MP Materials, the largest supplier of rare-earth metals, just announced a 26% increase in the price of neodymium praseodymium. This essential part often gets overlooked, but it’s hugely important to the success of electric vehicles (EVs). The Mountain Pass mine in California is the only rare-earth mine still operating in the U.S. Moreover, it is the core policy that fuels this major price jump. Thanks to the never-ending U.S.-China trade war, the U.S. has become more intent than ever on protecting its rare-earth resources. Yet the market for these essential minerals is changing at a breakneck pace.
The Mountain Pass mine, located in California, is an essential asset for the U.S. in the global rare-earth supply chain. MP Materials mines neodymium-praseodymium from this location, whose global spot prices have recently soared to their highest levels since early 2023. The price spike is not limited to neodymium-praseodymium. It nevertheless points to a larger trend that likely impacts most rare-earth metals, particularly those limited by China’s draconian export regulations.
Ever since, trade policy has stepped sharply into the limelight, further emphasizing the need to develop rare-earth resources domestically. And as China continues to enforce new, restrictive policies on mineral exports, U.S. stakeholders are starting to hoard their stocks. The ramifications of this strategy are wide-reaching, particularly for industries that are dependent on these materials, including electric vehicle production.
More than contributing to the overall price increase, these factors underscore the booming demand for neodymium-praseodymium, primarily fueled by the surging electric vehicle market. Automakers are racing to increase EV production, quickly responding to an unprecedented consumer demand for EVs. Therefore, the demand for high-performance and small volume magnets has increased. These magnets are essential to the efficiency of electric motors, and neodymium-praseodymium is a key ingredient of modern automotive technology.
MP Materials is understandably proud of its operations at the Mountain Pass mine. This plant is essential to the developing U.S. rare-earth industry. Defense Metals produces these metals through actively extracting and refining rare-earth metals benefiting both the defense and domestic company. This program strengthens national security by reducing our dependence on adversaries’ foreign network sources.