US launches strategic stockpiling of lithium carbonate, plans to purchase 16,200 tons over five years; bidding closes on July 17

On July 2, local time, the U.S. Defense Logistics Agency (DLA) released a solicitation for the procurement of battery-grade lithium carbonate, planning to sign a five-year fixed-price contract to supplement the National Defense Stockpile. This marks the first time the U.S. has launched a national-level large-scale strategic stockpiling initiative for lithium resources, signifying that the U.S. critical mineral stockpile has moved from policy planning to actual implementation.

Core Tender Parameters Announced, with Annual Decreasing Procurement

According to the official solicitation documents, the total upper limit for the five-year procurement is 16,167 tons of battery-grade lithium carbonate, with a total contract value of up to $300 million. The bid submission deadline is July 17. The solicitation adopts a lowest-price technically acceptable (LPTA) model, awarding the contract to the supplier with the best price that meets technical standards. The contract sets a minimum guaranteed procurement amount of $1 million.

Procurement is implemented through an annual tiered release. The procurement volume for the first contract year is approximately 3,657 tons, while subsequent procurement scales will be adjusted downward annually, dropping to 2,839 tons in the fifth year.

The document specifies the raw material standard as powdered battery-grade lithium carbonate with a purity of ≥99.5%. Goods must be delivered to designated defense stockpile warehouses in New York, Nevada, Indiana, and Ohio.

This solicitation is not a temporary plan. In March of this year, the DLA had already conducted a preliminary information request regarding the need for 550 tons of lithium carbonate reserves, and after multiple rounds of research, formally launched this large-scale five-year procurement plan.

Industry analysis points out that lithium's inclusion in the defense stockpile list stems from its irreplaceable strategic value: lithium is a core basic material for military aircraft, advanced semiconductors, military energy storage, and military new energy equipment, permeating the entire modern military system and energy security chain.

Market Institutions: Limited Procurement Volume, Difficult to Directly Reverse the Supply and Demand Pattern of Lithium Salts

Regarding the actual impact of this stockpiling on the global lithium market, objective calculations and judgments indicate: the total maximum procurement volume over five years is approximately 16,200 tons of LCE, with an average annual procurement scale of only about 3,200 tons. Compared to the overall consumption volume of global lithium salts, this is relatively small. It is far from the market impact brought by demand fluctuations in the new energy vehicle and large-scale energy storage industries, making it difficult to directly change the fundamentals of industry supply and demand. It only has a marginal pulling effect on spot prices.

Institutions also note that the core significance of this event does not lie in short-term demand increments, but as a signal that the U.S. critical minerals strategy is shifting from policy slogans to substantive procurement execution.

At the same time, historical experience presents uncertainties: previously, when the DLA advanced cobalt strategic stockpiling, it adjusted procurement strategies due to significant fluctuations in commodity prices and the constraints of the fixed-price contract mechanism. Whether this five-year fixed-price contract can be fully implemented remains a variable. The subsequent award progress, winning entities, actual transaction prices, and annual pickup execution are the key points to observe.

Intensifying Great Power Competition, Continuous Upgrading of U.S. Critical Minerals Strategy

Research from the China Metal Mining Economic Research Institute shows that against the backdrop of global great power competition, critical minerals have become the cornerstone of the defense industry. Supply chain autonomy and controllability are core policy objectives of the U.S. Department of Defense in recent years.

The development of the U.S. critical minerals strategy is clearly divided into three stages: The first term of the Trump administration completed strategic awakening and framework building; the Biden administration advanced the implementation of systematic policies; since the second term of Trump began in January 2025, the strategy has shifted to aggressive localization, with the Department of Defense strengthening confrontational layouts. By simplifying environmental constraints on domestic mineral development, increasing support for domestic production capacity, and exercising emergency executive powers, they are fully committed to reducing dependence on overseas minerals.

However, multiple official reports indicate that short-term fixes to the shortcomings in the U.S. mineral supply chain are difficult. Data from the U.S. Geological Survey (USGS) in early 2025 shows that among the 50 critical minerals in the U.S. in 2024, 12 categories had 100% import dependence, and 28 categories had an import dependence exceeding 50%. Core metals such as arsenic, gallium, natural graphite, niobium, tantalum, and yttrium rely entirely on overseas supply.

A report by the Carnegie Endowment for International Peace in January further pointed out that although the U.S. has considerable reserves of mineral resources such as lithium, copper, nickel, and graphite, domestic production capacity cannot match the overall needs of the defense and industrial sectors due to constraints including high mining costs, geological limitations, and long mine development cycles. High import dependence remains a long-term shortcoming in the U.S. defense and economic systems.

Industry insiders summarize that this large-scale stockpiling of lithium carbonate is an important measure for the U.S. to address shortcomings in critical mineral reserves and improve the security buffer for defense resources. However, constrained by factors such as procurement volume, domestic supply capacity, and long-term contract fulfillment risks, it is difficult to change the global lithium resource circulation pattern in the short term. Subsequently, critical mineral stockpiling and domestic industrial chain construction in various countries may continue to increase.