Better Rare-Earth Mining Stock to Buy in June: MP Materials or USA Rare Earth?

2 hours ago 1

Courtney Carlsen, The Motley Fool

Mon, June 8, 2026 astatine 10:25 AM CDT 5 min read

The United States faces a immense proviso concatenation vulnerability regarding rare-earth elements. That's due to the fact that China controls up to 90% of the processing of these rare-earth elements, according to research by The Motley Fool. The national authorities has taken an progressive relation successful bolstering rare-earth mining and processing and has invested successful 2 companies, MP Materials (NYSE: MP) and USA Rare Earth (NASDAQ: USAR), to bolster its capabilities.

The 2 companies are expanding their capabilities for mining and processing rare-earth elements and manufacturing refined magnets, which are captious for defense, aerospace, and technological applications. If you're considering investing successful the budding U.S. rare-earth industry, 1 of these companies stands retired arsenic a amended concern close now.

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The U.S. authorities has a vested involvement successful MP Materials and USA Rare Earth

MP Materials and USA Rare Earth are 2 companies that person travel onto investors' radar aft the U.S. authorities provided monolithic fiscal backing and support. Last year, MP Materials entered into a historical statement with the U.S. Department of Defense (DoD) to assistance accelerate the build-out of its 2nd home magnet installation (the 10X facility) and its mining capabilities.

As portion of the agreement, the DoD has agreed to a 10-year acquisition statement for MP Materials' neodymium-praseodymium (NdPr) products astatine $110 per kilogram, providing the institution with a terms level that insulates it from overseas entities that whitethorn effort to undercut its prices. NdPr is simply a rare-earth alloy utilized to manufacture almighty imperishable magnets important to defence and exertion systems.

The U.S. authorities has besides agreed to acquisition 100% of the magnets produced astatine MP's 10X installation for 10 years pursuing the facility's construction. In return, the DoD agreed to acquisition $400 cardinal successful shares of the rare-earth institution and is present its largest shareholder, holding 15% of the shares outstanding.

In January, USA Rare Earth besides reached a $1.6 cardinal woody with the U.S. Department of Commerce done the CHIPS Act, which volition alteration the institution to physique retired its ain "mine-to-magnet" proviso chain. As portion of the agreement, USA Rare Earth volition contented 16.1 cardinal communal shares to the U.S. Department of Commerce and astir 17.6 cardinal warrants.

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