Apple invests US$500mil in rare earths producer MP Materials
The investment is part of a broader push to bring the production of its coveted iPhones to the US and boost US manufacturing amid a push from the Trump administration to cut reliance on China.
Rare earths are a group of 17 metals used to make magnets that turn power into motion. China halted rare earths exports in March following a trade spat with US President Donald Trump that showed some signs of easing late last month, even as broader tensions underscored demand for non-Chinese supply.
Shares of Las Vegas-based MP Materials jumped 10 per cent to US$52.37 in premarket trading.
MP last week agreed to a multibillion-dollar deal with the US Department of Defense to boost output of rare earth magnets and help loosen China's market control.
Apple said the MP investment is part of its US$500 billion commitment to the US.
The agreement includes plans for Apple to purchase US-made rare earth magnets from MP Materials' Texas facility. It would be the first supply deal for MP's magnets since the financial backstop agreement with Washington.
MP already produces mined and processed rare earths and has said it expects to start commercial magnet production in its Texas facility by the end of this year.
The two companies would build another factory in Texas to produce magnets and a new recycling facility in Mountain Pass, California, near the company's existing mine.
Last week's deal with the US government includes a price floor for rare earths, designed to spur investment in domestic mines and processing plants, which has been lagging partly due to low prices set in China.
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