USA Rare Earth Acquires NdFeB Permanent Magnet Manufacturing Equipment

Texas Mineral Resources Corp. (TMRC), an exploration company targeting the heavy rare earths and a variety of other technology metals and industrial minerals, is pleased to announce that USA Rare Earth LLC, the funding and development partner of the Round Top Heavy Rare Earth and Critical Minerals Project in West Texas, has  purchased the neodymium iron boron (NdFeB) permanent magnet manufacturing equipment formerly owned and operated in North Carolina by Hitachi Metals America, Ltd.

Demand for rare earth magnets is being driven by electric vehicles (electric motors and batteries), wind generators (direct drive generators), medical devices (personal “vital signs” monitors and medical imaging machines), smart phones, and aerospace/defense applications, where high-performance in extreme conditions is important.

The $14 billion-a-year rare earth magnet market is more than 60% controlled by China which, under Made in China 2025, is increasingly using rare earth magnets in finished and semi-finished products, as opposed to exporting the magnets. Industry sources estimate the global rare earth magnet market will nearly double by 2027.

The equipment purchased by USA Rare Earth should provide most of what is needed to re-establish rare earth magnet production in the U.S. and, with the addition of some readily available components, can produce at least 2,000 tons annually of rare earth magnets.

At 2,000 tons per year, the USA Rare Earth Magnet Plant would produce approximately 17% of the current U.S. market, and would generate more than $140 million in annual sales (at 2019 prices). At present, no other NdFeB permanent magnet manufacturing plant is operational in the Americas.

USA Rare Earth will warehouse the equipment pending a decision about where to locate the new magnet operation, with the priority being good access to the Round Top Project, located in Texas. At the same time, USA Rare Earth plans to work with manufacturers of rare earth metals and alloys in order to convert the highly purified rare earth oxides from Round Top into magnets.

“Acquiring this capability is consistent with our mine-to-magnet strategy,” said Pini Althaus, CEO of USA Rare Earth.  “We did not want the United States to lose this key equipment, so when it became clear that was an imminent possibility, we moved quickly to ensure that this essential part of the critical minerals supply chain remains in the U.S. We have commenced discussions with the domestic U.S. electric vehicle and defense sectors to determine their needs and to work together to establish a domestic source of not only the raw materials from Round Top, but also the finished magnet product. We expect to partner with one or more groups that have expertise in rare earth magnet manufacturing.”

“Together with the critical materials contained in our Round Top project, coupled with our new processing plant and now the acquisition of the rare earth magnet manufacturing equipment, we have put into place the key building blocks for re-establishing a domestic critical minerals supply chain independent of China.” added Mr. Althaus.

This acquisition is complimentary to the Company’s Round Top Project in West Texas, which it is developing with Texas Mineral Resources Corp., and its pilot processing facility located in Wheat Ridge, Colorado.  Round Top is rich in heavy rare earths, including dysprosium and terbium, which are required for NdFeB magnets.  USA Rare Earth plans to produce high purity separated rare earth powders at Round Top that could support this newly acquired magnet manufacturing capacity and create a secure, reliable domestic supply chain. Round Top is also projected to produce 10,000 tons of lithium a year directed at the electric vehicle battery market.

“Developing a full rare earth supply chain independent of China is essential for both the national economy and national security,” said General Paul Kern, US Army (ret.), Board member of USA Rare Earth. “This plant provides the relevant industries in the U.S. the possibility of purchasing U.S. manufactured permanent magnets, without the reliance on China for this key component. The importance of this acquisition should not be underestimated.”