Rare-Earth Magnet Startups Seal $1.4 Billion Deal With Trump

Rare-Earth Magnet Startups Seal $1.4 Billion Deal With Trump Administration

The agreement with Vulcan Elements and ReElement Technologies is a strong sign the Pentagon is intent on building a supply chain to reduce China’s control

https://www.wsj.com/business/rare-earth-magnet-startups-seal-1-4-billion-deal-with-trump-administration-8184b9ae?gaa_at=eafs&gaa_n=AWEtsqen4Ta_lCr-lUbbYIgF2xXYqTSAoDoROzHD5VAOVrKgJctqAsUt1E1B_xWEin4%3D&gaa_ts=690952df&gaa_sig=7oYR-hKWMXGBYeb73S8GupY33S3SG8v_qntosOSvkeW59rrVf0mnreTyV3rxFkbOVDjB1i-RPSvyXKAq8QMI9g%3D%3D

Let me try to summarize the key points:

1. DoD investing $400MM in preferred shares of MP, making Dod its largest shareholder

2. $150MM loan from the DoD to MP to expand heave rate earth separation capabilities at its Mountain Pass site in CA

3. 10-year price-floor commitment for key rare earths (neodymium + praseodymium, Nd/Pr) of $110 per kg, along with a 10-year offtake agreement for magnets produced at the new falicility (My understanding of this price-floor is designed to protect US rare earth producers from potential future price wars initiated by china)

4. The new magnet manufacturing plant is expected to begin commissioning in 2028, with large capacity (10,000 metric tons) to serve defence and commercial customers