Weekly News Review January 26 – February 1 2026

This week, the U.S. government announced its second major investment in a domestic rare earth company, USA Rare Earth. Meanwhile, the EU is seeking to bolster its supply chains and is finalizing a free trade agreement with India, which has been in the works for 20 years. Additionally, the bloc upgraded its relations with Vietnam, seeking to access the country’s high-tech and mining sectors.

All this and more from the newsroom at @rawmaterials.net

US GOVERNMENT CONSIDERING STAKE IN USA RARE EARTH:

State Could Again Acquire Shares in Rare Earths Company, Sources Say:

There has been no official confirmation so far, but industry insiders say the U.S. government could once again take a stake in a rare earths producer. Following its investment in MP Materials in the summer of 2025, USA Rare Earth is reportedly planning a 10% stake, the Financial Times first reported. Details could be announced as early as this Monday, Reuters reported, meanwhile.

The aim is to develop a domestic rare-earth mine, along with downstream processing for the manufacture of permanent magnets. The material could come from the Round Top deposit in Texas, where the company has already processed raw materials on a pilot basis. A pilot operation at Round Top could start later this year, with regular raw material production expected to begin at the end of 2028.

Last September, USA Rare Earth secured key downstream expertise by acquiring the UK-based rare-earth and alloys specialist Less Common Metals.

USA RARE EARTH: GOVERNMENT CONFIRMS BILLION DOLLAR INVESTMENT:

Over the weekend, unofficial news made rounds that the U.S. government was preparing to take an equity stake in USA Rare Earth. Following MP Materials in summer 2025, this would mark the second federal engagement in a domestic rare earths company. On Monday, this speculation was confirmed through a letter of intent between USA Rare Earth and the U.S. Department of Commerce.

The agreement outlines up to $277 million in potential government grants, along with a $1.3 billion loan that could be financed through the CHIPS and Science Act. In return, the Department of Commerce will receive 16.1 million shares in the company. USA Rare Earth also announced that it has raised an additional $1.5 billion in private capital through the issuance of new shares. The combined funding is intended to support the development of a fully domestic mine-to-magnet supply chain, including the construction of a U.S.-based rare earth mine and downstream manufacturing capabilities for permanent magnets.

Feedstock will be sourced from the Round Top deposit in Texas, where the company has already conducted pilot-scale processing of extracted materials. A pilot operation at Round Top could commence later this year, with commercial production targeted for late 2028. In September of last year, USA Rare Earth strengthened its downstream expertise through the acquisition of Less Common Metals, a UK-based specialist in rare earth metals and alloys.

Further technological advancement, particularly in the separation of heavy rare earth elements, is being pursued under a separate agreement with the U.S. Department of Energy, as noted in the company’s press release. Unlike the agreement between the Pentagon and MP Materials, the current deal does not include price guarantees for rare earth products.

INDIA AND THE EU REACH AGREEMENT ON FREE TRADE DEAL:

The economic bloc will gain access to India’s rapidly growing market, while the subcontinent is expected to benefit from increased investment and new export opportunities. The raw materials sector, in particular, could see long-term gains.

After nearly two decades of negotiations, India and the European Union announced on Tuesday that they have reached an agreement on a free trade deal. The next steps include approval by the EU Council and the European Parliament.

According to the EU, the planned free trade area would encompass around two billion people. Under the agreement, tariffs on more than 90 percent of EU goods exports to India are to be eliminated or significantly reduced. The EU estimates annual savings of up to four billion euros and expects its exports to India to double. Brussels describes the deal as the most extensive trade liberalization India has ever granted to a partner.

For India, one of the world’s fastest-growing economies, the agreement opens up new opportunities to expand exports in key sectors such as semiconductor manufacturing and green technologies. At the same time, investment inflows from the EU are anticipated to rise.

Search for New Trade Partners Amid Global Upheaval:

The agreement comes amid rising geopolitical tensions and shifting global trade patterns. Established trade structures are under pressure, prompting major economies to seek new strategic partnerships. Both India and the EU have been affected by U.S. tariff policies, while also striving to reduce their dependence on China’s dominance in raw materials through increased domestic extraction and more diversified supply chains

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India is already a significant producer of several raw materials classified by the EU as critical, including barite and manganese. In other areas, such as rare earth elements, the country holds substantial reserves, ranking third globally, but these resources remain largely untapped. Processing capacities are even more limited. As a result, it is likely to take years before the EU can meaningfully diversify its supply of critical minerals through imports from India.

Another free trade agreement that could offer the EU comparable economic benefits and strengthen its access to raw materials is the long-discussed deal with the South American Mercosur bloc. Despite a recent breakthrough, however, negotiations have once again stalled.

VIETNAM AND THE EU DEEPEN COOPERATION:

The Southeast Asian country is a major producer of tungsten and holds large, still largely untapped reserves of other critical minerals such as rare earths.

The European Union and Vietnam are already linked through several forms of cooperation, including a free trade agreement. Now, both sides aim to further deepen their political and economic ties. A corresponding declaration was signed on Thursday in Hanoi by senior government representatives. In addition to semiconductor supply chains and energy, the planned cooperation also covers critical minerals.

According to the joint statement, the focus will be on promoting the sustainable extraction and processing of these materials.

Vietnam possesses substantial deposits of various raw materials. Although mining currently contributes only around 3% to its gross domestic product and is largely of regional importance, the extraction of critical minerals, in particular, is set to expand significantly in the future.

Even today, Vietnam produces several raw materials (PDF) that are important to numerous European industries and, in some cases, are classified as critical by the EU. The country is among the most important suppliers of tungsten outside China, a hard metal that is indispensable for many civilian and military applications.

In addition, Vietnam is a major producer of bauxite, the primary raw material for aluminum production, and a major source of gallium. This portfolio is complemented by smaller quantities of bismuth, fluorspar, antimony, and manganese.

Large Rare Earth Deposits, Limited Mining:

Vietnam’s rare earth deposits are also among the largest known, although the U.S. Geological Survey significantly revised its estimates downward last year. In 2023, the Vietnamese government announced plans to sharply increase rare earth production. Several companies are already integrated into global supply chains.

Vietnam is also seeking to strengthen downstream segments of the value chain. To this end, the country has, among other measures, banned the export of unprocessed rare earths and initiated cooperation with global market leader China and partners from Australia. Refined products are intended in particular to support the rapidly growing domestic electric vehicle market.

USA: RETHINKING THE CIRCULAR ECONOMY – FROM ORE TO ENERGY:

Mining giant Rio Tinto is not only extracting raw materials but also using them on-site to generate solar energy.

What if a mine didn’t just supply raw materials, but also produced its own clean electricity from those same resources, thereby reducing CO₂ emissions?

This is exactly what is happening at Rio Tinto’s Kennecott site in Utah, USA. A new 25-megawatt solar power plant has recently become operational. What makes it special is that the solar panels contain tellurium, a critical mineral that is recovered on-site as a byproduct of copper processing.

The tellurium is then processed in Canada into semiconductor material, which US solar leader First Solar uses to manufacture thin-film modules, a technology that holds a significant market share in the United States. For Rio Tinto, the new plant represents more than just a step toward greater sustainability in mining. According to Nate Forster, Managing Director of Rio Tinto Kennecott, it also strengthens supply chains for essential resources.

Both copper and tellurium are classified as critical minerals by the US government. Beyond thin-film solar modules, tellurium is used in thermoelectric applications, as an alloying element to improve metals like steel and copper, and in catalysts, glass and ceramic pigments, and rubber vulcanization.

CANADA AND INDIA SEEK CLOSER COOPERATION:

Ottawa aims to help meet India’s growing demand for critical resources:

Canada and India are looking to further deepen their trade relations, with a particular focus on energy and raw materials. This follows a joint statement released earlier this week and signed by Canada’s Minister of Energy and Natural Resources, Tim Hodgson, and India’s Minister of Petroleum and Natural Gas, Hardeep Singh Puri.

The statement positions Canada as a supplier and India as a rapidly growing demand market for both clean and conventional energy, as well as critical minerals. India, now the world’s most populous country and one of its fastest-growing major economies, plans substantial investments in renewable energy to meet rising electricity demand.

These efforts, along with the planned expansion of its domestic high-tech sector, will require large quantities of critical minerals. Going forward, India aims to reduce its reliance on imports from China, placing greater emphasis on supply-chain diversification alongside increased domestic production.

Canada, for its part, is already a major mining nation and is seeking to further scale up production of critical minerals while positioning itself as an alternative supplier to China. Ottawa has set its sights on becoming a significant producer of rare earths and has recently brought one of the few rare-earth refining facilities outside China online, complementing its domestic mining operations.

PENTAGON INVESTS IN DOMESTIC GERMANIUM PRODUCTION:

Canadian specialty semiconductor manufacturer receives $18 million to expand refining capacity in the United States

The U.S. Department of Defense is moving to strengthen domestic production of the critical mineral germanium. On Thursday, it announced an investment of more than $18 million in 5N Plus Inc. (5N+), a Canadian producer of specialty semiconductors and advanced materials.

The funding will be used to significantly expand refining capacity at the company’s production facility in the U.S. state of Utah, to more than 20 tonnes per year, a sevenfold increase. The support will also back 5N+’s plans to source germanium in the future from domestic feedstocks that have so far been underutilized or unexplored.

Although the investment was made on December 15, its announcement was delayed, according to the Department of Defense, due to last year’s federal government shutdown.

Germanium: Critical for Military Technology, Heavy Dependence on China:

Beyond civilian uses, germanium is of high strategic importance for the defense sector. It is used in infrared optics and night-vision systems, as well as in solar cells that provide power for satellites. The funding for 5N+ is intended to help secure and strengthen these supply chains.

The United States remains heavily dependent on germanium imports from China. Beijing even imposed an export ban on shipments to the U.S. in 2024, which it later temporarily lifted. According to data from China’s customs authorities, export volumes to the U.S. had already fallen to minimal levels before the official ban took effect.

The newly disclosed investment is rooted in an executive order issued by U.S. President Donald Trump in March, aimed at accelerating domestic production of critical minerals and related goods while reducing reliance on China. As part of this strategy, the Pentagon has already taken several steps, most notably its investment in MP Materials, the largest rare earth producer in the United States.

FIGURE OF THE WEEK – +375% – CHINA’S INVESTMENTS IN CENTRAL ASIA HAVE FURTHER INCREASED IN 2025.