Pentagon Plans AI-Based Program to Calculate Prices for Critical Minerals

The U.S. Department of Defense plans to develop a program to estimate prices and predict supplies of nickel, cobalt and other critical minerals, a move aimed at boosting market transparency but introducing a new and uncertain variable into global metals markets.

The program, which received little attention after it was announced in October on a Pentagon website, is part of Washington’s broader efforts to boost U.S. production of critical minerals used in weapons manufacturing and the energy transition. U.S. production lags behind market leader China, in part because attempts to build new U.S. mines can be heavily influenced by swings in commodity prices. Jervois Global, for example, announced last year that it would suspend construction of a cobalt project in Idaho due in part to low market prices, even as Chinese cobalt miners — with financial backing from Beijing — said they would increase production of the battery metal in a bid to grab a larger market share. However, an official rubric by which Washington calculates how much a specific metal should cost could confuse metals markets by creating dueling structures to determine the price, according to two sources who were not authorized to speak publicly.

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