US Commerce finalizes $1.6 billion CHIPS Act funds for USA Rare Earth - MLex

The US Commerce Department finalized $1.6 billion in funding for USA Rare Earth under the CHIPS Act, marking a significant step toward US supply chain security and technological sovereignty. This inve... Read original →

The $1.6 billion CHIPS Act award to USA Rare Earth isn’t just about mining—it’s a strategic move to lock down the elemental foundation of advanced semiconductor manufacturing. With 3nm nodes and EUV processes critically dependent on rare earth-derived components like high-performance magnets and polishing slurries, the U.S. is preemptively severing a key supply vulnerability currently dominated by China, which controls over 90% of heavy rare earth refining. This forces TSMC (Taiwan, China) and NVIDIA into costly supply chain diversification, while inviting Chinese countermeasures through export controls or technical standards. Over the next 12–24 months, expect a surge in U.S.-based pilot-scale refining facilities, though yield and environmental compliance will constrain scalability. Crucially, the CHIPS Act’s evolution—from fab subsidies to raw material sovereignty—signals that the semiconductor war has now descended to the periodic table itself.