Alongside the prospective public funding, the company has raised $1.5 billion from private investors. The combined capital is expected to cover major expenditures linked to building a full-scale supply chain for rare-earth magnets, a component essential for defense systems, electric vehicles and advanced electronics. USA Rare Earth has outlined plans for a manufacturing facility in Stillwater, Oklahoma, that would process materials from its own mine as well as third-party feedstock.
The Round Top project near Sierra Blanca, Texas, is known for a diverse mix of heavy and light rare earth elements, including neodymium, praseodymium and dysprosium. Company officials have said the deposit’s geology supports a mine life of several decades, with production slated to supply both the Stillwater plant and external customers. Environmental assessments and permitting activities are under way, and the incoming funds are expected to speed engineering and construction work.
The financing initiative reflects a broader federal strategy aimed at reducing U.S. dependence on foreign sources of critical minerals, particularly China, which now dominates global rare-earth extraction and processing. Commerce Secretary Howard Lutnick said the investment would strengthen domestic supply chains and enhance national resilience, echoing policy goals advanced by the Trump administration to secure materials vital to high-technology manufacturing.
Washington has used similar tools in recent years to promote domestic production. The government arranged a package for MP Materials that included an equity stake, a price floor and an offtake agreement. It also acquired positions in Lithium Americas and Trilogy Metals, extending support to companies involved in battery and copper projects considered strategically important.
Rare earths form a subset of critical minerals indispensable to industries such as aerospace, robotics and semiconductor fabrication. Despite possessing known reserves, the United States has relied heavily on imported supplies of refined rare-earth oxides. According to the U.S. Geological Survey, China accounted for the vast majority of global rare-earth processing capacity in recent years, giving Beijing significant leverage over downstream industries. During trade disputes last year, Chinese authorities signaled the possibility of export restrictions, underscoring the vulnerability of U.S. manufacturers.
USA Rare Earth’s magnet plant is expected to integrate processing, separation and fabrication operations that are typically performed in different countries. By concentrating these activities domestically, the company and its federal partners aim to capture more value within the United States while reducing exposure to foreign supply disruptions. Project timelines indicate initial production could begin within the next few years, pending completion of financing and permitting milestones.
Final terms of the Commerce Department agreement, including loan conditions and warrant pricing, were not disclosed. USA Rare Earth stated that it will continue working with federal officials to finalize documentation and meet all eligibility requirements. The company also plans to pursue additional offtake contracts with end users in the automotive, defense and electronics sectors to secure long-term revenue streams once commercial output starts.
Crédito da imagem: Thomas Fuller / LightRocket / Getty Images
