The Strategic and Critical Materials Stockpile Will Be Deficient for Many Years

EMD-78-82: Published: Jul 27, 1978. Publicly Released: Jul 27, 1978.

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The United States stockpiles 93 strategic and critical materials (metals, ores, and drugs) currently valued at about $8.6 billion at 117 locations throughout the country. The General Services Administration's (GSA) Federal Preparedness Agency (FPA) is responsible for planning, programing, and reporting on the stockpile. The National Security Council gives FPA guidance for developing stockpile policy. The Federal Supply Service (FSS) is responsible for purchasing, storing, maintaining, transferring, rotating, distributing, and protecting the materials. The estimated material requirements goals were increased for 72 of the 98 stockpile materials as of October 1, 1976.

The present inventory of many materials is far short of the goals. Shortages totaling $7 billion exist for 51 materials, including 33 for which insufficient inventory is on hand to meet even the highest priority needs. As long as goals remain at the present level, the timeframe for attainment will be quite lengthy--15 or more years for many items. Attainment has been hampered by such factors as: an acquisition policy concerned primarily with avoiding market disruptions, limiting the dollar value of acquisitions to less than the value of disposals, continued disposals of needed materials under long-term sales contracts, loans of materials which reduce the available inventory needed to satisfy goals, and budgetary constraints. The practice of reporting goals as being satisfied by subspecification inventory significantly overstates stockpile readiness.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Director, FPA, should: (1) formulate schedules for meeting acquisition goals so that Congress can consider the reasonableness of acquisition timeframes; (2) separately identify in a report to Congress those materials which do not meet industrial requirements and the cost and time needed to convert these materials; (3) establish a formal procedure for systematic and periodic review of specifications; (4) determine all instances when materials have deteriorated below acceptable standards and include such information in the report to Congress; and (5) adopt a more flexible storage policy that would recognize other important factors, including the capability to transport materials during an emergency and the shifts in industrial consumption patterns.

    Agency Affected:

 

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