In an effort to lessen its reliance on China, the US government will invest in a startup that specializes in rare earth processing, the business revealed on Monday.
According to North Carolina based Vulcan Elements, the US government will collaborate with private investors who will contribute $550 million to the company's capital.
Vulcan shares worth $50 million will be given to the federal government in exchange for a $620 million loan and a $50 million grant.
For complex electrical components used in a variety of industries, such as automotive, electronics, and defense, rare earth elements are crucial.
In a press release on Monday, Commerce Secretary Howard Lutnick stated, "We are laser focused on bringing critical mineral and rare earth manufacturing back home, ensuring America's supply chain is strong, secure, and perfectly reliable."
The world's top producer of these minerals is China. Since April, it has impacted international manufacturing sectors by requiring licenses for certain shipments of the commodities.
In recent trade talks between the United States and China, rare earths have been a major topic of contention. Washington has accused Beijing of delaying the issuance of export licenses.
