MP Materials Shares Plunge 9.42% Intraday, 11.18% in Two Days as New Partnership Sparks Oversupply Fears

The share price fell to its lowest level since July 2025 today, with an intraday decline of 9.42%. The stock has now dropped 11.18% over two trading days, marking its sharpest selloff since the company’s 2022 market debut.

The decline followed a $1.4 billion partnership announced by two U.S. startups, Vulcan Elements and ReElement Technologies, to produce rare-earth magnets with government and private backing. The move intensifies competition for MP Materials, the sole active rare-earth magnet producer in the U.S., which faces pressure to defend its market position as new entrants gain access to public and private capital. The partnership aims to replicate MP Materials’ production of neodymium-iron-boron and samarium-cobalt magnets, critical for electric vehicles, wind turbines, and defense applications, raising concerns about capacity oversupply and pricing pressures.

Broader industry dynamics also weigh on the stock. The global rare-earth elements (REE) market is projected to grow at 6.29% annually through 2030, driven by demand for electrification and advanced manufacturing. However, U.S. tariffs on imported REEs, introduced in 2025, have increased sourcing costs and forced companies to prioritize domestic production. While MP Materials benefits from this shift, it must navigate supply chain bottlenecks and invest in recycling technologies to remain competitive. Geopolitical risks, including China’s dominance in REE processing, further complicate efforts to localize supply chains. Analysts note that MP Materials’ ability to scale production, secure raw materials, and adopt sustainable practices will be critical to sustaining its leadership in a rapidly evolving sector.