Highlights
- A global realignment of rare earth supply chains is underway.
- The United States is emerging as the gravitational hub of an 'ex-China' strategy.
- Major deals across five continents indicate a shift towards securing non-Chinese rare earth sources.
- The realignment is backed by government financing and strategic partnerships.
- The rare earth market is witnessing unprecedented collaboration.
- Collaboration includes upstream offtakes, massive funding vehicles, and downstream acquisitions.
- This effort aims to accelerate a mine-to-magnet ecosystem outside China.
Rare Earth Exchanges (REEx) presents “Deals of the Week” — your front-row seat to the global reshuffling of the rare earth and critical minerals chessboard. From September 30 to October 4, 2025, the deals tell a story: a world scrambling to unshackle itself from China’s dominance and rebuild the industrial spine of the 21st century—one rare earth contract, joint venture, and government-backed financing at a time. At the center of this seismic shift stands the United States, where, under President Donald Trump, Washington has positioned itself as the gravitational hub of an emerging “ex-China” rare earth supply chain. The progress is tangible: capital is flowing, alliances are tightening, and once-forgotten assets are roaring back to life. Yet the race is far from won. As REEx has tracked and announced, true supply chain resilience—from mine to magnet—remains years away unless the administration launches something akin to an “Operation Warp Speed” for critical minerals. The ambition must go beyond slogans: what’s needed is a durable,whole-of-government industrial policy that fuses innovation, private capital, and defense imperatives into a coherent national strategy. Only then will dynamic, competitive markets replace decades of dependency and deliver the foundation for a secure, high-tech future.
Upstream (Mining & Raw Materials)
Australia/Japan: Heavy Rare Earth Offtake Alliance
Australia’s Victory Metals (opens in a new tab) advanced its partnership with Japan’s Sumitomo Corp (opens in a new tab). by signing a non-binding Letter of Intent for heavy rare earth supply as cited in REEx. Sumitomo is one of Japan’s largest and oldest sogo shosha (general trading companies), part of the historic Sumitomo Group conglomerate whose roots date back to the 17th century. Headquartered in Tokyo, Sumitomo operates in over 60 countries and manages a diversified portfolio of businesses across various sectors, including metals, minerals, and other commodities.
Under the LOI, Sumitomo intends to offtake up to 30% of annual output (1,000 tpa of mixed rare earth carbonate, including ~50 tpa of dysprosium and terbium) from Victory’s North Stanmore clay deposit for an initial five-year term. This strategic tie-up aims to anchor a non-Chinese supply of heavy rare earths for Japan – a priority since a 2010 export cutoff – and would provide Sumitomo access to critical magnet elements (Dy/Tb) that have few Western sources. The deal remains preliminary (LOI stage), but it signals Japan’s urgency to secure alternative feedstocks. It could lead to a binding offtake (and possibly financing or equity participation by Sumitomo) as the project progresses toward pilot production in 2027.
Canada/Africa: Mega-Fund for Critical Minerals
CVMR Corporation (Toronto) unveiled an expansion of its critical minerals financing vehicle from $7 billion to $42 billion, backed by physical gold reserves.
A Canadian company that mines and refines critical minerals, including nickel, cobalt, rare earth elements, and tungsten, using proprietary vapour metallurgy (opens in a new tab) technologies to produce high-purity metal powders and other advanced products, this was formerly launched as the Critical Minerals Fund Corporation (opens in a new tab) (CMFC). Tracy Hughes’ InvestorNews (opens in a new tab) reported that the company formally launched as the CMFC in partnership with FINATRADES (opens in a new tab) of RAMINVEST: (opens in a new tab) The fund will finance mid-sized mining and refining projects globally, with a heavy focus on underdeveloped jurisdictions in Africa.
CVMR’s CEO highlighted plans to “go where people are afraid to go” – targeting Sahel countries and Central Africa (e.g., Niger, Chad, Mali, Burkina Faso, CAR) along with South Africa, Congo, Burundi, and others. Notably, CVMR emphasizes heavy rare earth elements (“all eight of them,” in Khozan’s words) among the most urgent targets alongside nickel, uranium, antimony, and others. By backing projects with gold-bullion security, the fund aims to bypass traditional finance hurdles and inject capital directly into critical mineral assets, potentially accelerating development of new rare earth mines and refineries in Africa, where Western investors have been hesitant. This outsized financing initiative (backed by >$25 billion in gold) could become a significant catalyst for upstream supply, especially for heavy rare earth projects that align with U.S. and allied supply-chain needs.
Midstream (Processing & Separation)
Pakistan/United States: $500 M Strategic Partnership
In a milestone bilateral move, Pakistan purportedly dispatched its first-ever shipment of enriched rare earth and critical mineral concentrates (opens in a new tab) to the U.S. under the $500 million supply-chain agreement. As reported by REEx, two MOUs signed on Sept 8 between Pakistan’s Frontier Works Organization (FWO) and U.S. Strategic Metals (USSM) laid out a framework to jointly develop the entire value chain – from exploration and beneficiation to concentrate production and ultimately establishing rare earth refineries in Pakistan.
The initial shipment delivered to USSM (Missouri) on Oct 2 contained antimony, copper concentrate, and rare earth elements (notably neodymium and praseodymium), also cited in Benzinga (opens in a new tab). Pakistan’s Prime Minister hailed this as a step toward “secure and diversified supply chains” benefiting both nations. For the U.S., the partnership offers a new ex-China source of critical minerals (with Pakistan emerging as a “credible and trusted partner” in the words of PM Shehbaz Sharif) and aligns with President Trump’s push to strengthen alternative supply chains. For Pakistan, it means entry into the global critical minerals market, technology transfer, and potential revenues from its vast mineral resource base. REEx has serious questions about the substance behind these news releases, but remains open-minded.
If all is as reported, the government-enabled midstream collaboration highlights how geopolitics are reshaping rare earth supply routes – the U.S. is leveraging friendly countries (even those outside traditional mining hubs) to establish refining capacity and diversify away from Chinese processors. The contractual framework outlines a multi-phase investment: initial concentrate exports are now, with a future Pakistani refining plant to be co-developed with U.S. expertise.
United States/Australia: Energy Fuels Upsized Financing
U.S.-based Energy Fuels Inc. (opens in a new tab) bolstered its rare earth processing plans by closing a $700 million convertible note (opens in a new tab) financing on Oct 3. The debt offering, upsized from an initial $600 M due to strong demand, carries a low 0.75% coupon and was supported by major underwriters (Goldman Sachs, Morgan Stanley, etc.). Proceeds will help accelerate Energy Fuels’ rare earth separation and refining projects, notably the expansion of its White Mesa Mill in Utah (the only operating REE-capable mill in the U.S.) and development of the heavy rare earth “Donald” project in Australia. Note the major bottleneck in the ex-China rare earth supply chain remains separation and refining---that processing is known as the midstream of the supply chain.
Energy Fuels’ CEO noted in a press release Friday that this capital raise reflects “strong investor sentiment” in their rare earth initiatives and will strengthen domestic midstream capacity. The financing’s structure even includes capped call options to minimize equity dilution, indicating market confidence in the company’s long-term strategy. Could Energy Fuels be the tip of the U.S. rare earth arrow?
With this war chest, Energy Fuels is positioned to increase production of separated rare earth oxides (like NdPr, Dy, Tb) on U.S. soil in the coming years. This deal also signals government policy tailwinds – Energy Fuels has previously received DoD awards for rare earth processing, and investors appear to be betting on sustained U.S. support (such as Defense Production Act measures and offtake agreements) to underpin these midstream projects.
Traded as UUUU via NYSE American, the U.S.-based uranium and rare earths producer, currently in a rapid growth and transition phase, has seen its value surge to $3.9 billion, up nearly fivefold from mid-2024 levels. This value growth is driven by investor enthusiasm for its expansion into rare earth separation and uranium revival projects.
Financially, the firm remains unprofitable, posting a -143% profit margin and a net loss of -$93 million over the trailing twelve months, with revenues of $65 million (down 52% year-over-year). Despite a negative cash flow of -$88 million (TTM), Energy Fuels maintains a strong liquidity position with nearly $198 million in cash and no reported debt, resulting in an exceptional current ratio of 8.1. And of course with the latest funding raising (debt) their cash position becomes far stronger.
The stock has been highly volatile (β = 2.21). Still, it has outperformed the S&P 500 dramatically—by +205% over 12 months —reflecting bullish sentiment around its White Mesa Mill rare earth processing expansion and the U.S. government-backed critical minerals strategy. With a forward P/E of ~213, investors are clearly pricing in future profitability from their uranium-rare earth vertical integration rather than current earnings.
Europe – (No new deals announced)
Across Europe, no explicit midstream deal was announced during the week. However, the context remains that the EU industry is pressing for local separation capacity as China’s export licensing requirements continue to tighten. European magnet makers and refiners (e.g., Estonia’s Neo Performance, Norway’s REEtec, and the UK’s Less Common Metals prior to its acquisition) are in focus to fill the gap, along with Carester in France. Note on the latter Carester, this privately held concern could well be one of the winners of the European rare earth processing race.
Market chatter: European officials reported ongoing Chinese delays in rare earth export licenses through late September, reinforcing the commercial case for EU-based refining and recycling ventures. While not a formal transaction, this policy friction is driving midstream activity – expect European consortia or government funding moves in the coming weeks to mirror the U.S. approach (e.g., the U.S. DFC’s recent $5 M backing of Aclara’s Brazil project earlier in Sept, and similar EU programs).
Downstream (Magnets & Manufacturing)
United States/United Kingdom: Mine-to-Magnet Acquisition
In a major vertical integration play (opens in a new tab), USA Rare Earth, Inc. (USAR) announced the acquisition of UK-based LessCommon Metals (LCM), one of the only rare earth alloy producers outside China.
On September 29, 2025, USA Rare Earth (USAR) announced a definitive acquisition of UK-based Less Common Metals (LCM), paying $100 million in cash and issuing 6.74 million USAR shares. In parallel, USAR secured a $125 million common equity investment from an existing shareholder to support the expansion and integration of LCM’s operations. LCM operates an established 67,000 sq ft facility in Cheshire, UK, producing rare earth metals and alloys (NdPr, Sm, SmCo, Dy, Tb, etc.), and is promoted as the only major ex-China producer with scale strip-casting capability.
The acquisition is part of USAR’s strategy to build a vertically integrated “mine-to-magnet” supply chain, with plans to feed LCM’s output into its planned 5,000 tpa magnet plant in Oklahoma, using raw material from USAR’s Round Top project and recycled feedstock. REEx notes there is a lot of work left to do (and some years) to build this out.
Other regions
No other downstream manufacturing deals were confirmed in the past week. However, industry verticals continue to prepare for non-Chinese magnet supply: e.g., Neo Performance Materials began initial magnet output in Estonia earlier this year, and Korea’s NovaTech is investing in a magnet plant in Vietnam to diversify supply, as cited in Reuters (opens in a new tab). Meanwhile, some automakers (BMW, Toyota) are exploring rare-earth-free or reduced-magnet motors, but analysts note these are long-term R&D bets – in the medium term, securing rare-earth magnet supply (even at premium prices) remains a priority for EV and wind turbine manufacturers.
Pricing & Contract Terms (Ex-China Signals)
According to various sources (cited below) the benchmark neodymium-praseodymium (NdPr) oxide price in China (to the extent that these numbers are reflective of true pricing) held around RMB ¥570–580k/ton (US$70–80/kg) through mid-late September as we reported last month.
According to those and related Chinese-language bulletins (Asian Metal (opens in a new tab), Shanghai Metals Market (opens in a new tab), BAI Info (opens in a new tab), and Sina (opens in a new tab)), light rare earth (NdPr) oxide prices appeared modestly firmer heading into the National Day holiday. The benchmark NdPr oxide was reported in some sources at ¥560,000–¥562,500 per tonne in late September (≈ US$78,900/tonne, FOB China), and several market watchers said that price held through the holiday. Some local reports also referenced neodymium and praseodymium metal quotes around ¥765,000–¥790,000/tonne by September 30, though those figures are less consistently documented in major public indices. There are also unverified mentions that Northern Rare Earth proposed an October long-term contract listing for NdPr oxide at ¥415,700/tonne (roughly +3% month-on-month), which—if accurate—would reflect underlying firmness despite subdued trading in early October.
Heavy Rare Earth Prices (Dy & Tb)
Heavy rare earth markets remained firm but quiet during the October 1–7 holiday stretch. Dysprosium oxide was quoted at ¥1,615 / kg (≈ US$200.13/kg) on Sep 30, 2025, per SMM listings (range ¥1,615); there is no open-source indication of major change during the holiday period. Also see Strategic Metals Invest (opens in a new tab). For terbium oxide, SMM reported (opens in a new tab) ¥7,025 / kg (≈ US$870.53/kg) on the same date, with stable pricing and negligible volatility noted. Market observers noted that downstream demand was weak and that few Dy / Tb transactions occurred during the holiday, leaving most offers unexecuted and prices in a tight range. Some reports also point to limited trading activity for medium-heavy rare earths in that period, reinforcing the impression of a subdued market despite stable pricing.
How About ‘Ex-China’?
This level is below the price floors embedded in recent Western contracts – for instance, the U.S. DoD’s deal with MP Materials guarantees a $110/kg floor price for NdPr over 10 years, roughly double the current Chinese spot price. Such sovereign-supported pricing is insulating Western projects from China’s market volatility. Notably, after China’s export curb scare in April, as reported by Reuters (opens in a new tab), NdPr rallied ~40% to ~$88/kg by late August, but even that peak remains below the ~$110/kg “insurance” price that U.S. defense contracts are willing to pay (at least in some deals we have reported on).
In effect, Western governments have signaled they will pay a supply chain security premium (or enforce floor prices) to ensure non-Chinese supply profitability.
Premiums & Offtake Terms
The supply risk shock this year (China’s magnet export restrictions and temporary halts) has fundamentally shifted contract dynamics. Customers in critical industries are now willing to pay significant premiums and accept novel terms to lock in rare earth supplies outside China, also known as “ex-China.”
For example, automakers and OEMs are reported to accept 15–30% higher prices (opens in a new tab) for magnets produced in non-China locations. One rare earth executive noted some auto contracts being discussed at $80/kg for NdPr oxide – about a 30% premium over the ~$62/kg Chinese price earlier (opens in a new tab) in the summer. Neo Performance’s Estonia plant has customers paying an extra $10–$30 per kg for its European-made magnets. These premiums reflect a new calculus: buyers value security of supply over lowest price, after realizing that a supply interruption (and ensuing factory shutdown) costs far more than a modest price increase. Consequently, recent offtake deals tend to span multi-year terms with take-or-pay clauses or floor/collar pricing to guarantee volumes and minimum revenues for producers as reported via REEx last month.
Western offtakers (especially in the EV and defense sectors) are essentially entering into long-term partnerships with rare earth suppliers, often with government support or funding, to share the cost burden of building new supply chains. What’s that emerging market look like---see REEx for some details.
Export & Policy Signals
After the initial shock, China’s rare earth export data have sent mixed signals. Beijing eased some export license restrictions by late summer, and Chinese rare-earth magnet exports actually rebounded to multi-month highs in August. However, REEx reports European firms still report bureaucratic delays in getting Chinese export licenses for oxides/metals, underscoring an unreliable supply regime. This contradiction – Chinese exports flowing again yet tinged with uncertainty – is keeping Western buyers on edge. It reinforces the trend toward binding contracts with non-Chinese (ex-China) sources, often including clauses like floor prices, take-or-pay commitments, and even equity stakes or upfront payments.
For instance, the Ucore–Critical Metals 10-year supply agreement (opens in a new tab) (announced in late August) did not publicly disclose price terms, but it is backed by U.S. Defense funding and reflects a strategic, volume-secure arrangement. Likewise, as we cited above, Japan’s Sumitomo in the Victory Metals LOI is exploring an offtake that could evolve into a broader strategic investment – a sign that offtakers may finance projects in exchange for guaranteed supply.
Across the board, ex-China rare earth deals now prioritize stability: guaranteed minimum pricing (or cost-sharing), assured volumes for 5–10+ years, and collaborative development of processing capabilities in-country or friendly locations.
Heavy REE Focus
This week’s developments also highlight a growing emphasis on heavy rare earths. Dysprosium and terbium, essential for high-temperature magnets, are in chronic short supply outside China. The Victory–Sumitomo LOI’s inclusion of ~50 tpa Dy/Tb is a notable attempt to secure these critical heavy elements in a non-Chinese supply chain.
It comes as India scrambles to source Dy/Tb-rich concentrates from alternative channels (even exploring cooperation with Myanmar’s Kachin rebel-held mines, per reports last month) – illustrating how post-April Chinese export controls have forced heavy-REE importers to get creative.
Heavy REEs command high premiums and will likely figure into more Western offtake agreements. Expect contract structures to reflect their scarcity – e.g., perhaps dysprosium price collars or priority allocations within broader NdPr contracts. Notably, Rare Earth Exchanges is now building a pricing and deal database (available in the new year via subscription) while Benchmark Mineral Intelligence announced price indices specifically for ex-China NdPr and Dy/Tb. This suggests a recognition that a two-tier market (China vs. ex-China) is here to stay. As one deep insider informed REEx “there is no going back.”
Takeaways and Outlook
Deals this week spanned five continents, underlining the global realignment of rare earth supply chains. The U.S. drove downstream integration (USAR–LCM) and expanded its midstream funding (Energy Fuels)—in fact, the USA under President Trump became the nexus for the ex-China rare earth element supply chain emergence, while also tapping a new partner in South Asia (Pakistan) for upstream feedstock.
Asia-Pacific allies like Japan are proactively locking in offtakes in Australia, complementing their parallel talks with India and others to secure heavy REEs. Africa remains high on the radar (CVMR’s fund and prior U.S. DFC initiatives) even if no single African project deal closed this week – large capital pools are being mobilized to develop African rare earth assets in the near future. REEx notes we have met with multiple African nations—even recently the Prime Minister of Niger in New York City during the UN General Assembly.
Europe, for its part, had a quieter week deal-wise, but end-users there are undoubtedly buoyed by moves like USAR–LCM, which strengthen the non-China magnet supply that European industries can also leverage. Notably absent were any significant China-origin deals this week – a reflection of China’s current focus on domestic innovation networks (as seen in recent policy rollouts) rather than outbound M&A, and perhaps a temporary caution amid the trade tensions.
Government financing and support mechanisms continue to underpin many of these developments. The Pakistan-US critical minerals pact was blessed at the highest political levels (although we need to see what this deal will really deliver), explicitly aligning with U.S. strategic objectives. Likewise, Energy Fuels’ ability to raise $700M at low interest speaks to investor confidence bolstered by U.S. government contracts (e.g., DoD offtakes for its future output). In Japan’s case, while the Sumitomo–Victory LOI is a corporate deal, it dovetails with the Japanese government's strategy to diversify rare earth sourcing (JOGMEC and METI have been supporting such efforts).
We also see multilateral financing: the U.S. DFC, DoE, and DoD have nearly $1 billion in various funding programs queued up to support critical mineral projects – expect announcements of specific awards from those programs in the coming months. In sum, the public sector is actively de-risking projects through grants, loans, equity stakes or price guarantees (as in the MP Materials deal), catalyzing the private deals we observe. REEx has emphasized the need for even more intense industrial policy in the rare earth and critical mineral sphere.
Bottom line
This week saw an upstream offtake LOI (Victory–Sumitomo), a new funding vehicle targeting Africa (CVMR’s $42B fund), a geopolitically driven midstream partnership (Pakistan–US), a major capital market financing (Energy Fuels $700M), and a landmark downstream acquisition (USAR–LCM). Each reflects the broader theme of 2025: the rare earth supply chain is reorganizing at speed, with ex-China alliances, bigger capital commitments, and innovative contract structures emerging as the new norm. We are witnessing the acceleration of a mine-to-magnet ecosystem outside China, supported by government policy and willing buyers.
So what should investors look out for?
They need to see these deals translate into concrete project milestones – e.g., groundbreaking on new refineries, pilot plant results, definitive offtake contracts – in the next 1–2 quarters. Remember, actual separation and refining are the core bottlenecks, and making magnets at scale is not easy. As Western and allied nations pour money and political will into rare earths, the coming months will test how quickly these partnerships can deliver actual goods. For now, the flurry of agreements and financings in late Q3 2025 bodes positively for greater transparency, resilience, and self-reliance in the critical minerals supply chain going into 2026. The market is clearly rewarding those moves: rare earth equities and strategic partners involved in these deals have generally seen improved valuations, pricing in the diminished “China risk” thanks to these proactive measures.
Remember, as REEx continues to impart, true rare earth supply chain resilience likely remains at least a handful of years away—if not more. A more comprehensive, rich, and extensive rare earth and critical mineral industrial policy is of paramount importance for the United States, Europe, and other “Ex-China” markets seeking to diversify the supply chain.
“This suggests a recognition that a two-tier market (China vs. ex-China) is here to stay. As one deep insider informed REEx “there is no going back.”
Welcome to the club! This has been building since the first Trump Admin’ despite the experts in RE claiming it was not possible.
“Remember, as REEx continues to impart, true rare earth supply chain resilience likely remains at least a handful of years away—if not more”.
Agreed, but, IOHO, selective RE retail investors who choose wisely will likely see serious investment profits in the next 3 years. RE wannabee exit strategies are as important in this sector this decade as are entrance theses.
GLTA – REI