FOX Business’ Lauren Simonetti reports live from Texas in the only U.S. plant turning rare earth materials into magnets.
The Trump administration’s push to secure U.S. supply chains of rare earth minerals amid trade tensions with China features a public-private partnership with a domestic producer that now has the Pentagon as its largest shareholder.
In July, the Department of War announced a multibillion-dollar deal involving investments and long-term purchase commitments to buy materials from MP Materials, which is involved with mining rare earth minerals and processing and refining the metals and manufacturing magnets.
The War Department made a $400 million investment in MP Materials’ preferred stock, which the company is using to expand its rare earths separation and processing capabilities, as well as its magnet production capacity to better meet the demand from defense and commercial customers.
Inside MP Materials’ Independence plant in Fort Worth, Texas. (FOX Business Network)
“When we have an adversary geopolitically that is willing to look holistically at certain verticals and make those investments to essentially make sure that a free market, capitalist economy can’t win in those verticals, we need to partner with government,” MP Materials CEO James Litinsky told FOX Business. “There’s no choice other than to have public-private partnerships.”
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Molten material inside the MP Materials plant in Fort Worth, Texas. (FOX Business Network)
Rare earths are used in a range of applications and are a critical component in many advanced technological products ranging from consumer-oriented devices like smartphones and electric vehicles to military equipment like radars and cruise missiles.
China is the world’s leading producer of rare earths and has the largest reserves, according to a report by the U.S. Geological Survey (USGS), and has threatened to use its clout to restrict U.S. supplies amid trade and geopolitical tensions.
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| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| MP | MP MATERIALS CORP | 57.54 | -2.18 | -3.65% |
The Chinese government has taken steps to implement export controls on rare earths, and despite agreeing to pause some of those restrictions, it has reportedly planned to block U.S. military contractors from obtaining shipments that move forward, according to The Wall Street Journal.
Electrolysis cells at MP Materials’ Independence factory convert rare earth oxides to high-purity metals essential for magnet production. (FOX Business Network)
“The Chinese recognize that they took a handful of industries. They wanted to both grow their economy and strengthen their military and ultimately get to dominance on the global stage. And we let them, we let them. That was smart of them, but we are quick learners in this country, and now we know we need to solve this problem,” Litinsky said.
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Machinery inside the MP Materials plant in Fort Worth, Texas. (FOX Business Network)
MP Materials is tripling capacity at its Fort Worth factory to handle magnets for GM and Apple, while it’s also building a new factory to meet the needs of the Pentagon.
The company previously said the new facility is expected to begin commissioning in 2028, at which time MP Materials’ estimated manufacturing capacity for rare earth magnets will reach an estimated 10,000 metric tons.
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MP Materials is also planning to expand its heavy rare earth separation capabilities at its facility in Mountain Pass, California, where rare earth materials are extracted, separated and refined.