So Trump just dropped $12 billion on something called “Project Vault,” and suddenly everyone’s talking about rare earth stocks like they’re the next Bitcoin. Spoiler alert: they’re not. But they might actually be more interesting.
Here’s the deal: America has been basically outsourcing its mineral supply chain to China for decades. You know, those little elements with names like neodymium and dysprosium that sound like rejected Pokémon but actually power everything from your iPhone to military drones. China controls about 70% of mining and 90% of processing. That’s… not great when you’re trying to build AI data centers and electric cars without asking Beijing for permission.
Enter Project Vault, which is basically a Strategic Petroleum Reserve but for rocks. The government is committing to buy $12 billion worth of these materials, which sent Critical Metals Corp (CRML) up 35% in one day. When Uncle Sam starts writing checks, investors pay attention.
The Players Worth Watching
MP Materials (MP) runs America’s only functioning rare earth mine in California. They’re like that one friend who actually has their life together while everyone else is still figuring it out.
USA Rare Earth (USAR) is developing a project in Texas focused on the heavy rare earths used in military stuff. Energy Fuels (UUUU) processes these materials in Utah, and Critical Metals Corp (CRML) has a deposit in Greenland because apparently we’re mining everywhere now.
But here’s where it gets interesting: this isn’t just about the miners. Companies like Caterpillar (CAT) make the equipment, Fluor (FLR) builds the processing facilities, and Olin (OLN) supplies the specialized chemicals. It’s like investing in the entire ecosystem of “let’s not depend on China for everything.”
Reality Check Time
Before you YOLO your portfolio into mining stocks, remember this isn’t happening overnight. We’re talking 3-7 years before meaningful domestic capacity comes online. Mining projects are like that friend who says they’ll be ready in 10 minutes but shows up an hour later – except with more environmental permits and hundreds of millions in capital requirements.
What’s changed isn’t the timeline but the risk profile. Federal backing means these companies can actually get financing and have predictable customers. It’s the difference between starting a lemonade stand and starting one where the government pre-ordered $12 billion worth of lemonade.
The Bottom Line
This isn’t about chasing the next commodity boom – it’s about positioning for a long-term shift in how America thinks about supply chains. Rare earths are embedded in AI infrastructure, EV motors, renewable energy, and defense systems. As these sectors grow, companies that can mine and process these materials outside of Chinese control could benefit from sustained policy support.
Both parties agree that supply chain security is important, which in today’s political climate is basically a miracle. Whether the U.S. can actually rebuild domestic capacity remains to be seen, but at least now there’s $12 billion betting it can.