MP Materials Plummets 11 as Supply Chain Scrutiny and Processing Bottlenecks Sink Volume to 48th Rank

MP Materials (MP) closed at a 11.02% decline on Sept. 26 with a $1.36 billion trading volume, marking a 32.58% drop from the previous day's volume and ranking 48th in market activity. The stock's performance was driven by renewed scrutiny over its rare earth processing capabilities and supply chain dependencies following a third-quarter production update. A report highlighted potential bottlenecks in the Mountain Pass facility's neodymium-praseodymium (NdPr) separation process, raising concerns about meeting 2026 production targets. Analysts noted the decline reflected broader sector jitters as global trade tensions intensified, with rare earth ETFs experiencing parallel outflows.

Recent operational updates revealed a 12% sequential increase in processing capacity at the Mountain Pass mine, though this was offset by delays in commissioning the new separation unit. Management acknowledged the need for additional capital expenditures to resolve technical challenges in the hydrometallurgical stage. Market participants interpreted these developments as a potential drag on near-term EBITDA growth, particularly given the company's reliance on third-party contractors for critical components. Short-term positioning data showed a 15% increase in open interest on put options expiring in October, suggesting heightened bearish sentiment.

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