U.S. awards MP Materials $35M rare-earth contract

The U.S. government is betting big on domestic rare-earth producers like MP Materials and USA Rare Earth, locking in decade-long deals to cut reliance on China’s near-monopoly in the sector.

The push is part of a wider reshoring drive that aims to rebuild critical supply chains for magnets used in everything from electric vehicles to missiles. Rare earths are the invisible backbone of modern tech, and Washington is now underwriting miners and processors to guarantee supply and pricing stability. Without this intervention, analysts warn, U.S. manufacturers would remain hostage to a single supplier that controls up to 99 percent of some key elements.

MP Materials just inked a blockbuster pact with the Department of Defense that guarantees a 10-year price floor, commits to buying magnets from its new Texas plant, and brings $1.15 billion in fresh capital—including a $150 million Pentagon loan and a $400 million DOD stock purchase. Days later, Apple signed a $500 million deal for magnets made entirely from recycled U.S. material, while MP raised another $650 million from public investors. The company is already shipping magnets to General Motors from its Fort Worth facility.

The strategy hinges on turning theoretical demand into lasting contracts. USA Rare Earth’s chief financial officer told a J.P. Morgan conference that China’s grip on the market is so complete that buyers need a “bifurcated” supply chain—domestic plus imported—to stay safe. If the government keeps writing these long-term checks and marquee customers like Apple and GM stick around, the rare-earth reshoring wave could lock in pricing, stabilize investment, and finally break China’s chokehold on a technology the U.S. cannot afford to lose.