The Department of War’s Office of Strategic Capital announced more than $1.9 billion in conditional loan commitments and agreements across four critical minerals sectors on Aug. 7. The investment represents one of the largest single-day defense-related mineral commitments in the department’s history.
The commitments include $1.4 billion for battery-grade silicon production, $400 million for domestic scandium mining, $150 million for rare earth-free magnet production, and $85.5 million for a bauxite supply chain agreement, the department said.
All four materials are classified as strategic with direct defense applications. Scandium is used in advanced aerospace alloys, silicon in batteries and electronics, bauxite in aluminum production for military platforms, and rare earth alternatives in motors and weapons guidance systems.
The investment package directly addresses one of the Defense Department’s most acute strategic vulnerabilities: dependence on Chinese and foreign-controlled supply chains for minerals essential to advanced weapons systems and military electronics. China currently controls approximately 60% of global rare earth mining and roughly 90% of rare earth processing, according to U.S. Geological Survey data.
For American workers, the commitments signal new domestic mining and manufacturing jobs in sectors that have largely been offshored. The battery-grade silicon and scandium commitments in particular target domestic production facilities that would reduce reliance on foreign suppliers.
The Office of Strategic Capital was established to make investment-style commitments in technologies and supply chains critical to national security. The $1.9 billion one-day total reflects an acceleration of the office’s deployment pace.
The rare earth-free magnet investment is designed to develop alternative materials that could eliminate the need for Chinese-sourced rare earths in electric motors used in both military and civilian applications, the department said.