A recent announcement that the Pentagon recently placed the largest drone order in American history — 30,000 one-way attack drones, with plans to scale past 300,000 by early 2028 suggests the importance of a Stillwater manufacturing plant.
As oilprice.com explained, the historic drone order has a major problem—-every one of the drones runs on a rare earth magnet. But Goldman Sachs claimed that roughly 98% of the world’s magnets are manufactured in China.
It’s a possibility where USA Rare Earths fits in, and if nothing else, emphasizes the importance of the company and its magnet manufacturing plant in Stillwater. In April, the company announced a $1.8 billion cash-and-stock acquisition of Brazilian rare earths miner Serra Verde. The announcement followed a $1 billion government funding of USA Rare Earth in its push for rare earth mineral development. The Commerce Department announced in January the commitment and USA Rare Earth CEO Barbara Humpton said it “represents a transformational step in delivering on our ambition to build a global champion and the partner of choice in rare earth elements, oxides, metals and magnets.”
Days later, USA Rare Earth’s President Barbara Humpton said her firm’s recent $2.8 billion acquisition of a mining operation in Brazil will eventually make the company and its magnet producing operation in Stillwater a leader in the rare earth industry worldwide and reduce dependency on China.
Interviewed on the Fox program, Mornings with Maria, she said the deal with the Serra Verde’s Pela Ema mine is a one-of-a-kind asset and the only producer outside Asia capable of
supplying all four magnetic rare earths at scale.
“And this is why USA Rare Earth is emerging as the leader, the global leader in the rare earth space, because we’re pulling together those links in the value chain, allowing each link to scale. Once we hit scale, we’ll be leading the pack.”
She said the company’s plant in Stillwater has started production of magnets which are used in high technology around the globe.
The company’s magnet manufacturing effort could be important in the Pentagon’s drone request. Here’s how. Magnets are considered critical for drones because they enable lightweight propulsion using brushless motors that deliver superior torque-to-weight ratios. They provide precises and stable flight through navigation sensors (magnetometers). The high grade rare earth magnets, such as neodymium are critical for speed, responsiveness and thermal stability in modern UAVs.
But as OilPrice.com reported, to understand why the Pentagon is moving this aggressively, you have to look at what happened in Ukraine. Over the past two years, drones have fundamentally reshaped modern combat like no other technology since the machine gun. Ukraine built over 1.2 million of them in 2024 alone.
The magnets that powered nearly every single one came from China. That means that one move from China could potentially shut down the military of major countries in the West.
