DoD Loans $700M to Boost U.S. Rare Earth Magnets

WASHINGTON — The Defense Department’s Office of Strategic Capital is providing $700 million in conditional loans to expand domestic production of rare-earth magnets used in defense and commercial systems.
Vulcan Elements will receive $620 million and ReElement Technologies $80 million to scale separation, metallization and magnet-manufacturing steps for Neodymium-Iron-Boron (NdFeB) magnets. The funding supports expansion of processing and fabrication capacity to reach a combined 10,000 metric tons of NdFeB-related material capacity, strengthening U.S. supply chains for high-performance permanent magnets.
NdFeB magnets are critical for electric motors, actuators, sensors and guidance systems because of their high energy density. The loans target upstream separation of rare-earth oxides, downstream metallization and magnet production stages to reduce reliance on foreign suppliers and shorten supply chains for defense-relevant technologies.
Officials say the conditional financing is intended to accelerate industrial scale-up, create manufacturing jobs and provide strategic material security for military and civilian applications.