Updated January 30, 2020
Defense Primer: Acquiring Specialty Metals, Rare Earth
Magnets, and Tungsten
Some metals (such as titanium and tungsten) and metal
appropriations legislation from 1941 until 2002, when they
alloys, as well as strong permanent magnets known as rare
were permanently codified as 10 U.S.C. §2533a by the
earth magnets, are critical to U.S. Department of Defense
FY2002 National Defense Authorization Act (NDAA, P.L.
(DOD) operations. These materials are frequently
107-107). In 2006, the FY2007 NDAA (P.L. 109-364)
integrated into components (e.g., integrated circuits,
moved the specialty metal-related provisions from 10
electrical wiring, or optoelectronic devices) or structures
U.S.C. §2533a to 10 U.S.C. §2533b.
(e.g., aircraft fuselages or ship hulls) of the military
The domestic sourcing mandate for specialty metals only
platforms and weapon systems that enable warfighting
applies to the Defense Department.
capabilities.
Applicability of Restrictions
A rare earth element is one of 17 chemical elements, including
The specialty metals domestic sourcing restrictions apply to
the 15 metallic chemical elements with atomic numbers 57
all DOD prime contracts and subcontracts. For the purposes
through 71, as well as the chemically similar elements
of the restriction, 10 U.S.C. §2533b defines a specialty
scandium and yttrium. These materials are considered rare in
metal as any of the following metals or metal alloys:
spite of their relative abundance throughout the Earth’s crust,
Steel with a maximum alloy content exceeding one or
as the extraction and production of such materials can be
more of the following limits: manganese, 1.65%;
difficult and costly. Rare earth magnets produced using rare
silicon, 0.60%; copper, 0.60%; or containing more than
earth elements are the strongest known permanent magnets.
0.25% of any of the following elements: aluminum,
chromium, cobalt, niobium (columbium), molybdenum,
There are few, and in some cases, no known alternatives for
nickel, titanium, tungsten, or vanadium.
many of these materials, which often have unique physical
Metal alloys consisting of nickel, iron-nickel, and cobalt
properties, such as high material strength coupled with low
base alloys containing a total of other alloying metals
density, or resistance to various forms of corrosion. Many
(except iron) in excess of 10%.
of these materials are subject to sourcing restrictions or
Titanium and titanium alloys.
prohibitions in DOD acquisitions. Congress established
Zirconium and zirconium base alloys.
these restrictions or prohibitions to protect the U.S.
domestic materials industry and ensure the United States
DOD uses the foundry location where the final melting or
maintains critical production capabilities and capacity
similar production of a specialty metal takes place to
within the U.S. defense industrial base.
determine its origin. For example, titanium sponge—
unwrought titanium that has not been melted—that has been
Certain sourcing restrictions establish that some items—or
manufactured in Kazakhstan, shipped to the United States,
components of such items—incorporating certain metals
and melted into ingots at a foundry in Ohio would be
and metal alloys known as specialty metals generally must
considered compliant with the specialty metals domestic
be produced or manufactured in the United States. Other
sourcing mandate. Under the specialty metals restrictions,
sourcing prohibitions establish that some items—or
DOD generally may not acquire certain military platforms
components of such items—incorporating certain types of
or weapon systems—or components of these platforms and
rare earth magnets and tungsten may not be acquired from
systems—that contain any amount of a specialty metal that
specified foreign sources.
was not melted or produced in the United States.
Sourcing Restrictions in Acquisitions
The restriction applies to aircraft; missile and space
systems; ships; tank and automotive items; weapon
For more information, see CRS Report R43354, Domestic
systems; and ammunition. DOD and its prime contractors
Content Restrictions: The Buy American Act and Complementary
are also prohibited from directly acquiring any specialty
Provisions of Federal Law.
metal (e.g., metal sheets, rods, plates) if it was not melted or
produced in the United States.
Acquiring Specialty Metals
Exceptions
Domestic sourcing restrictions for DOD acquisition of
Law and policy provide a number of exceptions to the
specialty metals first appeared in the FY1973 DOD
specialty metals sourcing mandate, including the following
appropriations bill (P.L. 92-570) as an expansion of
selected examples:
domestic content restrictions on DOD purchases of food,
clothing, and other goods. These restrictions are commonly
circumstances where the Secretary of Defense or a
known as the Berry Amendment. The Berry Amendment
secretary of a military department determines that
sourcing restrictions were included in annual DOD
compliant specialty metal of satisfactory quality and
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Defense Primer: Acquiring Specialty Metals, Rare Earth Magnets, and Tungsten
sufficient quantity, and in the required form, cannot be
magnets or tungsten that was melted or produced in the four
procured as and when needed;
specified countries. The prohibitions apply to aircraft;
acquisitions outside the United States in support of
missile and space systems; ships; tank and automotive
combat operations or contingency operations;
items; weapon systems; and ammunition.
acquisitions for which the use of other-than-competitive
DOD is also generally prohibited from selling covered
procedures has been approved when the need for
materials from the National Defense Stockpile to the
materials or end items is of an unusual and compelling
specified nations, or to any third party reasonably believed
urgency;
to be acting as a broker or agent for a covered nation or an
acquisitions where the prime contract is at or below the
entity in a covered nation. The National Defense Stockpile
simplified acquisition threshold (generally $250,000);
was established by Congress in 1939 (50 U.S.C. §98 et
situations where an acquisition furthers an international
seq.) to acquire and retain strategic and critical materials to
agreement (e.g., trade or offset agreements) with a
decrease or prevent the potential dependence of the United
qualifying country;
States on foreign sources for supplies of these materials in
purchases of electronic components, such as diodes or
times of national emergency.
integrated circuits, unless the Secretary of Defense,
pursuant to a recommendation of the Strategic Materials
Exceptions
Protection Board, determines that the domestic
Law and policy provide limited exceptions to these
availability of a particular electronic component is
prohibitions, applicable to:
critical to national security;
covered items incorporating specialty metals that were
circumstances where the Secretary of Defense
not melted in the United States if the total amount of
determines that compliant materials of satisfactory
noncompliant specialty metals in such an item does not
quality and quantity, in the required form, cannot be
exceed 2% of the total weight of specialty metals in the
procured as and when needed at a reasonable price;
item;
procurement or sale of covered materials, or end items
commercially available off-the-shelf (COTS) items
containing such materials, outside of the United States
containing specialty metals, except in certain
for use outside of the United States;
circumstances;
acquisitions at or below the simplified acquisition
acquisitions of some commercially available items (e.g.,
threshold;
fasteners, high-performance magnets);
purchase of a COTS end item containing covered
acquisition of commercial derivative military articles in
materials, barring COTS end items that are 50% or more
certain circumstances; and
tungsten by weight, or mill products (e.g., metal sheets,
items containing noncompliant materials if the
rods, plates) that have not been incorporated into an end
acceptance of such items is necessary to the national
item or component;
security interests of the United States.
purchase of electronic devices containing covered
materials, unless the Secretary of Defense, pursuant to a
Acquiring Rare Earth Magnets
recommendation of the Strategic Materials Protection
and Tungsten
Board, determines that the domestic availability of a
DOD sourcing restrictions for the acquisition of rare earth
particular electronic device is critical to national
magnets and tungsten first appeared in the FY2019 NDAA
security; or
(P.L. 115-232). These restrictions were permanently
purchase of an end item containing a neodymium-iron-
codified as 10 U.S.C. §2533c. In contrast to the specialty
boron magnet manufactured from recycled material if
metals restrictions, 10 U.S.C §2533c establishes that these
the milling of the recycled material and sintering of the
materials, or finished products containing these materials,
final magnet takes place in the United States.
may not generally be sourced from four specific countries:
the Democratic People’s Republic of Korea, the People’s
Relevant Statutes and Regulations
Republic of China, the Russian Federation, or the Islamic
Title 10, U.S. Code, §2533b and §2533c
Republic of Iran.
DFARS Subparts 225.7003 and 225.7018
These sourcing prohibitions only apply to the Department
of Defense.
CRS Products
Applicability of Prohibitions
CRS In Focus IF10548, Defense Primer: U.S. Defense Industrial
The sourcing prohibitions for rare earth magnets and
Base
tungsten apply to all DOD prime contracts and subcontracts
CRS In Focus IF11311, Defense Primer: The National Technology
at any tier. Covered materials include:
and Industrial Base
samarium-cobalt magnets;
CRS In Focus IF10609, Defense Primer: The Berry and Kissell
neodymium-iron-boron magnets;
Amendments
tungsten metal powder; and
CRS Report R43864, China’s Mineral Industry and U.S. Access to
tungsten heavy alloy or any finished or semi-finished
Strategic and Critical Minerals: Issues for Congress
component containing tungsten heavy alloy.
Under these sourcing prohibitions, DOD generally may not
directly acquire rare earth magnets or tungsten that was
Heidi M. Peters, Analyst in U.S. Defense Acquisition
melted or produced in the four specified countries, or
Policy
military platforms or weapon systems containing rare earth
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Defense Primer: Acquiring Specialty Metals, Rare Earth Magnets, and Tungsten
IF11226
Disclaimer
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https://crsreports.congress.gov | IF11226 · VERSION 2 · UPDATED