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  January 22nd, 2025 | Written by

US Interest in Greenland – A Shipping and Reserves Case

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The media have been on a tear surrounding President Trump’s interest in acquiring Greenland. Few would argue the President is consistently measured in his statements. Part of his appeal is off-the-cuff remarks that, in turn, create news and generate debate. As a marketer, the President is likely one of the best to ever do it. Remaining relevant is the point. 

Read also: Global Shipping Market Faces Turbulence as Tanker Rates Surge on China Routes

Yet, behind the 15-second Greenland quips lies a strategic dimension to Trump’s desire for the Arctic behemoth. More than three times the size of Texas, Greenland’s proximity to burgeoning shipping routes, vast undiscovered oil and natural gas reserves, and rare-earth deposits are extremely attractive. China’s growing advances and Russian proximity have the President on edge, and a more established US presence in Greenland, or acquiring the territory outright appears to be on the table for the incoming administration.   

The Shipping Case

As the earth warms, melting ice is giving way to new shipping routes. The Northwest Passage runs along Greenland’s coast and the island is part of a key maritime zone – the Greenland-Iceland-United Kingdom gap. Meanwhile, the Northeast Passage, icy conditions aside, could potentially reduce transport times between Europe and East Asia by half. 

Arctic shipping is on the rise. The volume of unique ships entering the Arctic Polar Code area increased by 37% from 2013 to 2023. Fishing vessels remain the most common type of ship, but cargo ships are gaining steam. September logs the greatest traffic as the Arctic sea ice is at its lowest. Over the past two decades, a loss of older, thick ice has created new channels. Before 2018 there were virtually no bulk carriers or gas tankers in the Polar Code area, but the Yamal Gas project and the Mary River Mine in Nunavut have contributed to a swell in activity. 

Chinese President Xi stated in a visit to Moscow in 2023 that stronger diplomatic relations with Russia were vital to counteract, “a long campaign by the United States to hobble China’s ascent.” Should tensions escalate between the US and China, unlike the Malacca Strait or the Suez Canal, a US blockade of the Northern Sea route would be difficult. 

The Reserves Case

Greenland is rich in raw material reserves. The Arctic region possesses an estimated 13% of the world’s undiscovered oil and an impressive 30% of natural gas. According to US Geological Survey estimates, Greenland is home to roughly 1.5 million tons of rare-earth element reserves. To put that into context, the US possesses 1.8 million tons while China absolutely dwarves the two with 44 million tons. 

One of the leading mining companies in Greenland, Tanbreez Mining, is in talks with the US and Danish officials to halt its potential sale to Chinese-linked companies. Tanbreez deposits are used extensively in defense applications, and the firm has revealed they have been in supply talks with Lockheed Martin coupled with upcoming meetings planned with Boeing. President Trump’s son, Donald Jr., visited Greenland in early January and it would appear that their advances have stalled any future sale to a Chinese entity for now. 

Saber-rattling over Greenland, the Panama Canal, and even absorbing Canada as the 51st state do share one thing in common. There is a feeling within the incoming administration that Chinese and Russian influence in “America’s backyard” is untenable. The Monroe Doctrine in 1823 aimed to keep European powers from encroaching into the Western Hemisphere. Chinese advances in South America have been notable in Peru, and while the Chinese do not control the Panama Canal, the Chinese firms CK Hutchison Holdings and Landbridge Group operate ports at both ends of the canal. 

The President’s approach and how he talks about geo-strategic moves will remain polemic. But there is a strong, strategic case to be made for Greenland.