Apple has made a significant move by agreeing to purchase $500 million worth of rare earth magnets from MP Materials, an American company. This announcement came on Tuesday, just after the U.S. Defense Department became the largest shareholder of MP Materials.
The deal will allow Apple to source rare earth magnets from MP Materials’ facility in Fort Worth, Texas. These magnets are crucial for various components in Apple products, including iPhones, audio equipment, and microphones. MP Materials plans to expand its Fort Worth facility to meet the demand, with shipments expected to start in 2027 and grow to support hundreds of millions of Apple devices.
James Litinsky, the CEO of MP Materials, expressed pride in partnering with Apple. He emphasized that this collaboration will enhance their recycling efforts and strengthen America’s manufacturing capabilities at a critical time.
Following the announcement, MP Materials’ stock surged by 28%, reaching an all-time high of over $62 per share. Apple’s stock also saw a slight increase of 0.5% around the same time.
This agreement is not just a business deal; it also represents a strategic step for the U.S. as it seeks to reduce reliance on China for rare earth materials. Currently, China produces about 60% of the world’s rare earths and refines nearly 90% of them. For years, MP Materials has operated the only rare earth mine in the U.S., located in Mountain Pass, California. Recently, the U.S. also opened its second rare earth mine in Wyoming, which will extract materials from coal.
President Trump has been vocal about wanting the U.S. to lead in the production and processing of non-fuel minerals, including rare earths. The Pentagon’s investment in MP Materials is part of this broader effort to boost domestic production.
In addition to this deal with Apple, MP Materials plans to build a second magnet manufacturing facility to serve both defense and commercial needs. This facility will further enhance the U.S. supply chain for critical materials.
