US proposing a bill to prevent defense contractors from using rare earths from China

A bipartisan piece of legislation introduced in the U.S. Senate last week would force defense contractors to stop buying rare earths from China by 2026 and use the Pentagon to create a permanent stockpile of the strategic minerals.

Rare earths are a group of 17 metals that, after processing, are used to make magnets found in electric vehicles, weaponry and electronics. While the United States created the industry in World War Two and U.S. military scientists developed the most widely-used type of rare earth magnet, China has slowly grown to control the entire sector the past 30 years.

The United States has only one rare earths mine and has no capability to process rare earth minerals. “Ending American dependence on China for rare earths extraction and processing is critical to building up the U.S. defense and technology sectors,” Reuters quoted one of the senators proposing the bill .

The senator, who sits on the Senate’s Armed Forces and Intelligence committees, described China’s evolution into the global rare earths leader as “simply a policy choice that the United States made,” adding that he hoped fresh policies would loosen Beijing’s grip.

Known as the Restoring Essential Energy and Security Holdings Onshore for Rare Earths Act of 2022, the bill would codify and make permanent the Pentagon’s ongoing stockpiling of the materials. China temporarily blocked rare earth exports to Japan in 2010 and has issued vague threats it could do the same to the United States.

To build that reserve, though, the Pentagon buys supply in part from China, a paradox that Senate staffers hope will abate in time.

The rare earths production process can be highly pollutive, part of the reason why it grew unpopular in the United States. Ongoing research is attempting to make the process cleaner. Most members of the nascent U.S. rare earths sector praised the bill, though some worried defense contractors could continue to ask for waivers to buy Chinese rare earths even after 2026.

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