USA Rare Earth: A Most Curious Speculation

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USA Rare Earth (USAR +8.37%) finds itself, rather delightfully, defying the prevailing gloom. While the market, in its collective wisdom, descends into a fit of bearish pique – the S&P 500 and Nasdaq Composite experiencing declines of 2.1% and 2.5% respectively – this particular stock has dared to ascend, even flirting with a 14.6% gain today. One might almost suspect a touch of rebellion, a refusal to be governed by the dreary dictates of economic common sense.

The source of this contrarian spirit? News of a mineral refining facility planned for Lacq, France. It seems even governments, in their perpetual search for strategic advantage, are susceptible to a little flattery – or, in this case, the promise of domestically sourced rare earth minerals. The U.S.’s whimsical ambition regarding Greenland, though currently stalled, merely underscores the growing desperation for alternatives. It’s a lesson in geopolitics, and a rather amusing one at that: desire, when frustrated, often seeks a different, equally improbable, outlet.

USA Rare Earth anticipates a production capacity of 3,750 metric tons of metal and alloy annually from this French venture. More significantly, the French government, in a display of admirable foresight – or perhaps a touch of national pride – is offering substantial financial support, covering up to 45% of equipment costs and a considerable 130 million euros for real estate. It’s a generous gesture, and one that reminds us that even in the cold calculus of international trade, a little patronage still goes a long way.

Is USA Rare Earth a Prudent Investment?

At a current valuation of approximately $2.5 billion, and with revenues yet to grace its balance sheet, USA Rare Earth is, undeniably, a speculation. To call it a ‘stock’ feels almost… generous. Yet, there is a certain theatrical quality to its potential. The market, as always, prefers the predictable. But it is in the unpredictable, the daring, that fortunes are truly made. To invest is to believe in a story, and USA Rare Earth, despite its current lack of earnings, possesses a narrative with a certain… allure.

Through its Less Common Metals Europe SAS subsidiary, the company is poised to receive sizable government subsidies. The French, it seems, are willing to pay a premium for supply chain security. This is not merely about minerals; it is about power, about independence. And in a world increasingly defined by strategic competition, such considerations are, shall we say, rather more valuable than mere profit margins.

China currently dominates rare earth mineral processing, controlling roughly 90% of the market. This imbalance is, of course, unsustainable. The West is awakening to the necessity of diversifying its supply chains, and USA Rare Earth, with its French foothold, is uniquely positioned to benefit. The relationship between China and Western nations, let us be frank, is unlikely to improve dramatically. And in such circumstances, a little self-reliance – and a strategically placed mineral processing plant – can prove remarkably lucrative. To invest in USA Rare Earth, therefore, is not simply to gamble on a stock; it is to place a bet on a geopolitical shift. A most curious speculation, indeed.

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2026-01-21 00:04