Here's Why Critical Metals Stock Jumped This Week
Key Points
Critical Metals could become a key player in supplying rare-earth metals for the U.S. defense complex.
Its Greenland pilot-plant mine facility has received approval for construction.
Partnership agreements have now secured offtake for all of the Tanbreez Project's rare earth concentrate production.
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Shares of Critical Metals Corp. (NASDAQ: CRML) have been on a roll for the last month. The stock has surged 123% over that period, including nearly 20% this week, according to data provided by S&P Global Market Intelligence.
The sector has been under a microscope as geopolitical drama plays out regarding who controls critical minerals for crucial industries, including cutting-edge technology and electronics, electric vehicles (EVs), and aerospace and defense.
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This week, Critical Metals announced plans for a joint venture to create a $1.5 billion rare-earth mineral processing facility in Saudi Arabia.
Image source: Getty Images.
In the crosshairs of politics and economics
Rare-earth elements play a vital role in advanced military technologies. That's one reason the Trump administration has raised national security concerns about Greenland and its vast reserves. That open discussion has also sparked significant investor interest in Critical Metals stock. That's because the mining company has been officially given the green light to begin construction of its Tanbreez rare-earth project in Greenland.
The Saudi Arabia joint venture will serve as a long-term recipient for 25% of Tanbreez's rare-earth output. Combined with previously announced agreements, the entire output of rare-earth concentrate from the Tanbreez Project is now allocated under long-term offtake arrangements.
That gives investors visibility on long-term revenue and ensures supply to strategic allies. The Saudi Arabian processing facility will send all finished products to the U.S. for use in the military-industrial sector.
Critical Metals now looks to be a key partner and supplier to the U.S. military defense establishment. That has investors jumping into the stock.
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Howard Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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