Washington just pulled the rug out from under global metal supply chains. If you run a recycling plant, manage supply chains, or track critical minerals, the new federal rule restricting US exports of secondary tungsten and battery black mass is a massive deal.
The Bureau of Industry and Security issued an emergency temporary final rule under the Defense Production Act. Starting August 27, domestic sellers of tungsten scrap and shredded lithium-ion battery black mass must allocate 100 percent of their monthly sales to domestic buyers. You can't just ship it overseas anymore. The directive covers key Schedule B codes for tungsten waste and scrap alongside three distinct categories for black mass. It targets the exact feedstocks that international refiners, particularly in Asia, have relied on for years to recover lithium, cobalt, nickel, and hard-to-source tungsten.
Why the sudden panic? Washington is terrified of running short on the materials that keep defense hardware and advanced manufacturing moving.
The Real Story Behind the Export Clampdown
President Trump signed a presidential determination stating that recoverable critical minerals and materials are scarce and essential to national defense. Import dependency became a liability. China dominates primary tungsten production and has slapped its own strict export controls on critical minerals. In response, Washington decided to choke off the supply of scrap flowing out of the United States.
Black mass production capacity from battery scrap input in the US represented roughly nine percent of the global total in early 2026. For years, massive volumes of scrap left North American ports because domestic processing infrastructure couldn't keep pace. In the first half of the year alone, US black mass exports hit tens of thousands of tonnes.
Now? That pipeline faces a hard stop. The rule treats internal corporate transfers and sales to foreign subsidiaries the exact same way it treats open-market export deals. If you own a recycling plant in the US and want to ship material to your own processing facility abroad, you are blocked unless you secure an exemption.
Where This Leaves Chinese and Asian Refiners
Chinese recyclers and international metal buyers are staring down a major feedstock shortage. Without a steady stream of secondary materials from North America, overseas refiners have to scramble for alternatives or scale back operations.
Tungsten is irreplaceable for military armor, piercing ammunition, and high-performance machine tools. When the US government locks down secondary tungsten scrap, it protects domestic defense contractors at the expense of foreign buyers who counted on American e-waste.
Asian markets, including South Korea and Southeast Asia, are feeling the squeeze too. They rely heavily on imported nickel and cobalt contained within black mass. When US supply gets locked inside US borders, global market pricing shifts.
The Domestic Catch-22
Keeping scrap at home sounds like a clean victory for national security, but reality is messier. North American battery recyclers have had a turbulent financial stretch. Companies like Ascend Elements and Li-Cycle faced heavy headwinds and bankruptcy restructuring over the past year.
The core issue remains simple: the United States still lacks sufficient domestic hydrometallurgical refining capacity to absorb all the black mass generated locally.
If you force recyclers to sell domestically when local processing plants are booked solid or non-existent, you create a massive bottleneck. Material piles up. Prices for raw scrap fluctuate wildly. Smaller recycling outfits caught in the middle might struggle to find local buyers willing to pay market rates.
Exemptions and What Comes Next
The Bureau of Industry and Security built a narrow escape hatch into the rule. Companies can apply for adjustments if they plan to ship black mass or tungsten scrap abroad for toll processing, provided the refined metals are shipped back to the United States.
Bureau officials promised to handle these requests within fourteen days, but discretion remains entirely with the agency. Customs and Border Protection now has full authority to detain suspicious shipments at the border while reviews happen.
If you operate in the recycling sector, you can't rely on business-as-usual export models for the next twelve months. Audit your supply contracts immediately. Check your Schedule B codes. If your current business model depends on shipping black mass or tungsten waste across international waters, start lobbying for a BIS adjustment or build relationships with domestic buyers before enforcement teeth clamp down hard.
