🤝 Billion-dollar alliance: Korea Zinc, the world’s largest zinc refiner, plans to invest up to USD 11bn in a critical-metals refinery project in Tennessee. The Pentagon will hold a 40% stake in the JV and help finance the build via loans and CHIPS Act subsidies.
⚙️ Tennessee turns high-tech furnace: From 2029, the plant is set to produce 540,000 tons of strategic metals annually, from zinc and copper to germanium, gallium, and antimony—key inputs for AI, chips, defense systems, and cars.
🇺🇸 Supply-Chain sovereignty: After China’s 2024 export ban on germanium and antimony, Washington is pushing hard on raw-materials policy. The project is part of the new U.S. strategy and marks the first large zinc smelter built in the U.S. since the 1970s.
🇰🇷 Shareholder power struggle: Major shareholders MBK Partners and Young Poong accuse CEO Choi of using the JV to secure backing. They threaten lawsuits over the capital increase and warn of a loss of “zinc sovereignty.”
📉 Rally, then whiplash: The stock initially jumped 26% before falling 13%. Supporters see a historic opportunity; critics see a geopolitical power play with Washington entering the shareholder base.
Background
The deal reflects the geopolitical reshuffling of raw-materials supply chains. The U.S. is rapidly building domestic capacity for critical metals needed for defense, chips, AI, power grids, and data centers, while cutting dependence on China. For Korea Zinc, this is less about expansion and more about securing a gateway into the U.S. industrial complex, complete with offtake, funding, and political backing.
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