Shares in USA Rare Earth (USAR.O) were up 18% to a record high on Friday following revelations the mining company's recently appointed CEO Barbara Humpton was interested in doing a deal with the Trump administration.
The stock’s share price rally - which has helped its market capitalisation double in the last 12 months to US$2.59 billion - follows the Trump administration’s decision to enter recent deals to help support the industry and break United States dependence on China.
The administration has taken a 5% stake in Lithium Americas (LAC.TO) and a separate 5% stake in the company's Thacker Pass joint venture with General Motors (GM.N) in the last week.
Its decision to invoke emergency powers to boost critical-minerals production earlier this year follows China's decision to halt exports.
China had halted exports of rare earths, a group of 17 metals used to make magnets that turn power into motion, in March as part of a trade spat with Trump.
While that showed some signs of easing in June, broader tensions underscored the need for greater U.S. output.
MP Materials had also unveiled a multibillion-dollar deal with the U.S. government in July to boost output of rare earth magnets, with the Pentagon becoming the largest shareholder in MP Materials (MP) via a US$400 million deal to build a magnet plant.
Meanwhile, USA Rare Earth has been developing a mine in Sierra Blanca, Texas and a neo magnet manufacturing facility in Stillwater, Oklahoma, which is expected to go commercial in the first half of 2026.
“This is a field where it will not be a zero sum game,” Humpton said of the rare earth supply chain.
“It’s going to take a lot of players to build out this marketplace.”
The company is understood to be one of the more significant emerging U.S. neo magnet manufacturers and any reshoring strategy should include them, said Subash Chandra, analyst at The Benchmark Company.
"We don't know what form a potential U.S. government investment can take, but there's still a missing piece to the mines-to-magnet strategy," Chandra said.
In the second quarter (Q2) of 2025, USA Rare Earth reported an operating loss of US$8.8 million and a net loss of US$142.5 million.
The company ended Q2 with around US$128 million in cash and no debt, raised US$22 million via warrant exercises and is investing heavily in facilities.
Analysts expect modest 2025 revenues (under US$50 million), reflecting the company's pre-revenue status.
