US Rare Earth Stocks React to Refinery Expansion

Shares of USA Rare Earth slipped after a rival revealed a large refinery expansion, but analysts say the move underscores expanding U.S. capacity rather than signaling a sectorwide setback.

American Resources boosted its Indiana refining facility by 141%, lifting capacity to over 200 metric tons per year of rare earth material. The plant produces high-purity outputs—roughly 99.9% to 99.999%—suitable for tech and defense applications, including ultrapure oxides and other critical elements.

The expansion highlights growing domestic demand and strengthens supply-chain redundancy for critical minerals. For USA Rare Earth, the stock reaction was swift, yet the company continues to advance its rare-earth magnet production project and benefits from government programs aimed at onshoring supply.

Risks remain, notably construction and execution challenges, but many investors view the pullback as a tactical buying opportunity amid a broader growth trend. Ultimately, increased refining and magnet-production capacity across multiple U.S. firms points to a maturing rare earth ecosystem rather than displacement of individual players.