Deal over four years for light and heavy rare earth oxides, including a price floor.
Australian mining company Lynas Corporation and the U.S. Department of Defense have signed a memorandum of understanding to supply rare earth elements (PDF). Under the agreement, the Pentagon will invest approximately $96 million over four years to purchase both light and heavy rare earth oxides. A minimum price has also been set for neodymium-praseodymium (NdPr), a precursor for the production of industrially critical permanent magnets. The two partners are in further discussions regarding additional supply agreements.
The newly established minimum price matches the one Lynas agreed with its Japanese customer, Japan Rare Earth, last week for neodymium-praseodymium (NdPr) (PDF). At the same time, it aligns with an existing 10-year price guarantee between the U.S. Department of Defense and the largest domestic rare-earth producer, MP Materials. The Pentagon made headlines in July 2025 with its investment in the company. Following this, other Western countries considered introducing price floors for critical minerals sourced outside China to enhance competitiveness. Lynas has been in dialogue with various governments regarding this, CEO Amanda Lacaze stated a little over two months ago.
Original Pentagon Deal Adjusted – Likely No U.S. Refinery
Lynas is the largest rare earth producer outside China. Its raw materials from the Mt Weld Mine are processed in Malaysia, but increasingly also domestically in Australia. The original plan, supported by the Pentagon, included constructing a separation plant for heavy rare-earth elements in Texas. However, uncertainties surrounding this project have been repeatedly reported. Against this backdrop, both parties adjusted their plans, resulting in the new memorandum of understanding, Lynas notes.
Photo: TRADIUM GmbH