OP-Ed: Permanent magnets are the spear in the critical minerals supply chain

This month, the Trump administration announced the launch of Project Vault, a $12 billion investment in a critical minerals stockpile to blunt America’s longstanding reliance on China.

This stockpile is a decisive step, leveraging a private-public partnership mechanism to put industry money to work at solving a national security vulnerability. But as policymakers stand up this important endeavor, they must not forget that the final gap to close is the production of permanent magnets—the spear in the critical minerals supply chain.

Permanent magnets power and propel motors, devices, and medical technology to allow for seamless, lifelong use. They drive America’s economy, sustain our Department of War, and make everyday life possible through the electrification of our daily routines.

Moving forward, permanent magnets will only grow in importance, as the technology of the future—from EVs to humanoid robots—need highly-performing permanent magnets to function seamlessly over their lifespan.

Therefore, it is critical for key decisionmakers to keep in mind the symbiotic relationship between critical minerals and permanent magnets. Behind the scenes, American magnet companies are wizards in the workshop, combining, alloying, and harnessing the raw materials for creating the ‘magnetic moments’ needed to take these materials, including light and heavy rare earths (HREEs), to yield permanent magnets that perform highly for end-use applications. Working directly with application companies, the magnets that make the market.

While many of these magnets today come from China, that is changing; US magnet makers are emerging, working intimately with the architects of the next generation of tech for transformative applications that change the world. Magnet innovators are ready to leverage Project Vault as well as budding partnerships with countries around the world—operating as the picks and shovels of the downstream supply chain.

Often lost in the conversation, however, is the innovation potential behind these magnets, where the US can be the driver of innovative magnet design that can use less critical resources or unlock new capabilities for applications without needing scarce heavy rare earth elements.

That begs the important question: What does this innovation-first approach really look like? The best approach is to let the buyers of magnets determine the pricing and demand, allowing industry to be the “pull” with the successful manufacturing of permanent magnets for their needs.

This market mechanism will not only drive value organically but also provide suppliers into the stockpile a better understanding of the supply and demand matrix and opportunity costs.

Industry knows what it wants, and industry is beginning to consider the value proposition of supply chain risk. US companies are competing against large factories in China, who have monopolized these industries using cheap labor and environmental derogation to price minerals and magnets low while flooding the market.

Therefore, this approach must be dynamic; it must diversify the types of rare earths stockpiled and the countries involved to ensure optionality, derisking supply chains.

This can come in many ways. More feedstock and supply chain optionality mean more potential for innovation, whether it be the alloying, separating, processing, or magnet-making—all aspects of an ever-complex supply chain.

Additionally, magnet materials such as samarium iron nitride (SmFeN) and manganese bismuth (MnBi) could replace significant demand in the market for displacing application risk and differentiate the US from China’s market distortions. The best offense against China is out-innovating.

America can make magnets that do more with less and differentiate from capabilities available anywhere else in the world. Behind every supply chain step, decisionmakers should keep in mind how America can differ itself from China on technology and business strategy—empowering the innovators with the tools to execute. This can leap America forward.

An innovation-first approach should consider all steps of the mine-to-magnet process, even those that could be considered blind spots. Equipment, for example, is highly in demand and necessary en masse to make magnets at scale.

Policymakers should consider these important parameters when establishing stockpiles and relationships, working with industry stakeholders to understand what is needed and how the government can facilitate this best to support US innovators.

The Trump Administration is leading an invigorated strategy for critical minerals, and this week is part of a series of pivotal steps to invigorate the situation on the ground. US magnet makers are the picks and shovels in communities across America ready to innovate, manufacture, and scale, working with governments in the process to best deliver as soon as humanly possible.

* Wade Senti is the CEO of Florida-based Advanced Magnet Lab