MP Materials Aims to Eliminate America's Dependence on Rare-Earth Imports After 2028

Eight months ago, MP Materials (NYSE: MP) made a giant leap.

For years -- decades -- MP Materials and its predecessor companies have worked to bring back rare-earth mining to the continental United States and free the U.S. from dependence on importing rare-earth materials essential to 21st-century technologies such as electric cars, wind turbines, and advanced defense technologies. Success, however, has been hit or miss.

The problem with MP Materials is simple.

According to recent research from The Motley Fool, "China accounts for roughly 70% of rare-earth extraction and 90% of rare-earth processing, giving it firm control over the rare-earth supply chain." China uses this control to sometimes strangle rare-earth supplies (to punish countries it's displeased with). Other times, China opens the floodgates, drowning the world in rare-earth exports and driving prices down -- so companies like MP cannot earn a profit and must eventually file for bankruptcy (as MP's predecessor company Molycorp did).

This stifles international investment in rare-earth metals and preserves China's near-monopoly over the metals.

Image source: Getty Images.

We're from the government, and we're here to help

Enter the U.S. government, in the form of the Trump Administration. In July 2025, the Trump Administration Department of Defense announced that, in order "to accelerate American supply chain independence," it would:

• Invest $400 million in MP Materials preferred convertible stock.
• Sign a 10-year supply agreement promising to buy MP's Neodymium-Praseodymium (NdPr) rare-earth oxide production for no less than $110 per kilogram.
• Loan MP $150 million to use for expanding heavy rare-earth separation capabilities and begin construction of a "10X" rare-earth magnet facility, enabling MP to manufacture 10,000 metric tons of magnets annually.
• And buy any magnets that 10X produces, for which MP cannot find commercial buyers.

And now MP is ready to begin.

Shovel-ready

Last week, MP announced it has chosen to build 10X at a 120-acre site in Northlake, Texas. "Engineering and equipment procurement is well underway," says the company, and 10X is scheduled to begin production in 2028.

MP didn't say how long it will take to scale up to 10,000 tons of rare-earth magnet production. What I can tell you, though, is that MP has a long runway of growth ahead of it. With only one manufacturing facility in operation today, MP is currently making less than $225 million in annual sales.

Analysts polled by S&P Global Market Intelligence project that adding the 10X facility to the mix will quadruple MP's revenue by 2028, to more than $1 billion, and grow this year's projected profit ($0.26 per share) sixfold, to $1.44 per share. Then that profit is expected to double again in two more years, approaching $3.30 per share in 2030.

Estimating rare-earth magnet demand

Are these realistic targets? Is there enough demand for rare-earth magnets to sustain this rate of growth? The answer is almost certainly "yes."

Data from rare-earth market researcher Rare Earth Exchanges show that the U.S. imported 10,000 tons of rare-earth magnets in 2024. Assuming no growth, this suggests MP Materials may "max out" production as soon as 10X opens (or with some growth in demand, shortly thereafter). But here's the thing:

Rare Earth Exchanges notes that "the 10,000 [tons] figure refers only to magnets directly purchased in the U.S.; it does not include the ~30,000 [tons] of magnets ... imported [as parts incorporated into other finished] products each year." That's 40,000 tons total, and with Rare Earth Exchanges forecasting 17% annual growth in "direct-use magnet demand," total magnet demand (for bare magnets and magnets incorporated into other products combined), could exceed 50,000 tons by 2030.

Is MP Materials stock a buy?

Translation: The potential market for MP's magnets is probably at least four to five times larger than 10X alone will be able to supply in 2028. There's plenty of room for MP Materials stock to grow beyond that.

Granted, at its current valuation of 225 (!) times estimated 2026 earnings, and roughly 18 times the profit analysts hope it will be earning in 2030, MP Materials is anything but a cheap stock. But the growth prospects are certainly there.

Investors are valuing this commodity metals producer as a growth stock for good reason.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool recommends MP Materials. The Motley Fool has a disclosure policy.