The new US-China battle is being fought not only with tariffs and technological restrictions, but in the mines and processing plants of rare earths. Washington is attempting to break Chinese dominance in critical strategic materials, placing REalloys at the forefront of an ambitious plan to create an American production chain from ore to magnet. The US military has placed REalloys at the center of the American effort to reconstruct the supply chain of heavy rare earths, selecting the company to construct and operate the first commercial critical minerals processing plant inside a US military facility. REalloys plans to construct a heavy rare earths processing complex at the Tooele Army Depot in Utah, which will be able to refine dysprosium and terbium—two of the most strategically important rare earth elements used in high-temperature permanent magnets for defense systems.
For the first time, Oilprice.com notes, commercial processing of critical minerals is being integrated directly into the US national security infrastructure. The Tooele platform is expected to support the US Army, the Defense Logistics Agency, the Department of Energy, and NASA, placing REalloys at the center of one of the country's most important strategic industrial facilities. The commercial development of the plant is expected to begin in 2027, while the initial operational capacity is projected to be achieved by 2028 at the latest. This timeline is designed to coincide with the federal procurement ban on Chinese rare earth materials used in US defense systems, which takes effect on January 1, 2027. REalloys expects to fund, construct, and operate the facility through an Enhanced Use Lease structure, creating a commercial processing platform on federal military land, while ownership, financing, and operations will remain within the private sector.
Why the Pentagon chose REalloys
Much of REalloys' heavy rare earths platform had already been established when the Army selected the company for the Tooele project. Over the past two years, REalloys has secured raw material agreements, processing rights, metallization technology, and downstream production capacity, aiming to create—through its partnership with the Saskatchewan Research Council—the largest heavy rare earths metallization facility outside of China. The company has committed approximately $20.6 million toward upgrading the Saskatchewan Research Council's rare earths processing facility, securing exclusive off-take rights for 80% of the plant's expanded output, including NdPr metal and oxides of dysprosium and terbium.
Access to rare earths production becomes the new strategic advantage
The initial commercial production of the Saskatchewan Research Council remains scheduled for early 2027, with REalloys constructing a dedicated heavy rare earths metallization facility for dysprosium and terbium. Engineering design is already underway, procurement of key equipment has commenced, and qualification materials are expected by the fourth quarter of 2026. This offers REalloys something that few companies in the Western rare earths industry can claim: access to separated heavy rare earths production, a clear path to metallization, and a US manufacturing base in Euclid, Ohio. The company has also secured long-term feedstock sources, including a definitive off-take agreement for 15% of Phase 1 production from Critical Metals' Tanbreez project in Greenland. Simultaneously, it has entered into a strategic alliance and off-take agreement tied to the Sheep Creek rare earths deposit in Montana, as well as a proposed supply framework with Ramaco Resources for rare earth material found in coal deposits from the Brook Mine platform in Wyoming.
Washington builds an industry from scratch against China
Over the past year, Washington has imposed procurement restrictions, awarded defense contracts, backed commercial processing, accelerated qualification programs, and is now opening the gates of a US military facility to commercial rare earths production. These moves are reshaping an industry that until a few years ago sat almost exclusively outside of China. Creating a domestic rare earths chain requires much more than simply opening new mines. The ore must first be mined and concentrated before being chemically separated into individual rare earth elements. Subsequently, the materials are processed into high-purity metals, specialty alloys, and ultimately into permanent magnets that power everything from precision weapons and fighter jets to electric motors, radar systems, and naval platforms.
The battle goes beyond the rare earths sector itself
President Trump invoked the Defense Production Act to address bottlenecks in the US defense industrial base, citing limited manufacturing capacity, fragile supply chains, and long-standing dependencies. This week, President Trump met with the executives of Lockheed Martin, RTX Corporation, Boeing, Northrop Grumman, General Dynamics, and L3Harris Technologies, as the administration pushed the defense industry to accelerate production and replenish US weapons stockpiles. Lockheed Martin, through its F-35 fighter jet, has significant exposure to the use of rare earths. This aircraft alone contains more than 900 pounds of rare earth materials, including approximately 50 pounds of samarium-cobalt magnets designed to maintain performance under extreme temperatures. RTX faces a corresponding reliance through its Patriot missile system, as well as its radar and electronic warfare production lines, which utilize high-purity dysprosium and terbium. These inputs remain tied to Chinese processing chains—the exact bottleneck that REalloys' Tooele complex aspires to eliminate. Northrop Grumman faces a similar challenge with the B-21 Raider bomber, as well as with radar and space surveillance programs, such as the Deep Space Advanced Radar Capability. Like Lockheed Martin and RTX, it must prove that its magnet supply chain does not include Chinese materials by 2027, or it risks losing eligibility for specific defense contracts.
The countdown to 2027 has already begun
The new procurement restrictions of January 1, 2027, require covered defense systems to utilize compliant rare earth materials and permanent magnets. Compliance is not merely about finding new suppliers. Rare earth oxides, metals, alloys, and permanent magnets must be certified before entering defense production—a process that can take months or even years, depending on the application. This process is already underway. REalloys is expected to launch its military-grade heavy rare earths certification efforts by the end of 2026, allowing potential customers to validate dysprosium, terbium, and other North American-produced materials before the critical January 2027 deadline. The result is one of the most ambitious industrial reconstruction efforts the United States has attempted in decades—and REalloys sits squarely at its center.
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