Geopolitical Mining · Country & Region Analysis

United States: How the Department of War Is Building a Mineral System

From military land and supply chain mapping to capital, procurement and strategic capacity

By Marta Rivera Muñoz and Eduardo Zamanillo

July 26, 2026

In June 2026, the United States Army announced an unusual use for four of its military installations. Private companies had been conditionally selected to finance, build and operate commercial processing facilities for graphite, lithium, boron, dysprosium and terbium on Army controlled land. The following month, a new Executive Order instructed the Department of War to begin reconstructing designated defence supply chains from finished military systems all the way back to the origin of their raw materials.

The two measures appear to belong to different institutional worlds. One concerns land, physical infrastructure and mineral processing. The other concerns contractors, data, procurement and supply chain risk. Their significance becomes clearer when they are viewed together. They show a defence institution recognising that the material foundations of military capability cannot be secured through a single purchase, a single producer or even a single domestic mine. Assured mineral supply is a system capability. It depends on whether raw materials can be extracted, processed and transformed into products of the required specification; whether the necessary infrastructure, technologies and expertise exist; whether suppliers are financially and operationally resilient; whether new materials can be qualified for use; whether customers provide sufficient demand; and whether alternative sources can be activated when disruption occurs. A defence contractor may purchase from an American supplier and still remain exposed to a foreign processor, a specialised chemical, a fragile component manufacturer or an industrial process concentrated in an adversarial jurisdiction.

The Department of War appears to have understood this complexity. More importantly, it has recognised that the mineral system sits inside the core of its own mission. Missiles, aircraft, sensors, batteries, communications networks and precision systems are technological products, but they are also material constructions. Their availability depends on a network of mines, processors, manufacturers, technologies and qualified suppliers that begins long before the final defence product reaches the military. That recognition is expanding the Department’s field of action. Military land can become an industrial platform. Procurement information can reveal mineral dependencies. Capital can be directed towards processing bottlenecks. Qualification rules can change which suppliers enter defence systems. Strategic reserves can provide time during disruption. The instruments are different, but they are increasingly being applied to a common problem: how to turn mineral availability into reliable defence capability. The Department of War therefore offers a practical case of applied geopolitical mining. Its importance lies less in any individual initiative than in the institutional understanding that connects them.

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The supply chain is not really a chain

The expression supply chain suggests an orderly sequence. A material is extracted, processed, manufactured into a component and delivered to a customer. The reality is closer to a network in which many nodes interact simultaneously. Each product may incorporate numerous materials, processing routes, technologies, companies and jurisdictions. The failure of a relatively obscure node can interrupt an entire industrial system even when the final manufacturer remains operational. A defence platform assembled in the United States may depend on rare earth elements separated elsewhere, an alloy produced by only a handful of companies, a precursor chemical manufactured in one country or a component whose alternative supplier has never completed military qualification. The immediate contractor may be financially strong while a supplier several tiers below it lacks the capital or production capacity needed to respond to a sudden increase in demand. The mineral itself may be available, yet not in the form, purity, consistency or volume required by the final application.

This is why a national list of critical minerals, while useful, cannot by itself reveal the architecture of material vulnerability. A list identifies which commodities matter. It does not necessarily show where they enter a defence system, which processing stages are concentrated, how ownership is structured, how quickly an alternative can be activated or which apparently minor dependency could stop production.

The Executive Order signed by President Donald J. Trump on July 20, 2026 moves directly into that hidden architecture. It requires the Department to develop rules under which prime contractors and subcontractors at every tier would map designated critical supply chains from raw materials to the products delivered to the Department. Contractors would submit an indentured Bill of Materials covering components, equipment, software and materials back to their raw-material origins. They would also assess suppliers for financial exposure, foreign ownership or influence, and manufacturing and supply risk. The Department would then use the information to identify bottlenecks, vulnerabilities and single points of failure, including through artificial intelligence where appropriate. Contractors would be required to mitigate significant risks, monitor corrective actions and report their progress. The same order instructs them to qualify alternative sources when unreliable foreign suppliers remain embedded in designated acquisitions, while directing the Department to accelerate testing and qualification procedures.

This is more than a traceability exercise. It reverses the conventional direction of mineral analysis. Traditional mining policy normally begins with a resource and moves towards an eventual customer:

The Department of War is beginning with the capability it needs to protect and moving backwards:

That reversal allows the institution to ask a more operational question. Instead of considering only whether the United States possesses a mineral or has access to a producer, it can examine precisely where a defence capability becomes exposed and what would be required to replace, reinforce or protect the vulnerable node. Mineral security begins with this visibility. An institution cannot finance the correct bottleneck, qualify the correct alternative or build effective redundancy unless it first understands where the dependency actually resides.

Materiality has moved to the core of the mission

The Department’s actions form part of a wider change in the American understanding of national security. The 2025 National Security Strategy, issued under President Donald J. Trump, declared economic security fundamental to national security. It argued that the United States should not depend on an external power for core components required by its economy or defence, covering the full continuum from raw materials to parts and finished products. It connected access to critical minerals with supply chain monitoring, reindustrialisation and the revival of the defence industrial base. Within the Department of War, Secretary Pete Hegseth carried that presidential direction into defence strategy. The 2026 National Defense Strategy explicitly presents the Department’s role as implementing President Trump’s vision and direction as laid out in the National Security Strategy, and identifies “Supercharge the U.S. Defense Industrial Base” as one of its four principal lines of effort. The significance of this alignment lies in its breadth. Minerals are not presented as a specialised mining concern sitting alongside defence, technology or economic policy. They appear within the productive architecture through which national capability is created.

A January 2026 determination on imports of processed critical minerals made the diagnosis still more explicit. The Department of Commerce concluded that processed minerals and their derivative products contribute to virtually every area of defence capability, including aircraft, munitions, armour, naval vessels, navigation, communications and surveillance. It also found that domestic mining did not necessarily remove dependence because the United States continued to lack sufficient processing capacity. Rare earth oxides could be mined domestically and still need to leave the country for further refining before returning for use. This is an essential distinction. Geological production creates potential supply. Industrial conversion determines whether that supply becomes usable.

A graphite deposit does not provide a battery ready anode material without purification, shaping and coating. A rare earth resource does not provide a permanent magnet without separation, metallisation, alloy production and manufacturing. A new domestic product does not automatically enter a missile or aircraft merely because it exists. It must satisfy technical standards, demonstrate consistency and complete the qualification process required by the customer. Materiality therefore reaches much deeper than access to ore. It includes the industrial capabilities that convert matter into function. The Department of War appears to be incorporating this reality into its understanding of defence readiness. Its responsibility does not begin only when it acquires a finished weapon or platform. Readiness also depends on the industrial processes that manufacture, maintain and repair that platform, and on the material system that allows those processes to continue under pressure. Once materiality is recognised as mission critical, the perimeter of institutional action changes. Mineral processing, project finance, supplier qualification and strategic inventories no longer appear external to defence. They become instruments through which the material basis of defence can be protected.

From purchasing supply to building assurance

The most revealing element of the emerging model is the movement from purchasing mineral supply towards building the conditions that make supply reliable. The Army’s decision to host private processing facilities on military installations illustrates this wider field of action. The conditional leases cover underutilised land at Anniston Army Depot in Alabama, Pine Bluff Arsenal in Arkansas, Red River Army Depot in Texas and Tooele Army Depot in Utah. The projects target graphite, lithium, boron and the heavy rare earth elements dysprosium and terbium. They would be the first commercial mineral processing facilities sited by the Army on American military installations.

The structure is particularly important. The Army is not purchasing the companies or proposing to operate the facilities. Under its Enhanced Use Lease authority, it retains ownership of the land and acts as landlord. The private companies would carry the costs of financing, design, construction, operation, security and decommissioning, while paying fair market rent that may be provided through improvements to the host installations. Environmental reviews, permits and local engagement remain required before construction can begin. This is a strategic recombination of existing institutional powers. The Army already controls land, infrastructure and legal authorities. Private companies possess technologies, operating capabilities and access to capital. By connecting those assets differently, the Army is attempting to create processing capacity without becoming the direct industrial operator.

The same logic is visible in finance. In June 2026, the Office of Strategic Capital announced a US$500 million conditional loan commitment to Phoenix Tailings to expand rare earth processing and develop a new separation and metallisation facility. Days later, it announced a US$725 million conditional commitment to Energy Fuels for rare earth separation and metallisation. A subsequent US$25 million Department investment in ReElement Technologies targeted refining and recycling capacity for rare earths and other defence critical minerals. These interventions concentrate on the stages where minerals become industrially usable. They recognise that a country can possess mines and remain strategically dependent if the material must still pass through foreign controlled processing, refining, metal making or manufacturing.

Capital is therefore being used not simply to support companies, but to close specific capability gaps. Early stage technologies may require scale up finance. Processing facilities may need long duration loans. New suppliers may require working capital while qualification proceeds. Commercial investors may recognise the long term strategic need yet remain unwilling to absorb technical, construction or market risk over the required period. Procurement addresses another part of the same system. The July order tightens the conditions under which contractors can obtain waivers for non compliant covered materials and requires mitigation plans that identify the source, document attempts to find alternatives and establish a timeline for removing the dependency. A contractor’s failure to qualify an available domestic source will not automatically demonstrate that compliant supply was unavailable. That provision matters because production alone does not create a defence supplier. The material must be tested, approved and incorporated into a highly controlled industrial system. Qualification can take time, require redesign or impose costs that a contractor has little commercial incentive to assume. By making alternative qualification part of supply chain responsibility, the Department is attempting to close the gap between the existence of a new source and its actual usability.

Strategic reserves add a further layer. Project Vault, supported by an EXIM loan of up to US$10 billion and private capital, is intended to store essential raw materials for participating manufacturers across facilities in the United States. The July Executive Order explicitly recognises materials supplied through Project Vault and projects backed by several federal financing institutions. A reserve does not replace productive capacity, but it provides time. It can protect manufacturers during a disruption while alternative supply is expanded, processed or qualified. Within a system, inventory is not an isolated stockpile. It is a bridge between an immediate shortage and the longer process of restoring supply.

The Department’s emerging response can therefore be understood through a set of connected requirements:

The important innovation does not lie in the invention of each instrument. Land authorities, public lending, procurement rules and strategic inventories already existed. The innovation lies in their strategic recombination around a newly understood material problem. The Department is beginning to use what it already controls in a different way.

Applied Geopolitical Mining

The Department of War provides a particularly clear application of the Geopolitical Mining framework because its behaviour reflects a fundamental principle: mineral endowment is not mineral power. A country may possess deposits, mines and producers while remaining unable to obtain the material it needs in the required form, quality, volume and timeframe. The distance between geology and strategic capability is filled by infrastructure, industrial knowledge, processing, capital, skilled practitioners, customer qualification, viable projects and institutions capable of coordinating the system.

This distance can be expressed as a sequence:

A disruption at any stage can break the sequence. A resource without a viable project remains underground. A mine without processing creates an intermediate product that may still leave the country. A processor without secure feedstock is vulnerable. A technically successful material without qualification cannot enter the final system. A qualified supplier without sufficient demand or capital may be unable to expand. The Department’s approach matters because it is addressing several of these conversions simultaneously. Supply chain mapping identifies where the sequence is vulnerable. Military land provides a location for new industrial capacity. Strategic finance supports difficult processing stages. Qualification connects new products to defence demand. Procurement changes incentives within the contractor base. Reserves create time while the system adjusts.

This is what differentiates a minerals policy from a mineral system. A policy identifies commodities, objectives and programmes. A system connects the capabilities required to deliver a reliable material outcome. It recognises that the weakness of one node may undermine the performance of all the others and that no single company, ministry or financial instrument can secure the entire result independently. The case also illustrates the role of a strategic enabling state. The state does not need to own every mine or operate every processing facility. It can make dependencies visible, provide physical assets, structure capital, set standards, create demand and coordinate institutions around a defined capability requirement. This requires institutional imagination: the ability to recognise that a strategic problem exceeds traditional administrative boundaries and to mobilise existing powers in new combinations.

A department responsible for war does not normally appear to be a mineral processing institution, a project financier or a designer of industrial markets. Yet once it understands that its mission depends on material capabilities located across this system, those activities become intelligible extensions of its mandate. Geopolitical mining begins at precisely this point. Minerals cease to be treated as isolated commodities and become part of the network through which economic, technological and military power is produced.

Understanding the system is not the same as mastering it

The strength of the Department’s approach lies in its systemic understanding. Its success will still depend on execution. Military land may provide a location, but it does not guarantee a viable processing business. Each facility will still require appropriate feedstock, energy, water, logistics, skilled operators, environmental approvals and customers. Technologies must demonstrate recovery, purity, consistency and performance at commercial scale. Cost estimates and schedules must withstand technical scrutiny. The Army’s awards remain conditional, and construction cannot begin until lease negotiations and regulatory reviews have been completed.

Strategic capital also requires discipline. Public finance can accelerate a strong project, but it can also accelerate a weak one. The language of national security cannot substitute for credible engineering, experienced management, realistic costs, robust markets or detailed due diligence. The conditional commitments announced by the Office of Strategic Capital still require financial, legal and technical conditions to be satisfied before closing. Greater visibility creates its own institutional challenge. A complete Bill of Materials may uncover thousands of dependencies across materials, suppliers, jurisdictions and technologies. Data alone will not determine which vulnerabilities require immediate intervention, which can be tolerated, which should be addressed through allied supply and which represent a genuine single point of failure.

That judgement requires practitioners who can connect geology, metallurgy, project development, manufacturing, procurement, finance and operating risk. Artificial intelligence may help organise and analyse the information, but it cannot replace the industrial knowledge needed to distinguish a strategically important bottleneck from a commercially weak project carrying a strategic label. Mineral assurance will also remain international. The July order recognises domestic and allied sourcing, and the Army’s own projects include secure Canadian feedstock for heavy rare earths. The realistic objective is therefore unlikely to be complete self sufficiency. It is closer to controlled interdependence: domestic capacity where it is essential, allied capacity where it is reliable, multiple sources where concentration creates risk and visibility throughout the network. Finally, strategic urgency does not remove legitimacy. Processing facilities still create environmental, infrastructure and community effects. Permitting, local engagement and public accountability remain part of project viability. A mineral system capable of supporting national power must also be capable of operating lawfully and maintaining the social conditions on which long term industrial activity depends. The Department has begun to understand the mineral problem systemically. Whether it can execute systemically remains the decisive question.

A wider field of action

The Department of War matters as a case because it demonstrates what happens when an institution truly recognises the material foundations of its mission. The National Security Strategy placed critical materials, supply chain security, reindustrialisation and the defence industrial base within the same national security architecture. The measures that followed show that doctrine beginning to influence institutional behaviour: supply chains are being reconstructed back to raw material origins, military land is being considered industrial infrastructure, capital is being directed towards conversion bottlenecks, procurement is being used to accelerate supplier qualification, and strategic reserves are being integrated into the wider supply response. The system is still emerging. It would be premature to describe it as complete or proven. Several projects remain conditional, implementation rules have yet to be written, and productive capacity will take time to develop. Yet the conceptual shift is already visible. Reliable mineral supply is no longer being treated solely as something that can be purchased from a producer when required. It is increasingly being understood as the outcome of multiple connected capabilities that must be visible, viable, qualified, financed and coordinated before disruption occurs.

That understanding expands the legitimate field of institutional action. Land becomes a strategic asset for industrial development. Procurement becomes an instrument of mineral policy. Supplier information can guide risk and capital decisions. Qualification becomes part of resilience, while inventory becomes strategic time. What appears at first to be a series of disconnected interventions begins to look like a coordinated attempt to influence the conditions under which mineral supply can remain available, usable and reliable. Once an institution begins to demand visibility across the full mineral system, however, the effects of that visibility need not remain confined to supply assurance. The same information required to identify geopolitical exposure, processing concentration or a fragile supplier can reveal other forms of opacity embedded in the network. A material system cannot be fully understood without knowing not only which companies and jurisdictions participate in it, but also where the material originated and how it moved through processors, traders and successive tiers of suppliers. Traceability therefore has consequences that can extend beyond the Department’s immediate defence objective.

If contractors are eventually required to provide auditable provenance rather than a broad declaration of country of origin, materials entering defence supply chains would need to remain traceable through those successive stages. This could make illegally mined, smuggled or laundered material more difficult to insert into formal industrial channels, where the mixing of legal and illicit production can obscure its original source. The July order does not yet establish a responsible sourcing or mineral legality standard, and its implementing rules will determine how precisely provenance must be demonstrated. But a system designed to expose geopolitical and industrial dependence could also begin to expose another vulnerability: material whose provenance and legitimacy cannot be verified. This possible extension into mineral governance does not turn the Department into a mining regulator, just as its use of military land or strategic finance does not turn it into a mining company. Nor does the wider approach require it to replace processors, manufacturers or private investors. Its role is to understand where its own mission intersects with the mineral system and to use the assets and authorities it possesses to strengthen the connections on which that mission depends.

The broader lesson is therefore not that defence institutions should directly control every stage of mineral production. It is that strategic capability cannot be protected if the material system supporting it remains poorly understood, commercially fragile or institutionally disconnected. Once mineral dependence is recognised as a systemic risk, the relevant field of action necessarily extends beyond purchasing more material from a different supplier. It reaches into the conditions that determine whether that supplier can produce, process, qualify and deliver the required material reliably and legitimately.

In the return of the material economy, the institutions best positioned to protect national capability will be those that see beyond individual commodities and direct suppliers. They will understand the network of conversions through which matter becomes technology, industry and power, and they will be willing to reconsider how their existing assets and authorities can be mobilised around that reality. A mineral strategy identifies what matters. A mineral system makes it deliverable. The Department of War has begun to build one.