Key Takeaways:
- USA Rare Earth commits $1.2B to Cherokee County rare earth production
- Facility targets 490 jobs and commercial output by April 2028
- US rare earth magnet import reliance exceeds 90%, per USGS data
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USA Rare Earth invests $1.2B as US breaks China's grip on magnets
USA Rare Earth advanced toward commercial-scale production with a $1.2 billion commitment to a South Carolina processing facility, the company said June 18.
"This is a structural shift in how the US sources critical minerals — from exploration through to finished magnets," Tim Wither, managing director at Critical Resources Ltd, said.
The Cherokee County facility targets 490 jobs by April 2028, according to company filings. South Carolina committed $9 billion in capital investment in 2025 across the broader critical minerals supply chain. New bipartisan legislation introduced this session aims to boost domestic permanent magnet production, directly targeting China's dominant position in the supply chain.
The US currently relies on China for more than 90% of its rare earth magnet supply, according to USGS data. USA Rare Earth's project represents one of the largest domestic processing investments, with the potential to reduce the geopolitical risk premium embedded in rare earth prices.
The $1.2 billion investment places USA Rare Earth among the largest domestic rare earth processing projects in development. For context, MP Materials' Mountain Pass facility in California — the only US rare earth mine — produced approximately 42,000 tonnes of rare earth oxide equivalent in 2024, while Lynas Rare Earths operates the only significant non-Chinese processing capacity at 17,000 tonnes annually from its Malaysian plant.
Rare earth prices have reflected the supply concentration risk. Neodymium-praseodymium oxide, the key input for permanent magnets used in EVs and wind turbines, traded at approximately $72,000 per tonne in June 2026, according to Fastmarkets data. That compares with a five-year average near $85,000 per tonne, with periodic spikes tied to Chinese export policy shifts.
The bipartisan legislation introduced alongside the commercial announcement would authorize $500 million in grants for domestic magnet manufacturing, according to the bill text. Companies must prioritize supply security over cost as US-China competition reshapes global resource markets, one economist tracking the sector said.
This article is for informational purposes only and does not constitute investment advice.
[1] USA Rare Earth Just Moved Closer to Commercial Reality[2] New Bill Would Boost U.S. Production of Permanent Magnets[3] South Korea urged to rethink security in critical minerals race[4] Critical Resources in solid-state battery breakthrough[5] Business investment opportunities surge in South Carolina
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