Introduction
Permanent magnets, especially high-performance rare-earth magnets, are at the heart of modern electrification. They power the traction motors in electric vehicles, keep industrial automation running, enable precision in defense systems, and drive generators in clean-energy technologies such as wind turbines. Yet for decades, the United States has relied overwhelmingly on imports, with China dominating global production of rare-earth materials and finished magnets. In recent years, however, a wave of investment, policy support, and strategic industrial partnerships has begun transforming the U.S. landscape. A growing number of companies are now building or expanding domestic facilities to produce rare-earth metals, alloys, and sintered permanent magnets—specifically Neodymium Iron Boron (NdFeB), Samarium Cobalt (SmCo), and, increasingly, rare-earth-free alternatives.
MP Materials Project
Among the most prominent efforts is that of MP Materials, which has re-established rare-earth magnet production inside the United States for the first time in roughly two decades. At its “Independence” manufacturing facility in Fort Worth, Texas, the company has begun commercial production of NdPr metal and initiated trial manufacturing of sintered NdFeB magnets. This plant is expected to reach an initial output of about one thousand tons of magnets per year in late 2025, with engineering and equipment in place to expand capacity significantly, potentially to two or even three thousand tons annually. MP’s vertically integrated model is critical: its Mountain Pass mine in California remains the nation’s only large-scale producer of rare-earth oxides, enabling the company to supply magnet manufacturing with domestic raw materials. Major offtakes, including General Motors, have already committed to using these magnets in electric-drive systems.
MP Materials has announced a major public-private partnership with the U.S. Department of Defense (DoD) that aims to build a complete, domestic rare-earth magnet supply chain and reduce reliance on foreign sources. Under the agreement, MP will build its second U.S. magnet manufacturing plant—called the “10X Facility”—which is expected to begin commissioning in 2028. Once ups and running, this facility will allow MP to produce about 10,000 metric tons of rare-earth magnets annually. The DoD is making a long-term commitment to MP through several financial mechanisms. It will invest US$400 million in a newly stock. In created series of preferred stock (convertible into common shares), and it will receive a warrant to purchase additional common shares. On a fully converted basis, this could give the DoD about 15% of MP Materials’ common stock. In addition to the equity investment, the DoD is backing the project operationally: it will provide a US$150 million loan to MP to expand its heavy rare-earth separation capacity at its Mountain Pass site in California. The Mountain Pass facility is strategic, since MP extracts, separates, and refines rare-earth materials there making it a centerpiece of their vertically integrated supply chain.
Crucially, the DoD has agreed to two long-term supply terms: First, there’s a 10-year price floor of US$ 110 per kilogram for neodymium-praseodymium (NdPr) oxide products from MP, which helps stabilize MP’s revenue and reduces its exposure to volatile market prices. Second, there’s a 10-year offtake agreement: for ten years after the 10X Facility is built, 100% of the magnets produced there will be purchased by the DoD (and also made available for commercial customers), with both parties sharing in the upside.
To finance the construction of the 10X Facility, MP has secured another US$1.0 billion in funding from JPMorgan Chase and Goldman Sachs.
MP Materials already operates the Mountain Pass mine in California, which is one of the richest rare-earth deposits in the U.S. Through this deal, the company aims to expand its refining and separation capabilities there, reinforcing its role as a strategic national asset. Rare-earth magnets are critical components for many advanced technologies—defense systems, electric vehicles, wind turbines, robotics, aerospace, and more. This agreement helps the U.S. secure a more resilient, homegrown supply chain for these materials.
USA Rare Earth Project
Another key player, USA Rare Earth, has advanced its mine-to-magnet vision through the recent startup of its Innovations Lab in Stillwater, Oklahoma. The facility has successfully produced its first batch of sintered rare-earth magnets (neo magnets), a milestone meant to validate quality control, refine processing techniques, and support future commercial-scale production. This first batch of Neodymium magnets was produced with powerful magnet presses designed and manufactured by Gasbarre Products and Salvador Consultant. As this magnet lab moves toward pilot and later full-scale manufacturing, USA Rare Earth aims to integrate mining, separation, alloying, and magnet fabrication into one US-based supply chain, an ambition that, if realized, could substantially strengthen national security and industrial independence.
USA Rare Earth is buying Less Common Metals (LCM) (ex-China rare earth metal and alloy producer), a UK company that makes rare-earth metals and alloys, paying $100 million in cash plus 6.74 million of its own shares. This deal helps USA Rare Earth build a full “mine-to-magnet” supply chain by giving it access to LCM’s production of key rare-earth materials (like Neodymium-Praseodymium, Samarium, Dysprosium, etc.) at LCM’s 67,000 ft² plant in the UK. LCM can also recycle rare-earth oxides, so USAR can reuse end-of-life magnets and scrap, making the supply chain more sustainable. With this acquisition, USAR will supply its planned 5,000-ton magnet factory in Stillwater, Oklahoma, more reliably. The transaction is expected to close by Q4 2025, after gaining regulatory approval.
Noveon Magnetics Project
While several groups remain in pilot stages, Noveon Magnetics in San Marcos, Texas, already operates as a commercial-scale producer and is currently the only U.S. company making sintered NdFeB magnets at meaningful volumes. Its current plant is capable of producing roughly two thousand tonnes per year, and the company has signed a five-year agreement with Nidec Motor Corporation for one thousand tonnes of magnets starting in 2025. Noveon’s strategy emphasizes recycling: its proprietary EcoFlux™ process recovers magnet material from end-of-life products and industrial scrap, allowing production with significantly less environmental impact. The company is rapidly establishing itself as a linchpin for American electrification, adding long-term supply agreements with ABB for industrial motors, as well as a recent multiyear deal with General Motors to support large-scale EV manufacturing. Its partnership with Lynas Rare Earths further reinforces access to critical feedstock materials. Noveon’s long-term expansion plan involves scaling capacity toward ten thousand tonnes per year—an order of magnitude increase that would make it the largest magnet producer in the Western Hemisphere.
REalloys Project
Smaller but strategically significant efforts are also emerging. REalloys, headquartered in Ohio, has established the Euclid Magnet Facility (EMF), which produces both rare-earth alloys and finished magnets for U.S.-protected markets, including defense. The company intends to begin with a production capacity of approximately five hundred tonnes per year of NdFeB magnets and magnet alloys by the first quarter of 2026, and to double that output to one thousand tonnes by 2028. Unlike most new entrants, REalloys is also developing production of samarium-cobalt magnets, a high-temperature, corrosion-resistant material crucial to aerospace and defense applications.
Vulcan Elements Production Project
Meanwhile, Vulcan Elements, based in North Carolina’s Research Triangle Park, has begun producing sintered NdFeB magnets at a much smaller scale—around ten tonnes annually. While modest, this capacity represents an important addition to the U.S. domestic landscape. The company is in early stages, but its presence in the high-tech research corridor and its focus on advanced materials offer potential for future growth.
POSCO-Star Group Project
International collaboration is also accelerating U.S. capacity. POSCO International of South Korea, together with its partner Star Group, has announced plans for a major U.S.-based magnet manufacturing facility supported by a $220 million investment. Although publicly disclosed tonnage has not yet been finalized, the project is designed to supply magnets for as many as 2.5 million electric vehicles per year, suggesting that its ultimate capacity could rival or exceed that of other new U.S. facilities. This plant is part of a coordinated effort among Asian and Western companies to develop non-Chinese magnet supply chains.
Niron Magnetics Project
A noteworthy complement to these rare-earth projects is the rise of rare-earth-free magnet innovation, most prominently from Niron Magnetics in Minnesota. Backed by automotive manufacturers including GM and Stellantis, Niron is constructing a 1,500-tonne facility to produce its proprietary iron-nitride magnets. While these materials are not yet a drop-in replacement for NdFeB in all high-performance applications, they provide a promising alternative for EVs, industrial motors, and other sectors seeking to eliminate supply-chain risk.
Collectively, these developments mark one of the most significant expansions of U.S. magnet manufacturing in modern history. Yet challenges remain. Even if all planned facilities reach full capacity, U.S. production will still represent only a fraction of global demand, which exceeded 220,000 tonnes in 2024. China continues to dominate the entire value chain—mining, refining, metalmaking, alloying, and manufacturing—leaving the U.S. dependent on foreign sources for at least some critical steps. Upstream bottlenecks, particularly in refining and heavy rare-earth separation, still threaten to constrain magnet output unless new refining capacity is established domestically or reliably sourced from allies.
Conclusions
Scaling also presents technical hurdles. Sintered NdFeB magnets require highly precise powder metallurgy, controlled atmospheres, advanced presses, and sintering furnaces—capital-intensive equipment that must maintain strict consistency. Automotive and defense customers impose demanding quality requirements, and any supply interruption or defect can cause production delays. The economic environment poses further uncertainty, as U.S. manufacturing costs are higher than those in China, making long-term viability dependent on government incentives, strong customer commitments, and innovation in recycling and process efficiency.
Despite these obstacles, the accelerating pace of investment points toward a more resilient future. Electric-vehicle manufacturers increasingly view domestic magnet supply as a strategic necessity. Industrial motor makers are turning to U.S. suppliers for reliability and shorter lead times. Defense applications, from guided munitions to aircraft actuators, benefit from secure sourcing that avoids geopolitical exposure. Even consumer electronics and clean-energy systems stand to gain from diversified supply.
While domestic capacity will take years to reach global-scale competitiveness, the foundation for an integrated American supply chain is now being laid stretching from rare-earth mining and refining to alloy production, magnet manufacturing, and next-generation material innovation. The result is a more secure, diversified, and technologically advanced magnet industry, positioned to support the country’s ambitions in clean energy, transportation, defense, and advanced manufacturing for decades to come.
References
[1] MP Materials restores rare-earth magnet production. MP Materials+2Business Wire+2
[3] USA Rare Earth first sintered magnet batch. GlobeNewswire
[4] USA Rare Earth produces first batch of magnets at Oklahoma plant - Oklahoma Manufacturing Alliance
[8] Vulcan Elements capacity. Wikipedia
[9] Noveon & Nidec offtake agreement. PR Newswire
[10] REalloys expansion plan. BlackBoxStocks
[11] Strategic partnership: Noveon & Lynas. PR Newswire
[12] Recent analysis of U.S. magnet manufacturing. IEEE Spectrum
[13] Niron breaks ground on rare earth-free magnet manufacturing plant in Minnesota - MINING.COM