REalloys Inc.

REalloys shares jumped 13.7% today after the rare-earth company reported second-quarter 2026 financial results. Revenue grew 83% year-over-year to $0.8 million, driven by PMT Critical Metals, which REalloys acquired in March, selling rare-earth metals and materials from its Euclid, Ohio facility. The company posted a net loss of $36.8 million, wider than the $2.2 million loss a year earlier, largely due to $32.1 million in non-cash stock-based compensation. REalloys also said it has fully funded the planned upgrade of the SRC Rare Earth Processing Facility, where it plans advanced separation trials using recycled mixed rare-earth oxide feedstock before year-end, ahead of commercial intake of neodymium-praseodymium metal and dysprosium/terbium oxides in the third quarter of 2027.

REalloys has signed a strategic agreement with permanent magnet manufacturer JS Link to develop one of the first fully integrated non-Chinese rare earth magnet platforms, bringing together feedstock, separation, metallization, and permanent magnet manufacturing under a single North American industrial strategy. The deal adds finished magnet manufacturing to REalloys' existing chain, which already includes a $20.6 million expansion of the Saskatchewan Research Council's rare earth processing facility with preferred rights to up to 80% of its output, a dedicated heavy rare earth metallization facility expected to produce qualification-scale materials in the fourth quarter of 2026, and secured feedstock from projects in Greenland, Montana, and Wyoming. The agreement follows REalloys' selection by the U.S. Army for exclusive negotiations to develop heavy rare earth processing at the Tooele Army Depot in Utah, positioning the company ahead of the Department of Defense's January 1, 2027 ban on Chinese-origin rare earth magnets. CEO Lipi Sternheim stated that strategic advantage belongs to the country that builds the magnets, and that capability is now being built in the United States.

The U.S. Army has selected REalloys to build and operate heavy rare earth processing facilities at the Tooele Army Depot in Utah, marking the first time a commercial mineral-processing facility has been placed on an American military base. The company closed a $100 million private placement, giving it roughly $130 million in cash, and was added to the Russell 3000 Index. REalloys also secured feedstock agreements covering billions of tonnes of rare earth-bearing material from sources in Wyoming, Appalachia, and Greenland, and signed a strategic partnership with South Korean magnet manufacturer JS Link. The company has initiated qualification of defense-grade heavy rare earth materials ahead of a Pentagon procurement deadline on January 1, 2027, that will restrict Chinese-origin rare earth materials in U.S. weapons systems.

Pentagon suppliers warn that the United States will not have sufficient domestic processing and magnet manufacturing capacity by the January 1, 2027 deadline, potentially forcing the Trump administration to extend access to Chinese rare earth materials. Industry executives told Reuters that despite billions of dollars in federal support for new mines, separation facilities, and downstream manufacturing, U.S. capacity remains insufficient to meet military and commercial demand. The shortage centers on neodymium-iron-boron and samarium-cobalt magnets, which rely on rare earth supply chains still dominated by China. Companies including MP Materials, USA Rare Earth, Lynas Rare Earths, Energy Fuels, and REalloys are investing heavily, with several projects expected to begin commercial production within 18 months, but executives say they cannot fully replace Chinese supply by early 2027. Beijing's tighter export controls and expanded traceability regime have further strengthened its grip on global magnet feedstocks.

The U.S. Army has selected REalloys to build and operate the first-ever commercial critical mineral processing operation on a U.S. military installation. The company plans to construct a heavy rare earth processing complex at the Tooele Army Depot in Utah, capable of refining dysprosium and terbium, two strategically important elements used in high-temperature permanent magnets for defense systems. Commercial development is targeted to begin in 2027, with initial operating capability expected no later than 2028, aligning with the January 1, 2027, federal procurement ban on Chinese rare earth materials in American defense systems. REalloys will finance, build, and operate the facilities under an Enhanced Use Lease structure, keeping ownership and operations in private hands. The project builds on the company's existing platform, which includes feedstock agreements, processing rights, metallization technology, and a partnership with the Saskatchewan Research Council for what is expected to become the largest heavy rare earth metallization facility outside China.

REalloys has closed its previously announced private placement, raising aggregate gross proceeds of approximately $100 million before fees and expenses. The company sold 7,017,540 shares of common stock at $14.25 per share. Clear Street acted as the sole placement agent. REalloys intends to use the net proceeds for working capital and general corporate purposes.

China's escalating export restrictions on heavy rare earths threaten to replicate the 2,600% price surge seen in antimony after Beijing banned its shipments, with U.S.-based REalloys positioning as a key non-Chinese supplier. Following antimony's spike from $1,400 to $38,000 per ton and a 97% drop in U.S. imports, China has imposed export licensing on seven heavy rare earth elements including dysprosium and terbium, and restricted rare earth processing technology. Terbium prices have already risen 103% this year, while non-Chinese dysprosium and terbium trade at three to four times Chinese domestic prices. REalloys holds an exclusive 80% offtake from North America's only non-Chinese heavy rare earth processing plant, operates a metallization facility in Ohio, and sources feedstock from the U.S., Canada, Brazil, Kazakhstan, and Greenland, avoiding Chinese inputs entirely. With Pentagon DFARS rules banning Chinese-origin rare earths from the defense supply chain starting January 1, 2027, and demand for rare earth magnets expected to triple by 2030, the company recently closed a $50 million offering to build the largest heavy rare earth metallization facility outside China and appointed a former Pentagon Chief of Staff as advisory board chair.