China chokes flow of critical rare minerals to Western weapons contractors

China’s tightened export controls on rare earths and minerals like germanium, gallium, and antimony cripple U.S. defense manufacturing. Supplying 90% of global rare earths, Beijing’s restrictions since December delayed drone parts orders by two months, with samarium prices surging 60 times higher.

Leonardo DRS’s CEO Bill Lynn warned, “In order to sustain timely product deliveries, material flow must improve,” as germanium stocks for infrared sensors in missiles dwindle. Over 80,000 Defense Department parts rely on Chinese-controlled minerals, per Govini, exposing supply chain fragility. Weapons contractors supplying the U.S. military rely on minerals that are mainly produced and controlled by China for microelectronics, drone motors, night-vision goggles, missile-targeting systems, defense satellites and more.

China demands sensitive data, like product images, rejecting defense magnet imports. ePropelled’s Chris Thompson refused to share buyer details: “Of course we are not going to provide the Chinese government with that information.” This halted shipments, forcing reliance on limited Japanese and Taiwanese suppliers.

The Pentagon’s 2027 ban on China-sourced magnets faces hurdles, as startups like Vulcan Elements and USA Rare Earth won’t scale until late 2025. A U.S. Antimony Corporation shipment, detained in Ningbo for three months, was released only after redirection to Australia, with broken seals raising tampering concerns. “They’d never seen this happen before,” said CEO Gary Evans.

Lockheed Martin’s James Taiclet called a $400 million MP Materials deal “groundbreaking” for F-35 magnet supply. Yet, China’s dominance and export bans inflate costs and delay production, leaving defense firms scrambling for scarce non-Chinese mineral sources.