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The Star
4 days ago
- Business
- The Star
The US has plenty of rare earths but not for long
HYPOCRISY, it's said, is the tribute that vice pays to virtue. The US government's meltdown about rare earths similarly shows how an administration determined to halt the energy transition knows it's already lost the argument. Rare earth magnets are the super-strong pellets that help stick a charging cable to your laptop, smartwatch or headphones. They're also an essential component in a swath of high-tech applications. About 90% are produced in China. That gives powerful leverage. Export curbs imposed by Beijing in April have been a key sticking point in discussions over unwinding tit-for-tat tariffs between the United States and China. A call between President Donald Trump and President Xi Jinping to get talks back on track was 'having to do mostly with rare earth magnets and some other things,' according to Trump. Automakers have warned of factory shutdowns in a matter of weeks if the restrictions aren't lifted. To hear the administration talk, this is all about national security. Rare earths and other critical minerals are 'key building blocks of our defence industrial base,' the White House said in April. The magnets are used in plenty of advanced weaponry, thanks to their ability to power ultra-efficient, lightweight motors. The F-35 Lightning aircraft contains 408kg of rare earths, while a Virginia class submarine has 10 times that amount. Smaller amounts crop up in Tomahawk cruise missiles, Predator drones, and JDAM smart bombs. The US military doesn't account for a very significant slice of demand, however. The exact amount is a secret, but it's unlikely to be much more (and may well be much less) than 3,000 tonnes a year – fewer than 1% of global consumption. The vast majority goes instead to clean power, where the magnets help run electric vehicles (EVs) which use them in their motors and wind farms which need them for their gearboxes. If the Pentagon wants an onshore supply chain to meet its rare earths needs, it's going to have to piggy-back off the far larger civilian market being fueled by the energy transition. For all it has been derided since the 2024 election, former President Joe Biden's signature climate law recognised this. The Inflation Reduction Act or IRA, contained billions of funding to establish factories producing everything from EVs, to batteries, to critical components and raw materials usable in both commercial and military settings. At this very moment, US$439mil of loans and grants to rare earths projects from the Department of Defence since the start of 2020 are starting to bear fruit. The Mountain Pass rare earths mine southwest of Las Vegas, owned by MP Materials Corp, now refines about half of the 45,000 tonnes it produces each year on-site, rather than in China. An MP-owned facility due to open in Fort Worth within months will use these compounds to produce 1,000 tonnes per year of rare earth magnets – the first such mine-to-magnets supply chain ever built entirely in the United States. In Sumter, North Carolina, e-VAC, owned by Houston-based private equity fund Ara Partners, is building a separate plant to make another 1,600 tonnes a year of non-China magnets, with production due to start in the fall. On their own, these two factories could probably supply the US military's needs. More are under way elsewhere. The trading arm of South Korean steelmaker Posco Holdings Inc struck a deal in March to provide rare earths mined in Utah to a planned US factory making as much as 5,000 tonnes from as soon as 2026. In Estonia and Germany, European companies are looking to build another 9,000 tonnes. Most of this activity depends on manufacturers switching to clean energy, who are in turn counting on low-cost finance provided by the United States and other governments. Main customer General Motors Co is the main customer of both MP Materials and e-VAC. Arafura Rare Earths Ltd, which is developing a mine in the Australian outback, has signed agreements with wind turbine manufacturers Siemens Gamesa Renewable Energy SA and GE Vernova Inc. Support for this was once a bipartisan matter. The initial spark was a law signed by Trump himself in 2018, ordering the military to remove all Chinese-sourced magnets from its supply chains by 2027. The United States should now be on the brink of hitting that target. There's just one snag. While Trump is pleading with Xi to give the United States access to more rare earths, his allies in Congress are doing their best to eviscerate the IRA, cancelling billions of funding for clean energy to support his tax cut plans. The outcome of that may push much of this nascent supply chain into bankruptcy, once again leaving GE and Detroit dependent on the whims of a trade official in Beijing. Myopic mismanagement It's a blatant act of economic and geopolitical self-harm to match Washington's myopic mismanagement of the country's solar sector a decade ago. By pretending a clean energy revolution isn't underway and scouring the globe for the materials it needs, Trump is ensuring that critical minerals supply chains become even more concentrated in the secure investment environment offered by China. The IRA's attempt to bring production of clean tech onshore was an insurance policy against a more chaotic and contested geopolitical environment. In smothering that industry in the cradle, Trump is ensuring that in future trade disputes with Beijing, America will find itself in the role not of equal, but supplicant. — Bloomberg David Fickling is Bloomberg Opinion columnist covering climate change and energy. The views expressed here are the writer's own.
Yahoo
06-06-2025
- Business
- Yahoo
Why MP Materials Corp. (MP) Skyrocketed Today
We recently published a list of . In this article, we are going to take a look at where MP Materials Corp. (NYSE:MP) stands against other Wednesday's best-performing stocks. MP Materials rallied for a second straight day on Wednesday, jumping 11.73 percent as investors gobbled up shares in the company on optimism that it would benefit from China's rare earth export restrictions. It can be learned that Beijing suspended exports across a wide range of critical minerals last month, disrupting production of industries such as automakers, semiconductors, and aerospace manufacturers around the world that are heavily reliant on such materials. Heavy machinery at work in a mining facility, excavating the earth for rare earth minerals. However, MP Materials Corp. (NYSE:MP)—the only rare earth minerals producer based in the US—stands to benefit from China's restrictions on expectations that companies would set their sights on non-Chinese producers to supply needed elements. MP Materials Corp. (NYSE:MP) used to heavily rely on its partners in China for refining rare earth elements, until withdrawing shipments following 125-percent retaliatory tariffs slapped on US goods. Additionally, MP Materials Corp. (NYSE:MP) said that its withdrawal was also aligned with the Trump administration's goal to bring back and boost manufacturing in the US. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
05-06-2025
- Business
- Yahoo
Why MP Materials Corp. (MP) Skyrocketed Today
We recently published a list of . In this article, we are going to take a look at where MP Materials Corp. (NYSE:MP) stands against other Wednesday's best-performing stocks. MP Materials rallied for a second straight day on Wednesday, jumping 11.73 percent as investors gobbled up shares in the company on optimism that it would benefit from China's rare earth export restrictions. It can be learned that Beijing suspended exports across a wide range of critical minerals last month, disrupting production of industries such as automakers, semiconductors, and aerospace manufacturers around the world that are heavily reliant on such materials. Heavy machinery at work in a mining facility, excavating the earth for rare earth minerals. However, MP Materials Corp. (NYSE:MP)—the only rare earth minerals producer based in the US—stands to benefit from China's restrictions on expectations that companies would set their sights on non-Chinese producers to supply needed elements. MP Materials Corp. (NYSE:MP) used to heavily rely on its partners in China for refining rare earth elements, until withdrawing shipments following 125-percent retaliatory tariffs slapped on US goods. Additionally, MP Materials Corp. (NYSE:MP) said that its withdrawal was also aligned with the Trump administration's goal to bring back and boost manufacturing in the US. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
29-05-2025
- Business
- Yahoo
Why MP Materials Corp. (MP) Went Down On Tuesday
We recently published a list of In this article, we are going to take a look at where MP Materials Corp. (NYSE:MP) stands against other worst-performing stocks. MP Materials dropped its share prices by 4.67 percent to finish at $18.77 as investors disposed of positions to flock to higher-yielding stocks such as nuclear and AI amid promising growth prospects for the said industries. In the first three months of the year, MP Materials Corp. (NYSE:MP) swung to a net loss of $22.6 million from a net income of $16.5 million in the same period last year, primarily due to a $46.3 million non-cash gain in the first quarter of 2024 associated with the early extinguishment of a portion of convertible notes due in 2026. Revenues, however, were higher by 25 percent to $60.8 million from $48.68 million year-on-year, primarily driven by higher production of separated products, resulting in a greater mix of NdPr oxide and metal revenue in the current period. A close up of an essential mineral being extracted from a large rock wall. MP Materials Corp. (NYSE:MP) is the only fully integrated rare earth producer in the United States, with capabilities spanning the entire supply chain—from mining and processing to advanced metallization and magnet manufacturing. Overall, MP ranks 6th on our list of worst-performing stocks. While we acknowledge the potential of MP, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MP and that has 10,000x upside potential, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
28-05-2025
- Business
- Yahoo
Why MP Materials Corp. (MP) Went Down On Tuesday
We recently published a list of In this article, we are going to take a look at where MP Materials Corp. (NYSE:MP) stands against other worst-performing stocks. MP Materials dropped its share prices by 4.67 percent to finish at $18.77 as investors disposed of positions to flock to higher-yielding stocks such as nuclear and AI amid promising growth prospects for the said industries. In the first three months of the year, MP Materials Corp. (NYSE:MP) swung to a net loss of $22.6 million from a net income of $16.5 million in the same period last year, primarily due to a $46.3 million non-cash gain in the first quarter of 2024 associated with the early extinguishment of a portion of convertible notes due in 2026. Revenues, however, were higher by 25 percent to $60.8 million from $48.68 million year-on-year, primarily driven by higher production of separated products, resulting in a greater mix of NdPr oxide and metal revenue in the current period. A close up of an essential mineral being extracted from a large rock wall. MP Materials Corp. (NYSE:MP) is the only fully integrated rare earth producer in the United States, with capabilities spanning the entire supply chain—from mining and processing to advanced metallization and magnet manufacturing. Overall, MP ranks 6th on our list of worst-performing stocks. While we acknowledge the potential of MP, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MP and that has 10,000x upside potential, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
