USA Rare Earth Starts Hydromet Facility, Targets Heavy Rare Earth Oxides by Q3 2026

USA Rare Earth (Nasdaq: USAR) has started commissioning its hydrometallurgical demonstration facility in Wheat Ridge, Colorado, with first production of separated heavy rare earth oxides targeted for the third quarter of 2026. The company expects to become one of the few Western suppliers of dysprosium, terbium and yttrium at commercial quality.

The facility has begun an initial campaign to de-risk three processing flowsheets in parallel: ore from the Round Top deposit in Texas, third-party mixed rare earth carbonate feedstock – including material from Serra Verde's Pela Ema mine in Brazil – and rare earth magnet swarf recycling. Insights from these campaigns will feed into the Round Top Definitive Feasibility Study, due for completion in Q4 2026 and publication in Q1 2027, and will guide engineering for a planned commercial processing facility.

CEO Barbara Humpton said the hydromet facility is "the latest example of the proprietary technology and capabilities USA Rare Earth is scaling across the entire value chain." The company is building an integrated platform spanning mining, processing, metals, alloys and magnets, with operations in the U.S., U.K., France and Brazil. Its subsidiary Less Common Metals is one of the few commercial-scale metal and alloy producers outside China.

Dr. Alex Moyes, Senior Vice President of Mining and Processing, said very few companies outside China have proven they can produce separated oxides of neodymium-praseodymium, dysprosium, terbium and yttrium at commercial quality. "The work at Wheat Ridge can help convert proven chemistry into bankable feasibility studies and move us closer to producing the rare earth materials America's most critical industries depend on – from mine to magnet," he said.

The Wheat Ridge plant is fully automated with a multi-stage solvent extraction circuit, live SCADA monitoring and an on-site analytical laboratory. A team of 28 engineers, scientists and technicians operates in rotating shifts. Process data will also support a digital twin development program with the U.S. Department of Energy's National Energy Technology Laboratory, enabling virtual simulation of the full processing flowsheet.

Oxide production is expected to draw from multiple sources: Serra Verde, the only scaled producer of all four magnetic rare earths outside Asia; Round Top, one of North America's richest known sources of heavy rare earths with production targeted for late 2028; and potential third-party feedstocks. The resulting oxides are expected to feed LCM's metals and alloys production, which in turn supplies USA Rare Earth's permanent magnet business in Stillwater, Oklahoma.

The company is positioning itself as a Western-aligned alternative in a supply chain dominated by China. Heavy rare earths like dysprosium and terbium are critical inputs for permanent magnets used in aerospace, defense, semiconductors, energy, data centers and electric vehicles. The demonstration facility's ability to validate processing flowsheets at commercial quality will determine whether USA Rare Earth can move from pilot-scale to bankable project financing.

For traders tracking the rare earth supply chain, the key milestones are the Q3 2026 first oxide production, the Round Top feasibility study publication in Q1 2027, and the closing of the Serra Verde Group acquisition. Each represents a step toward the company's stated goal of operating across the entire value chain from mining to magnet manufacturing outside China.