Korea Zinc Co., the world’s largest zinc smelter, is moving forward with a $7.4 billion investment to build a new smelting facility in Tennessee, backed by JPMorgan Chase & Co. and support from the US government. The project reflects Washington’s intensifying push to localize supply chains for critical metals used in clean energy, defense, and advanced manufacturing.

The development comes as the United States accelerates efforts to reduce reliance on overseas processing, particularly from China, reshaping global capital flows and industrial investment decisions.

Strategic financing meets industrial policy

JPMorgan’s involvement positions the deal among the most significant Wall Street-backed industrial investments tied to US strategic priorities. While detailed financing structures have not been fully disclosed, the bank’s participation signals confidence in the long-term demand outlook for refined metals and the durability of policy support.

The Biden administration has prioritized domestic processing capacity through legislation such as the Inflation Reduction Act and the CHIPS and Science Act. Smelters, long viewed as environmentally and economically challenging assets, have re-emerged as strategic infrastructure. Korea Zinc’s Tennessee plant is expected to process metals essential for electric vehicles, batteries, and renewable energy systems.

Why Tennessee matters for critical metals

The choice of Tennessee reflects both logistical and political considerations. The state offers access to major transportation networks, a growing clean-energy manufacturing base, and a regulatory environment viewed as more predictable for large-scale industrial projects. For Korea Zinc, the location strengthens proximity to North American customers while reducing exposure to global shipping disruptions.

From a US policy perspective, anchoring advanced metals processing domestically enhances supply-chain resilience. Smelting capacity is often the bottleneck between mining and finished products, making it a focal point in efforts to secure materials critical to national security and climate objectives.

Market and geopolitical implications

The project highlights a broader shift in global capital allocation, where geopolitics increasingly influences investment decisions alongside traditional return metrics. For financial institutions like JPMorgan, participation in such projects allows alignment with government-backed initiatives while gaining exposure to long-duration industrial assets.

For global investors, including those in Israel with interests in advanced materials, energy transition technologies, and infrastructure finance, the deal underscores how industrial policy can reshape valuation frameworks. Capital-intensive assets once viewed as cyclical or environmentally risky are now being reframed as strategically indispensable.

Looking ahead, markets will watch closely for regulatory approvals, environmental permitting progress, and final financing terms. Cost overruns, commodity price volatility, or political shifts could test the project’s economics. However, continued US policy support and strong institutional backing suggest Korea Zinc’s Tennessee smelter could become a cornerstone of America’s evolving critical-minerals strategy.