Yulia Slavina

U.S. establishes 10-year rare earths pact with MP Materials, Alec Stapp notes

U.S. establishes 10-year rare earths pact with MP Materials, Alec Stapp notes
U.S. partners with MP Materials

Alec Stapp, industry influencer, reports that China is responsible for processing over 90% of the world's rare earths. To address this imbalance, the U.S. has recently entered into an agreement with MP Materials. The deal includes a 10-year price floor, guaranteed purchases, preferred equity, and warrants granting a 15% ownership stake to the U.S.

However, Stapp highlights that there are concerns and problems related to this arrangement.

Stapp has previously commented on policy-driven disruptions in commodity markets. He reported that Sri Lanka’s 2021 crop policy led to a 20% decline in rice output and $425 million in tea losses. The policy also pushed 500,000 people into poverty, according to Stapp’s analysis.

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