In 2023, Raytheon CEO Greg Hayes warned that Beijing effectively has the US military’s supply chain by the balls, thanks to America’s reliance on rare earths and other materials which either come from, or are processed in, China.
According to Hayes, Raytheon has “several thousand suppliers in China,” because of which “decoupling … is impossible.“
“We can de-risk but not decouple,” he told the Financial Times, adding that he thinks this is the case “for everybody.”
“Think about the $500bn of trade that goes from China to the US every year. More than 95 per cent of rare earth materials or metals come from, or are processed in, China. There is no alternative,” he said.
Fast forward two years later – and China’s recent curbs on the export of critical minerals are rippling through the U.S. defense supply chain, slowing production schedules and sending manufacturers on a global search for scarce materials needed in everything from munitions to fighter jets.
In short, amid a surge in U.S.-China trade tensions earlier this year, Beijing tightened its control over rare earth exports. Those shipments resumed after the Trump administration reached a set of trade concessions in June, however China has kept a firm hold on materials destined for defense use. Accounting for roughly 90 percent of the world’s rare earth output – and dominating the supply of other strategic minerals – China has also barred the sale of germanium, gallium and antimony to the United States since December. The three metals are essential for bullet hardening, night-vision optics and other military applications, the WSJ reports.
Hellbound and Down 