MRI machines, wind turbines, and other advanced technologies used by both the military and industry.
Kunal Sinha, global head of recycling at Glencore, emphasized that recycling was not taken seriously until recently. “A lot of people are still sleeping at the wheel and don’t realize how big this can be,” he said. Glencore has been processing old electronics at its smelter in Quebec for decades, transforming waste into copper slabs and extracting precious metals like gold, silver, palladium, and platinum.
Fifteen percent of the smelter’s feedstock now comes from recycled electronics. Glencore also signed a multi-year deal with Cyclic Materials to supply them with recycled copper from EV motors, data center parts, and wind turbines. Cyclic is investing over $20 million to build a new U.S. plant in Mesa, Arizona.
Foreign Firms Enter the U.S. Market
The demand for recycled materials is so high that foreign firms are entering the U.S. market. Germany’s Wieland started a $100 million recycling facility in Kentucky in 2022, while Aurubis launched an $800 million multi-metal plant in Georgia. CEO Toralf Haag stated that the Aurubis Richmond facility will help keep strategically important metals within the economy, reducing dependence on China.
Recycling isn't just focused on rare earths. John Mitchell, president of the Global Electronics Association, highlighted that most electronics imported into the U.S. contain valuable metals like copper, gold, and steel. “There’s a great opportunity to actually have the tariffs be an impetus for greater recycling in this country,” he said.
The Growth of E-Waste Recycling
The pace of e-waste recycling is significantly faster than traditional mining. Full Circle Electronics CEO Dave Daily noted a surge in dumped electronics as businesses rush to upgrade ahead of rising prices. “We’re definitely seeing a bit of an influx of [e-waste] coming into our warehouses,” he said. Full Circle processes old gear into 40 to 50 material types, selling them off to recyclers who extract metals for resale.
Lithium-ion batteries have also become a major focus due to their high content of lithium, cobalt, nickel, manganese, and aluminum. Companies like Ascend Elements, Redwood Materials, Cirba Solutions, and American Battery Technology are working to tap into these materials to support EV battery production.
However, the future of these companies is uncertain. They rely heavily on the 45X tax credit introduced under Biden, a program that could face cuts in Trump’s new spending plan. Sinha warned against building a recycling company on the back of a single tax credit, as it could be short-lived.
Data-Heavy Gear and ITAD Industry
Data-heavy equipment is also being targeted for recycling. Illumynt is harvesting rare earths from hard drives removed from data centers. In April, Western Digital partnered with Microsoft, Critical Materials Recycling, and PedalPoint Recycling to extract copper, gold, aluminum, steel, and rare earths from old drives.
Meanwhile, the ITAD (IT Asset Disposition) industry is booming, with waste disposal firms like Waste Management, Clean Harbors, and specialists such as Sims Lifecycle Services and Electronic Recyclers International playing a key role in wiping data and breaking down devices.
The Scale of E-Waste
The amount of e-waste produced globally continues to grow. In 2022, nearly 62 million metric tons of e-waste were generated worldwide—an 82% increase since 2010. The U.S. contributed almost 8 million metric tons, but only 15–20% was recycled. The U.S. e-waste recycling market generated $28.1 billion last year, with an annual growth rate of 8%.
China's Role and U.S. Response
Despite these efforts, China still dominates the rare earth market, controlling 90% of the supply chain from mining to refining. In April 2025, China restricted exports of rare earth magnets in response to new Trump tariffs, causing shortages that forced Ford to shut down some factories. Although China granted a few six-month export licenses in June, shipments remain far from normal.
The Trump administration is pushing new initiatives. Before the Pentagon’s recent move, Biden allocated $45 million to MP Materials. In April, the Interior Department approved the Colosseum rare earth project in California’s Mojave National Preserve, owned by Australia’s Dateline Resources, which could become the second U.S. rare earth mine.
The Future of Recycling
Sinha emphasized the need for realistic expectations. He warned against betting too much on hype or new technology. “Don’t invest on the hype,” he said, “but on the fundamentals.” Glencore is currently navigating challenges, having invested $327.5 million in Li-Cycle, a battery recycler based in Toronto. The company filed for Chapter 15 bankruptcy in May after starting construction on a plant in Rochester, New York. Glencore is now trying to acquire the failed project with a $40 million bid.
Despite these challenges, Sinha believes the market is heating up. “The current environment will lead to more startups and investments,” he said. “We are investing ourselves.”
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