Vulcan Elements, based in North Carolina, said the US government is to partner with private investors who will inject $550 million into the firm's capital.
The federal government will allocate a $620 million loan and a $50 million grant, for which it will receive Vulcan shares valued at $50 million.
Rare earth materials are essential for sophisticated electronic components across a range of industries including auto, electronics and defense.
"We are laser-focused on bringing critical mineral and rare earth manufacturing back home, ensuring America's supply chain is strong, secure and perfectly reliable," Commerce Secretary Howard Lutnick said in a statement in Monday's press release.
China is the world's leading producer of the minerals. It has required licenses for certain exports of the materials since April, hitting global manufacturing sectors.
Rare earths have been a major sticking point in recent trade negotiations between China and the United States, with Washington accusing Beijing of slow-walking export license approvals.
US could hike tariffs if China backtracks on rare earths: Bessent
New York (AFP) Nov 2, 2025 -
US President Donald Trump's administration is prepared to raise tariffs on China if Beijing continues blocking rare earth exports, Treasury Secretary Scott Bessent warned Sunday.
China announced Thursday it would suspend for one year the restrictions it imposed in October on rare earth materials and technologies, but Bessent voiced concern that Beijing had not always followed through on its commitments.
"The Chinese have cornered the market (on rare earths), and unfortunately at times they proved to be unreliable partners," Bessent told Fox News Sunday.
Such metals are mined in several countries including the United States, but China has a virtual monopoly on processing these metals for industry usability.
The suspension was announced following recent talks between Trump and his Chinese counterpart Xi Jinping in South Korea.
Some of the export restrictions previously decided by Beijing remain in place.
Following the agreement and the "goodwill" between the leaders of the world's two largest economies, Bessent said he hoped "we can depend on them to be more reliable partners."
If not, "we could threaten the tariffs again," Bessent warned, stressing Washington has been prepared to use "maximum leverage."
"We don't want to decouple with China, but we're going to have to de-risk," he said.
Bessent also accused previous US governments of being "asleep at the switch" as Beijing spent years putting together its rare earths strategy.
"Now this administration, we're going to go at warp speed over the next one, two years, and we're going to get out from under this sword that the Chinese have over us -- and they have it over the whole world," he told CNN's "State of the Union" talk show.
As part of the announced deal, Washington will reduce the level of tariffs imposed on Chinese exports to the United States by 10 percent.
The agreement also requires China to take significant measures to stem the flow of fentanyl into the United States, where consumption of the powerful synthetic opioid has caused tens of thousands of deaths.
According to the US Drug Enforcement Administration, China is by far the largest supplier of fentanyl to the United States.
China's suspension of rare earth controls applies to EU: official
Rome (AFP) Oct 31, 2025 -
The EU's commissioner for trade on Friday said China's one-year suspension on its restrictions of rare earth materials would apply to the bloc as well as the United States.
"My understanding is that the agreement, which was found between the US and China in this matter, is 'erga omnes', so we should apply it to all and, of course, including the European Union," Maros Sefcovic told reporters during a visit to Rome.
Following discussions with the United States, China on Thursday said it would suspend certain export restrictions announced in October, including on rare earth materials, for one year.
The controls on rare earths -- a major sticking point in trade negotiations between US President Donald Trump and China's President Xi Jinping this week -- have rattled markets and snarled supply chains.
Sefcovic, who met both with Italy's Agriculture Minister Francesco Lollobrigida and Foreign Minister Antonio Tajani, said the EU was now having "high-level official talks on export controls" with China.
"I will speak again with my Chinese counterpart very, very soon," he added.
- EU bloc bidding -
China is the world's leading producer of the minerals used to make magnets that are crucial to the auto, electronics and defence industries.
Separate to the October restrictions, it has since April required licences for certain exports, a system Sefcovic said was not working.
"We have not very positive experience with the issuing of export licenses for the rare earths," he said.
Only 50 percent of EU applications had been "properly processed" so companies received the needed rare earth materials, he noted.
"It has direct implications on the production capacities of the companies in the EU."
After meeting Tajani at the foreign ministry, Sefcovic told reporters he envisioned a "common purchase of critical raw materials" by the EU.
"We can do the bidding on behalf of the biggest trading bloc in the world, which is the European Union, and to get the critical raw materials for a better price," he said
The stockpiles would be "stored in Europe so we will not be under this permanent tension".
Tajani proposed that Italy could host such a storage site.
- 'Dumping' dispute -
Sefcovic also said the EU was backing Italy, which is facing punitive tariffs on exports of pasta to the United States, by showing its US counterparts that their "surprising" accusation of dumping was unfounded.
Last month, the US Department of Commerce said it would impose provisional anti-dumping duties of over 91 percent on Italian pasta makers from January. This would be applied on top of the 15-percent tariff imposed on all EU imports.
"This was a very surprising move from the United States towards the European Union, towards pasta producers," Sefcovic said.
He said he believed the commerce department "didn't have proper or enough detailed information from some producers of pasta in Italy" so the EU, along with Italy and its pasta producers, was working to provide it.
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