USA Rare Earth is considering building a magnet plant in France, its CEO said on April 9, following a deal to take a 12.5 percent stake in local rare-earth processor Carester.
The company agreed to pay 40 million euros ($47 million) for the stake, as the United States and Europe step up efforts to build domestic supply chains and reduce reliance on China for critical minerals.
China controls roughly 90 percent of global capacity for the processing, smelting, and separation of all such materials, as well as for the manufacturing of magnetic materials.
“They [the French government] are interested in … supporting a potential USA Rare Earth magnet-making facility in the south of France,” USA Rare Earth CEO Barbara Humpton told an investor call.
InfraVia, a critical minerals fund seeded by the French government, will also buy a 12.5 percent stake in privately held Carester, USA Rare Earth said in a corporate presentation. Carester previously secured 216 million euros in backing from the French government and strategic partners, including Japan French Rare Earths, which is backed by the Japanese government, it said.
In an interview with Reuters, Humpton said the Carester investment was partly to gain access to French expertise in rare-earth processing.
“When you’re in a situation where there’s limited know-how, the most important thing you can do is build the ecosystem and share that know-how,” said Humpton.
France is developing a rare earth industry. Last year, France launched Europe’s first pilot line for the recycling and manufacturing of rare-earth magnets in Grenoble, aimed at reducing reliance on Chinese imports.
State-owned nuclear energy commercial enterprise Orano Group and government research organization CEA inaugurated the pilot line dedicated to high-performance rare-earth permanent magnets.
The results of the pilot project are expected by the end of this year, Orano said in a statement at the time.
Last year, the French government said it would take a direct stake in Imerys’ domestic lithium project, using a state investment arm to secure critical mineral supply chains under its France 2030 plan.
USA Rare Earth, an Oklahoma-based miner, said in March that it is rapidly advancing the development of its Round Top mine in West Texas, with commercial production expected to begin in 2028.
Under its accelerated mining plan, USA Rare Earth said it expects that by 2030, “it will extract from Round Top approximately 40,000 metric tons per day of rare earth and critical mineral feedstock.”
Last year, President Donald Trump said the United States would end its reliance on China for rare-earth minerals within 18 months under an “emergency program.”
In a Nov. 2 interview on CBS’s “60 Minutes,” Trump said his administration’s new rare-earth plan would ensure that the United States can meet all of its industrial and defense needs in less than two years, citing new partnerships with Japan, Australia, and the UK.
“Within a short period of time, we‘ll have everything we need for ourselves,“ Trump said. ”We’ve instituted an emergency program, and we will have—within a year from now to a year and a half—we’ll have everything we need, no matter what kind of a threat is being [made].”
The deal was condemned in 2005 by Sen. Jim Inhofe (R-Okla.) for leaving the United States without a domestic neodymium magnet supplier during Washington’s broader economic opening to Beijing under President Bill Clinton.
Reuters and Tom Ozimek contributed to this report.
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