Defense Dept Seeks Funds to Bolster Rare-Earth Output

The U.S. Dept. of Defense is asking for new funding to bolster U.S. capacity to produce rare earths minerals, 80% of which are currently supplied by China.

The request comes as China raises the prospect of withholding its rare earths metals if the country’s trade war with the U.S. escalates, Reuters reports.

Rare earths are critical in the production of a wide variety of products, from jet engines and lasers to computer chips and motors for electric cars. Automakers such as Toyota Motor Corp. have been rushing to reduce the amount of rare such materials required in electric motor magnets.

The only active producer of rare earths in the U.S. is the Mountain Pass mine in California. But it sends the 50,000 tons of rare earth concentrates it produces each year to China for processing.

Reuters notes that three U.S. companies are planning or building local processing facilities, one of which will go online next year and two of which aren’t likely to open until at least 2022.

The Defense Dept. estimates that the U.S. accounts for about 9% of global demand of rare earths. Defense operations consume only 1% of the country’s total usage of the metals.