Summary：Trump Signs Tough Order, Sending Shockwaves Through Defense Contractors on Minerals **Introduction

referrerpolicy="no-referrer"
style="max-width:100%;height:auto;display:block;margin:0 auto;">

Trump Signs Tough Order, Sending Shockwaves Through Defense Contractors on Minerals

**Introduction**
President Donald Trump has signed a new executive order that sharply limits the ability of defense contractors to secure waivers for banned foreign minerals, a move that reverberates across the aerospace, shipbuilding and weapons‑manufacturing sectors. The directive tightens existing supply‑chain controls aimed at reducing reliance on adversarial nations for critical materials such as rare‑earth elements, tungsten and cobalt. By closing a loophole that previously allowed firms to bypass restrictions through case‑by‑case exemptions, the administration says it is bolstering national security and encouraging domestic production.

**Key Developments**
The order, issued under the Defense Production Act, amends Section 1234 of the National Defense Authorization Act to require that any request for a waiver be reviewed by a newly created interagency panel rather than a single agency official. Contractors must now demonstrate that no viable domestic or allied‑nation alternative exists before a waiver can be considered, and even then the approval timeline has been extended from 30 to 90 days. In addition, the mandate expands the list of prohibited minerals to include several high‑purity grades of lithium and gallium, materials essential for advanced batteries and semiconductor‑based guidance systems. Industry groups reported that the announcement triggered an immediate review of existing contracts, with several major primes pausing new procurements pending clarification on compliance costs.

**Industry Analysis**
Analysts say the policy shift could accelerate a broader trend toward reshoring and stockpiling of strategic minerals. While larger contractors with established in‑house processing capabilities may absorb the added administrative burden, mid‑tier suppliers—often reliant on overseas smelters—face potential delays and cost overruns. The extended waiver review period may also disrupt just‑in‑time logistics models that have become standard in defense procurement, prompting firms to increase safety stocks or redesign supply chains around certified domestic sources. Some experts warn that the heightened scrutiny could inadvertently raise the price of end‑products, affecting budget allocations for programs such as the F‑35 Joint Strike Fighter and next‑generation naval vessels. Conversely, the order creates opportunities for U.S. mining and