Increased demand for shares in MP Materials, a company specializing in rare earth elements, drove prices up again during this recent week.
In the heart of California, MP Materials operates the Mountain Pass mine, the world’s second-largest rare earth mine, primarily producing light rare earth elements like neodymium and praseodymium (NdPr). Amid ongoing tensions in the US-China trade conflict, the company is making strides to advance its rare earth supply chain within the U.S.
CEO James Litinsky recently reiterated the urgent need for the United States to accelerate its full-scale domestic rare earth magnetic supply chain. This call to action comes as MP Materials has ceased shipments of rare earth concentrate to China due to tariffs and concerns about selling critical materials not being aligned with America's national interest.
A transformational public-private partnership formed in July 2025 with the U.S. Department of Defense (DoD) is injecting billions into MP Materials to expand its NdPr separation and magnet manufacturing capacity. This strategic government effort aims to build resilient, domestic supply chains for critical rare earth magnets used in defense and commercial technologies, in response to China's control over around 90% of global rare earth processing and its export restrictions enacted in April 2025.
However, challenges remain, notably with heavy rare earth elements such as dysprosium and terbium, critical for high-temperature magnets and defence applications. Mountain Pass contains only small amounts of HREEs, and China still controls nearly all of the extraction, separation, and processing capacity for these elements. Separation capacity outside China is the bottleneck, and China actively restricts know-how transfers by limiting its experts’ movement. MP Materials’ plans to expand HREE separation are reported but currently speculative.
In addition to the DoD partnership, MP Materials announced a $500 million deal with Apple to supply recycled rare earth magnets made in the U.S. from 100% recycled feedstock at its Texas facility, further strengthening domestic circular supply chains and magnet production capacity.
MP Materials, known as "America’s rare earth magnetics champion," is poised to become a national strategic asset, moving toward integrated extraction, separation, refining, and magnet production within the U.S. The company's growth opportunity lies in being part of the U.S. developing its own rare earth supply chain.
The stock performed well this week due to such speculation, with MP Materials currently up 21.8% in share price. However, retail investors may find it challenging to invest in the stock due to the uncertainty surrounding the company's direction. The trade conflict is currently a near-term negative for MP Materials, but the development of a robust domestic rare earth supply chain could offer long-term benefits.
Sources: [1] Reuters, July 2025 [2] Bloomberg, July 2025 [3] Wall Street Journal, July 2025 [4] CNBC, August 2025
- investments in money are being made by MP Materials to expand its finance for separating and manufacturing rare earth magnets, a move aimed at strengthening its domestic supply chain and reducing dependence on China.
- The strategic partnership between MP Materials and the U.S. Department of Defense involves finance from billions of dollars, which will be used to increase the company's capacity in producing critical rare earth magnets, particularly for defense and commercial technologies.
- Alongside the partnership with the U.S. Department of Defense, MP Materials has secured a $500 million deal with Apple, marking a significant step in the company's mission to develop a domestic circular supply chain for rare earth magnets, using recycled feedstock. This investment could potentially boost the company's financial status and solidify its position in the business of rare earth magnet production.
