In early July 2025, the U.S. Department of Defense made a landmark strategic move by investing $400 million in MP Materials, the owner of Mountain Pass—the only active rare earth mine in the United States. Through the purchase of newly issued preferred stock, the Pentagon became the company’s largest shareholder with approximately a 15% equity stake. This unprecedented direct equity participation signals a decisive shift in U.S. industrial policy, underscoring the national security imperative of securing critical minerals essential for defense systems, renewable energy, and advanced manufacturing.
In parallel with the equity stake, the Pentagon signed a 10-year offtake agreement to purchase 100% of the output from MP Materials’ upcoming “10X Facility,” a rare-earth magnet manufacturing plant. The agreement includes a minimum price guarantee of $110 per kilogram for neodymium-praseodymium oxide, protecting the company from price volatility. An additional $150 million loan from the Department of Defense will support the expansion of heavy rare-earth element separation capabilities at Mountain Pass— critical for diversifying away from Chinese refining infrastructure, which currently dominates global supply chains.
This investment marks a profound evolution in how the U.S. government approaches supply chain resilience, moving from passive regulation to active participation. The Pentagon’s involvement reflects growing recognition that control over critical minerals is as vital as traditional defense assets. By backing domestic production and refining, the U.S. aims to reduce its reliance on Chinese suppliers, safeguard its technological edge, and ensure the availability of materials indispensable to everything from electric vehicles and wind turbines to precision-guided missiles.