BIS DPAS Directive Allocation Order — 100% domestic-sale mandate for black mass and tungsten waste/scrap

Mechanism

BIS administers the Defense Priorities and Allocations System (DPAS, 15 CFR part 700) under Title I of the DPA (50 U.S.C. 4501 et seq.). On July 30, 2026 the President issued a Section 101 determination finding that "recoverable critical minerals and materials" (CMMs) — specifically black mass and tungsten waste/scrap — are scarce and critical to national defense, and authorized the Secretary of Commerce (via the E.O. 13603 delegation) to act. BIS responded by issuing a Directive Allocation Order under DPAS Subpart F (§700.33): as of August 27, 2026, any U.S. person selling black mass or tungsten waste/scrap must direct 100% of monthly sales volume to other U.S. persons. Because the rule reaches "sale" (defined broadly to include intra-affiliate transfers) rather than export specifically, it functions as a de facto export ban absent a BIS-granted adjustment or exception (a DPAS license) or interim relief (a DPAS temporary license).

BIS invoked the urgent-and-compelling-circumstances exception under DPA §709(b)(2) to skip prior notice-and-comment, publishing this as a temporary final rule instead — comments close November 4, 2026 and may lead to revisions or an extension beyond the August 27, 2027 sunset.

"Black mass" is defined in the rule as shredded lithium-ion battery scrap containing cathode material (aluminum, copper, iron, lithium, cobalt, nickel, manganese) and/or anode material (graphite, silicon) or other residual battery-cell materials — i.e., the order reaches the recycling/secondary-materials feedstock stage for the core EV/grid-battery mineral basket, not raw ore or refined metal.

Downstream implications

• First US DPA/export-control action targeting the recycling and

secondary-materials stage of the critical minerals chain (vs. mining or refining) — closes an arbitrage channel where US-generated battery scrap and tungsten scrap had been exported (notably to China) for offshore processing.

• Adjustment/exception requests go to BIS's Office of Strategic Industries

and Economic Security (DPASAllocations@bis.doc.gov) on a rolling basis from August 6, 2026 through the order's expiration — worth tracking for which companies/flows get carve-outs.

• Complements China's existing tungsten-focused export controls (see

china-minerals-counter-strike theme) by shoring up the US side of the tungsten supply chain with a domestic-retention mandate rather than a China-style export-license regime.

• Domestic battery recyclers (e.g., Redwood Materials, Li-Cycle, Cirba

Solutions) and tungsten-scrap processors gain a captive-supply mandate; downstream buyers outside the US lose access to US-origin feedstock.

Open questions

• Volume of black mass / tungsten scrap actually redirected domestically

vs. previously exported — no public trade-flow figure yet disclosed.

• Whether BIS extends the order past August 27, 2027 or converts it to a

standing rule after the comment period.

• Whether other DPA-scarce-material determinations follow for additional

recoverable CMMs (e.g., rare-earth magnet scrap) using the same Subpart F mechanism.