Apple has signed a $500 million agreement with MP Materials for rare earth magnets, aiming to mitigate supply risks following China’s export restrictions earlier this year.
The company last week secured backing from the Pentagon – the US Department of Defense – which will become its largest shareholder.
The deal marks a significant victory for MP Materials, the only American rare earths mine operator, whose shares jumped by 20 percent as a result.
Earlier this year, US President Donald Trump invoked emergency powers to boost domestic production of critical minerals, aiming to counterbalance China’s overwhelming dominance in the industry.
“Rare earth materials are essential for making advanced technology, and this partnership will help strengthen the supply of these vital materials here in the United States,” Apple CEO Tim Cook said this month.
“We couldn’t be more excited about the future of American manufacturing, and we will continue to invest in the ingenuity, creativity, and innovative spirit of the American people.”
But even with this high-profile deal, China still processes nearly 90 percent of the world’s rare earths, and about two-thirds of American-mined minerals are shipped to China for refining before they can be used in products like Apple’s.
China’s control over the sector extends directly to MP Materials through Shenghe Resources, which has held roughly an eight percent stake in the company. For years, MP had been sending the majority of its ore to China for processing.
Now, the US Department of Defense has an effective 15 percent stake in MP by purchasing half a billion dollars in preferred stock along with warrants.
The company has pledged it will no longer send any material to China for processing.
“We're getting an important national security need met, but we're maintaining our free market public company approach,” MP's CEO James Litinsky told an investor call.
The deal marks a significant step toward reshoring critical processing capabilities, but it also raises a broader question about whether such efforts can truly shift the balance.
A long road to independence
While American officials and industry leaders are keen to celebrate the latest MP Materials deal as a turning point, experts caution that it is only one step on a much longer journey.
China’s overwhelming dominance in rare earth processing and refining means the US still faces enormous structural obstacles.
According to Jack Lifton, Senior Fellow at the Institute for the Analysis of Global Security, the fundamental landscape has shifted beyond what most Western policymakers anticipated.
“What’s changed is the advent of truly global competition,” Lifton tells TRT World. “Americans and Europeans are very, very late—too late—to this game.”
Now it is not just a matter of catching up in mining or extraction.
As outlined in reports from the Hinrich Foundation, even if American mining output increases, most of those minerals still end up in Chinese refineries before they can reach US factories.
Steve Christensen, executive director of the Responsible Battery Coalition, welcomes the new investments, but recognises the limitations.
“Expanding extraction is great, and we need more of it and investments along the value chain,” said Christensen, executive director of the Responsible Battery Coalition, an association representing battery makers, automakers and battery sellers.
“The metals produced from MP will lessen our dependence on China”.
Yet, the challenges go well beyond the supply chain.
Lifton points out that now countries in the Middle East, South America, and Africa are increasingly determined to keep more of the economic benefits from their own mineral resources, rather than settling for quick profits.
In other words, the global landscape for critical minerals is evolving quickly, with China prepared to offer its processing technology in exchange for continued influence.
“American and European companies cannot compete at this level,” Lifton says.
Policy changes in Washington have tried to address some of these gaps.
President Trump’s emergency orders and the Ocean Shipping Reform Act are attempts to make American supply chains more resilient.
However, reports reveal that regulatory and environmental struggles mean that even approved mining projects in the US can take decades to come into effect.
"The US has the second-longest lead time globally (29 years) from discovery to production,” the S&P Global report writes.
Most evidence suggests that even with more investment, American efforts will take years—if not decades—to match the scale and sophistication of China’s network.
As the experts discuss, success will require a coordinated approach, long-term investment, and a willingness to work alongside partners in the Global South, rather than relying solely on domestic solutions.