Pentagon takes big stake in new Korea Zinc smelter in Tennessee, will get 10% of company

Key Points

The Defense Department is getting a 40% involvement successful a $7.4 cardinal mineral smelter to beryllium built successful Tennessee successful concern with Korea Zinc, Reuters reported Monday.

The captious minerals smelting and processing installation could nutrient 540,000 tons of materials successful the U.S. per year, according to the U.S. Commerce Department.

The woody comes arsenic the U.S. seeks to signifier captious mineral partnerships that are not babelike connected China.

Reuters said that Korea Zinc volition merchantability caller shares worthy $1.9 cardinal to a associated task controlled by the U.S. authorities and unnamed U.S.-based strategical investors. The authorities and investors would past power 10% of Korea Zinc, according to the quality outlet.

"The United States hasn't built a large-scale zinc smelter similar this since the 1970s — a information that reflects however decades of mediocre enactment imperiled our nationalist and economical security," White House spokesperson Kush Desai said successful a connection to CNBC connected Monday.

"Thanks to President Trump, that's present changing with Korea Zinc's .... concern successful Tennessee," Desai said. "The Trump medication volition proceed to leverage each instrumentality astatine our disposal to extremity America's overseas dependence for captious minerals and reconstruct working-class prosperity."

The Pentagon did not instantly respond to a petition for comment.

"These minerals powerfulness the technologies that substance astir for our future: defence systems, semiconductors, AI, quantum computing, autos, information centers, and precocious manufacturing," the Commerce Department said successful a post connected X Monday.

The Commerce Department said that successful summation to the smelter, the U.S. would person precedence entree to Korea Zinc's planetary production. The woody "strengthens our nationalist security, rebuilds our concern base, and ends our dependence connected overseas proviso chains," the station states.

The Korea Zinc woody follows an $8.5 cardinal "framework" statement betwixt the U.S. and Australia successful October to summation uncommon world and captious mineral concern betwixt the 2 countries.

Rare earths are a benignant of captious minerals that tin beryllium utilized successful the improvement of weapons, semiconductor manufacturing, robotics and electrical vehicles. China presently dominates the uncommon earths proviso chain.

As portion of the statement with Australia, the Pentagon agreed to put successful gathering a gallium refinery successful occidental Australia, the White House said astatine the time.

The Pentagon successful July became the largest shareholder successful the uncommon world miner MP Materials aft agreeing to bargain $400 cardinal of its preferred stock.