Key facts
- The U.S. Army has chosen REalloys to establish a rare earth processing facility at the Tooele Army Depot in Utah.
- The facility will focus on processing dysprosium and terbium, critical for high-performance magnets used in defense systems.
- This initiative aims to reduce U.S. reliance on China, which controls a significant portion of global rare earth processing.
- REalloys will finance, build, and operate the plant, while the Army provides the land.
- The project aligns with a new Department of Defense rule set to take effect in January 2027, restricting rare earth materials from certain countries.
- REalloys has secured processed material from Canada through a deal with the Saskatchewan Research Council (SRC).
The U.S. Army is taking an unprecedented step by partnering with REalloys to establish a rare earth processing facility on its land at the Tooele Army Depot in Utah. This initiative addresses national defense concerns over the U.S. reliance on China for critical minerals, particularly dysprosium and terbium, which are essential for high-performance magnets used in advanced weaponry, radar, sonar, and electric motors.
Dr. Jeff Waksman, Principal Deputy Assistant Secretary of the Army for Installations, Energy and Environment, stated that processing critical minerals on U.S. soil is a national-defense priority. The Army is leveraging its land and authorities to help build a domestic industrial base without risking taxpayer dollars. China currently dominates global rare earth separation and refining, controlling approximately 91% of magnet rare earths and producing about 94% of rare-earth permanent magnets, according to the International Energy Agency (IEA).
This arrangement marks the first time the Army has hosted commercial mineral processing on a U.S. installation. REalloys will bring the capital, build, and operate the facility on the 43,000-acre depot. Dysprosium and terbium are crucial because they enable magnets to function under extreme heat, a necessity for precision guidance systems, defense electronics, and other critical military applications. The vulnerability of this supply chain was highlighted in April 2025 when China imposed export controls on several heavy rare earths, causing disruptions for U.S. and European manufacturers.
REalloys already has existing rare-earth metal production in Ohio and has secured a supply deal with the Saskatchewan Research Council (SRC) in Canada. The SRC expansion, in which REalloys is investing approximately $21 million, is expected to produce up to 30 tonnes of dysprosium oxide and 15 tonnes of terbium oxide annually. SRC will separate and refine the materials in Canada, which will then be sent to REalloys' Tooele plant to be converted into metals before final processing in Ohio.
Following the Army's conditional award announcement on June 25, REalloys closed a $100 million financing round the next day, which will support its operations across Ohio, Saskatchewan, and potentially Utah. The project is under pressure to meet a January 1, 2027, deadline, when a new DFARS rule will ban rare earth material for defense contracts if it was mined, refined, separated, melted, or produced in China or other named countries. REalloys anticipates SRC will provide qualification material by late 2026, with commercial production starting in early 2027. The Tooele facility is projected to begin initial operations by or before 2028.
Other companies are also benefiting from the U.S. push for domestic critical mineral supply chains, including copper producers like Freeport-McMoRan and Southern Copper, niobium developer NioCorp Developments, and Idaho Strategic Resources, which is expanding its rare earth portfolio.