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Followers of ARPN have known since long before the U.S. Government issued its first comprehensive Critical Minerals List in 2018 that rare earth elements are in fact critical minerals.

However, more often than not, the group composed of scandium, yttrium and the lanthanides has been treated as a homogenous group considered critical for producing electronics, optical technologies, alloys and high-performance magnets.

While their indispensability is widely acknowledged, the homogenous grouping fails to do the individual REEs justice and prevents a much-needed discourse on the supply chains for these materials – a fact that was recognized by USGS in its latest update for the U.S. Government critical minerals list, in which it individually listed each REE as a separate Critical.

Amidst the group of 17 is one element, which according to Jack Lifton, editor in chief, critical minerals for InvestorIntel.com, and a seasoned technology metal expert, may be one of the most critical of all metals – dysprosium.

In a recent column for InvestorIntel.com, Lifton argues that while he pointed to the importance of the metal a little over a decade ago, dysprosium today is “more critical than ever and just as scarce as ever.”

According to Lifton, without dysprosium “the modern automotive powertrain would lack the ability to have reliable stable electric motors and generators ‘under the hood’ where dysprosium-modified neodymium-boron-magnets provide high coercivity (magnetic field strength) maintenance through repeat cycles of heating and cooling, and, also, the miniaturization of the automobiles power options, power steering, and a variety of motor management sensors.”

But while the automotive industry was aware of the material’s importance and a shortfall was beginning to form, today, the approximately 1000 metric tonnes of dysprosium produced annually come almost exclusively from China, according to Lifton.

With the growth of the automotive industry and especially the EV segment relying on “large electric traction motors of the rare earth permanent magnet type” the shortfall is not only here, it is alarming, and in light of its supply scenario, there is good reason the material makes an appearance on the list of “Defense Criticals”promulgated earlier this month by ARPN.

by Daniel McGroarty

The Critical Mineral space in the U.S. experienced a dramatic development this week, largely overlooked beyond specialty reporting in the defense and energy media:  With his February 27, 2023 Presidential Determination, President Biden once more invoked Title III of the Defense Production Act (DPA) to strengthen critical mineral supply chains – and in doing so, effectively created a new category of Critical Materials.  Two days later, the President followed with another DPA Presidential Determination (2023-5), designating airbreathing engines, advanced avionics navigation and guidance systems, and hypersonic systems and their “constituent materials” as priority DPA materials.

Tied to the Korean War-era Defense Production Act, the action carries the force of federal law, unlike Executive Orders, which carry no legislative weight — and while they can be enacted with the “stroke of the presidential pen,” can be rescinded with the same pen held by the next president.

Here’s where things get interesting, or more accurately, complicated.  ARPN followers are well aware of the frequency with which we focus on the U.S. Government Critical Minerals List, enacted via a Trump Administration Executive Order, promulgated in 2018, codified into federal law in 2020, and updated in 2022, to its present list of 50 minerals, metals and elements.

Alongside the Critical List we’ve seen a series of DPA Presidential Determinations involving specific Critical Minerals, beginning with President Trump’s July 2019 designation of the Rare Earth permanent magnet supply chain being designated as “essential for the national defense,” followed by President Biden’s designation of what ARPN calls the “Battery Criticals” as DPA Title III eligible in March 2022, followed by Platinum and Palladium in a DPA Presidential Determination in June 2022.

So, for anyone compiling a Critical Mineral Defense Production Act scorecard, at the close of 2022, the DPA list numbered 12:  5 “Magnet Rare Earths” (Neodymium, Praseodymium,  Terbium, Dysprosium and Samarium), plus 5 “Battery Criticals” (Graphite, Nickel, Cobalt, Manganese and Lithium), joined by Platinum and Palladium.  [For ARPN’s more detailed take on each of the battery criticals, see these previous posts.]

ARPN dubbed these 12 the “Super Criticals,” to distinguish this dozen from the 50 in the Critical Minerals List.

With this week’s new DPA Presidential Determination, the Super Critical category got a lot larger.  Just how large will take a bit of sleuthing, as President Biden’s three paragraph determination is framed around specific supply chains, implying without naming the specific minerals, metals and materials that will now be “strategic and critical materials,” instead directing Critical wonks to the White House 100 Day Supply Chain report, covered extensively by ARPN.  As for the hypersonic and airbreathing engines DPA announcement, it lacks any breadcrumbs on the metals, minerals and materials that will fall under the “constitutent materials” category.

Which makes building out the new Criticals list a work in progress.

What can be said so far?  To build out the new Strategic and Critical Materials list, start with the semiconductor materials referenced in Department of Commerce’s section of the 100-Day Report:  Gallium, Germanium, and Indium.

Then look to the Department of Defense portion of that report and a table said to list the 53 “materials” – get used to the DoD nomenclature, which unlike the U.S. Critical Mineral List, includes metals, minerals, materials including alloys and composites – found to be in shortfall by DoD.  (I’ll save a post on how DoD determines shortfalls for another time.)

But count the materials listed in the 100 Day Supply Chain Report, and you’ll end at 38, not 53.

15 of them are mentioned only in the Report appendices — and the appendices are withheld from the public document, as Classified and/or Controlled Unclassified Information (CUI).

What’s CUI?  You’ll be unhappy you asked: “Controlled Unclassified Information is information that requires safeguarding or dissemination controls pursuant to and consistent with applicable law, regulations and government-wide policies but is not classified.”  So it’s not classified, but without a U.S. Government security clearance, you can’t see it.

With just a quick look over the edge of the rabbit hole, ARPN will be scratching its head for a bit on how private sector resource developers will get to work producing 15 essential DPA Title III materials whose names cannot be spoken outside a government SCIF.  More to come on that.

As for the rest of the new 38 DPA Title III materials, what are they?

Aluminum (high purity)
Al-Li Alloy
Antimony
Arsenic (molecular beam grade)
Beryllium ore
Beryllium Metal
Bismuth
Boron (Boron 10 isotope – and other unnamed classified isotopes)
Carbon-Carbon (and classified variants)
Energetics (classified variants)
Fluorspar
Graphite (ISO-molded, civilian applications)
Graphite (ISO-molded, defense applications)
Lithium metal
Magnesium
Manganese (Electrolytic Manganese Metal)
FerroManganese
Niobium
REE NdFeB magnets
REE SmCo magnets
Rubber
Steel (1080 grade ultra-high strength cable tire cord)
Steel (grain oriented electrical, silicon-based)
Tantalum
Tin
Titanium (sponge)
Tungsten

…Plus 11 Rare Earths:

Cerium
Erbium
Europium
Gadolinium
Lanthanum
Neodymium
Praseodymium
Samarium
Scandium
Yttrium
Yttrium (multiple types, classified)

(Notice that 3 of these Rare Earths were already DPA Title III materials via the Trump Presidential Determination)

All together, counting the unique minerals/metals/elements in the new DPA announcement compared to the previously-designated Super Criticals, that’s 7 new Rare Earths plus 13 new elements, for a total of 20.

Back to the scorecard:

• 12 prior “Super Criticals”
• 3 semiconductor materials (Department of Commerce section, Supply Chain Report)
• 20 newly-designated metals/minerals/elements (DoD section, Supply Chain Report)

…For a total of 35.  For now, anyway:  as we’ve yet to dig in on the hypersonics, airbreathing engines and navigation and guidance system materials:

Aluminum
Antimony
Arsenic
Beryllium
Bismuth
Boron
Cerium
Cobalt (2022)
Dysprosium (2019)
Erbium
Europium
Fluorspar
Gadolinium
Gallium
Germanium
Graphite (2022)
Indium
Lanthanum
Lithium (2022)
Magnesium
Manganese (2022)
Nickel (2022)
Neodymium (2019)
Niobium
Palladium (2022)
Platinum (2022)
Praseodymium (2019)
Samarium (2019)
Scandium
Tantalum
Terbium (2019)
Tin
Titanium
Tungsten
Yttrium

Meet the “Defense Criticals:”  

A strong signal that the quest to create domestic supply chains just got serious.

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