Shares of USA Rare Earth surged as much as 78% on Thursday following a report that the company is in advanced discussions wiht the White House regarding a potential $120 million funding commitment.
the potential investment, first reported by the Financial Times, aims to bolster domestic production of rare earth elements crucial for electric vehicles and defense technologies. USA Rare Earth operates the Round Top Mountain project in Texas, which contains rare earth minerals, lithium, and other critical materials. the company anticipates the funding could be finalized within weeks, according to the report, and would be used to accelerate production at the site.
The U.S. currently relies heavily on China for rare earth elements, creating a strategic vulnerability. The Biden administration has prioritized securing a domestic supply chain for these materials, viewing them as essential for national security and the transition to a green economy. A triumphant investment in USA Rare earth would represent a meaningful step toward that goal, potentially reducing reliance on foreign sources and creating American jobs.
USA Rare Earth shares closed at $6.88, up 64.8% on the day. The company did not immediately respond to requests for comment.
