Gina Rinehart, Australia’s richest person and iron ore billionaire, has made a strategic move by acquiring a 5.3% stake in MP Materials, the owner of the Mountain Pass rare earths mine in California. This investment comes as competition with China for rare earth materials intensifies, particularly in high-tech industries. Rinehart, who is also heavily invested in battery metals such as lithium, has seen MP’s share price rise by 20% over the last five days, from around $14.50 to $17.44, potentially resulting in a profit of $26 million for her.
While Rinehart’s short-term gain is significant, her long-term plans for MP and her other rare earth interests, including a stake in an emerging Australian producer and a Brazilian company, are yet to be revealed. With her substantial wealth and growing cash pile from iron ore investments, Rinehart could potentially become a key player in the western world’s rare earths industry. This game-changing move comes as Chinese dominance in the rare earths sector poses a threat, prompting efforts to develop non-Chinese sources of these critical materials.
MP Materials, with close ties to the U.S. Government, plays a crucial role in the push to develop alternatives to Chinese rare earth supplies. Earlier discussions between MP and Lynas Rare Earths, Australia’s leading producer, about a possible merger suggest potential for collaboration to create the largest source of rare earths outside China. Rinehart’s involvement as a major shareholder in MP could accelerate the merger plans between MP and Lynas, potentially integrating other assets such as Arafura Resources’ Nolans project in Australia and the Brazilian Rare Earths company in a comprehensive deal.
The increasing cooperation between the U.S. and Australian rare earths industries extends beyond production plans to government-level initiatives. A joint Critical Metals Taskforce between U.S. and Australian officials aims to map out complementary production capacities across both countries’ supply chains. Additionally, MP and Lynas are building rare earth separation plants in Texas to supply finished products to the U.S. manufacturing sector. Rinehart’s investment in MP has also boosted Lynas’ stock performance on the Australian stock exchange, reflecting the interconnected nature of the rare earths industry.
As the U.S. and Australian rare earth industries continue to evolve, major companies like MP, Lynas, and their significant shareholders like Rinehart share common goals and interests in reducing reliance on Chinese rare earth supplies. The potential merger between MP and Lynas, with the inclusion of other assets under Rinehart’s portfolio, could create a new powerhouse in the rare earths sector with significant growth opportunities. With Rinehart’s substantial financial resources and influence, she could play a pivotal role in reshaping the landscape of non-Chinese rare earth production and supply chains.
