Rare-earth magnet maker to build $1B factory in North Carolina in bid to expand domestic supply

Rare-earth magnet company Vulcan Elements revealed plans Tuesday to build a $1 billion factory in Benson, North Carolina, as U.S. companies look to compete with China over rare-earth dominance.

The facility will have a magnet manufacturing capacity of 10,000 metric tons and is expected to create more than 1,000 jobs. Construction of the facility is expected to begin within the next year, and employees are anticipated to be on site by 2029, according to Vulcan Elements’ statement.

The upcoming facility follows news of a heavy U.S. government investment in Vulcan Elements. Earlier this month, the company announced a $1.4 billion partnership with the government to expand the “vertically integrated, domestic magnet supply chain” for rare-earth magnets.

That investment is part of a broader U.S. strategy to increase competition in the mining and refining of rare-earth metals, which China currently dominates. Rare-earth metals are essential components of most electronics, from consumer goods like smartphones to security systems such as autonomous drones and ballistic missiles. 

Vulcan Elements CEO John Maslin noted the importance of the rare-earth supply chain, adding that the North Carolina facility is a crucial step in building U.S. dominance.

“We need to draw on world-class talent, innovation and infrastructure as we secure one of the 21st century’s most important supply chains. As home to our current facility, North Carolina has proven that it has all three,” Mr. Maslin wrote in a statement. “And as we create 1,000 new American jobs, we will tap into the region’s deep bench of experience across industries — from engineers and technicians who understand hardware and manufacturing to military veterans who have spent their careers managing complex supply chains, operating heavy machinery, and serving their country.”

Ironically, the metals themselves are not rare and are found during most mining operations. However, the refinement process is technical and expensive.

Beijing currently has a stranglehold over the industry, controlling over 50% of the mining sector and approximately 90% of the world’s rare-earth refinement infrastructure. Experts say China’s level of control is alarming and could have disastrous effects for U.S. security.

“The tank, the battleship, nuclear energy, wind energy, gas energy, all of it relies on rare earth metals. And without it, our society is crippled not from a military standpoint, only from an actual everyday operation standpoint,” said Nick Myers, CEO and co-founder of rare-earth processing company Phoenix Tailings. “They are playing on a different level right now. China is engaging in economic warfare. They understand that warfare is not all kinetic, and they’re leveraging their economic power.”

Mr. Myers said Phoenix Tailings is one of the few U.S. companies seeking to support an entirely domestic rare-earth supply chain to bolster self-sufficiency. The company takes the waste, or tailings, of mining operations and processes it to produce rare-earth metals. 

U.S. lawmakers have begun to sound the alarm over China’s dominance in the processing of rare-earth metals. Sen. Todd Young, Indiana Republican, has been one of the loudest voices urging U.S. leadership to get aggressive on rare-earth metals. 

“They have vast stores of rare-earth minerals and other critical minerals that they provide into the American market,” the senator said of China in an exclusive interview with Threat Status. “These are key inputs as we electrify our economy. And they’re also key inputs to other, important, manufactured goods like defense articles. We literally cannot produce our defense goods without access to rare-earth minerals.”

In April, Mr. Young introduced a bill with Sen. Chris Coons, Delaware Democrat, that urges the U.S. Geological Survey to give America a more competitive edge in developing mines around the world. The bill, which has been cosigned by Sens. John Cornyn, Texas Republican, and John Hickenlooper, Colorado Democrat, is awaiting action in the Senate.