Defense Primer: Acquiring Specialty Metals and Sensitive Materials
Updated March 30, 2023
Defense Primer: Acquiring Specialty Metals and Sensitive
Materials
Some metals (such as titanium and tungsten) and metal
they were permanently codified by the FY2002 National
alloys, as well as strong permanent magnets known as rare
Defense Authorization Act (NDAA, P.L. 107-107). In
earth magnets, are critical to U.S. Department of Defense
2006, the FY2007 NDAA (P.L. 109-364) separated the
(DOD) operations. These materials are frequently
specialty metal-related provisions into a new section of the
integrated into components (e.g., integrated circuits,
U.S. Code.
electrical wiring, or optoelectronic devices) or structures
Applicability of Restrictions
(e.g., aircraft fuselages or ship hulls) of the military
The specialty metals domestic sourcing restrictions apply to
platforms and weapon systems that enable warfighting
all DOD prime contracts and subcontracts. For the purposes
capabilities.
of the restriction, 10 U.S.C. §4863 defines a specialty metal
as any of the following metals or metal alloys:
A rare earth element is one of 17 chemical elements, including
the 15 metallic chemical elements with atomic numbers 57
Steel with a maximum alloy content exceeding one or more of
through 71, as well as the chemically similar elements
the following limits: manganese, 1.65%; silicon, 0.60%;
scandium and yttrium. These materials are considered rare in
copper, 0.60%; or containing more than 0.25% of any of the
spite of their relative abundance throughout the Earth’s crust,
following elements: aluminum, chromium, cobalt, niobium
as the extraction and production of such materials can be
(columbium), molybdenum, nickel, titanium, tungsten, or
difficult and costly. Rare earth magnets produced using rare
vanadium.
earth elements are the strongest known permanent magnets.
Metal alloys consisting of nickel, iron-nickel, and cobalt base
alloys containing a total of other alloying metals (except iron)
There are few, and, in some cases, no known alternatives
in excess of 10%.
for many of these materials, which often have unique
Titanium and titanium alloys.
physical properties, such as high material strength coupled
Zirconium and zirconium base alloys.
with low density, or resistance to various forms of
DOD uses the foundry location where the final melting or
corrosion. Many of these materials are subject to sourcing
similar production of a specialty metal takes place to
restrictions or prohibitions in DOD acquisitions.
determine its origin. For example, titanium sponge—
Congress established these restrictions or prohibitions to
unwrought titanium that has not been melted—that has been
protect the domestic materials industry and ensure the
manufactured in Kazakhstan, shipped to the United States,
United States maintains critical production capabilities and
and melted into ingots at a foundry in Ohio would be
capacity within the defense industrial base. Statutory
considered compliant with the specialty metals domestic
restrictions in 10 U.S.C. §4863 establish that some items
sourcing mandate. Under the specialty metals restrictions,
that incorporate certain metals and metal alloys known as
DOD generally may not acquire certain military platforms
specialty metals generally must be produced or
or weapon systems—or components of these platforms and
manufactured in the United States. Other statutory
systems—that contain any amount of a specialty metal that
prohibitions establish that some items that incorporate
was not melted or produced in the United States.
certain sensitive materials may not be acquired from
The restriction applies to aircraft; missile and space
specified sources.
systems; ships; tank and automotive items; weapon
systems; and ammunition. DOD and its prime contractors
Sourcing Restrictions in Acquisitions
are also prohibited from directly acquiring any specialty
metal (e.g., metal sheets, rods, plates) if it was not melted or
For more information, see CRS Report R43354, Domestic
produced in the United States.
Content Restrictions: The Buy American Act and Complementary
Provisions of Federal Law.
Exceptions
Law and policy provide a number of exceptions to the
specialty metals sourcing mandate, including the following
Acquiring Specialty Metals
selected examples:
Domestic sourcing restrictions for DOD acquisition of
specialty metals first appeared in the FY1973 DOD
circumstances where the Secretary of Defense or a secretary of
appropriations bill (P.L. 92-570) as an expansion of
a military department determines that compliant specialty
domestic content restrictions on Departmental purchases of
metal of satisfactory quality and sufficient quantity, and in the
food, clothing, and other goods. These restrictions are
required form, cannot be procured as and when needed;
commonly known as the Berry Amendment. The Berry
acquisitions outside the United States in support of combat
Amendment sourcing restrictions were included in annual
operations or contingency operations;
DOD appropriations legislation from 1941 until 2002, when
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Defense Primer: Acquiring Specialty Metals and Sensitive Materials
acquisitions for which the use of other-than-competitive
space systems; ships; tank and automotive items; weapon
procedures has been approved when the need for materials or
systems; and ammunition.
end items is of an unusual and compelling urgency;
DOD is also generally prohibited from selling covered
acquisitions where the prime contract is at or below the
materials from the National Defense Stockpile to the
simplified acquisition threshold (generally $250,000);
specified nations, or to any third party reasonably believed
situations where an acquisition furthers an international
to be acting as a broker or agent for a covered nation or an
agreement (e.g., trade or offset agreements) with a qualifying
entity in a covered nation. The National Defense Stockpile
country;
was established by Congress in 1939 (50 U.S.C. §§98 et
purchases of electronic components, such as diodes or
seq.) to acquire and retain strategic and critical materials to
integrated circuits, unless the Secretary of Defense, pursuant to
decrease or prevent the potential dependence of the United
a recommendation of the Strategic Materials Protection Board,
States on foreign sources for supplies of these materials in
determines that the domestic availability of a particular
times of national emergency.
electronic component is critical to national security;
covered items incorporating specialty metals that were not
Exceptions
melted in the United States if the total amount of noncompliant
Law and policy provide limited exceptions to these
specialty metals in such an item does not exceed 2% of the
prohibitions, applicable to
total weight of specialty metals in the item;
commercially available off-the-shelf (COTS) items containing
circumstances where the Secretary of Defense determines that
compliant materials of satisfactory quality and quantity, in the
specialty metals, except in certain circumstances;
acquisitions of some commercially available items (e.g.,
required form, cannot be procured as and when needed at a
fasteners, high-performance magnets);
reasonable price;
procurement or sale of covered materials, or end items
acquisition of commercial derivative military articles in certain
circumstances; and
containing such materials, outside of the United States for use
items containing noncompliant materials if the acceptance of
outside of the United States;
acquisitions at or below the simplified acquisition threshold;
such items is necessary to the national security interests of the
purchase of a COTS end item containing covered materials,
United States.
barring COTS end items that are comprised of 50% or more of
Acquiring Sensitive Materials
covered sensitive materials by weight, or mill products (e.g.,
DOD sourcing restrictions for the acquisition of sensitive
metal sheets) that have not been incorporated into an end item
materials first appeared in the FY2019 NDAA (P.L. 115-
or component;
232). In contrast to the specialty metals restrictions, 10
purchase of electronic devices containing covered materials,
U.S.C. §4872 establishes that these materials, or finished
unless the Secretary of Defense, pursuant to a recommendation
products containing these materials, may not generally be
of the Strategic Materials Protection Board, determines that
sourced from four countries: the Democratic People’s
the domestic availability of a particular electronic device is
Republic of Korea, the People’s Republic of China, the
critical to national security; or
Russian Federation, or the Islamic Republic of Iran. These
purchase of an end item containing a neodymium-iron-boron
sourcing prohibitions only apply to the Department of
magnet manufactured from recycled material if the milling of
Defense.
the recycled material and sintering of the final magnet takes
place in the United States.
In an explanatory statement accompanying the FY2022
NDAA, Congress expressed concern that the
Relevant Statutes and Regulations
aforementioned countries were attempting to circumvent
these prohibitions and directed DOD to provide certain
Title 10, U.S. Code, §4863 and §4872
congressional committees with a briefing on the matter, to
DFARS Subparts 225.7003 and 225.7018
include proposals for countering such attempts.
Applicability of Prohibitions
CRS Products
The sourcing prohibitions for sensitive materials apply to
CRS In Focus IF10548, Defense Primer: U.S. Defense Industrial
all DOD prime contracts and subcontracts at any tier.
Base
Covered materials include
CRS In Focus IF10609, Defense Primer: The Berry and Kissell
samarium-cobalt magnets;
Amendments
neodymium-iron-boron magnets;
CRS In Focus IF11574, National Stockpiles: Background and
tungsten metal powder;
Issues for Congress
tungsten heavy alloy or any finished or semi-finished
CRS Report R46618, An Overview of Rare Earth Elements and
component containing tungsten heavy alloy; and
Related Issues for Congress
tantalum metals and alloys.
Under these sourcing prohibitions, DOD generally may not
directly acquire sensitive materials that were mined,
Heidi M. Peters, Coordinator, Analyst in U.S. Defense
refined, separated, or melted in the four specified countries,
Acquisition Policy
or military platforms or weapon systems containing
Alexandra G. Neenan, Analyst in U.S. Defense
sensitive materials melted or produced in the four specified
Infrastructure Policy
countries. The prohibitions apply to aircraft; missile and
Luke A. Nicastro, Analyst in U.S. Defense Infrastructure
Policy
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Defense Primer: Acquiring Specialty Metals and Sensitive Materials
IF11226
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