U.S. builds new magnet factory to reduce dependence on Chinese industrial components

The company’s first rare earth magnet production line, located in Stillwater, Oklahoma, has been put into operation and is expected to reach full production capacity of 600 tons per year by the end of December, a statement said. In January this year, U.S. rare earth companies signed a non-binding agreement to provide US$1.6 billion in funding from the Department of Commerce to help build a mine to meet its magnet production.

Rare earth magnets are vital in high-tech applications such as cars, wind turbines and missiles. These tiny but powerful components suddenly acquired geopolitical significance a year ago when Beijing tightened supplies to strongman President Donald Trump to sign a trade truce.

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American Rare Earth Corporation is one of many companies that already produces magnets in the United States, although output is very low compared to China. These include Pentagon-backed MP Materials Corp., which operates the country’s only rare earths mine, as well as Germany’s Vacuumschmelze GmbH and Texas-based Noveon Magnetics Inc.

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Creating robust production outside China could take many years because magnet factories are just the end of a complex supply chain dominated by Beijing. American Rare Earths acquired British company Less Common Metals last year to gain access to critical “heavy” rare earths and hopes to start up its Dome Mine in Texas in 2028.