US Bets $7.4 Billion on Korea Zinc Plant to Decouple Critical Minerals from China
Washington just placed a massive geopolitical wager on the battery supply chain.
The Strategic Pivot
Forget trade wars and tariffs—the real battle for tech supremacy is being fought over raw materials. The United States is funneling a staggering $7.4 billion into a single Korea Zinc facility. This isn't just an investment; it's a direct attempt to rewire the global supply chain for the minerals that power everything from electric vehicles to defense systems. The target? Cutting China out of the equation entirely.
Building a Parallel System
The move bypasses traditional diplomacy, opting instead to build a competing industrial base from the ground up. It funds the infrastructure to process and refine critical minerals outside of Beijing's sphere of influence. The goal is a self-sufficient, allied corridor for tech manufacturing—a hedge against future geopolitical friction that could strangle production.
The Finance Angle
On paper, it's a masterstroke of economic statecraft. In reality, it's a multi-billion-dollar gamble that assumes building physical factories is faster than China finding new leverage—a bet usually made by people who've never waited for a building permit. The closer promises supply chain security; the cynic sees a costly attempt to out-maneuver a system that's spent decades optimizing for exactly this kind of dependency.
The message is clear: the era of relying on a strategic competitor for critical tech inputs is over. Whether this $7.4 billion plant is the first domino to fall or just a very expensive lesson remains to be seen.
US and Korea move money into new joint venture
The deal followed a $350 billion South Korean investment pledge tied to a tariff deal signed in late October.
Korea Zinc’s chair, Choi Yun-birm, had joined a South Korean business group that visited Washington in August, and the plan now ranks as one of South Korea’s largest pushes into the US critical minerals sector.
Korea Zinc’s board approved a foreign joint venture structure on Monday and said the venture will include the US government as a direct party.
The filing said the joint venture will raise around $2 billion, and the rest of the funding will come from US government loans, US government grants and capital put in by Korea Zinc.
The company said, “The facilities will help us secure a strategic status in the US critical minerals market and strengthen our competitiveness. It will also boost our corporate and shareholder value by helping us secure future growth drivers.”
The statement showed a clear plan to anchor Korea Zinc inside the US supply chain.
Korea Zinc said it plans to acquire a former Nyrstar smelting site in Tennessee and rebuild the whole place so it can produce 13 metals plus sulphuric acid for chipmaking.
The production targets were specific: 300,000 tonnes of zinc, 35,000 tonnes of copper, 200,000 tonnes of lead, and 5,100 tonnes of rare earths each year once operations scale. That level of output marks one of the biggest attempts yet to pull critical minerals away from China’s control.
The US and its allies still rely heavily on China for most critical minerals, and everyone knows Beijing has strict export controls on materials like antimony, indium, tellurium, cadmium and germanium, all of which Korea Zinc already produces.
Beijing said last week it WOULD issue general licenses for rare earth exports as part of the trade war truce reached with the US last month.
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