DoD commits $450M to U.S. tungsten and molybdenum producer to boost domestic processing

# What happened Policy, partnered with the Economic Defense Unit, made a $450 million redeemable preferred equity investment in the Elmet Group through the Industrial Base Analysis and Sustainment program. The investment aims to expand U.S. tungsten and molybdenum production and processing capacity.

# Why the investment was made Elmet Group is a fully integrated producer of tungsten and molybdenum materials. Those materials support more than 100 Defense Department programs, including systems in aerospace, missiles, munitions, propulsion, naval and undersea applications, and certain electronics uses.

The funding targets three practical gaps:

• Increase U.S.-aligned refining and processing capabilities to reduce dependence on foreign supply chains where China leads global production.
• Strengthen the production base that supplies essential defense systems and sustain related manufacturing jobs.

# Scale and context The announcement cites that China controls an estimated 85% of global tungsten production and about 40% of molybdenum production. The DoD investment is structured as a redeemable preferred equity stake in Elmet and is intended to strengthen domestic capacity and resilience for critical minerals used in defense systems.

# What Elmet will do with the money According to the announcement, Elmet will use the capital to:

• Expand domestic tungsten capacity and refining operations.
• Open a North American independent APT facility, a key processing step for tungsten.
• Enhance U.S.-aligned refining and processing to lower exposure to supply chains dominated by foreign suppliers.

The company is presented as the only fully integrated U.S.-owned producer of pure tungsten and molybdenum, and its products are already embedded across many defense programs.

# Practical implications for supply chains and defense programs For defense acquisition and sustainment, increased domestic processing can shorten lead times for critical components and reduce risk tied to concentrated foreign production. For industrial policy, the investment represents a direct government capital infusion aimed at rebuilding parts of the domestic metals processing base.

# Immediate points to watch

• Construction and commissioning timeline for the APT facility and other processing expansions.
• Degree to which the investment reduces U.S. reliance on currently dominant foreign suppliers over the coming years.
• Operational and financial terms attached to the redeemable preferred equity and how they affect Elmet's business decisions.

# Bottom line The DoD's $450 million investment in Elmet is aimed at bringing critical tungsten and molybdenum processing steps back into U.S.-aligned facilities, supporting defense supply chains that depend on these materials, and reducing exposure to markets where China currently dominates production.