On November 3, retired four-star General Jack Keane, the Army's former Vice Chief of Staff, put a warning on the record: China "has made clear it is prepared to use [America’s] dependence as leverage."
The dependence he's talking about is America's reliance on Chinese rare earths. And he didn't say it from a cable news set.
He said it as a director of REalloys [NASDAQ: ALOY], the company the Army recently selected for exclusive negotiations to build a plant to process dysprosium and terbium on one of its own military bases.
And the timing couldn't be more critical. According to U.S. Treasury Secretary Scott Bessent, the truce that has kept Beijing's widest rare earth rules on hold now runs only until January 10, 2027.
That's just nine days after the Pentagon's new magnet rules take effect.
In short, Keane is warning about a pressure tactic China has already used, and one it could use again this winter. And the Army is preparing as if that threat will be around for decades.
China Has Already Shown What It's Willing to Do
Beijing has spent the last year and a half showing exactly what that leverage against America looks like.
In April 2025, it put seven rare earth elements under special export licenses, and dysprosium and terbium were on the list. Western factories felt the impact within weeks.
Ford CEO Jim Farley said the company "shut down plants for three weeks because we cannot get high power magnets."
If a company the size of Ford couldn't get the magnets it needed, it's easy to see what the same shortage would mean for the companies building America's weapons.
Then, in October 2025, China went even further. Its new rules would have required Beijing's approval to export even magnets made outside China if they contained trace amounts of Chinese rare earths, and they took direct aim at the military.
Under those rules, requests to use rare earths for military purposes "will be automatically rejected," according to Gracelin Baskaran, director of the Critical Minerals Security Program at CSIS. She called the measures "a sharp escalation in Beijing's long-running strategy to weaponize its dominance in rare earths."
The truce between Washington and Beijing has kept those October 2025 rules on hold for now, but they could come back in place as soon as January 10, 2027.
And Beijing hasn't waited on the truce to go after the defense industry.
On June 22, 2026, China's Commerce Ministry banned exports of goods with military uses to 10 U.S. companies and organizations it tied to the American military, two of them U.S. rare earth companies.
It even barred anyone, anywhere in the world, from passing those Chinese goods along to them.
In other words, Beijing has moved past squeezing overall supply and is now picking which American companies get cut off. So, for American defense planners, the real question is not if, but when China will use that leverage next.
Why the Pentagon Can't Build Without These Two Metals
Dysprosium and terbium aren't household names, but the Pentagon can't do without them. They go into the heat-resistant magnets inside radar and sonar, electric motors, and precision-guided munitions.
So, when the supply of those metals tightens, the companies building those weapons can end up waiting on Beijing just to keep their production lines running.
This is the vulnerability Keane, and the rest of the REalloys team, are pointing at. "For too long," he said, "the United States has depended on adversaries and others for the materials inside its most advanced defense technology."
And he spelled out what's at stake. "Our ability to deter conflict, and to prevail if deterrence fails, depends on producing munitions and weapons systems at scale," he said, "and that requires supply chains we control."
Washington has now written that idea into its own rules. From January 1, 2027, defense contractors can't deliver magnets containing materials from China, Russia, North Korea or Iran at any stage, from the mine to the finished magnet.
For big defense contractors like Lockheed Martin (NYSE: LMT) and RTX (NYSE: RTX), that deadline is now only weeks away, and you can't simply build that kind of supply chain overnight.
What that means is the hardest thing to find in this market right now is processed metal with a paper trail that never touches China.
Why the Army Is Planning 75 Years Ahead
That’s exactly what the Army is trying to lock down at Tooele, and the length of the proposed deal says a lot.
The Army first named REalloys to a short list of four companies cleared to negotiate for critical mineral plants on Army land back in June. On November 3, the two sides tentatively agreed on terms for roughly 200 acres at Utah's Tooele Army Depot.
The non-binding term sheet sets an initial 50-year lease with the option to renew for 25 more, even though federal law normally caps leases like this at five years.
In other words, the Army isn’t planning around this winter’s deadlines. It’s planning for a world where China’s leverage lasts for generations, and it wants a supplier on its own land for just as long.
Under the deal, the Army gets the first shot at buying any dysprosium and terbium made on the base. It isn't required to buy, but this term would mean no other customer gets ahead of it.
But Tooele isn't REalloys' only door into the Pentagon. Earlier this year, the Defense Logistics Agency tapped its Ohio unit to design a plant for samarium and gadolinium metal, two more rare earths the company wants to bring back to U.S. production.
None of this depends on what Beijing decides in January, though. Even if China extends the truce, the Pentagon's 2027 rules still apply, and if it doesn't, contractors will need a domestic source even more.
The 75-year deal is still pending, and site plans, environmental reviews, permits and approvals all have to come before it becomes a binding lease.
But the size and scale of that deal signals just how serious the Pentagon is about securing its supply chain over the next century.
Why Keane Isn't the Only Name Worth Noticing
The people behind REalloys know exactly what’s at stake, starting with Keane himself.
Keane spent 37 years in uniform, commanding the 101st Airborne Division, serving as acting Chief of Staff and Vice Chief of Staff of the Army, and helping shape the "Surge" strategy in Iraq.
Today he chairs the Institute for the Study of War, and in 2020 he received the Presidential Medal of Freedom.
But he isn't the only heavyweight in the room.
The chairman is Steve duMont, president of GM Defense, who describes the company's mission as securing "the industrial foundation of the free world."
Former Saskatchewan Premier Brad Wall and David MacNaughton, Canada's former ambassador to the United States, also sit on the board.
Put together, that's a board with deep roots in both the U.S. defense world and Canada, where REalloys' first new production is taking shape.
But a board only matters if the company can deliver, and that comes down to one hard step in the supply chain.
The Step Most Rare Earth Companies Skip
Most rare earth headlines are about mining the minerals still in the ground. New mines and processing plants get all the attention.
But rock in the ground is still a long way from something a defense contractor can use in its weapons and defense systems.
It has to be turned into metal and then approved by a buyer who needs to trace it every step of the way.
That’s the step REalloys has built its business around. And because those buyers need to trace every gram’s origin, where REalloys gets its raw material matters just as much.
So far, that answer runs through Canada and Greenland. In Saskatchewan, REalloys has supply rights to most of the output from the Saskatchewan Research Council's fully funded expansion, which is built to turn out dysprosium and terbium.
The first metal production from Saskatchewan is targeted for early 2027, just as the Pentagon's new rules kick in.
And in Greenland, Critical Metals has locked in 15% of its Tanbreez rare earth output for REalloys for 15 years, starting once the mine is up and running.
In other words, REalloys is lining up its supply in places well outside China's reach.
What sets REalloys apart, it argues, is that it's bringing the technology, the raw material, the know-how and the factories together under one company. And it plans to go all the way to finished magnets.
What Happens the Next Time Beijing Pulls the Lever
China has already shown it's willing to use its rare earth leverage, first against carmakers and then against the defense industry itself. What's yet to be seen is whether America will have its own supply of these metals the next time Beijing pulls that lever.
The calendar is already set. The Pentagon's sourcing rule takes effect January 1, and REalloys' first metal from Saskatchewan is targeted for the same quarter.
Keane called the Tooele terms "an important step toward bringing heavy rare earth processing onto a U.S. defense installation."
With the Army’s selection in hand, a potential 75-year lease on the table and its first production months away, REalloys is lining up to be one of the first companies to give the Pentagon a supply of these metals that China can't switch off.
By. Josh Owens
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