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If we needed any more reminders about the high-stakes nature of our ongoing (see ARPN’s post on the latest USGS Mineral Commodity Summaries report here) deep over-reliance on Chinese-sourced (and/or processed) critical minerals, the shooting down of a Chinese spy balloon in U.S. airspace and the subsequent downing of three other unidentified flying objects over Alaska and Canada have clearly delivered.

The events have created a new flashpoint in already strained U.S.-Chinese relations.  The visit of U.S. Secretary of State Antony Blinken to Beijing planned for this past weekend was canceled and U.S. Northern Command and the North American Aerospace Defense Command (NORAD) are on high alert.

Against this backdrop, last week’s hearing before the House Armed Services Committee on the State of the Defense Industrial Base should be viewed with a greater sense of urgency.

During the hearing, members of Congress and defense experts argued that there was a “mismatch between what our national strategies aim to achieve and how our defense industrial base is postured,” and that “key industrial readiness indicators for great power competition are going in the wrong direction,” as David Norquist, president of the National Defense Industrial Association phrased it.

A key culprit, according to witnesses, is an over-reliance on Chinese supplies of key critical materials, like antimony, and the rare earths not just in terms of mining, but also processing.

“We found ourselves where we were relying on China for those minerals over many years, giving up our capacity and our ability to do that,” Eric Fanning, president of the Aerospace Industries Association, told the committee, referring to reshoring critical mineral production and processing capabilities, according to the Daily Caller’s Micaela Burrow.

Soliciting recommendations from witnesses on what Congress could do in the context of the 2024 National Defense Authorization Act to shore up U.S. domestic processing capabilities and strengthen the defense industrial base, committee chairman Mike Rogers (R-AL) stressed that “it is completely unacceptable that we are so heavily reliant on China for those minerals as well as their processing.”

The hearing also highlighted one of the inherent ironies of today’s critical mineral resource policy, which juxtaposes the urgent need to access and process critical minerals domestically with environmentalist pressures to reject new mineral resource projects.

Burrow cites Rep. Carlos Gimenez (R-FL) who put it bluntly: “The problem is us. We’re schizophrenic,” pointing to Armed Services members pressuring companies to access those minerals domestically while Congress orders other federal government entities, such as the Environmental Protection Agency, to sequester public lands.

Overall, Daniel F. Runde, senior vice president and William A. Schreyer chair in Global Analysis at CSIS argued in The Hill this weekend, while there has been an uptick in activity and recent legislative changes are “significant and helpful,” a “coherent strategy remains absent.”

Runde cites the Biden Administration’s 2022 National Defense Strategy as an example, which, he says, contains no mention of the mining and processing challenge posed by China — a “regrettable” omission “given that past assessments have found that China strategically floods the metals market to undermine U.S. producers critical to national security.” 

At a time when geopolitical stakes continue to mount and tensions flare, here’s hoping that in the coming months, urgency to strengthen U.S. critical mineral supply chains and the defense industrial base with a comprehensive all-of-the-above-approach is the name of the game.

As Norquist closed his remarks to the committee last week:

“The return of great power competition places greater demands on America’s defense industrial base. A brittle industrial base is a strategic vulnerability. A resilient defense industrial base is a powerful deterrent.”

 For all the talk about reducing our over-reliance on foreign critical mineral resources against the backdrop of soaring demand, strained supply chains and increasing geopolitical tensions, last week’s release of the annual USGS Mineral Commodity Summaries report still paints a sobering picture.

While the number of metals and minerals for which the U.S. remains 100% import dependent may have dropped by two from 17 to 15, the number of materials for which we are more than 50% or more import dependent has actually gone up over last year.

When cross-referencing the U.S. Net Import Reliance chart with the 2022 Final list of Critical Minerals, the United States was 100% net import reliant for 12, and an additional 31 critical mineral commodities (including 14 lanthanides, which are listed under rare earths) had a net import reliance greater than 50% of apparent consumption.

Recent policy developments, such as the Biden Administration’s invoking of the Defense Production Act (DPA) for the five “battery criticals” — graphite, lithium, cobalt, nickel and manganese –  as well as the rare earths, declared DPA priority materials during the Trump Adminstration, plus the passage of the Inflation Reduction Act, the energy provisions of which contained EV tax credits observers said would send important signals to investors and industry that the U.S. was serious about domestic supply chains, provide hope for a positive change.

But, after decades of dwindling domestic resource production and rising import reliance, no one ever said turning an aircraft carrier this size would be easy.  As Morgan D. Bazilian of the Colorado School of Mines and Gregory Brew from the Jackson School of Global Affairs at Yale University argue in a recent piece for Foreign Affairs, while this general trend represents “welcome and overdue progress, (…) implementing plans to reduce greenhouse gas emissions could be stymied in part by a material obstacle: the procurement of critical minerals such as lithium, cobalt, nickel, and copper that are essential to clean energy systems,” which in their words have so far been “myopic.”

At the same time, as scholars at the Wilson Center’s Environmental Change and Security Center have pointed out, “the Biden administration’s efforts to free up federal funds for domestic mining activities has highlighted the inherent conflict between accessing the minerals needed for climate action and the administration’s commitment to environmental and social justice.” 

Developments like the recent Biden administration halt on progress on the Ambler Road project in Alaska, which proponents say would unlock access to critical minerals and create new jobs, or the cancellation of the two mineral leases held by Twin Metals Minnesota LLC which seeks to mine copper, nickel and other commodities near the Boundary Waters Canoe Area Wilderness, point to conflicting viewpoints between the President’s stated objectives and his Administration’s policy.

This week’s State of the Union Address to both chambers of Congress could have provided important impetus to strengthen critical mineral supply chains. However, while professing that his administration understood the importance of making sure that “the supply chain for America begins in America,” the President’s speech never once referenced the terms “critical minerals,” “mining,” or “processing.”  

That is in spite of the fact that there are promising developments underway – especially for the “battery criticals.”  Over the next few weeks ARPN will be looking at each of these materials, now deemed under President Biden’s DPA determination to be “essential to the national defense,” and the U.S.-based projects working to urgently needed new supply into production.

Let’s start with graphite, one of the materials for which USGS noted an ongoing 100% import dependence this year.

As the key raw material in the battery anode, graphite is the largest component of lithium-ion batteries by weight. In light of “phenomenal demand growth from the EV battery sector and delays to new capacity as well as rising power costs,” the graphite supply chain represents a significant and growing challenge for automakers looking to reduce the carbon footprint of the materials they use for their EVs.

However, that’s not for lack of known graphite resources.  As USGS noted in February 2022 in its updated U.S. Mineral Deposit Database, the Graphite Creek deposit near Nome, Alaska – being developed by Graphite One, Inc. — is America’s largest graphite deposit.

Graphite One recently announced it is cooperating with two U.S. national laboratories under the Department of Energy umbrella in an effort to establish a mine-to-manufacturing all-American graphite supply chain.

In January, the company announced that it had entered into an agreement to have active anode material and other materials sourced from Graphite Creek tested to verify conformity to EV battery specifications by the Pacific Northwest National Laboratory (PNNL).

Aside from these public private partnerships according to Metal Tech News’s Shane Lasley, at least three automakers to date have also taken notice and are currently testing Graphite One material for use in their EV batteries.

In keeping with the new generation of miners looking to harness the materials science revolution to responsibly green our energy future [see ARPN’s post series on mining companies’ sustainability initiatives here], the company is also collaborating with Sandia National Laboratories in New Mexico to explore the lab’s award-winning green extraction methods to recover materials other than graphite from Graphite Creek – providing, in Lasley’s words, an opportunity to “provide an ancillary income stream for Graphite One while maximizing the Alaska deposit’s potential to supply minerals critical to the U.S” or – to use the President’s State of the Union verbiage — an opportunity to make sure that “the supply chain for America begins in America.”

As ARPN recently pointed out,

“If U.S. Government efforts to develop an American-based EV and lithium-ion battery supply chain have any hope of succeeding, looking for ways to help projects like Graphite Creek down the path to production will be, in a word…. Critical.”

As a highly versatile key mainstay metal, copper has been a building block of humanity’s progress. As a gateway metal, it yields access to critical minerals.  It also is an energy metal — an indispensable component for advanced energy technologies, ranging from EVs and wind turbines to the electric grid and solar panels. But for all its traditional and new applications [...]

The global race for critical mineral resources is heating up. Against the backdrop of soaring demand and rising geopolitical tensions, nations are scrambling to diversify their critical mineral supply chains away from adversary nations, i.e. primarily China, and, in the case of Europe, also Russia. While the European Union works to flesh out what is [...]

Earlier this week, USGS released its latest iteration of the annual Mineral Commodity Summaries, a much-cited report that every year gives us a data-driven glimpse into our nation’s mineral resource dependencies. It’s fitting that ARPN reviews the report on Groundhog Day, February 2nd, because just like in the Bill Murray classic movie, in which the clock jumps [...]

This week, world leaders are gathered in Davos, Switzerland, for the World Economic Forum Annual Meeting. They are facing, as the New York Times’s Roger Cohen (NYT) titled his reporting on the meeting, a “New World Order.”   Leaders must “pivot to the new reality provoked by the Covid-19 pandemic, the war in Ukraine, the growth of extreme inequalities [...]

Two weeks into the new year, it appears that 2023 will continue the fast-paced tempo we got used to in 2022 when it comes to developments on the critical minerals front. With Congressional leadership elections – finally – behind us, policy makers in Washington are gearing up to delve into the issues, and, if the [...]

Earlier this week, the Biden Administration unveiled a road map for reducing the transportation sector’s carbon emissions to net-zero by 2050. Two weeks into the new year, the green energy transition continues to gain steam.  However, as Morgan D. Bazilian of the Colorado School of Mines and Gregory Brew from the Jackson School of Global Affairs at Yale [...]

It may not make headlines as much as some of its U.S. Government Critical Minerals List peers, especially the battery criticals lithium, cobalt, graphite, nickel and manganese, and as such you may not have heard much about it — but antimony has entered the spotlight and has garnered the attention of Pentagon planners. After receiving [...]

  2022 surely was as fast-paced a year as they come. Didn’t we just throw overboard our New Year’s Resolutions?  We blinked, and it’s time for another review of what has happened in the past twelve months. So with no further ado, here is ARPN’s annual attempt to take stock of what has happened on the [...]