'On par with what the DoD pursued during the Cold War': Pentagon’s war stockpile plan hits a minerals wall | Fortune

The minerals may be the hardest part. The U.S. produces less than 1% of the most common type of rare-earth magnet it uses, and China, which dominates the processing of many critical minerals, has kept American companies short even in peacetime.

The initiative, known as FORTRESS America, short for Federal Operations for Resilience, Troop Resources, Energy, Supply, and Survivability, was formally established on Sept. 30. It is designed to keep U.S. forces operating if a conflict disrupts domestic power grids and manufacturing supply chains, and it is the same program behind the Pentagon’s push for major bases to plan for 90 days without the grid.

Stockpiling materials isn’t unusual for the U.S. military, Bryan Clark, a senior fellow at the Hudson Institute, told Fortune. What distinguishes FORTRESS is its planned scale and its shift toward domestic reserves rather than overseas stockpiles.

During the Cold War, the Pentagon stored as much or more war matériel overseas, near anticipated battlefields in Eastern Europe or Northeast Asia, Clark said. FORTRESS instead focuses on protecting supplies inside the United States, reflecting growing concern that American factories could themselves become targets.

China could disrupt U.S. industrial production through cyber operations, drones, electromagnetic warfare, or attacks carried out by people inside the country, Clark warned. U.S. agencies have already warned that Chinese state-sponsored hackers had positioned themselves inside American critical infrastructure.

That concern has a recent precedent in Europe. On Dec. 29, 2025, cyberattacks hit about 30 renewable energy sites, a manufacturing company, and a heat and power plant serving nearly 500,000 customers in Poland. Polish officials linked the attacks to Russia’s Federal Security Service and said the attackers tried to destroy industrial systems, but the country avoided a major outage.

America makes less than 1% of its most common rare-earth magnet

Building stockpiles on the scale Clark described runs into a stark industrial reality: America’s defense industry remains deeply reliant on foreign supply chains for its raw materials.

In 2025, the U.S. imported about $60 billion worth of critical minerals other than rare earths, including nickel, lithium, cobalt, graphite, and tungsten, according to the Peterson Institute for International Economics.

The gap is most acute in rare-earth magnets. U.S. demand for the most common type reached roughly 48,000 metric tons in 2025, while domestic sources supplied just 300 metric tons, according to Arthur D. Little data reported by Reuters. U.S. companies are on track to have capacity for about 5,000 metric tons by the end of this year, roughly a tenth of last year’s demand.

The shortage has already reached factory floors. Ford, No. 22 on the 2026 Fortune 500, idled its Chicago Explorer plant for a week in May 2025 when rare-earth supplies ran short.

China has repeatedly tightened rare-earth export controls, and American companies are still struggling to secure enough supply, Reuters reported on Nov. 6, citing U.S. officials. That day, U.S. Trade Representative Jamieson Greer pressed Chinese Vice Premier He Lifeng to fully carry out Beijing’s commitments on rare earths and other critical minerals.

A major war could further disrupt overseas production and shipping routes, making it harder for the Pentagon to replenish its stockpiles.

To reduce foreign dependence, Clark said, the Pentagon is pursuing a dual approach: building raw-material reserves while funding domestic mining and processing capacity.

Why a $2 billion tungsten deal won’t fill the stockpile soon

Tungsten, a stockpiling priority Clark identified, illustrates why building reserves takes more than government spending.

The U.S. hasn’t commercially mined tungsten since 2015, when cheaper imports undercut domestic production, according to Scientific American. Its net import reliance for the metal exceeded 50% in 2025, according to the U.S. Geological Survey.

In September, tungsten manufacturer The Elmet Group won a Defense Logistics Agency contract worth up to $2 billion to supply tungsten ores, concentrates, and sodium tungstate to the National Defense Stockpile. Only $150 million of that is guaranteed. The Pentagon also committed $450 million to Elmet, including about $150 million earmarked to restart the Springer tungsten complex in Nevada.

Yet Elmet said it won’t begin deliveries to the stockpile until additional supply becomes available. To avoid diverting existing tungsten from American manufacturers, the company plans to wait until new production comes online from investments in Nevada, Australia, and Spain.

The deal illustrates a problem FORTRESS could face across the board: signing supply contracts doesn’t immediately put minerals into government vaults.

A price tag that could reach hundreds of billions

The cost of FORTRESS also remains uncertain. A senior defense official told reporters on Oct. 20 that officials are still assessing costs, Air & Space Forces Magazine reported. The magazine estimated the broader initiative could cost “scores of billions of dollars, if not hundreds of billions.”

To help cover the bill, the Pentagon is exploring public-private partnerships, Dale Marks, assistant secretary of defense for energy, installations, and environment, told Breaking Defense.

Even with capital flowing, analysts warn that supply chain independence can’t be rushed.

“The Pentagon is unlikely to meet the goals in the near term,” Clark said, pointing to the structural difficulty of rapidly stockpiling both finished weapons and raw minerals.

Chris Berry, a minerals industry analyst, told Reuters it will “take many more years” to build the infrastructure needed to compete with China’s dominant supply chain.

The first test comes soon. Starting Jan. 1, 2027, federal rules require defense contractors to stop buying rare earths, magnets, and tungsten from China, Russia, Iran, and North Korea. Washington has repeatedly granted waivers because domestic supply falls short, Reuters reported in July.

For the Pentagon, building the physical reserves may prove far harder than announcing them.