Critical Minerals and Materials Geoeconomics: Lessons and Ideas From Past Wars and Strategic Competitions

Executive Summary

“... you can’t make bullets out of gold.”— President Dwight D. Eisenhower, 1957^[1]

While gold is not the material for physically manufacturing implements of war, economic power coupled with creative thinking is an essential precursor for victory in warfare regardless of whether it is industrial/economic in nature or kinetic conflict. Imaginative policy executed at scale has helped ensure US critical minerals security in past wars and strategic competitions. This brief report outlines ten geoeconomic experiences and ideas that were either used by previous generations of American leaders or new concepts which likely are applicable today. Where possible, these approaches emphasize channeling market and technological forces to maximize returns on taxpayer dollars obligated.[2] Each of these experiences hold lessons for a new generation of American policymakers who once again face global competition with industrialized, highly capable adversaries.

Defense occupies a much-reduced share of total US materials demand than during the enormous World War 2 buildup. Indeed, the post-war ramp down of defense-related domestic material and mineral supply chains and manufacturing for much of the period between WW2 and the present time helped set the stage for contemporary concerns about security and readiness. The post-1991 “Peace Dividend” geopolitical window opened by the fall of the Soviet Union further removed policymakers’ thinking from the reality that victory in a protracted industrial war requires a country to be able to sustain both military needs and a significant portion of pre-war civilian economic activity levels. 

Yet unlike the 1991 to early 2000s window, the US now faces multiple industrially capable competitors in a loose axis headed by China and Russia. The return of Great Power competition matters because protracted war is the historical norm when industrial powers clash, a lesson being renewed and hammered home by the past three years of bloodshed in Ukraine.

Furthermore, killing technologies have in many instances evolved, as have their materials consumption profiles.

The humble and vitally important 155mm artillery shell has not changed much in terms of physical dimensions or materials requirements per unit during the intervening 80 years. But much else has altered on air, land, and sea battlefields. In the maritime domain, a modern DDG-51 destroyer consumes approximately as much fuel as a similarly sized World War 2 light cruiser under many operating regimes. Other machines have become far more fuel intensive. A P-51 Mustang takes off under full power at a fuel flow rate of 120 gallons per hour, while an F-16 Viper with an afterburner engaged for the same takeoff could burn approximately 130 gallons in a single minute.[3] Land combat has also become an order of magnitude more supply-intensive. An American division engaged in active combat in the WW2 European theater could consume 600 to 700 tons/day of supplies.[4] By the 2010s, mechanized US divisions could consume more than 6,000 tons per day of supplies.[5]

As the demand for mass in warfare reasserts itself, creating and sustaining today’s combat mass requires many materials that our grandfathers’ wars did not. The vast shifts in technologies, with more on the way, have placed a premium on new alloys and advanced materials for high performance gear and weapons systems. No World War 2 aircraft used meaningful amounts of titanium in their airframes and fabrication of even Vietnam-era fighters and strike aircraft typically only required hundreds of pounds of titanium (“buy weight”).[6] By the 1990s, each tactical aircraft produced necessitated the purchase of tens of tonnes of titanium — an order of magnitude increase.[7]

Likewise, aircraft ordnance in World War 2, Korea, and to a substantial extent, Vietnam, required steel, high explosives, lead, and some copper. Fast forward to the present and key munitions like standoff strike missiles still need lots of steel and explosives but also require a smorgasbord of other materials ranging from titanium to rare earths, to composites and complex additive manufactured materials, and exotic electronics inputs like gallium and indium. Warfare’s newest mass addition, drones, face similar challenges. The materials inputs for ten million drones containing explosives but also composites, servo motors, semiconductor packages, and so forth is something WW2, Korea, Vietnam, and Gulf War 1 and 2 never featured.

Concurrently with rising materials intensity in key military hardware, technological lines have blurred in important ways. Computing, geopositioning, and telecommunications all reflect the reality that materials and manufacturing supply chains that serve defense industries make a first stop at off-the-shelf consumer products. This has critical implications for industrial war because securing direct military requirements alone will likely prove insufficient to prevail.

Semiconductors — where US Department of Defense, DoD, procurement constitutes perhaps 2-3% of the civilian market – offer an example. So does oil, where DoD use even during recent wars accounted for less than 3% of total US refined products consumption. Another example is cobalt, a strategic metal that is, among other things, critical for the superalloys used in jet engines. Direct military uses likely account for less than 10% of total world demand, with the balance used in commercial, civilian products.[8] Likewise, during Vietnam, the United States’ second most ammunition-intensive conflict to date after WW2, military usage of copper (an important ammunition raw material) never exceeded 7% of total domestic copper demand. But a shortage of copper would nonetheless have seriously impeded war efforts by forcing tougher “guns versus butter” decisions on policymakers.

More complicating is the dominant position China occupies in supply chains for key non-fuel minerals and the materials and manufactured components derived from them that are essential for defense – a unique circumstance.[9] By contrast, the US holds a position of strength in oil, natural gas, the petrochemicals sourced from hydrocarbons – including carbon fiber and plastics, resins, and advanced composites. Plastics and resins altogether are the fastest growing commodity group worldwide. Defense needs for these materials are the subject for a follow on working paper.

View the full paper (PDF).

Notes

[1] Alfred E. Eckes, Jr., 1979, The United States and the Global Struggle for Minerals, University of Texas Press, https://doi.org/10.7560/785069, page 216.

[2] “Critical minerals” are defined as those for which a high risk of disruption exists. This varies with nation. For the US, see https://www.usgs.gov/programs/mineral-resources-program/science/what-are-critical-minerals-0 and https://www.federalregister.gov/documents/2023/08/04/2023-16611/notice-of-final-determination-on-2023-doe-critical-materials-list.

[3] See Gabriel Collins, 2024, Energy Stockpiling as A China Strategic Warning Indicator, Testimony before the US-China Economic and Security Review Commission, Hearing on "China’s Stockpiling and Mobilization Measures for Competition and Conflict," June 13, https://www.uscc.gov/sites/default/files/2024-06/Gabriel_Collins_Testimony.pdf.

[4] D.M. Kennedy, 1999, Freedom from Fear: The American People in Depression and War, 1929–1945, Oxford University Press, page 733.

[5] S. Leary, 2007, Sustaining the Long War (Student Research Project), US Army War College, Carlisle Barracks, PA, Defense Technical Information Center, March 30, https://apps.dtic.mil/sti/tr/pdf/ADA469589.pdf.

[6] See National Materials Advisory Board, 1983, Chapter 9, End uses of Titanium, in Titanium: Past, Present, and Future, National Academies Press, Washington, DC, https://nap.nationalacademies.org/read/1712/chapter/10#115.

[7] See Craig A. Brice, 2011, Net Shape Processing of Titanium Alloys for Enhanced Performance and Improved Affordability, in Proceedings of the 12th World Conference on Titanium, https://cdn.ymaws.com/titanium.org/resource/resmgr/ZZ_WTCP_2011_Re-Do/V3/2011_Vol.3-1-I-Net_Shape_Pro.pdf.

[8] Tom Fairlie, 2023, State of the Cobalt Market 2023, Cobalt Institute presentation, https://icsg.org/presentations/# (Slide 7).

[9] See Michelle Michot Foss, 2024, Minerals and Materials Challenges for Our Energy Future(s): Dateline 2024, Center for Energy Studies | Energy, Minerals, and Materials | Report, Rice University’s Baker Institute for Public Policy, September 20, https://www.bakerinstitute.org/research/minerals-and-materials-challenges-our-energy-futures-dateline-2024.

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