It finally happened.
After years of threatening to cut off rare earth supply to the U.S., that’s exactly what they just did. Unfortunately, it could have devastating consequences for us considering China controls about 90% of the rare earth market.
As noted by the New York Post:
Effective April 3, China is no longer exporting seven heavy rare earth metals processed exclusively in the Asian power, as well as heavy rare earth magnets — of which about 90% of the world’s supply are also synthesized on Beijing’s territory.
The export halt applies to all countries, but access to elements like dysprosium and yttrium is critical to US industry — especially in the tech, electric vehicle, aircraft and defense sectors, according to Drew Horn, who served as the top US official on strategic minerals and energy supply chain development in President Trump’s first administration.
All because of the wild trade war.
What makes it worse — Right now, the U.S. lists dozens of critical minerals including rare earths as vital to its economic security: lithium, cobalt, nickel and manganese for EV batteries; copper and aluminum for power grids; dysprosium and terbium for missiles and jet engines; as well as neodymium, praseodymium, dysprosium and terbium for magnets and semiconductors, says Newsweek. So, either we secure those rare earths. Or, to be blunt, we’re screwed.
MP Materials (MP)
One way is by buying MP Materials (MP), the largest producer of rare earth materials in the Western Hemisphere. The Company owns and operates the Mountain Pass Rare Earth Mine and Processing Facility, America’s only active and scaled rare earth mining and processing site.
“We now also commercially produce neodymium-praseodymium metal in our new Fort Worth, TX factory,” said the company, as quoted by Barron’s, It’s the “first time this has been produced in the U.S. in a generation.”
As long as China’s ban on rare earth materials stands, stocks like MP should rocket higher.
Sincerely,
Ian Cooper
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