TABLE OF CONTENTS
Chromite mining in Logar Province, Afghanistan.
Los Angeles Times via Getty Images
The rare earth sector has surged, with stocks rallying on heightened geopolitical tensions and aggressive U.S. policy shifts at the start of 2026.
China’s dominant position in rare earth processing and refining has sparked a strategic scramble in Washington, with the Trump administration flagging these critical minerals as essential to national security. While rare earth mining involves extracting raw ore from the ground, the far more complex and strategically vital step is processing and refining, where China controls the vast majority of global capacity.
Federal funding is flooding into domestic mining and processing projects, while export controls from Beijing have intensified supply chain anxieties. For investors, this convergence of geopolitical rivalry, government backing, and technological demand creates a rare opportunity in an often-overlooked corner of the market.
This article examines five rare earth stocks positioned to capitalize on these dynamics in 2026. From established producers expanding vertically integrated operations to early-stage developers with strategic government partnerships, each company offers exposure to a sector that’s no longer just about mining — it’s about securing America’s technological future.
Whether you’re looking for near-term production plays or higher-risk, higher-reward development stories, these picks span the spectrum of rare earth investment opportunities as the industry enters what could be its most transformative year yet.
Why Rare Earths Are Critical In 2026 And Beyond
Rare earth elements have evolved from industrial footnotes to geopolitical flashpoints. These 17 minerals power everything from electric vehicle motors and wind turbines to defense systems and smartphones. The problem isn’t scarcity — it’s concentration. China controls roughly 90% of global rare earth processing and refining, giving Beijing enormous leverage over supply chains that underpin Western technological infrastructure. Export controls in this context function less like traditional tariffs and more like a strategic choke point, allowing Beijing to selectively restrict access to materials that are difficult, time-consuming, and costly for other countries to replace. That reality crystallized in early 2025 when China rolled out sweeping export controls covering terbium, dysprosium, samarium, and yttrium, sending shockwaves through industries dependent on these elements.
MORE FOR YOU
The response has been swift and substantial. The U.S. rare earth market, valued at roughly $82.7 million in 2024, is projected to grow at 9.5% annually toward $135 million by 2030. But it’s not just market growth driving interest — it’s policy. The Biden administration imposed 25% tariffs on Chinese rare earth magnets effective in 2026, while the Trump administration has doubled down with cumulative tariffs reaching 54% on certain Chinese goods. Department of Defense funding is backing domestic processing facilities and magnet manufacturing plants, with streamlined permitting and tax credits sweetening the deal. Exploration budgets for rare earths hit $155 million in 2025, the highest since 2012, with 80% concentrated in just four countries: Australia, Brazil, the U.S. and Canada.
Looking ahead, demand drivers remain robust. Permanent magnets for EVs, renewable energy infrastructure and defense applications continue expanding, while supply-security concerns ensure government support will persist regardless of administration changes. The industry is shifting from a China-dependent model to a fragmented, Western-backed supply chain — a transition that creates winners and losers. The companies that successfully navigate this shift, backed by federal partnerships and operational execution, stand to benefit from a multiyear tailwind as rare earths move from commodity to strategic asset.
Greenland is home to some of the richest natural resource reserves in the world, including critical raw materials such as lithium and rare earth elements that are vital for green energy technologies.
Anadolu via Getty Images
How These Rare Earth Stocks Were Picked
Selecting rare earth stocks in 2026 requires balancing operational readiness with strategic positioning. The criteria here focused on three core factors: proximity to production, government backing and vertical integration potential. Companies already producing or commissioning facilities within the next 12 months ranked higher than exploration-stage plays, though pre-production developers with clear government partnerships also cut. Federal support — whether through Department of Defense contracts, EXIM Bank financing or strategic equity discussions — served as a key differentiator, signaling projects aligned with U.S. supply chain priorities.
Vertical integration emerged as another critical lens. Rare earth mining is only the first step; separation, refining and magnet manufacturing represent where the real value and strategic importance lie. Companies building end-to-end capabilities or partnering across the supply chain received preference over single-node operators. Finally, market momentum and analyst sentiment provided context — stocks with strong year-to-date performance, institutional interest and positive price targets reflected market confidence in their execution ability and strategic value proposition in this rapidly evolving sector.
You’ll notice that all five companies currently report negative earnings, which is typical for the rare earth sector at this stage of development. Most of these operators are either ramping up production, building processing facilities or advancing pre-production projects — all capital-intensive phases that require significant upfront investment before generating positive cash flow. Mining and refining infrastructure can take years to construct and commission, while research and development, permitting costs and pilot plant operations drain resources long before the first commercial sale. Even MP Materials, the most established producer on the list, is pouring capital into downstream magnet manufacturing expansion rather than optimizing for near-term profitability. For rare earth investors, negative earnings reflect growth investment rather than operational failure, with the expectation that these losses will flip to substantial profits once facilities reach full commercial production and economies of scale kick in.
5 Rare Earth Stocks To Invest In 2026
These five stocks represent a cross-section of the rare earth value chain, from established producers to strategic developers. Each offers distinct risk-reward profiles, but all share common characteristics: exposure to U.S. supply chain buildout, alignment with government priorities and positioning in a sector where geopolitics and industrial policy are rewriting competitive dynamics.
The U.S. rare earth market, valued at roughly $82.7 million in 2024, is projected to grow at 9.5% annually toward $135 million by 2030.
Copyright 2022 The Associated Press. All rights reserved
1. MP Materials (MP)
Business Overview
MP Materials stands as the most advanced rare earth platform in the Western Hemisphere, anchored by its Mountain Pass mine and processing facility in California — the only large-scale integrated rare earth operation outside China. The company produced a record 721 metric tons of neodymium-praseodymium oxide in Q3 2025 and is targeting 60,000 metric tons of annual rare earth oxide capacity. Beyond mining, MP is developing downstream magnet manufacturing capabilities in Texas, positioning itself as a true mine-to-magnet operator. A $400 million preferred equity investment from the Pentagon in mid-2025 underscored the strategic importance of its operations to U.S. defense and technology supply chains.
Why MP Stock Is A Top Choice
MP Materials embodies the rare earth investment thesis: operational scale, vertical integration ambitions and unparalleled government support. The company’s existing production capacity and proven operational track record differentiate it from development-stage peers, while its expansion into heavy rare earth separation and magnet production addresses the highest-value segments of the supply chain. The Department of Defense partnership provides both capital and validation, ensuring MP’s role in any U.S. domestic rare earth strategy. Trading at elevated multiples relative to earnings, the stock prices in significant growth expectations, but the combination of production scale, expansion trajectory and policy tailwinds positions MP as the sector’s blue-chip play. Recent volatility following Greenland-related speculation and Trump administration mineral policy discussions has created entry opportunities for investors willing to ride geopolitical catalysts alongside operational execution.
2. USA Rare Earth (USAR)
Business Overview
USA Rare Earth is building a vertically integrated mine-to-magnet operation centered on its Round Top project in Texas and a magnet manufacturing facility in Stillwater, Oklahoma. The company accelerated its Round Top commercialization timeline by two years in late 2025, now targeting production in late 2028. Round Top contains significant deposits of heavy rare earths including dysprosium and terbium — critical elements for defense and clean energy applications. The acquisition of Less Common Metals in late 2025 added proprietary separation technology, strengthening USA Rare Earth’s ability to process diverse feedstocks and reduce dependence on specific ore sources. The Stillwater magnet plant is scheduled to begin operations in 2026, positioning the company to capture near-term demand while its mining operations ramp up.
Why USAR Stock Is A Top Choice
USA Rare Earth represents the highest-risk, highest-reward play on the list — an early-stage operator with explosive upside tied to government backing. The company’s CEO has maintained “close communication” with the Trump administration, sparking speculation about potential Department of Defense contracts or equity investment. If USAR secures federal support similar to MP Materials’ Pentagon deal, the stock could replicate MP’s triple-digit gains from 2025. Recent geopolitical developments, including U.S. military action in Venezuela and renewed interest in Greenland’s rare earth deposits, have fueled retail enthusiasm and trading volume. The core investment thesis hinges on the company’s heavy rare earth focus — elements where Chinese control is most pronounced and Western alternatives most desperately needed. The Stillwater facility provides near-term revenue potential, while Round Top offers long-duration strategic value. For investors with high risk tolerance seeking leveraged exposure to U.S.-China supply chain decoupling, USAR offers asymmetric upside if policy catalysts materialize in 2026.
3. American Resources Corporation (AREC)
Business Overview
American Resources operates through its ReElement Technologies subsidiary, which focuses on refining and processing critical minerals including rare earths. The company’s facilities in Indiana are designed to produce thousands of metric tons annually of magnet-grade rare earths, battery materials and other critical elements. ReElement’s approach emphasizes recovering rare earths from secondary sources including mining waste streams and recycling, positioning it as a circular-economy play within the critical minerals space. In early 2026, ReElement secured a $200 million equity facility with Transition Equity Partners to scale operations and fund additional refining sites domestically and internationally. The company has also partnered with international entities including South Korea and Uzbekistan to advance U.S.-allied supply chain cooperation.
Why AREC Stock Is A Top Choice
American Resources offers differentiated exposure through its refining-focused model rather than traditional mining. As the industry shifts toward onshore processing — the true bottleneck in Western rare earth supply chains — ReElement’s capabilities become increasingly strategic. The company’s ability to process diverse feedstocks, including waste streams and recycled materials, provides flexibility that pure mining operations lack. Government partnerships and the recent capital commitment signal institutional confidence in ReElement’s technology and business model. At a fraction of the market capitalization of MP Materials or USA Rare Earth, AREC represents a value play with significant upside if its refining operations scale as planned. Analysts maintain strong buy ratings with price targets suggesting more than 100% upside from current levels. The stock’s volatility and smaller market cap demand careful position sizing, but for investors seeking exposure to the critical processing segment of the rare earth value chain, AREC offers compelling risk-reward dynamics tied to U.S. onshoring trends.
Business Overview
Critical Metals is developing the Tanbreez rare earth project in southern Greenland, which contains substantial heavy rare earth deposits. The company recently commenced construction of a multi-use storage and pilot plant facility in Qaqortoq, Greenland, with the pilot plant scheduled to be operational by May 2026. Tanbreez has secured significant offtake agreements covering roughly 75% of planned production, with the company targeting completion of remaining commitments in early 2026. Critical Metals has also secured $120 million in non-dilutive financing from the U.S. Export-Import Bank, providing funding without equity dilution. The company is exploring additional partnerships, including a joint venture with Romanian state entities for refining operations, expanding its downstream integration strategy.
Why CRML Stock Is A Top Choice
Critical Metals exploded in early 2026 on renewed Trump administration interest in acquiring Greenland, with the stock surging over 100% year to date. While Greenland acquisition talk adds speculative fervor, the underlying investment case rests on Tanbreez’s heavy rare earth concentration — elements where Western supply is virtually nonexistent. Heavy rare earths command premium pricing and carry greater strategic importance for defense applications. The EXIM Bank financing provides credibility and capital efficiency, while offtake agreements demonstrate commercial viability. The geopolitical angle cuts both ways: If U.S.-Greenland relations warm, Critical Metals gains strategic significance; if tensions persist with Denmark, project execution could face headwinds. Recent volatility has created opportunities for entry, though investors must weigh speculative catalysts against operational risks. For those bullish on Greenland’s role in Western rare earth strategy and willing to embrace frontier mining exposure, CRML offers leveraged upside tied to both execution and geopolitical developments.
5. NioCorp Developments (NB)
Business Overview
NioCorp is advancing the Elk Creek Critical Minerals Project in southeast Nebraska, which will produce niobium, scandium and titanium — with rare earth production potential being evaluated. The project has secured $360 million in equity financing and recently received board approval for a Mine Portal Project, with construction expected to commence in Q1 2026. NioCorp acquired manufacturing assets and intellectual property from FEA Materials in an $8.4 million all-cash transaction, positioning the company to produce aluminum-scandium alloy master alloys as defense and commercial demand grows. The company has garnered strong local and federal support, with Nebraska leadership and EXIM Bank chairman highlighting Elk Creek as an ideal example of U.S. critical minerals development.
Why NB Stock Is A Top Choice
NioCorp represents a diversified critical minerals play rather than pure rare earth exposure, but its inclusion reflects the broader strategic value of minerals essential to defense and advanced manufacturing. The company’s focus on niobium and scandium — elements with limited U.S. production — aligns with federal supply chain priorities beyond rare earths alone. Recent analyst coverage initiation with buy ratings and price targets near $12 suggests significant upside from current levels. The Mine Portal Project represents a tangible milestone, transitioning NioCorp from planning to construction phase. The FEA Materials acquisition adds downstream integration, allowing the company to capture value beyond raw material production. Freedom Capital Markets highlighted the combination of government support, high-quality assets and long-term revenue visibility in initiating coverage. For investors seeking exposure to the broader critical minerals theme with rare earth optionality, NioCorp offers a shovel-ready project with federal backing and clear 2026 catalysts around construction commencement and production timelines.
The Bottom Line
Rare earth stocks have emerged as one of 2026’s most compelling investment themes, driven by the intersection of geopolitical tension, government policy, and technological demand. But remember: Rare earth stocks are volatile and often long‑duration investments.
The five stocks outlined above include established producers and early-stage developers, each offering distinct exposure to a sector undergoing fundamental restructuring.
MP Materials provides scale and operational certainty, while USA Rare Earth and Critical Metals offer leveraged upside tied to government partnerships and geopolitical catalysts. American Resources delivers refining exposure at the industry’s most strategic chokepoint, and NioCorp adds diversification across adjacent critical minerals. The sector carries meaningful volatility and execution risk, but for investors bullish on U.S. supply chain independence and the strategic importance of critical minerals, these stocks position portfolios to benefit from a multiyear transition away from Chinese dominance in rare earth production and processing. That opportunity comes with sharper price swings than the broader market, making rare earth equities best suited for patient investors willing to tolerate near-term volatility in pursuit of long-term strategic gains.
Read More
8 Index Funds To Consider For 2026
Stock Market Outlook 2026: What Investors Can Expect In The First 6 Months