Lockheed Martin is in advanced talks to secure domestic supplies of two critical minerals — scandium and germanium — as the Trump administration intensifies pressure on U.S. defense contractors to reduce their dependence on Chinese sources, according to two sources familiar with the discussions cited by Reuters. The world's largest defense contractor is negotiating with Colorado-based NioCorp Developments for scandium supply and with Teck Resources and Quebec-based 5N Plus for germanium, both minerals essential for military applications ranging from aircraft components to infrared sensors, the sources told Reuters. According to a source familiar with the agreement and details seen by Reuters, NioCorp has signed a preliminary deal to supply Lockheed with 15 metric tons of scandium per year.
The metal, one of the 17 rare earth elements, is used to produce lightweight, corrosion-resistant alloys for aircraft. NioCorp would supply the material from its Nebraska mine, which is slated to open by 2028 with an annual production capacity of 100 metric tons. The contracted volume would represent roughly a quarter of global scandium demand, which the U.S.
Geological Survey (USGS) estimates at approximately 60 metric tons annually and growing. The agreement still requires finalization, though the two companies already have an existing relationship through a Pentagon-funded research program. The U.S. has not mined scandium domestically since 1969.
Rio Tinto currently stands as the only North American scandium producer, with capacity to produce roughly nine metric tons per year. "Both companies recognize how important scandium has become to the future of American defense technology," said Mark Smith, NioCorp's CEO. Lockheed stated it appreciated "the work NioCorp is doing to establish a domestic source of scandium." On the germanium front, Lockheed is in separate negotiations with Teck Resources, which mines and produces a zinc and germanium concentrate from its Red Dog mine in Alaska.
The concentrate is subsequently smelted in British Columbia, where the two metals are separated. Teck has described itself as the largest North American germanium producer and the fourth-largest globally. The USGS estimates global germanium consumption at approximately 60 metric tons annually and rising.
The U.S. currently imports more than half of its germanium requirements. Lockheed is also engaged in parallel germanium supply talks with 5N Plus, which earlier this year received Pentagon funding to process the metal from recycled feedstock at a facility in Utah, according to the second source. "What Lockheed basically wants is a long-term supply chain security," the second source told Reuters.
"Because they are under pressure, so they really want to know if the supply is coming from China or elsewhere." Negotiations with both Teck and 5N Plus have been ongoing for more than a year. Pricing and contract length remain the primary sticking points, according to the source. Representatives for 5N Plus were not immediately available for comment.
Teck declined to comment on specific commercial agreements but confirmed it has agreed to work with the Canadian government to increase germanium processing capacity in British Columbia. Asked about the germanium discussions, Lockheed said it continuously assesses "the global critical minerals supply chain to ensure access to materials that support our customers' missions." The negotiations come against a backdrop of escalating U.S. policy action. Last month, President Trump signed an executive order making it harder for defense contractors to obtain waivers that had previously allowed them to purchase minerals from China and other prohibited foreign suppliers.
Reuters reported last week that U.S. miners and processors remain significantly behind in their race to match China's market dominance, even as dozens of domestic mineral projects are currently under development. Lockheed manufactures the F-35 Lightning II fighter jet, Patriot interceptor missiles, and other weaponry for the U.S. government. Chinese critical minerals prices have historically been cheaper than those from Western sources, owing to differences in mining practices, regulatory standards, and other structural factors.
Reuters reported earlier this year that Western governments are attempting to establish regional mineral pricing mechanisms independent of Chinese market influence. Source: Reuters, reporting by Ernest Scheyder in Houston and Divya Rajagopal in Toronto, August 4, 2026.
Source: reuters.com