Pentagon orders an about-face on REEs – by Shane Lasley (North of 60 Mining News – March 31, 2013)

Department of Defense reverses its public stance on rare earths, recommends building a US$130M stockpile of the strategic minerals

About face; forward; march! The U.S. Department of Defense recently issued this order in the field of rare earth elements.

The unique properties of REEs – a group of 17 previously obscure metals that include scandium, yttrium and the 15 lanthanides – are key ingredients in a number of military applications such as guided missiles, lasers, radar systems, night vision equipment and battlefield communications.

China is estimated to supply between 90 and 95 percent of the world’s rare earth oxides, according to a September 2012 report penned by Congressional Research Service.

Though these Sino-mined elements are key ingredients to much of the U.S. Military’s advanced weapons systems, Pentagon officials have never considered REEs rare enough to need a stockpile of them.

“I wouldn’t run out and buy a bunch of rare earths,” DoD Industrial Policy Director Brett Lambert proclaimed during a defense conference held in New York late in 2010.

Today, the Pentagon proposes to do just that. In a 189-page report, the DoD recommends investing US$130 million to establish near-term strategic stockpiles of seven rare earth elements – dysprosium, terbium, yttrium, erbium, thulium, scandium and one classified REE.

All told, the defense agency found “insufficient supply to meet demand” for 23 of 72 metals and minerals it studied and is recommending that US$1.24 billion be earmarked to build strategic stores of materials on the list.

According to Dan McGroarty – one of the few people outside of the Pentagon and the U.S. House Armed Services Committee to have seen the report – the DoD named 19 of the mined materials that are in shortfall, the remaining four are classified.

The list of non-rare earth materials deemed in short enough supply to warrant stockpiling include antimony, bismuth, gallium and tantalum.

McGroarty told Mining News that China is a common thread that binds all of the unclassified metals and minerals on the stockpile list.

“China is a top-tier supplier for all 19 metals and minerals that they identified as being in shortfall,” the president of American Resources Policy Network explained.

About face

China’s dominance as a supplier of many of the metals of strategic importance to the U.S. Military has been a concern for many policymakers on Capitol Hill. Pentagon’s previous laidback approach to ensuring an adequate supply of rare earths drew sharp reproach from U.S. Sens. Mark Begich, D-Alaska, and Lisa Murkowski, R-Alaska, and Rep. Mike Coffman, R-Colo.
“Clearly, rare earth supply limitations present a serious vulnerability to our national security. Yet early indications are the DoD has dismissed the severity of the situation to date,” the lawmakers wrote in a January 2011 letter to then U.S. Secretary of Defense Robert Gates.

The senators urged the Pentagon to take inventory of the U.S. military’s anticipated REE demand and establish policies to ensure an uninterrupted supply of these critical materials.

In their letter to Gates, the trio wrote, “In our view, it is a fundamental responsibility of DoD industrial policy to have a comprehensive understanding of the security of our defense supply chain, which requires understanding detailed knowledge of the sources and types of components and materials found in our weapon systems.”

The DoD Office of Industrial Policy is charged with sustaining an environment that ensures the industrial base on which the Pentagon depends is reliable, cost-effective, and sufficient to meet its requirements.

The Alaska and Colorado legislators said the Pentagon should require its weapons contractors “to provide a detailed accounting of the various rare earth-containing components within their weapons system.” This information could then be used to create policies that would ascertain that the military would have these vital minerals on-hand.

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