The investment is aimed at expanding domestic processing of rare earths and critical minerals used in semiconductors and defence equipment, as the US looks to reduce dependence on China.
The US Department of Defense will invest $25 million in rare earths startup ReElement Technologies, marking another step in the country’s efforts to secure domestic supplies of critical minerals used in semiconductor manufacturing and defence systems. According to Reuters, the investment is part of a wider push by the Trump administration to reduce dependency on China, which dominates global rare earth processing and magnet production.
ReElement plans to use its proprietary processing technology at a commercial facility in Marion, Indiana, where it aims to refine rare earth elements and other critical minerals. The Pentagon said the funding will support the purchase and installation of equipment at the site, which is expected to recycle magnets while producing rare earths as well as germanium and gallium, minerals widely used in semiconductor and defence applications.
The rare earth materials processed at the facility are expected to be used in magnets for military equipment, including fighter jets, missiles and submarines.
It remains unclear whether the $25 million support will be provided as a grant, loan or another funding mechanism.
Last week, Reuters reported that ReElement had withdrawn its request for an $80 million Pentagon loan announced in November after the company was unable to meet federal due diligence requirements.
