Pentagon Fails To Act On Crucial Rare Earth Minerals

Round Top Mountain, Texas. The alternative to China for DoD rare earth elements? A new Government Accountability Office report scolds the Department of Defense for failing to figure out which rare earth elements are critical to national security — China controls the world market — and for not developing plans to make sure the United States has enough even though Congress passed a law telling them to five years ago. When Breaking Defense asked for a response, DoD denied any error in its ways – but promised to do better. “DoD disagrees with the GAO characterization that DoD has no department-wide approach for critical materials, but in the spirit of continuous improvement, the Department agrees with the recommendations in the GAO report,” said spokesman Air Force Lt. Col. Eric Badger. Thus continues a sleepy debate over whether the Pentagon, the defense industry and other manufacturers are comfortably numb about the fact that China controls 100 percent of the world supply of rare earths the military needs and about 85 percent of those used in consumer products. In 2010, some reports – denied by Beijing — said China used that near monopoly as a weapon, cutting off rare earth supplies to Japanese companies after a Chinese trawler collided with Japanese Coast Guard boats. Rare earth prices skyrocketed. “With what’s going on in the South and East China Sea, I just find it ironic that most people are not aware that the Chinese really control a very important raw material,” said Anthony Marchese, board chairman of Texas Rare Earth Resources (TRER). The company seeks investors to finance development of a rare earths deposit in Texas that would be the only active U.S. source of such materials. Rare earth materials contain one or more of 17 similar metals or elements that offer unique properties, such as high-strength magnetism and high-strength heat resistance. Divided into “light” and “heavy” categories, they bear quirky names — yttrium, neodymium, dysprosium – but running out of one wouldn’t be funny. “Recent studies have shown that rare earths are essential to the production, sustainment, and operation of U.S. military equipment,” the GAO said. “Reliable access to the necessary material, regardless of the overall level of defense demand, is a bedrock requirement for DOD.” Why are these minerals so important to the Pentagon (as delineated in the fiscal 2012 National Defense Authorization Act)? Each nuclear-powered SSN-774 Virginia-class fast attack submarine requires about 9,200 pounds of rare earth minerals; Each DDG-51 Aegis destroyer needs about 5,200 pounds; Each F-35 Joint Strike fighter needs about 920 pounds; Rare earths are also essential to precision-guided munitions, lasers, satellite communications, radar, sonar and other military equipment, added a 2013 Congressional Research Service report. “Rare earths are not particularly rare but are found in low concentrations in the earth’s crust,” the CRS report explained. This makes them expensive to extract and process, and they require a lot of processing: separating the ore into individual oxides; refining the oxides into metals; forming the metals into alloys; and manufacturing the alloys into devices and components, such as the permanent magnets used in the Joint Direct Attack Munition (JDAM), the guidance kit that turns dumb bombs into smart ones. The GAO said the three DoD offices that deal with rare earths – the Defense Logistics Agency’s Strategic Materials Office, which acquires rare earths for the government and private companies, the office of Manufacturing and Industrial Base Policy (MIBP), and the Strategic Materials Protection Board (SMPB) — have been “fragmented” in their approaches, failing to even agree on what constitutes “critical” rare earths. The GAO said Defense Secretary Ashton Carter should direct the SMPB to “designate which, if any, rare earths are critical to national security,” analyze the effect of their potential “unavailability,” and “develop a strategy to help ensure a secure supply.” The defense secretary also should “direct MIBP to define reliable sources and secure supply for rare earths in measurable terms,” the GAO said. Don’t hold your breath. The new GAO report is only the latest of many government reports on the issue in recent years, but none seem to elicit much urgent action by the Defense Department, or for that matter, the defense industry. “I’ve talked to major Fortune 100 companies and they all say the same thing: ‘Tony, what’s the problem? I can buy all the rare earth I want right now, and at very good prices,” Marchese said. His company is fulfilling a Defense Logistics Agency contract awarded last September to prove the value of TRER’s Round Top Mountain rare earths deposit about 80 miles south of El Paso. TRER is producing “bench scale” amounts – samples for laboratory analysis – of yttrium, ytterbium and another rare earth whose identity DLA ordered the company to keep secret. Marchese promises Round Top Mountain could “supply 100 percent of the DoD rare earth element needs in the future.” If anyone ever starts to care.

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Pentagon Fails To Act On Crucial Rare Earth Minerals

Posted on March 1, 2016

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