(Pentagon) Invests $750 Million to Reduce "Overreliance on China" by Securing Rare Earth Elements

Washington, Aug 24 (KUNA) -- The U.S. Department of Defense (Pentagon) announced on Monday an investment of $750 million as part of a broader $1.55 billion initiative to secure critical rare-earth elements, a move that “effectively addresses the problem of overreliance on China” for their supply. In a statement, the ministry said its Defense Economic Base unit, in partnership with the Office of the Assistant Secretary of Defense for Industrial Base Policy, announced the $750 million investment with U.S. Rare Earths Inc. through the Industrial Base Analysis and Sustainment program to support a purchase agreement for mixed rare-earth carbonates produced at the Serra Verde’s Piuma project in central Brazil. It noted that this “strategic partnership” will “create a secure supply chain for rare-earth elements that are vital to national defense and economic security.” The ministry clarified that the investment announced today is part of a broader investment framework totaling $1.55 billion, which includes a $300 million purchase commitment from the Defense Logistics Agency and another $500 million commitment from a major bank. It added that the initiative “effectively addresses the problem of overreliance on China” for rare-earth elements. The project, once it reaches full operational capacity, will ensure the supply of large quantities of critical elements such as dysprosium, terbium, neodymium, and praseodymium, enabling the United States to overcome China’s dominance in supply chains and support emerging U.S. capabilities in magnet manufacturing. Rare-earth elements are essential for enhancing the thermal stability and magnetic strength of neodymium-iron-boron magnets, components indispensable for manufacturing critical parts used by U.S. combat forces. These components include advanced systems in nuclear submarines, fighter aircraft, satellites, guided missiles, combat ships, and unmanned aerial vehicles. The Pentagon also stated that, beyond the defense sector, these high-purity materials form a fundamental pillar and a vital raw material for energy, transportation, space, and electronics infrastructure sectors, making them a cornerstone of the modern industrial economy. (End) R.S.R./N.S.A.