DPA Funds Prepped to Bolster U.S. Critical Mineral and Advanced Material Supply Chains
The Department of Energy and Defense are leveraging Defense Production Act (DPA) authorities to channel nearly $1 billion into U.S. critical mineral processing, battery recycling, rare earth recovery, and strategic alloy development. The initiative spans across multiple agencies to reduce reliance on adversarial supply chains, especially China.
Key Points:
DOE’s Nearly $1 Billion Initiative:
Funding includes:Up to $500 million for U.S. battery manufacturing, recycling, and mineral processing.
$135 million to advance rare earth‐element supply chains, particularly via mining tailings recovery.
$250 million for industrial byproduct mineral recovery (e.g., from coal plants).
$50 million for refining and alloying of key materials like gallium, germanium, and silicon carbide.
https://www.reuters.com/business/energy/us-proposes-nearly-1-billion-funds-critical-minerals-materials-2025-08-13/
Pentagon’s Directed DPA Investment:
The Department of Defense awarded $10 million (Title III DPA) to Elk Creek Resources—backed by NioCorp—for feasibility engineering, resource drilling, and cost planning toward a Scandium-Niobium-Titanium alloy supply chain in Nebraska.
https://www.defense.gov/News/Contracts/Article/4264389/department-of-defense-awards-10-million-to-develop-a-domestic-mine-to-master-al/Continued DOD Sector Investment:
The Pentagon maintains significant equity in MP Materials and has channelled $540 million into critical minerals projects via DPA and Office of Strategic Capital tools—evidencing a long-term push into supply chain resilience.
https://www.reuters.com/world/china/pentagon-keep-working-with-us-rare-earths-projects-us-defense-official-says-2025-07-15/
Why It Matters:
Strategic Autonomy: Expanding domestic capacity in battery materials, rare earths, and strategic alloys directly addresses key vulnerabilities in national security.
Private Capital Leverage: DPA grants and financing are intended to crowd in adaptive private sector investment.
Cross-Agency Activation: The program demonstrates a surge in using DPA-supplied funds across DOE, DOD, and DOE’s MESC office to fast-track domestic supply chains.
Watchlist Companies & Projects:
Elk Creek Resources (NioCorp) — Building U.S. scandium alloy pathway.
https://www.defense.gov/News/Contracts/Article/4264389/department-of-defense-awards-10-million-to-develop-a-domestic-mine-to-master-al/MP Materials — DOD-backed rare earths miner with ongoing supply partnership.
https://www.reuters.com/world/china/pentagon-keep-working-with-us-rare-earths-projects-us-defense-official-says-2025-07-15/
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This update is for informational purposes only and is not financial or legal advice. Information is believed accurate but not guaranteed.