Dangerous Dependence on China for Critical Minerals Runs Deep

Secretary of the Interior, Ryan Zinke, determined that the United States’ economic and military security depend upon 35 essential minerals. Unfortunately, our nation is import-reliant on 30 out of 35. Most alarmingly, we rely on one country — China — for our supply of 12 critical minerals, including the rare earth elements necessary for a little-known, but critical component, of electronic warfare systems: the traveling wave tube.

Producing these wave tubes requires no fewer than 46 elements on the periodic table. Of these, the U.S. is import-reliant on 27, many of which are sourced from China. Alarmingly, the U.S. is nearly 100 percent import-reliant on minerals in the rare earth element group, a market almost exclusively cornered by the Chinese. In 2018, the U.S. Geologic Survey reported that the United States imported 11,000 tons of rare earth elements. Our dependence on China’s rare earth mineral production should cause pause.

So, what can be done?

Our import dependence on China’s rare earth mineral production isn’t due to a lack of domestic resources.  The U.S. is blessed with domestic reserves of 1.4 million metric tons. We can and should encourage production here at home.

The U.S. must enact policies to galvanize the defense industrial base. Three recent provisions in the Fiscal Year 2019 National Defense Authorization Act (NDAA) are good examples of the steps Congress and this administration should take to ensure that our radar and electronic warfare systems are not held hostage by foreign and adversarial nations.

First, the House version of the NDAA included Sec. 873 prohibiting the acquisition of sensitive materials from non-allied nations. The provision, which the Administration strongly supported in its Statement of Administrative Policy issued May 22, forbids the acquisition of tungsten components, samarium-cobalt magnets, and neodymium-iron-boron magnets from non-allied nations including China, Russia, North Korea and Iran. These minerals have a broad range of aerospace and defense applications including bullets, missiles, and aircraft turbine engines. Promoting domestic production of these minerals should be a high national security priority. While a good first step, and one long overdue, Sec. 873 addresses just a small percentage of America’s import dependence for essential military components. In next year’s NDAA, Congress should consider expanding this provision, with input from the technical experts at the Department of Defense, to include other critical minerals essential to national security.

Second, Congress recognized that although exotic and lesser-known minerals make up the bulk of critical minerals, some of the more abundant and basic materials are also critical to defense production and the production of these materials is also insufficient. Sec. 343 of the House-passed NDAA would mandate that eight minerals — including copper, molybdenum, gold, nickel, lead, silver, and certain fertilizer compounds — should be added to the critical minerals list. Expanding the list of critical minerals and prohibiting acquisition of these materials from adversarial nations will help stimulate domestic investment in strategic materials and shore up supply chain vulnerabilities.

Finally, the House adopted Rep. Mark Amodei’s (R-NV) amendment to the NDAA, which will significantly reduce the mine permitting process from 10 years to two years. This is an important step and will incentivize private-sector domestic exploration, production and technological innovation. Congress and this administration must continue to remove regulatory barriers that dissuade investment in critical minerals production.

When the House and Senate begin conference negotiations for the FY19 NDAA, policymakers must ensure that these provisions are included in the final bill. Furthermore, the U.S. must continue seeking proactive solutions to improve the defense industrial base. With these policy changes and robust investment in promising advanced manufacturing companies, the United States can reduce its reliance on non-allied foreign nations for critical minerals and ensure the security of our men and women in uniform.

Jeff A. Green is president and founder of J.A. Green & Company, a bipartisan government relations firm based in Washington DC.