Exclusive: Pentagon halts rare earths funding for Lynas, MP Materials – document, sources

HOUSTON (Reuters) – The U.S. Department of Defense has reversed its decision to fund two projects to process rare earth minerals for military weapons, one of which has controversial ties to China, according to three sources and a government document seen by Reuters.

Australia’s Lynas Corp and privately held U.S. firm MP Materials both said on April 22 they had been awarded funding by the Pentagon for rare earths separation facilities in California and Texas.

The Pentagon decision is a step backward for President Donald Trump’s plan to redevelop the U.S. rare earths supply chain and reduce reliance on China, the world’s largest producer of the strategic minerals used to build a range of weapons.

(Reporting by Ernest Scheyder; additional reporting by Melanie Burton in Melbourne; Editing by Amran Abocar and Chizu Nomiyama)