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MP Materials Faces Market Challenges Despite Growth Potential
MP Materials (NYSE: MP), the only major U.S. source of rare earth metals, has seen its stock fall approximately 34% from recent highs amid shifting U.S.-China trade relations. In mid-October, MP’s stock surged over 500% for the year, driven by concerns over China’s export controls on rare earth elements. However, as signals of a potential truce between the U.S. and China surfaced, investor optimism waned.
The Pentagon has invested $400 million in MP, making it a key player for national security and future profitability. The Department of Defense secured a 10-year price floor of $110 per kilogram for neodymium-praseodymium, compared to $79 per kilogram in September. Partnerships with major firms like Apple also bolster MP’s growth trajectory, as the tech giant invested $500 million to help establish a second magnet factory.
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