The U.S. government is planning a major intervention to bolster domestic critical-minerals capacity, with a $1.6 billion package for USA Rare Earth that would include an equity stake and loan support aimed at accelerating U.S.-based production.
According to reporting that cited people familiar with the matter, the government would take about a 10% stake in the Oklahoma-based company, alongside a larger loan component structured through federal programs linked to industrial policy. The effort reflects a broader push to secure supply chains for materials viewed as essential to national security and advanced manufacturing.
USA Rare Earth has been developing a rare earth mine in Sierra Blanca, Texas, and a magnet manufacturing facility in Stillwater, Oklahoma. The magnet segment is particularly sensitive for U.S. policymakers because high-performance permanent magnets are used across defense systems, electric motors, and a range of technology hardware.
The package is also expected to be paired with private financing, signaling an attempt to combine public capital with market funding to scale projects quickly. In recent years, U.S. officials have increasingly argued that the rare earth ecosystem—mining, processing, and magnet production—needs coordinated investment because market forces alone often fail to support capital-intensive supply chain buildouts.
The plan underscores how industrial policy has moved deeper into the minerals sector, as Washington tries to reduce exposure to overseas supply concentration and to ensure that key inputs for chips, defense, and electrification can be sourced at home or from close partners.
- Proposed package: $1.6 billion total support
- Structure described: equity stake plus substantial loans
- Strategic goal: expand U.S. rare earth and magnet capacity and reduce reliance on foreign supply
If finalized, the deal would represent one of the most aggressive federal moves to support a single U.S. rare earth developer, and would highlight the administration’s willingness to take direct stakes in strategic industries while demanding significant private co-investment.