The Pentagon plans to purchase up to $1 billion worth of critical minerals as part of a global stockpile program to counter Chinaʼs dominance in the metals market.
The Financial Times writes about this.
The Trump administration’s accelerated initiative to bolster the National Strategic Stockpile, described in public reports released in recent months by the Defense Logistics Agency (DLA), is a response to China’s export restrictions on a range of materials used in everything from smartphones to fighter jets.
In recent months, the Pentagon has been exploring the possibility of purchasing several important minerals:
- cobalt worth up to $500 million;
- antimony — up to $245 million at US Antimony Corporation;
- tantalum — up to $100 million from an unnamed producer from the USA;
- scandium — up to $45 million in Rio Tinto and APL Engineered Materials, a chemical materials manufacturing company with offices in Illinois, Japan, and China.
“This shows that the US government recognizes the importance of these materials and wants to support any domestic production,” said an industry representative.
The DLA amasses dozens of alloys, metals, ores, and precious elements stored in warehouses across the country, with a total value of $1.3 billion as of 2023.
The price of germanium has soared this year due to a decline in Chinese exports, causing panic among Western traders. The Pentagon is trying to address the problem.
The cost of antimony trioxide has nearly doubled in the past year, and automakers have faced shortages of rare earth metals due to Chinese restrictions.
- In April, China restricted exports of rare earth metals after U.S. President Donald Trump imposed new tariffs on the country. The resources are used in high-tech manufacturing, from electric cars to weapons.
- China accounts for nearly 70% of the world’s rare earths production, according to the US Geological Survey. The policy of control has long been seen as a potential geopolitical weapon for Beijing, given the United States’ dependence on Chinese supplies, Bloomberg reports.
- China has already imposed similar measures on gallium, germanium, graphite and antimony amid rising trade tensions.
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