RE: MKA23 Sep 2025 16:21
Adamas have spoken to Bloomberg ahead of their rare earth summit today:
Initial US Magnet Supplies Can’t Meet Future Needs, Adamas Warns
The US will briefly have enough rare-earth magnet capacity to meet domestic demand around 2028, before rapid growth from high-tech sectors drives the need for even more supply, according to consultancy Adamas Intelligence.
The global rare earths and magnets sector is still adjusting to China’s supply shock in April, when the world’s dominant producer put export controls on the critical minerals in an escalating trade war with the US. That’s driven a scramble among geopolitical rivals to ease the risk of future disruptions.
“The pipeline today is on track for the US, on a tonnage basis, to have as much magnet capacity in 2028 as it’s now importing magnets — on paper,” Ryan Castilloux, managing director of Adamas, said in an interview ahead of his company’s rare earths gathering in Toronto. “But after that, demand will continue to grow much faster than what the supply pipeline is going to unleash.”
US demand for magnets will expand by up to five times from 2024 to 2035, he said.
Rare earth magnets are used in everything from electric vehicles to dishwashers and fighter planes. Their essential role in manufacturing was highlighted when China’s export curbs threatened major factory stoppages from Europe to India and the US. Beijing controls about 90% of global magnets production.
Companies that will be producing magnets in the US by 2028 include MP Materials Corp. — a firm that’s received unprecedented backing from the Department of Defense — as well as Noveon Magnetics Inc., USA Rare Earths Inc. and South Korean firm JS Link Inc.
That first wave of magnet production stems mostly from investments that were in place before this year’s China-driven supply shock. Ensuring enough quality raw materials — particularly the so-called “heavy” rare earths for high-performance magnets — remains the biggest stumbling block beyond the next few years.
Securing enough heavy rare earths is the “next hurdle to cross, because it will be the enabler of whether your capacity makes conference badge magnets or whether your capacity can make EV traction motor magnets,” Castilloux said.
There’s been a clear turn in favor of government intervention to ensure the feasibility of future magnet projects. The Pentagon in July took a $400 million preferred equity stake in MP Materials that also comes with guaranteed purchases at a minimum price. The US government is also in talks to set up a $5 billion fund for critical minerals investments worldwide, including for rare earths.
The rare earths industry is now waiting to see how policy develops, according to Castilloux. For example, will more firms will get government investments, and on what basis, or what arrangements will the Trump administration comesup with for supplies of raw materials.
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