New York, June 3, 2026, 10:07 EDT
- USA Rare Earth slipped $1.06 to $29.64 in early delayed Nasdaq dealing. The stock touched an intraday high of $32.74 earlier.
- The company wrapped up agreements with the Commerce Department, securing access to as much as $277 million in federal funding and up to $1.3 billion available through senior secured loans.
- USA Rare Earth earlier announced plans for a $1.2 billion South Carolina plant with commissioning aimed for 2028. The deal comes after that.
USA Rare Earth stock slipped at the open Wednesday, erasing an early rise. The company earlier said it had completed agreements with the U.S. Department of Commerce for up to $1.6 billion in funding.
Shares dropped 3.5% to $29.64 in after-hours action, slipping from an open at $31.18 and a high of $32.74. Regular trade on the Nasdaq kept going; its 2026 holiday calendar has Juneteenth on June 19 as the next June market break.
Deal turns January funding plan into actual signed agreements. It lands just a day after USA Rare Earth picked Cherokee County, South Carolina, for its planned magnet and rare earth metals plant. Rare earths go in electric vehicles, medical gear, turbines, oil refining and defense.
The Commerce deal gives USA Rare Earth up to $277 million in federal funds and up to $1.3 billion in senior secured loan capacity, which is debt that’s backed by collateral and sits ahead of other debt. Disbursements are milestone-based, not lump sum, the company said.
USA Rare Earth plans to give the Commerce Department 16.1 million common shares and about 17.6 million warrants, which allow the holder to buy shares at a fixed price later. The company said that, along with a $1.5 billion PIPE deal closed in January, its committed capital for expansion is now about $3.5 billion.
Michael Blitzer, who chairs USA Rare Earth, called the deal the “largest of its kind” for the sector. CEO Barbara Humpton said the group is going from “intent to execution.” Bill Frauenhofer, executive director of Semiconductor Investment and Innovation, said the funding would be “instrumental” in building up a domestic critical-minerals and magnet supply chain. GlobeNewswire
USA Rare Earth plans to add around 490 jobs at a new plant in Blacksburg, South Carolina. The factory is set to turn out 6,400 metric tons of neodymium-iron-boron magnets and 5,000 tons of strip-cast metals and alloys a year. Those products are key steps in the company’s magnet supply chain. Site preparation should start in the next few months, with commissioning expected in 2028.
Humpton called Cherokee County the “next critical link” for the company’s rare earth and magnet supply work. The South Carolina project is planned to support the Stillwater, Oklahoma, magnet plant. That plant started up its first commercial production line in March. Upstate SC Alliance
The stock was up 5.9% to $31.10 Tuesday morning after the South Carolina news, Reuters said. But shares slipped Wednesday. Investors looked at the same positive news, but also factored in possible execution risk, dilution from new government shares and warrants, and how long it might take to get new plants making money.
Rare earth stocks turned lower Wednesday. MP Materials lost 4.8%, and the VanEck Rare Earth/Strategic Metals ETF slid 3.1%. Broader indexes struggled too, with the SPDR S&P 500 ETF easing 0.5% and the Invesco QQQ Trust slipping 0.4%.
US officials are moving to reduce reliance on China for rare earths and critical minerals. The Department of Energy on Tuesday picked projects in Louisiana and Oklahoma for $134 million to extract rare earth elements from waste streams. Reuters reported that USA Rare Earth was picked in May for up to $19.3 million for a pilot processing project.
USA Rare Earth aims to set up a mine-to-magnet supply chain across the U.S., the UK, France, and Brazil. The plan involves the Round Top deposit in Texas, UK-based Less Common Metals, and its magnet operations in Oklahoma and South Carolina. USA Rare Earth also points to a planned deal for Serra Verde in Brazil.
The risks are clear. Federal funding is tied to milestones, and new shares plus warrants could mean dilution for holders. USA Rare Earth still faces the job of building, permitting, supplying and staffing big projects, and it needs to turn customer talks into signed orders. The company’s own risk section calls out commodity prices, feedstock, construction delays, demand, and integrating planned deals as possible hurdles to hitting targets.
