The US-based miner and magnet manufacturer USA rare earth has announced plans to allocate up to about US$203 million (175 million euros) toward expanding its European industrial footprint. The funds are destined to support growth in permanent magnet, metal, and alloy production in France, reinforcing an integrated supply chain from processing to magnet assembly. The company says the program will reinforce its existing operations and is expected to create more than 300 jobs within the French rare earth ecosystem, leveraging local skills and industrial networks.
Scope of the French investment and existing assets
USA Rare Earth will direct the capital toward expanding facilities that build on current French assets. The group already operates a Less Common Metals (LCM) production site in Lacq and has a strategic joint investment with InfraVia Capital Partners in the French processor Carester SAS. Executives describe France as an appealing location due to its heavy industrial infrastructure, a growing rare earth processing cluster, and a workforce experienced in metallurgy and magnet production. The company frames the expansion as part of a broader effort to construct a resilient, regional mine-to-magnet value chain that can reduce dependency on single-source supply routes.
Political and financial support in France and the United States
Parisian authorities are reported to be considering additional forms of support for the project, including potential debt guarantees and even a direct equity stake in USA Rare Earth’s European subsidiary. Those measures would complement the company’s ongoing efforts to build capacity in Europe. At the same time, USA Rare Earth continues to pursue domestic projects: in the United States it secured a conditional package of roughly US$1.6 billion in government-backed financing to develop a planned mine in Texas and an associated magnet factory in Oklahoma aimed at achieving commercial-scale production by 2028.
Parallel federal grant for separation technology
Separately, the US Department of Energy has selected USA Rare Earth for a grant of US$20 million under its “Critical Materials Innovation, Efficiency and Alternatives” program. That federal award is intended to partially finance a US$50.5 million pilot-scale project for rare earth element separation, an essential step in producing usable metals for magnets and alloys. The final scope and budget are still subject to negotiation and the execution of a definitive funding agreement with the DOE, meaning the numbers could change as contracts are finalized.
Legal dispute with MP Materials
While expanding overseas, USA Rare Earth is also facing litigation at home. California-based MP Materials has filed suit alleging that USA Rare Earth misappropriated proprietary magnet formulation data through a former employee and disclosed that information to a third-party technology firm. MP Materials says the disputed formula is used to increase a magnet’s coercivity, which measures resistance to demagnetization. USA Rare Earth has publicly denied the allegations, stating the claims misrepresent the company and pledging a vigorous defense.
Commercial positions and government relationships
The two firms sit at different commercial and contractual stages. MP Materials last year reached an agreement with US authorities that included a government minority ownership stake and minimum price guarantees for certain products. USA Rare Earth, by contrast, has focused on building out upstream mining and downstream magnet production capacity with conditional US government financing and the announced France expansion. These parallel tracks underscore a broader industrial competition to secure domestic and allied supplies of critical minerals and magnet components.
Implications for supply chains and the rare earth sector
If executed as planned, the France expansion could strengthen European options for magnet and alloy production while creating local employment and processing capabilities. The combination of public support in both France and the United States, together with pilot-scale separation work funded by the DOE, points to a multi-jurisdictional strategy to reduce strategic vulnerabilities in the rare earth supply chain. However, the pending lawsuit introduces legal risk that could affect timelines, technology access, or commercial partnerships as both companies press their respective claims and defenses.
For transparency, the author discloses that Giann Liguid holds no direct investment interest in any company mentioned in this article.