USA Rare Earth Rallies More than 11% - What’s Driving The Optimism?

• The French government has committed to address multiple aspects of LCM Europe's capital and operating requirements.
• LCM Europe was approved for direct credits under the C3IV program of up to 45% of all eligible equipment and up to a total of €130 million for real estate.
• Last week, Critical Metals said it has entered into a 50-50 joint venture with a Saudi Arabia-based firm to build a state-of-the-art rare-earth processing facility in the Kingdom of Saudi Arabia. 

Shares of USA Rare Earth rallied on Tuesday after it said it will build a plant in France to expand its production facilities with help from the French government.

It said that its subsidiary Less Common Metals (LCM) Europe SAS plans to develop a 3,750 metric ton per annum (mtpa) metal and alloy production facility in Lacq, France. 

The French government has committed to address multiple aspects of LCM Europe's capital and operating requirements. LCM Europe was approved for direct credits under the C3IV (Green Industry Investment Tax Credit) program of up to 45% of all eligible equipment and up to a total of €130 million for real estate, the statement said. 

The French government is also interested in providing support for hiring and training programs to bolster talent development and skills building at LCM Europe's new facility, it added. 

"The development of an integrated rare earth processing and metal-making platform in France enhances USAR's integrated rare earth value chain, to the benefit of the United States and our allies," said Barbara Humpton, Chief Executive Officer of USAR. "We are proud to establish Europe's first metal-making platform, which will accelerate the realization of a secure, sustainable transatlantic rare earth value chain."

USAR Joins The Trend

Critical metal firms are increasingly looking to increase their production levels by setting up factories outside of the country. President Donald Trump’s administration has been asking U.S. firms to increase rare earth metal production in bid to catch up and reduce the country's reliance on China which holds more than 50% of global rare earth metal. 

Critical Metals late last week said it has entered into a 50-50 joint venture with Saudi Arabia-based Tariq Abdel Hadi Abdullah Al-Qahtani & Brothers Company.

According to the agreement, the framework includes the development, financing, construction, and operation of a state-of-the-art rare-earth processing facility in the Kingdom of Saudi Arabia, thereby creating a fully integrated mine-to-processing supply chain.

How Did Stocktwits Users React?

Retail sentiment around USAR trended in ‘bullish’ territory amid ‘high’ message volumes. 

Shares of USA Rare earth have risen 58% year to date. 
 

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