More crazy stuff. In 2022, China produced 55% of the world’s supply of silk. India produced 40%. The rest of the world only made 5%.
China has been known for unfair trading practices. They will sell products below their production costs to wipe out competitors, obtain a near monopoly, then raise their prices.
You may think the US military can support KBLB’s entire production of silk, but that would represent a niche market for KBLB. They would be producing silk in the US (costly) for a single customer (US military). The market cap for such a company would not be terribly impressive.
China does face significant economic problems. They discourage immigration, for example, and are facing an aging workforce. But their government is willing to support their efforts to succeed in critical markets. Modified silkworm silk may or may not be one they target.
You don’t have to care about China. Others may wish to keep an eye on developments there. There are certainly reasons for concern. Dismissing one’s competitors is the best way to make sure you are blindsided by their actions.