The US Department of Defense is investing $450 million into Elmet Group to secure domestic tungsten production. This deal grants the federal government up to 19.9% ownership through redeemable preferred equity and warrants, alongside the right to appoint one independent director to the company board.
Of the total investment, over $165 million will modernize Elmet facilities in Maine, Michigan, and Ohio. Additionally, approximately $150 million is allocated to a joint venture for the Springer Tungsten Complex in Nevada, which will serve as the only ammonium paratungstate facility in North America.
The Defense Logistics Agency also awarded Elmet a contract with a ceiling of $2 billion and a minimum commitment of $150 million to replenish the National Defense Stockpile. Following the news, Elmet shares on the Nasdaq rose by as much as 55% during intraday trading.
The initiative aims to reduce reliance on China, which controls about 85% of the global tungsten market. New US procurement regulations, effective January 1, 2027, will restrict sourcing from certain countries, making domestic production a requirement for defense contractors.
The project is expected to generate 1,200 jobs across mining and manufacturing sectors. Tungsten is essential for military and industrial applications, including aerospace components and semiconductor equipment, due to its high melting point of approximately 3,422 degrees Celsius.
