Shares of USA Rare Earth are rocketing higher this afternoon after it was reported that the Trump administration is moving to extend price support mechanisms for U.S. rare earth projects to other companies, broadening a policy that previously focused on MP Materials to include other mining, refining, and magnet production firms.
USA Rare Earth is the obvious #2 name in the U.S. that such an expansion may have an impact on. scale, government stake, and strategic timing. Shares quickly popped 15% on the news:
This expansion will provide guaranteed price floors for key rare earth elements, reducing the investment risk that has historically deterred private capital. The approach mirrors the strategy used to back MP Materials earlier this year, where government involvement transformed market confidence and secured long-term domestic supply.
Top White House officials have told rare earth companies that they are pursuing a pandemic-style strategy to strengthen U.S. critical minerals production and counter China’s market dominance by setting a guaranteed minimum price for their products, according to five sources familiar with the plan, per Reuters.
The previously unreported July 24 meeting, led by President Donald Trump’s trade advisor Peter Navarro and National Security Council supply chain official David Copley, included ten rare earth firms alongside major tech companies like Apple, Microsoft, and Corning—all of which depend on reliable supplies of critical minerals for electronics manufacturing.
The precedent for this move was set in July when the Pentagon made an unprecedented $400 million equity investment in MP Materials, the operator of the Mountain Pass rare earth mine in California. As part of that deal, the Department of Defense became MP’s largest shareholder and locked in a 10-year price floor for neodymium-praseodymium oxide at roughly $110 per kilogram—nearly double prevailing Chinese spot prices.
Alongside the equity, the Pentagon committed to purchasing MP’s entire magnet output for a decade, while private lenders like JPMorgan and Goldman Sachs provided over a billion dollars in commercial financing to scale production.
MP Materials’ stock reaction was swift and dramatic. On the day the Pentagon’s investment was announced, MP shares surged more than 50% as investors priced in the guaranteed revenue and government backing. In the days that followed, the stock rallied further after Apple revealed a $500 million supply deal with MP, ultimately pushing the company’s year-to-date gains to well over 200–250% by mid-July.
The market capitalization climbed toward $9.5 billion, marking one of the most significant single-year jumps for a U.S. resource company in recent memory.
Navarro and Copley emphasized that the price floor arrangement granted to MP Materials earlier this month as part of a multibillion-dollar Pentagon investment was “not a one-off” and that similar agreements were being developed for other companies. For years, U.S. critical minerals producers have argued that China’s market dominance deters investment in domestic mining projects, and they have pushed for federally backed price guarantees to reduce risk.
Rare earths—17 metals essential for manufacturing magnets that convert power into motion—are widely used in electronics, including smartphones and military hardware.
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