China’s April move to license and throttle exports of five rare-earth and strategic metals is already reverberating through American weapons programs. Lead times on everything from missile optics to drone motors have lengthened, and component prices have exploded, underscoring how tight Beijing’s grip on critical minerals remains. 
Raytheon chief Greg Hayes saw this coming two years ago, saying “we can de-risk but not decouple” with China.
Beijing, which produces roughly 90% of global rare earth output, has barred germanium, gallium and antimony sales to the US since December and tightened magnet export licences in April. Shipments meant for civilian end users have resumed, but material destined for defense platforms remains choked.
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Stocks are fading fast. Leonardo CEO Bill Lynn told investors his germanium inventory is down to “safety stock” levels, warning that deliveries will slip unless flows recover in the second half of 2025.
This has led to front line suppliers missing deadlines. For instance, a US drone parts maker had to postpone orders by up to two months while hunting non-Chinese magnets. Traders also report samarium for jet engine magnets is offered at 60 times its typical price.
Beijing is also tightening disclosure demands. In an example, New Hampshire-based ePropelled said Chinese officials required photos of production lines and customer lists before approving a magnet shipment in May. The company refused, and the cargo never left port.
In similar repercussion, United States Antimony saw 55 metric tons of Australian antimony detained for three months in Ningbo before Chinese customs released it—on the condition it be sent back to Australia. Seals were broken when it arrived.
The Pentagon has ordered contractors to phase out magnets containing Chinese minerals by 2027, yet most firms hold only a few months of non-magnet inventory. Small drone startups—thinly capitalised and highly specialised—are viewed as the most exposed.
Washington is also throwing money at the gap. One of its initiatives is the Department of Defense ploughing $400 million into MP Materials, taking a strategic stake, and locking in a decade-long offtake agreement for magnets destined for the F-35 and cruise-missile programs.
READ: Trump Eyes Defense Production Act to Break China’s Rare Earth Grip
Still, the underlying reality has not changed. As Hayes put it, “There is no alternative.” Until non-Chinese mines and processors reach scale—an effort now measured in years—the US military remains hostage to a supply chain its chief rival can shut off at will.
Information for this story was found via Zero Hedge and the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
