US Defense Department Set to Purchase Cobalt for $500M
The U.S. aims to buy cobalt worth $500 million to bolster defense stockpiles and improve critical mineral supplies. Companies have been quickly sourcing rare earths following China's restrictions, which caused a 75% drop in rare earth magnet exports in June and led some auto manufacturers to halt production.
The U.S. aims to buy cobalt worth $500 million to bolster defense stockpiles and improve critical mineral supplies. Companies have been quickly sourcing rare earths following China's restrictions, which caused a 75% drop in rare earth magnet exports in June and led some auto manufacturers to halt production.
In March, U.S. President Donald Trump used emergency powers to boost domestic critical mineral production, aiming to lessen China's near-complete control of the sector.
In July, Reuters reported that the White House appointed Mr. David Copley, a former mining executive, to oversee an office within the National Security Council dedicated to safeguarding supply chains.
According to a tender issued by the U.S. Department of Defense and the Defense Logistics Agency (DLA) on Wednesday, proposals are being sought for approximately 7,480 tonnes of alloy-grade cobalt over five years. Cobalt, primarily imported by the U.S., is used in batteries, nickel superalloys for high-temperature jet engines and gas turbines, among other uses.
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The Department of Defense is soliciting bids exclusively from three companies: Vale S.A.’s Canadian units, Japan's Sumitomo Metal Mining, and Norway's Glencore Nikkelverk. The document indicates that the purchase could range from $2 million to $500 million during the five-year period.
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