MP Supplies begins producing neodymium magnets within the US

In mid-January, a high United States supplies firm introduced that it had began to fabricate uncommon earth magnets. It was vital information—there aren’t any giant U.S. makers of the neodymium magnets that underpin enormous and vitally vital industrial and protection industries, together with electrical automobiles. Nevertheless it created barely a ripple throughout a very loud and stormy time in U.S. commerce relations.

The press launch, from MP Supplies, was gentle on particulars. The corporate disclosed that it had began producing the magnets, referred to as neodymium-iron-boron (NdFeB), on a “trial” foundation and that the manufacturing facility would start regularly ramping up manufacturing earlier than the top of this 12 months. In response to MP’s spokesman, Matt Sloustcher, the ability can have an preliminary capability of 1,000 tonnes each year, and has the infrastructure in place to scale as much as 2,000 to three,000 tonnes per 12 months. The discharge additionally mentioned that the ability, in Fort Value, Texas, would provide magnets to Common Motors and different U.S. producers.

NdFeB magnets are probably the most highly effective and helpful kind. They’re utilized in motors for electrical automobiles and for heating, ventilating, and cooling (HVAC) methods, in wind-turbine mills, in instruments and home equipment, and in audio audio system, amongst different gear. They’re additionally essential parts of numerous navy methods and platforms, together with fighter and bomber plane, submarines, precision guided weapons, night-vision methods, and radars.

A magnet manufacturing surge fueled by Protection {dollars}

MP Supplies’ has named its new, state-of-the-art magnet manufacturing facility Independence.Enterprise Wire

The Texas facility, which MP Supplies has named Independence, shouldn’t be the one main rare-earth-magnet mission within the U.S. Most notably, Vacuumschmelze GmbH, a magnet maker primarily based in Hanau, Germany, has begun setting up a plant in South Carolina by a North American subsidiary, e-VAC Magnetics. To construct the US $500 million manufacturing facility, the corporate secured $335 million in outdoors funds, together with a minimum of $100 million from the U.S. authorities. (E-VAC, too, has touted a provide settlement with Common Motors for its future magnets.)

In one other intriguing U.S. rare-earth magnet mission, Noveon Magnetics, in San Marcos, Texas, is at present producing what it claims are “industrial portions” of NdFeB magnets. Nonetheless, the corporate shouldn’t be making the magnets in the usual manner, beginning with steel alloys, however moderately in a novel course of primarily based on recycling the supplies from discarded magnets. USA Uncommon Earth introduced on 8 January that it had manufactured a small quantity of NdFeB magnets at a plant in Stillwater, Oklahoma.

One more firm, Quadrant Magnetics, introduced in January, 2022, that it will start building on a $100 million NdFeB magnet manufacturing facility in Louisville, Kentucky. Nonetheless, 11 months later, U.S. federal brokers arrested three of the corporate’s high executives, charging them with passing off Chinese language-made magnets as domestically produced and giving confidential U.S. navy knowledge to Chinese language companies.

The a number of US neodymium-magnet tasks are noteworthy however even collectively they received’t make a noticeable dent in China’s dominance. “Let me provide you with a actuality test,” says Steve Constantinides, an IEEE member and magnet-industry guide primarily based in Honeoye, N.Y. “The full manufacturing of neo magnets was someplace between 220 and 240 thousand tonnes in 2024,” he says, including that 85 % of the whole, a minimum of, was produced in China. And “the 15 % that was not made in China was made in Japan, primarily, or in Vietnam.” (Different estimates put China’s share of the neodymium magnet market as excessive as 90 %.)

However have a look at the figures from a unique angle, suggests MP Supplies’s Sloustcher. “The U.S. imports simply 7,000 tonnes of NdFeB magnets per 12 months,” he factors out. “So in whole, these [U.S.] services can supplant a major share of U.S. imports, assist re-start an {industry}, and scale because the manufacturing of motors and different magnet-dependent industries” returns to the USA, he argues.

And but, it’s arduous to not be just a little awed by China’s supremacy. The nation has some 300 producers of rare-earth everlasting magnets, in line with Constantinides. The biggest of those, JL MAG Uncommon-Earth Co. Ltd., in Ganzhou, produced a minimum of 25,000 tonnes of neodymium magnets final 12 months, Constantinides figures. (The corporate just lately introduced that it was constructing one other facility, to start working in 2026, that it says will deliver its put in capability to 60,000 tonnes a 12 months.)

That 25,000 tonnes determine is similar to the mixed output of all of the rare-earth magnet makers that aren’t in China. The $500-million e-VAC plant being inbuilt South Carolina, for instance, is reportedly designed to provide round 1,500 tonnes a 12 months.

However even these numbers don’t absolutely convey China’s dominance of everlasting magnet manufacturing. The place ever a manufacturing facility is, making neodymium magnets requires provides of rare-earth steel, and that almost all the time leads straight again to China. “Though they solely produce, say, 85 % of the magnets, they’re producing 97 % of the steel” on the earth, says Constantinides. “So the magnet producers in Japan and Europe are extremely depending on the rare-earth steel coming from China.”

MP’s Mine-to-Manufacturing stragegy

And there, a minimum of, MP Supplies could have an attention-grabbing edge. Hardly any corporations, even in China, do what MP is making an attempt: produce completed magnets beginning with ore that the corporate mines itself. Even giant corporations sometimes carry out only one or at most two of the 4 main steps alongside the trail to creating a rare-earth magnet: mining the ore, refining the ore into rare-earth oxides, lowering the oxides to metals, after which, lastly, utilizing the metals to make magnets. Every step is a gigantic endeavor requiring completely completely different tools, processes, data, and talent units.

The uncommon earth steel produced at MP Supplies’ magnet manufacturing facility in Fort Value, Texas, consists of largely neodymium and praseodymium.Enterprise Wire

“The one benefit they get from [doing it all] is that they get higher insights into how completely different markets are literally rising,” says Stan Trout, a magnet {industry} guide in Denver, Colorado. “Getting the timing proper on any enlargement is vital,” Trout provides. “And so MP must be getting that data in addition to anyone, with the completely different vegetation that they’ve, as a result of they work together with the market in a number of alternative ways and may actually see what demand is like in actual time, moderately than as some projection in a forecast.”

Nonetheless, it’s going to be an uphill climb. “There’s are numerous each arduous and delicate subsidies within the provide chain in China,” says John Ormerod, an {industry} guide primarily based in Knoxville, Tenn. “It’s going to be tough for a US producer to compete with the present worth ranges of Chinese language-made magnets,” he concludes.

And it’s not going to get higher any time quickly. China’s rare-earth magnet makers are solely utilizing about 60 % of their manufacturing capability, in line with each Constantinides and Ormerod—and but they’re persevering with to construct new vegetation. “There’s going to be roughly 500,000 tonnes of capability by the top of this 12 months,” says Ormerod, citing figures gathered by Singapore-based analyst Thomas Kruemmer. “The demand is simply about 50 % of that.”

The upshot, the entire analysts agree, will probably be downward worth strain on uncommon earth magnets within the close to future, a minimum of. On the similar time, the U.S. Division of Protection has made it a requirement that rare-earth magnets for its methods should be produced completely, beginning with ore, in “pleasant” international locations—which doesn’t embrace China. “The DoD might want to pay a premium over cheaper imported magnets to ascertain a worth ground enabling home U.S. producers to efficiently and repeatedly provide the DoD,” says Constantinides.

However is what’s good for America good for Common Motors, on this case? We’re all going to search out out in a 12 months or two. In the intervening time, few analysts are bullish on the prospect.

“The automotive {industry} has been extraordinarily cost-conscious, demanding provider worth reductions of even fractions of a cent per piece,” notes Constantinides. And even the Trump administration’s tariffs are unlikely to change the essential math of market economics, he provides. “The appliance of tariffs to magnets in an try to ‘degree the enjoying subject’ incentivizes corporations to search out work-arounds, corresponding to exporting magnets from China to Malaysia or Mexico, then re-exporting from there to the USA. This isn’t theoretical, these work-arounds have been used for many years to keep away from even the previous or current low tariff charges of about 3.5 %.”