The U.S. and Japan collaborate to develop the rare earth industry chain.

During former U.S. President Trump's visit to Saudi Arabia,Foreign exchange dealer brokers the accompanying U.S. business delegation announced a series of major investment and cooperation plans. One of the most strategically significant collaborations comes from U.S. rare earth miner MP Materials and Saudi national mining company Ma'aden.

According to a memorandum of understanding signed by both parties, the two companies will join forces to develop a complete rare earth supply chain in Saudi Arabia, covering key stages from mining, separation, and smelting of mineral resources to downstream magnet manufacturing. MP Materials CEO James Litinsky stated in a release that this collaboration will not only help reshape the global rare earth supply landscape but also promote advancements in emerging technologies such as robotics and physical artificial intelligence, further cementing the U.S.-Saudi strategic partnership.

Saudi Arabia Aims to Build a New Mining Pillar, U.S. Offers Technology and Expertise

Rare earth magnets are indispensable core components for modern transportation, energy, robotics, aerospace, and other critical technologies. Although Saudi Arabia has identified approximately 3.2 million tons of rare earth resources, accounting for 1.5% of the global total, the country still lacks capabilities in rare earth refining and technological processing, limiting industrial development. This collaboration is precisely a complement of resources and capabilities: Saudi Arabia provides ample funds, resource development rights, and geographical hub advantages, while MP Materials brings its experience in rare earth mining and some separation processes, aiming to achieve an industrial cycle from raw ore extraction to high-value-added magnet products.

However, it is widely believed in the industry that constructing a complete rare earth industrial chain is not a short-term project. Technological accumulation, talent development, equipment support, and market systems all need gradual improvement, potentially taking years or even longer to form.

China Still Dominates, U.S. and Saudi Seek a Diversified Supply Landscape

Currently, the global rare earth supply chain is highly concentrated in China. Data shows that China's rare earth reserves exceed 40 million tons, accounting for about 40% of the global total; in the smelting and separation stages, China's capacity accounts for about 90% of the global capacity. While the U.S. has certain rare earth resources, it has long relied on China for refining and processing, with MP Materials' Mountain Pass mine being a typical example.

This U.S.-Saudi collaboration is seen as an important step toward breaking the over-concentration of the rare earth supply chain and achieving diversification of critical resources. Saudi Arabia also views this project as a crucial aspect of its "Vision 2030" to promote economic diversification and build an emerging industrial base.

Trump's Saudi Visit Yields Rich Results, U.S.-Saudi Cooperation Upgraded

During this round of Trump's visit to Saudi Arabia, the two sides announced a series of collaborative plans across energy, defense, technology, mining, and other fields. According to Saudi sources, future investments in the U.S. are expected to exceed $600 billion, covering strategic reserves and development of key resources including rare earths.

Meanwhile, U.S. tech giants such as NVIDIA, AMD, Google, and Oracle also announced investment or cooperation agreements with Saudi Arabia during the visit, marking an accelerated pace in Saudi Arabia's strategic integration of global high-tech and basic resources.

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