“It’s the biggest gun they have to our heads,” says Evan Smith, CEO of Altana Technologies, which provides supply chain insights to a host of major companies. In the case of the F-35, the company recently created the following graphic, which shows how the planes rely on rare earths for everything from sensors to motors to thermal coating:
In the current trade war, China has outright banned the export of these rare earths, but has introduced a licensing regime that is already introducing supply chain disruptions. Ordinarily, U.S. firms would turn to suppliers in other countries but the current system of rare earth production means nearly all of it occurs in China. This Altana graphic shows that, in most cases, the country is responsible for 90% or more of most of these key minerals:
“Developing mining and processing capabilities requires a long-term effort, meaning the United States will be on the back foot for the foreseeable future,” the CSIS report notes.
