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

The US Commerce Department finalized $1.6 billion in CHIPS Act funding for USA Rare Earth, marking a significant step in America's strategic push to secure critical rare earth supply chains. This inve... Read original →

The $1.6 billion CHIPS Act award to USA Rare Earth isn’t just about mining—it’s a strategic play to secure heavy rare earths critical for sub-3nm nodes and EUV-based manufacturing. Dysprosium and terbium are indispensable for advanced magnets in semiconductor tools, yet over 90% of global refining capacity resides in China. This move forces TSMC (Taiwan, China) and NVIDIA into costly supply chain re-engineering, elevating compliance burdens. Beijing may retaliate via export controls, risking further tool delivery delays. Over the next 12–24 months, Washington will push ‘friend-shored’ mining alliances, but high-purity separation tech remains a bottleneck—U.S. output won’t scale before 2027. The real tail risk? Geopolitical friction is migrating upstream: chip security now hinges on mineral security. Without breakthroughs in hydrometallurgy and green refining, ‘de-risking’ is merely strategic theater.