USA Rare Earth Breaks Into China's-Dominated Refining Market, Opens Domestic Supply

1. Cori Fisher wrote this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. 
2. This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company. 

For additional disclosures, please click here.

1. Ownership and Share Structure Information

The information listed above was updated on the date this article was published and was compiled from information from the company and various other data providers.

Investors are often focused on big-name metals: gold, silver, copper, etc., and miss the larger metals market. USA Rare Earth Inc. (USAR:NASDAQ) has announced successful separation of less common critical minerals at its Stillwater, Oklahoma, plant.

Key Takeaways

• USA Rare Earth produced commercial-grade Dy (dysprosium) and NdPr (neodymium-praseodymium) oxide from recycled magnet scrap at its Wheat Ridge, Colorado, facility.
• The oxides came from "swarf" — leftover scrap from magnet machining — sourced from USA Rare Earth's Stillwater, Oklahoma, plant.
• Recycled swarf could supply up to 30% of future oxide feedstock, adding to planned output from Round Top and Serra Verde.
• The oxides head next to Less Common Metals (UK) for qualification, then on to U.S. magnet manufacturing.
• More processing is underway using material from Round Top and Serra Verde's Pela Ema mine, with new results expected in the coming weeks.

Recycled Scrap Produces Dysprosium & NdPr Oxide

On July 14, 2026, USA Rare Earth announced that its hydrometallurgical facility in Wheat Ridge, Colorado, had successfully produced commercial-grade Dy and NdPr from recycled rare earth magnet scrap. The company believes that this marks an important milestone in its strategy to establish a fully integrated rare earth domestic supply chain — encompassing mining, processing, metallization, alloy production, and permanent magnet manufacturing. USA Rare Earth's mission is to "build the leading global rare earth and critical mineral value chain where each link reinforces the next. This achievement marks a critical step toward delivering a global, integrated solution to de-risk supply chains for defense, semiconductors, and physical AI infrastructure," the press release claimed.

Commercial-scale separation of heavy rare earth elements is one of the most technically demanding stages of the rare earth production chain. According to the company, very few producers outside Asia can manufacture commercial-grade Dy oxide, making the achievement significant for Western manufacturers seeking more diversified supplies of critical minerals.

The oxides were produced from recycled neodymium-iron-boron (NdFeB) magnet scrap known as "swarf" — a fine metallic material generated during the machining and finishing of magnets. The oxides produced at Wheat Ridge will be sent to Less Common Metals (LCM), which is a U.K. subsidiary of USA Rare Earth, for qualification and conversion into rare earth metals and strip cast. The materials produced there will serve as feedback materials for U.S. manufacturing facilities.

The press release stated: "Dysprosium is one of the most technically challenging rare earth elements to separate at commercial purity, and today virtually all Dy oxide is produced in China. While NdPr provides the magnetic foundation of NdFeB permanent magnets, dysprosium is added in smaller quantities to allow magnets to retain performance and coercivity at high operating temperatures, a requirement of the aerospace, defense, electric vehicle, robotics, and industrial motor applications that NdFeB magnets enable. Producers with the proven ability to separate heavy rare earths at commercial specification outside Asia remain scarce, and Dy availability is widely recognized as a primary constraint on the Western permanent magnet industry."

USA Rare Earth is focused on creating a fully integrated rare earth and permanent magnet value chain across the U.S. and U.K., with future ambitions to expand into France and Brazil.

China Still Dominates Refined Rare Earths

Permanent magnets account for around 95% of total rare earth consumption. But what is a permanent magnet, and what is important about them? Permanent magnets are materials that create their own persistent magnetic field without the need for external power. Okon Recycling's website says: "From the speakers in your smartphone to the heart of electric vehicles, these magnets play a crucial role in converting electrical energy into mechanical motion and vice versa." The report goes on to claim: "One of the most significant applications of permanent magnets is in electric motors and generators. In these devices, magnets interact with electromagnetic fields to produce rotational motion or electrical current. This principle powers everything from your electric toothbrush to massive wind turbines generating renewable energy."

A report from the International Energy Agency (IEA) expects that demand for magnet rare earth elements (neodymium, praseodymium, dysprosium, and terbium) has doubled since 2015 and is expected to expand another third by 2030. Due to geopolitical trade tensions, the IEA stated that domestic sourcing is becoming increasingly more important. In 2024, China produced 60% of global mined magnetic rare earths and even represented 91% of global refined output.

By completing commercial-grade dysprosium separation, USA Rare Earth said it joins a small group of producers capable of supplying this strategically important material outside of Asia.

Third Party Calls Company's Operations 'Most Strategic' in Industry

On July 20, 2026, Shad Marquitz of Excelsior Prosperity discussed his position on USA Rare Earth, writing that the company has "best-in-class capabilities across mining, processing, separation, metallization, and magnet making with broad-based support from multiple U.S. government agencies and allies." The article noted that the company represents one of the industry's "most strategic operations" because it is the only scaled producer of all four magnetic rare earth elements outside of Asia. USA Rare Earth has also received a "15-year 100% offtake agreement with a special purpose vehicle capitalized by various U.S. government parties, as well as private capital sources and including specific price floors" for its metals.  

As for ratings by analysts:

• On July 22, 2026, Needham gave the company a Buy rating with a price target of US$33.
• On July 21, Roth Capital gave the company a Buy rating with a target price of US$30.
• On May 14, 2026, Wedbush gave the company a Buy rating with a US$35 target price.
• On April 23, 2026, Northland Securities gave the company an Outperform rating and a US$45 price target.
• On April 21, Canaccord Genuity gave the company a Buy rating and a US$32 price target.

Stillwater Capacity Set to Grow Sharply

By recovering valuable rare earth elements from manufacturing scrap, the company expects recycled swarf could eventually provide up to 30% of its magnetic rare earth oxide feedstock.

USA Rare Earth's investor presentation lists mid-term and long-term catalysts for its Stillwater, Oklahoma, plant as follows:

• Capabilities across macro and micro magnets in various grades
• 600 tpa Line 1a commissioned
• 600 tpa Line 1b targeting commissioning in Q1 2027
• 10,000 tpa planned capacity by 2029

Ownership & Share Information¹

USA Rare Earth Inc. has a market cap of US$3.73 billion, with 244.66 million shares outstanding. The company's 52-week range is US$10.91-US$43.98. Institutions own 50.88% of shares, while Strategic Investors own 15.36%. Management & Insiders own 0.77% of shares, and the remaining 32.99% of shares are held by Retail.

Frequently Asked Questions

Q: What are rare earth elements?

A: Rare earth elements are a group of 17 metals used to manufacture high-performance technologies such as electric vehicles, wind turbines, smartphones, robotics, defense systems, and advanced electronics. Despite their name, many are relatively abundant, but they are difficult and costly to separate and refine.

Q: What are permanent magnets?

A: Permanent magnets are magnets that maintain their magnetic field without requiring electricity. They are essential components in electric motors, generators, wind turbines, consumer electronics, industrial machinery, and many defense applications.

Q: What are dysprosium and neodymium-praseodymium (NdPr)?

A: Dysprosium (Dy) and neodymium-praseodymium (NdPr) are rare earth materials used to make powerful permanent magnets. NdPr provides the magnetic strength, while dysprosium helps magnets maintain their performance at high temperatures, making them important for electric vehicles, aerospace, and defense technologies.

Q: What is rare earth magnet recycling?

A: Rare earth magnet recycling is the process of recovering valuable rare earth elements from used magnets or manufacturing scrap so they can be processed and reused. Recycling helps reduce waste and can supplement mining as a source of critical minerals.

Q: Why are rare earth elements considered critical minerals?

A: Rare earth elements are considered critical minerals because they are essential for modern technologies and national defense, while much of the global supply chain is concentrated in a small number of countries. Many governments are investing in domestic production to improve supply chain security.