James Kennedy is president of ThREE Consulting, Thorium & Rare Earth Elements, Mining Minerals and Metals (ThREEM3). He is also a consultant to the U.S. government, financial, mining and energy industry on strategic issues related to rare earths and thorium within the U.S. regulatory environment. China controls substances so valuable that the Pentagon dares not act. It’s up to the Senate now.
The Pentagon recently received what amounts to a grade of F on its efforts to ensure that its suppliers can continue to obtain the rare-earth metals that make possible many of today’s advanced weapons and other technologies. After nearly two decades of Defense Department fecklessness, it’s up to lawmakers to act.
In stark terms, a Government Accountability Office report described how defense officials have failed to meet, and even to identify, their legal and national security obligations with regard to this “bedrock” national-security concern. Instead, defense officials have repeatedly given the all-clear signal to Congress and two administrations.
Depending on when you want to start the clock, this “bedrock” problem is now a teenager or old enough to vote. The last U.S. rare-earth mine ceased mining operations in 1998, the same year that the premiere U.S. rare-earth metallurgist company, Indianapolis-based Magnequench, was essentially sold to members of Deng Xiaoping’s family. Magnequench’s facility was shut down, moved and reopened in China in 2003.
Since then, U.S. defense contractors have become completely reliant on Chinese sources for rare-earth metals, alloys, and magnets—directly or indirectly. The short list of reliable non-Chinese metallurgy companies get all of their rare earth oxides from China and their production is fully committed to Japan and other industrial users.
Outside this small circle, there is an even shorter list of financially troubled metallurgical companies that have ongoing quality control issues, limited capabilities, and uncertain economic futures. None of these currently supply U.S. defense contractors. The reality is that all rare earth metallurgy used in U.S. defense systems originates in or must pass through China.
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