Highlights

• The U.S. is attempting to reduce dependency on China for rare earth elements through limited partnerships.
• There is a lack of a comprehensive national strategy to address this dependency.
• Current efforts include the Department of Defense's $400 million deal with MP Materials.
• Apple's magnet recycling partnership is also part of these current efforts.
• These efforts are insufficient to challenge China's 90% control over global magnet production.
• America needs an urgent, systemic approach similar to 'Operation Warp Speed'.
• A full-spectrum industrial policy for critical minerals across the entire supply chain is necessary.

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The United States is waking up—again—to the strategic stranglehold China holds over rare earth elements (REEs). But if Washington thinks a handful of flashy corporate partnerships and well-meaning agency grants can unwind decades of dependence, it is badly mistaken. What’s unfolding isn’t an industrial renaissance—it’s a patchwork of ambition masquerading as strategy.

Yes, there is movement. In July 2025, the U.S. Department of Defense (DoD) inked a $400 million deal with MP Materials (opens in a new tab), granting the Pentagon a stake and board seat in the company. The contract guarantees a price floor for neodymium-praseodymium oxide and supports the construction of a 10,000-ton magnet facility in Fort Worth by 2028. It’s the boldest public-private rare earth play the U.S. has made in decades. But it’s just that: a play. One company. One contract. One direction. It is not a national plan, nor a competitive ecosystem. And therein lies the danger.

Apple’s $500 million magnet recycling partnership with MP Materials is another feather in the same cap—recycled magnets to go into future iPhones by 2027. Admirable? Certainly. Scalable or fast? Not even close. Apple’s tens of millions of devices won’t feature American-made magnets for years, and recycled feedstock will only meet a fraction of demand. Meanwhile, China continues to supply over 90% of global magnet production, refining nearly all of the world’s heavy rare earths—without pause or peer.

America’s at least traditional allies are stirring too. Europe passed its Critical Raw Materials Act, (opens in a new tab) setting targets for 2030 on mining, refining, and recycling. But even EU officials concede their supply chain is “siloed and disjointed.” Japan, galvanized by a 2010 rare earth embargo, has made the most headway, cutting Chinese import dependence from 90% to 58%. It's a secret? An empowered government agency, JOGMEC, (opens in a new tab) that writes big checks, strikes strategic deals, and sticks around long enough to see them through.

Contrast that with the U.S., where promising junior miners and downstream startups remain marooned, left to fight Chinese pricing and decades-old permitting laws alone. The MP deal is instructive not just for what it does, but what it reveals: the absence of a systemic, inclusive plan. We’ve crowned a national champion while leaving the rest of the field behind, or at least the potential for that.

And let’s be clear—the rest of the field matters. The 10,000-ton Fort Worth plant will help, but it won’t meet national demand for magnets in EVs, drones, and defense systems. Without multiple producers, refiners, and recyclers operating in parallel, we risk trading Chinese dependency for a new bottleneck—just one with an American flag on it.

What America needs is not another deal. It needs Operation Warp Speed for critical minerals—a crash program to coordinate funding, permitting, incentives, and offtakes across the entire value chain. Mining. Refining.  It needs to be guided by an industrial policy that raises confidence in the investment world.

Alloying. Magnet production. Recycling. Stockpiling. Not just rare earths, but lithium, graphite, cobalt, and nickel—each one a link in a chain China has locked down while we’ve been holding ribbon-cuttings.

Investors should take heed. Companies with exposure to U.S.-backed supply chain development—such as MP, Lynas, or lesser-known players with significant REE capacity—stand to benefit if industrial policy catches up to rhetoric. But without structural support, they remain vulnerable to Chinese price suppression, financing constraints, and volatile policy shifts. Betting on critical minerals today is like betting on semiconductors in 1980—it could make fortunes or go up in flames without a guiding hand.

Meanwhile, U.S. industry remains exposed—defense primes still source neodymium magnets from China. EV makers build batteries with Chinese cathodes. Grid storage, robotics, and aerospace are similarly entangled. Any future export restriction from Beijing—on dysprosium, terbium, or gallium—could trigger a panic far worse than the 2010 embargo that spurred Japan to act.

The U.S. government has tools at its disposal: Defense Production Act funding, long-term procurement contracts, strategic reserves, and a powerful bully pulpit. What it lacks is cohesion plus capital market structures that direct capital flow through the entire supply chain.  A jigsaw puzzle is being assembled, but no one seems to have the box. Permitting reform, domestic content mandates, price stability mechanisms—none have yet been fully enacted.

In the race to secure critical minerals, piecemeal is perilous. Progress is too slow, too narrow, and too fragile. China isn’t playing whack-a-mole. It’s playing Empire. America can still catch up—but only if it stops treating each rare earth deal like a victory parade and starts building a full-spectrum industrial policy with urgency, discipline, and scale.

Because until that happens, American independence in rare earths will remain a mirage—visible from afar, but always just out of reach.

Rare Earth Exchanges™

Sources: MP Materials, RareEarthExchanges.com, DoD, Apple Inc, European Commission, JOGMEC, newsecuritybeat.org, CSIS, EIA, warroom.armywarcollege.edu.