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American Resources Policy Network
Promoting the development of American mineral resources.
  • U.S. Military Faces Compounding Problems – Surging Tensions, Depleted Stockpiles, Critical Mineral Supply Chain Challenges

    In a piece that may not be hot-of-the press but is certainly as relevant today as it was in November of last year when it was penned – and ties into the context of ARPN’s latest post on NATO facing the critical minerals challenge –the Oregon Group’s Anthony Milewski warns that the U.S. defense industrial base is ill-prepared to support the current global rearmament trend, particularly with regards to critical minerals underpinning military technology and munitions.

    Milewski points to Russia having fired an estimated 11 million artillery shells in 2022, the majority of which can contain – depending on shell and manufacturing process – at least an estimate 0.5kg of copper. This, he says would amount to 5,500 tons of copper, or the equivalent of copper used in 1,170 wind turbines.

    Copper demand is already forecast to increase by more than 100% by 2035 with many analysts warning there may not be enough copper to meet decarbonization goals in the next few decades after years of underinvestment in the mining industry and falling ore grades.  And those projections, according to Milewski, do not account for surging military demand against the backdrop of increasing geopolitical volatility around the globe.

    Of course, copper is just the proverbial tip of the iceberg. According to the National Mining Association, the U.S. Department of Defense uses nearly 750,000 tons of minerals on an annual basis – a number that was calculated around 2016/2017 at a time when the U.S. was not facing any major conflicts.

    Fast-forward to 2024 and the U.S. is supporting allies in the Ukraine and Israel while the situation in the Taiwan Strait looks increasing vulnerable.  Meanwhile, particularly ammunition stockpiles are running so low that NATO officials have warned that Western militaries are scraping “the bottom of the barrel” forcing NATO to provide Ukraine with supplies not from full warehouses, but rather “half-full or lower warehouses in Europe.”

    The issue is compounded by the fact that production time to rebuild weaponry stocks can take anywhere between three and 18 years, depending on equipment according to the Centre for Strategic and International Studies – however that analysis focuses only on manufacturing and production times.

    As followers of ARPN well know, supply chains for the metals and minerals underpinning U.S. military technology and munitions are “extremely vulnerable” due to a perennial over-reliance on supplies from adversary nations, i.e. China.

    For all the talk about decoupling supply chains in recent years, the needle has not moved much, and the latest USGS Mineral Commodity Summaries still has the U.S. 100% import reliant for 12 metals and minerals, while an additional 29 critical mineral commodities had a net import reliance greater than 50% of apparent consumption — a small drop by two over last year’s report.

    However, some important steps have been taken in recent years, and are beginning to bear fruit. Milewski lists several military budget ramp-ups to “try and resolve the massive shortfall.”

    As ARPN previously outlined, a notable example of such efforts is the series of (Defense Production Act) DPA Presidential Determinations involving specific Critical Minerals, beginning with President Trump’s July 2019 designation of the Rare Earth permanent magnet supply chain as being “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.  Earlier this spring, two further Presidential Determinations (February 27, 2023 Presidential Determination, and DPA Presidential Determination (2023-5)), effectively created an entirely new category of critical minerals – Defense Criticals” as ARPN calls them – by way of designating airbreathing engines, advanced avionics navigation and guidance systems, and hypersonic systems and their “constituent materials” as priority DPA materials.

    Those DPA actions, funded by Congressional appropriations, are now producing Department of Defense funded projects to encourage domestic development of these “defense criticals” and their supply chains.

    Milewski highlights the following:

    • Graphite: a $37.5 million agreement between the DoD and Graphite One (Alaska) to fast-track a domestic graphite mine;
    • Antimony: two awards — $24.8 million and $15.5 million — by the DoD to Perpetua Resources to secure a domestic source of antimony [an additional conditional award of up to $34.6 million under the existing Technology Investment Agreement was announced earlier this week];
    •  Lithium: a $90million agreement to secure lithium production between the DoD and Abermarle;
    • Nickel: a US $20.6 million agreement between the DoD and Talon Nickel to increase domestic nickel production.

    He closes:

    “We see the U.S. military shifting its position and capacity to secure its critical mineral supply gaining more momentum than it has for arguably the past 30 years. However, the U.S. military is America’s largest government agency, and it will take time.”

    However, with conflict brewing in many parts of the world, time is a luxury we do not have, and strengthening critical mineral supply chains should be a key priority for policy stakeholders in 2024.

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  • Groundhog Day All Over Again in Spite of Rising Pressures? USGS Releases Annual Mineral Commodity Summaries Report

    Earlier this week, the U.S. Geological Survey (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. ARPN has been reviewing the report on an annual basis.

    Last year, we noted that our coverage of the report coincided with Groundhog Day, February 2nd.  And just like in the Bill Murray classic movie, in which the clock jumps back to the same day all over again every morning, the Critical Mineral movie appeared to bring us back to a situation of ongoing deep dependency on foreign sourced metals and minerals every year – at least in recent memory.

    This year, we’re once again back with a look at the report, and, lo and behold, it’s Groundhog Day all over again – and by the looks of it not only with regards to the date, but also in terms of what we’re seeing, especially on one of the most telling charts of the report – the depiction of U.S. Net Import Reliance, or “Blue Wall of Dependency” as we have dubbed it based on the many blue bars showing our significant degree of import dependence.

    While there are some changes from last year’s report, the number of metals and minerals for which we are 100% import dependent stayed the same at 15.  The the number of metals and minerals for which we are 50% or more import-dependent has dropped slightly, after having gone up over the year before — with the new report pegging it at 49 versus 51 in 2023 and 47 in 2022.

    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 29 critical mineral commodities (including 14 Rare Earth lanthanides, which are listed under rare earths) had a net import reliance greater than 50% of apparent consumption — a small drop by two over last year’s report.

    Once more, ARPN  can’t help but observe that the trendlines represent a stark contrast to U.S. import reliance for metals and minerals in 1984, when we were 100% import reliant for just 11 mineral commodities.

    A few changes for individual metals and minerals included in the report are notable and significant, particularly in the context of the accelerating global green energy transition:

    For the Rare Earths, a key group of tech metals underpinning 21st Century technology and the accelerating green energy transition, our import reliance had dropped from 100% in the 2021 report to “greater than 90%” in the 2022 report.  Last year’s report had, this number back up to “greater than 95%” and it remains at the same level in this year’s report, with rare earth concentrate being extracted in the U.S. currently sent to China for separation.  Once again, a single link lacking in a supply chain continues U.S. dependency.

    For Lithium, perhaps the most frequently cited battery tech mineral, and Cobalt, another one of Lithium’s “battery critical” peers, U.S. import reliance stayed the same at “greater than 25%” for lithium, while Cobalt’s number dropped from 76% to 69%.

    For Graphite and Manganese, both battery criticals – the USGS report shows both still pegged at an unchanged 100% import reliance, unchanged from last year.

    For Nickel, the final battery critical and a new element on the 2022 Critical Mineral List, import-reliance saw a small jump from 56% last year to 57% in this year’s report, after a more significant jump the year before (from 48% to 56%).

    Import reliance for Platinum represents one of the biggest changes over last year’s report, which had the metal pegged at 66%. That number increased to 84 percent in the 2024 report.

    Another change worth mentioning is the upward trajectory for Copper import reliance. In the 2010s, import reliance for Copper hovered around 30 to 35 percent, but in recent years, that number has gone up.  This year’s report has it pegged at 46%, up from 41% in the 2023 report.  This development that may be of particular relevance as in 2024, the U.S. Government Critical Minerals List is up for another update, on the 3-year timetable codified in federal law, and in spite of the metal’s inarguable growing importance in the context of decarbonization efforts and expert warnings that there may not be enough copper to meet decarbonization goals in the next few decades, the material has to date been left off the whole-of-government list. Congressional efforts to change this may have not succeeded in 2023, but the Department of Energy designated the material a critical material as part of its 2023 Critical Materials Assessment, further raising the material’s clout.

    As in previous iterations of the report, China continues to be the elephant in the data room. And against all pledges in recent years for the United States to reduce import reliance on supplies from China, the 2023 Mineral Commodity Summaries lists China 24 times as one of the major import sources of metals and minerals for which our net import reliance is 50% or greater (which is down by one over last year) – and for all the talk about decoupling supply chains from China and against the backdrop of the escalating trade and tech wars between Beijing and Washington (see our coverage here), this continues to be a concern.

    Like last year’s report, this year’s Mineral Commodity Summaries report features an expanded chapter on developments in the critical minerals realm, identifying trend lines, and supply chain security and U.S. government critical minerals initiatives as well as critical mineral investments.

    Last year we noted that “while the urgency of the need to secure critical mineral supply chains has registered with stakeholders over the past few years, USGS’s findings underscore once more that supply chains in the 21st Century are extremely complex and meaningful change takes time – and the developments of 2022 ranging from increased resource nationalism in the Southern hemisphere over war in Ukraine to rising geopolitical tensions have not made untangling supply chains any easier.”

    Since then, the stakes have only gotten higher as geopolitical tensions continue to rise and U.S.-Chinese relations appear to sour, but ARPN’s basic assessment of the situation stays the same.

    So, with the report revealing more of the same, and in true Groundhog Day fashion, we revisit last year’s post, in which we stated:

    “In Bill Murray’s movie, it took the protagonist several years to realize how to change behavior to break the cycle.  We know by now that to break our cycle of resource dependence, it will take a comprehensive ‘all of the above’ approach to critical mineral resource policy – and stakeholders have come to realize this and have increasingly embraced the concept.  We continue to stand by what ARPN’s Dan McGroarty stated during a congressional hearing in 2019 – ‘we can’t admire the problem anymore. We don’t have the luxury of time.’

    If we act swiftly and comprehensively, there may just be a chance that we will wake up twelve months from now not to another Groundhog Day, but to a 2024 Mineral Commodity Summaries that paints a picture of reduced resource dependence.”

    2024’s report was not the one to paint that picture, but in light of recent policy developments (see our recap of 2023 here and refer to page 18 – 22 of the report), there is still hope we will be getting closer by the time next year’s Groundhog Day rolls around.  Meanwhile, with apologies to Punxsutawney Phil’s cheery forecast of an early spring, ARPN is projecting another long winter ahead of Critical Mineral foreign dependency.

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  • ARPN’s Year in Review – 2023

    – A Look at 2023 Through the Prism of Critical Mineral Resource Policy -  In the waning days of December 2022, ARPN and others were gearing up for a watershed year in the critical minerals realm – a year which could be a “breaking point if there is to be an EV revolution/transformation,” and one that would [...]
  • China Zeroes in on Copper

    While critical mineral supply chain security has become more than an obscure concept these days, many people will still associate metals like lithium, cobalt or maybe rare earths with it, rather than some of the more mainstay metals. However, that does not mean we should not be worried about their supply. As Dario Pong, founder [...]
  • Old Metal, New Uses, New Demand Profile, New Technologies – A Look at Copper

    Copper may be one of the earliest identified metals – there is evidence of Stone Age societies between 9000 BC to 2000 BC using it (without smelting) and it had its own archaeological period a long time ago — but its versatile properties make it one of the most sought-after materials even today, and perhaps [...]
  • The EV Transition is Here – But Its Enthusiasts Ignore Its Political and Economic Implications

    When it comes to the EV revolution, there really isn’t any doubt — it’s happening, and it’s accelerating.  But what does that mean for a society in which the automobile has become a central element in the social and economic structure, and in which the “the personal computer and personal car are co-equal in their transformative impacts? And [...]
  • More Mines Needed to Provide Enough Copper, the “Metal of Electrification,” for Green Energy Shift

    Gathering for the Financial Times’s Mining Summit both in person and online last week, chief executives of global copper mining companies sounded the alarm on the insufficient number of copper mines currently under development to supply the surging material needs of the ever-accelerating green energy transition. Copper prices may have dropped, however demand for the [...]
  • The Most Critical Non-Critical? A Look at Copper

    In a new piece for Metal Tech News, Shane Lasley zeroes in on the U.S. government’s failure – at least to date – to afford critical mineral status to copper, which is not only a key mainstay metal but an indispensable component in clean energy technology, and supply scenarios in the face of surging demand as the [...]
  • New Report Predicts Supply Gaps for Four Battery Criticals Plus Neodymium and Copper, Calls for Significant Capital Investments Along Supply Chains

    A new report released this month by the Energy Transition Commission, an international think tank comprising a coalition of leaders from across the energy landscape committed to achieving net-zero emissions by mid-century, has identified supply gaps for six materials key to green energy technology and calls for increased investment in the supply chain to stave [...]
  • Bearing Testimony to Its Importance to the Green Energy Shift, DOE Adds Copper to Department’s Critical Materials List

    Against the backdrop of mounting supply chain concerns for critical minerals, the U.S. Department of Energy (DOE) has officially added copper to its critical materials list in the context of the agency’s 2023 Critical Materials Assessment. The annual report assesses the criticality of materials to the supply chains in the renewable energy technology sector and focuses [...]

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