31 Mar President Biden to utilise Cold War legislation to boost US battery metals production
US President Joe Biden is set to add a host of battery metals to the 1950 Defence Production Act, in a bid to encourage domestic production of critical minerals – or MIFTS (metals important for future technologies) – for electric vehicles (EVs) and other large batteries.
The Cold War era legislation was originally used by President Harry Truman to make steel for the Korean War, and more recently by President Donald Trump to spur mask production during the COVID-19 pandemic.
Adding minerals like lithium, nickel, graphite, cobalt and manganese to the list would provide a significant boost to US-based mining companies, with up to US$750 million potentially available to miners under the Defence Production Act’s Title III fund.
Instead of loans or direct purchases for minerals, the directive would fund production at current operations, productivity and safety upgrades and feasibility studies, according to one person familiar with the matter. In addition to EV batteries, the directive also would apply to large capacity batteries.
The Biden administration has already allocated huge sums, including $6 billion as part of the infrastructure bill, for the development of a US battery supply chain in order to reduce its reliance on China for lithium-ion cells. A White House report last year found that the US is reliant on imports for 58 mineral commodity products, up from 21 in 1954.
Rising EV demand this year has rapidly pushed up prices for the likes of nickel, lithium and cobalt, along with supply chain disruptions and Russia’s invasion of Ukraine. The price swings have underscored the US industry’s vulnerability as it transitions to clean energy.