US companies that have received billions of dollars in government aid from the US administration are selling rare earths to Japan and South Korea, despite efforts by the White House to create their own supply chain, the Financial Times (FT) reported, citing sources.
Rare earth products made by MP Materials, Energy Fuels and Phoenix Tailings are reportedly being sold to companies in Asia, where demand and production scale, particularly for magnets, are much higher than in the US. American demand in this sector “has not yet materialized“, experts emphasize.
According to Phoenix Tailings CEO Nick Myers, Japanese customers are eager to get their hands on the company's products, given the sharp decline in exports of these materials from China in 2026. According to him, the startup's customers are “primarily in the Republic of Korea and Japan“.
Phoenix Tailings, backed by CIA-funded venture capital firm IQT, is increasing production but is not yet a major producer and does not disclose sales figures, the publication reports. American defense contractors need to act much faster, Myers noted. For now, he plans to sell the products overseas, where “other companies pay more money faster.”
Energy Fuels, which received $725 million in targeted government funding in June, plans to increase production of rare earths and is also looking to Asia. “We will be shipping oxides to the Republic of Korea in the near future,” said CEO Ross Bapu.