CEO of Raytheon, Greg Hayes, announced that the company cannot fully sever ties with China due to the Asian nation’s dominance in rare-earth metals, essential to various military technologies. Despite the reopening of the Mountain Pass mine, a rare-earth metals mine in California, there remains an unnecessary risk due to partial Chinese ownership in MP Materials, which manages the mine.
- Raytheon’s reliance on China is largely due to China’s dominance in the rare-earth metals market, crucial to many military technologies such as lasers and missile flight systems. China controls over half of the world’s rare-earth mining and 90% of its processing.
- The Mountain Pass mine, the only source of rare-earth metals in the US, is being reopened and upgraded by MP Materials. However, the Chinese mining company Shenghe Resources holds a minority stake in MP Materials, posing a potential risk to the defense industry.
- Given the potential vulnerability of a single-source supply chain, experts suggest the Pentagon seek alternative domestic sources of rare-earth metals. The goal is to create redundancies, even if economically inefficient, to ensure continuous military production.
- While acknowledging the interconnectedness of the global economy, it’s argued that the defense industry and the Pentagon need to be prepared for possible decoupling scenarios in the event of a major conflict.
- The Defense Production Act contains provisions to manage the issues posed by far-flung critical resources, but systematic tracking of disruptions is not in place, which could be crucial for ensuring resource security.