Anchor
Breaking China's grip on rare earths
Built WorldDomestic producers scale as the July Section 232 deadline and November truce expiry put America's rare earth push to the test
May 28th, 2026: MP Materials Sues USA Rare Earth Over Magnet Trade SecretsNew here? Follow stories to track developments over time. Create a free account to get updates when stories you care about change.
Overview
Updated May 31The United States imports roughly 80% of its rare earth elements and relies on China for over 90% of processing—materials essential to electric vehicles, wind turbines, and precision weapons. China's April 2025 export controls on seven heavy rare earths remain in force, with a broader set of restrictions due to expire in November 2026.
The Trump administration launched a $12 billion strategic mineral stockpile and a 55-nation Critical Minerals Ministerial in February 2026, producing 11 bilateral supply agreements and the FORGE coalition. MP Materials posted 49% revenue growth in Q1 2026, Lynas signed a $96 million Pentagon offtake deal in March, and USA Rare Earth struck a $2.8 billion deal to acquire Brazil's Serra Verde. At the Trump-Xi Beijing summit in May, China pledged to address specific element shortages but made no formal commitments, with the Section 232 deadline arriving July 13.
Why it matters
Chinese export controls can freeze weapons programs, stall EV production, and wipe out industries—proving America can't make anything without these materials.
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Key Indicators
93%
Rare earth magnet shipment decline to US
Year-over-year drop in Chinese rare earth magnet exports to the US in May 2025
~50%
Heavy rare earth export decline from China
Estimated drop in Chinese exports of yttrium, dysprosium, and terbium to the US since April 2025 controls took effect
$134M
DOE demonstration facility funding
Federal funding for 1-2 projects recovering rare earths from unconventional sources; award pending as of May 2026
90%+
China's rare earth processing share
China refines over 90% of global rare earths and produces 90% of high-performance magnets
$400M
DOD equity stake in MP Materials
July 2025 investment making the federal government MP's largest shareholder
$12B
Project Vault stockpile
Trump administration's strategic critical minerals reserve launched February 2026
$3.1B
USA Rare Earth government investment
Government equity stake plus private capital for mine-to-magnet chain; January 2026
$2.8B
USA Rare Earth acquires Serra Verde
April 2026 deal to buy Brazil's Serra Verde, the only non-Asian producer of all four magnetic rare earths at scale
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Breaking China's grip on rare earths
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People Involved
James Litinsky
CEO and Chairman, MP Materials
Leading the only major US rare earth producer
Paul Ziemkiewicz
Director, West Virginia Water Research Institute
Leading acid mine drainage rare earth extraction research
Amanda Lacaze
CEO, Lynas Rare Earths
Texas facility abandoned; secured $96M Pentagon offtake deal at $110/kg NdPr floor price
Organizations Involved
DOE Office of Critical Minerals and Energy Innovation
Federal Agency
Awarded $45.7M to 19 critical minerals projects (May 2026); $134M rare earth demonstration facility award still pending
DOE office responsible for deploying Bipartisan Infrastructure Law funding for critical mineral supply chains.
MP Materials
Mining/Processing Company
Q1 2026 revenue +49% on record NdPr output; Independence magnet factory on track for H2 2026 commercial sales; suing USA Rare Earth over trade secrets
Owner of Mountain Pass, the only operating rare earth mine and processing facility in the United States.
Phoenix Tailings
Technology Company
Operating first US rare earth metallization facility without Chinese inputs
Massachusetts-based startup recovering rare earths from mine tailings and waste using a carbon-free process.
RE
USA Rare Earth
Mining/Processing Company
Acquiring Serra Verde for $2.8B (Q3 2026 close expected); named defendant in MP Materials trade secrets lawsuit
Developing Texas/Oklahoma vertically integrated rare earth supply chain challenging China's dominance.
Lynas Rare Earths
Mining and Processing Company
Texas refinery abandoned; pivoting to $96M Pentagon oxide supply deal and Malaysian expansion
The world's second-largest rare earth producer outside China, with a mine in Western Australia and a processing facility in Malaysia.
Timeline
September 2010 May 2026
28 events
Latest: May 28th, 2026 · 3 months ago
Showing 8 of 28
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-
MP Materials Sues USA Rare Earth Over Magnet Trade Secrets
Latest CorporateMP Materials filed suit in Texas federal court alleging a former employee stole proprietary "grain boundary diffusion" magnet formulations and shared them with USA Rare Earth and a third-party firm. Both companies receive federal backing, making the dispute a government-funded rivalry; USA Rare Earth denied all allegations.
-
DOE Awards $45.7M for 19 Critical Minerals Projects
FundingThe DOE Office of Critical Minerals and Energy Innovation announced $45.7 million across 19 projects to fill domestic supply chain gaps, including pilot-scale facilities for rare earth and magnesium processing. Awardees include Argonne National Laboratory, Columbia University, and Ohio University.
-
Trump-Xi Beijing Summit Produces No Rare Earth Deal
GeopoliticalPresident Trump traveled to Beijing for a summit where rare earth access was central to the agenda. China agreed to "address US concerns" on yttrium, scandium, and neodymium but made no binding commitments and left the April 2025 controls on seven heavy rare earths fully in place.
-
Lynas Signs $96M Pentagon Rare Earth Offtake Deal
CorporateLynas Rare Earths signed a binding letter of intent with the US Department of War to supply rare earth oxides for $96 million over four years at a $110/kg NdPr floor price. The deal replaces the original Texas refinery plan, which Lynas confirmed is unlikely to proceed.
-
US Announces Critical Minerals Trading Bloc
PolicyTrump administration unveils plans for allied trading bloc (EU, Japan, Mexico) with price floors maintained via tariffs to counter China dominance and secure rare earth supply chains.
-
Lynas Ends Merger Talks with MP Materials
CorporateAustralia's Lynas Rare Earths terminates confidential merger discussions with US-based MP Materials amid rare earth market turmoil and divergent growth strategies.
-
US Hosts Critical Minerals Ministerial, Launches FORGE Coalition
PolicySecretary of State Rubio convened 55 foreign delegations in Washington and signed 11 bilateral supply agreements. The meeting launched FORGE (Forum on Resource Geostrategic Engagement), a successor to the Minerals Security Partnership chaired by South Korea, designed to coordinate price floors and counter Chinese market dominance.
-
Rare Earth Stocks Surge on Trading Bloc News
MarketUS rare earth miners rally—Critical Metals +10%, USA Rare Earth +11%, MP Materials +4%—following critical minerals trading bloc announcement and Project Vault momentum.
-
Trump Launches $12B Project Vault Stockpile
Policy$12B strategic critical minerals reserve ($10B EXIM loan + $1.67B private) including rare earths, modeled on Strategic Petroleum Reserve; GM, Boeing, Google commit.
-
DOE Application Deadline Closes
MilestoneFinal deadline for applications to $134 million rare earth demonstration program. Awards of $67-134M each expected for up to 2 projects; selection anticipated February 2026.
-
Trump Signs Critical Minerals Executive Order
PolicyPresident Trump invokes Section 232 national security authorities, ordering Commerce and USTR to negotiate critical minerals trade agreements with 180-day deadline. Failure triggers potential tariffs or minimum import prices.
-
MP Materials CEO Sells $19.2M in Stock
CorporateJames Litinsky sells 300,000 shares at approximately $64 per share via pre-arranged trading plan. Stock up 33% year-to-date amid government partnership and production ramp-up.
-
China Bans Rare Earth Exports to Japan
GeopoliticalChina halts rare earth and magnet exports to select Japanese firms following Prime Minister Takaichi's comments on potential military intervention in Taiwan Strait conflicts. Japan relies on China for 63% of rare earth imports.
-
DOE Announces $134M Demonstration Program
FundingDepartment of Energy opens applications for Rare Earth Elements Demonstration Facility program targeting recovery from unconventional feedstocks.
-
China Suspends October Controls for One Year
GeopoliticalFollowing US-China negotiations, China suspends October export controls until November 2026. April 2025 restrictions on heavy rare earths remain in place.
-
Phoenix Tailings Opens First US Metallization Facility
MilestoneExeter, New Hampshire facility begins producing 200 tons/year of rare earth metals with capacity to scale to 1,000+ tons—enough to supply entire US defense industrial base. First domestic rare earth metallization without Chinese inputs.
-
China Escalates with October Controls
GeopoliticalChina announces expanded export controls including extraterritorial provisions requiring licenses for products made outside China using Chinese rare earth materials.
-
Apple Announces $500M MP Materials Partnership
CorporateApple signs long-term agreement with MP Materials for American-made rare earth magnets from recycled materials, expanding domestic supply chain commitments.
-
DOD Takes 15% Stake in MP Materials
InvestmentPentagon invests $400 million equity in MP Materials, becoming largest shareholder. Deal includes $150M loan, 10-year offtake agreement, and $110/kg price floor—triple market rates.
-
US Rare Earth Imports Collapse
TradeChinese rare earth magnet exports to US fall 93.3% year-over-year. Ford temporarily closes Chicago factory; automakers scramble for supply.
-
China Imposes Rare Earth Export Controls
GeopoliticalChina requires export licenses for seven heavy rare earth elements—including samarium and dysprosium—in response to US tariffs. Defense contractors effectively barred from purchasing.
-
DOD Awards MP Materials $35M
FundingDepartment of Defense awards contract to MP Materials to design and build heavy rare earth separation facility at Mountain Pass.
-
Bipartisan Infrastructure Law Enacted
PolicyPresident Biden signs legislation including $140 million for DOE rare earth demonstration facilities and over $600 million for critical mineral programs.
-
MP Materials Acquires Mountain Pass
CorporateConsortium led by JHL Capital purchases Mountain Pass mine at bankruptcy auction for $20.5 million, beginning revival of US rare earth production.
-
Molycorp Files for Bankruptcy
CorporateAmerica's only major rare earth producer files Chapter 11 with $1.4 billion in debt. Mountain Pass mine shuts down as rare earth prices collapse from post-2010 highs.
-
WTO Rules Against China
LegalWTO finds China's rare earth export restrictions violate trade rules. China subsequently drops export quotas in 2015.
-
US Files WTO Case Against China
LegalUnited States, Japan, and European Union jointly file WTO dispute against China's rare earth export restrictions.
-
China-Japan Rare Earth Crisis Begins
GeopoliticalChinese fishing trawler collides with Japanese Coast Guard near disputed Senkaku Islands. China halts rare earth exports to Japan for two months, triggering global price spike and supply chain panic.
Historical Context
3 moments from history that rhyme with this story — and how they unfolded.
September-November 2010
China-Japan Senkaku Islands Rare Earth Embargo (2010)
After Japan detained a Chinese fishing captain near the disputed Senkaku Islands, China halted rare earth exports to Japan for approximately two months. Japan imported 90% of its rare earths from China. Prices for some rare earths spiked over 2,000%—the cost of US rare earth imports rose from $6,969 to $170,760 per metric ton by 2011.
Then
Japan's automotive and electronics industries faced immediate supply disruptions. The crisis triggered a global rare earth price bubble lasting through 2011.
Now
Japan invested 100 billion yen in supply chain resilience, cutting China dependence from 90% to 60% and halving total rare earth consumption through efficiency and recycling. Lynas received $250 million in Japanese investment. The WTO ruled against China's export restrictions in 2014.
Why this matters now
The 2010 crisis demonstrated China's willingness to weaponize rare earth supply. Japan's response—diversification, efficiency improvements, recycling, and allied investment—provides a template for US strategy. The current situation is more severe: April 2025 restrictions target defense applications specifically.
October 2010 - Present
Japanese Rare Earth Strategy (2010-2025)
After the 2010 embargo, Japan launched a comprehensive five-pillar strategy: reduce rare earth usage through technology, develop substitute materials, promote recycling, diversify suppliers, and build strategic stockpiles. The government invested 100 billion yen ($1.2 billion) immediately. State-backed entities invested $250 million in Lynas, securing 30% of Japanese demand.
Then
Japanese companies rapidly developed motors using fewer rare earths and found substitutes for some applications.
Now
Japan cut China dependence from 90% to 60% while halving total consumption. The Lynas investment helped create a second major non-Chinese rare earth producer. Japan's approach became a model for resource security policy.
Why this matters now
Japan achieved meaningful diversification in 15 years through sustained government-industry coordination. The US is attempting a similar effort but started later. The DOE demonstration program and DOD's MP Materials investment mirror Japan's playbook.
June 2015 - June 2017
Molycorp Bankruptcy and Mountain Pass Collapse (2015)
Molycorp, America's only major rare earth producer, filed Chapter 11 bankruptcy with $1.4 billion in debt. The company had invested over $1 billion to modernize Mountain Pass after the 2010 price spike, but prices collapsed before full production began. Shares fell from $79.16 to $0.35. The mine sold at auction for $20.5 million.
Then
The US lost its only significant rare earth production capability. Mountain Pass sat idle for two years.
Now
MP Materials acquired and revived the mine, going public in 2020 at a $4 billion valuation. The experience demonstrated both the volatility of rare earth markets and the difficulty of competing with Chinese state-subsidized production.
Why this matters now
The Molycorp failure shows why government support—like the July 2025 DOD price floors—may be necessary to sustain domestic rare earth production. Private capital alone proved insufficient against Chinese market manipulation.
Sources
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