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US Defence Department warns of urgent need to secure critical minerals

The US Department of Defence (DOD) has warned that securing critical minerals is crucial for the US defense industrial base — to build everything from unmanned aerial systems to fighter jets.

“Recent disruptions [due to] adversarial actions have underscored what we have long recognized, that it is more urgent than ever to build capability and resilience in supply chains for critical minerals”

— Adam Burstein, technical director for strategic and critical materials in the Office of the Assistant Secretary of Defense for Industrial Base Policy

China’s recent export restrictions on materials like gallium, germanium, and antimony, as well as proposed lithium tech restrictions, has highlighted the urgent need to secure supply chains. Burstein noted that China’s actions have demonstrated its willingness to disrupt critical US supply chains.

The warning comes as the FBI director, Christopher Wray, warned about China’s penetration of US infrastructure.

“China’s cyber program is by far and away the world’s largest– bigger than that of every major nation combined and has stolen more of Americans’ personal and corporate data than that of every nation, big or small, combined”

— Christopher Wray,  FBI director

To secure these vital materials, the US Department of Defence has focused on:

  • increasing domestic mining and processing: since 2020, the Department has invested over US$439 million to establish domestic rare earth element supply chains
  • partnering with allies: Congress has included the UK, Canada, Australia as domestic sources to support the Defense Production Act. 19 security supply cooperation arrangements have been signed between the US with partner nations to allow DOD to request priority delivery for DOD contracts, subcontracts, and allow the signatory nations to request the same of the US. Last year, the US issued multiple DPA awards to projects based in Canada, which also received joint funding from the Canadian government, targeting an increase in secure supply of key materials, including cobalt, graphite and tungsten
  • stockpiling critical minerals: stockpiling of critical minerals is another DOD strategy that reduces risk from unanticipated demand spikes or supply chain disruptions, essentially acting as shock absorbers, Burstein said

Our recent analysis on the new move to stockpile critical minerals across the world, especially China and the US, and the impact this will have on mineral supply and demand:

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The Oregon Group is an investment research team focused on critical minerals, mining, energy and geopolitics.

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