In 1937, the Army guarded the first shipments of a critical resource, U.S. gold, as it was transferred into Fort Knox.
Nearly 90 years later, Washington faces a similar situation with a very different resource.
The Army picked REalloys (NASDAQ: ALOY) to build a facility to process dysprosium and terbium at Utah’s Tooele Army Depot - two rare earths that keep high-performance magnets working in weapons, radar, sonar and electric motors.
Gold went to Fort Knox because America was unsure they could protect it from threats abroad. Rare earths now raise a similar question: how much of the defense supply chain can the country afford to leave overseas?
“The ability to process critical minerals on U.S. soil is a national-defense priority required for munitions, missiles, sensors, batteries, and the platforms our Soldiers depend on,” said Dr. Jeff Waksman, Principal Deputy Assistant Secretary of the Army for Installations, Energy and Environment.
“Leveraging our legal authorities and land, the U.S. Army is able to help nurture a critical minerals industrial base which equips and sustains America’s Soldiers without putting any taxpayer dollars at risk.”
China controlled about 91% of global separation and refining for magnet rare earths as of 2024 and produced roughly 94% of the world’s rare-earth permanent magnets, according to the International Energy Agency.
The Army has spent decades buying equipment that depends on those magnets. Now it has picked one of its own bases for domestic dysprosium and terbium processing in the Utah desert.
The Army Has Never Done This Before
The Army has never hosted commercial mineral processing on a U.S. installation before, which makes the Tooele award more than an ordinary land deal.
REalloys won the dysprosium and terbium site at the 43,000-acre Tooele Army Depot.
The arrangement is simple: the Army keeps the land while REalloys brings the capital, builds the facility and runs it.
For a new processing project, that changes the starting point. REalloys (NASDAQ: ALOY) would not have to begin by finding and securing an industrial site.
The Army has already picked one and tied it directly to a U.S. defense priority. It also chose the first two metals carefully.
Dysprosium and terbium help powerful magnets continue working under extreme heat. The Army uses those magnets in precision guidance, defense electronics, electric motors, sonar and radar - systems that cannot afford to lose strength when conditions get rough.
China dominates the processing behind those magnets, giving Beijing control over a part of the supply chain the U.S. defense industry cannot easily replace.
In April 2025, Beijing showed how damaging wielding that much control is when it put seven heavy rare earths under export controls, along with related metals, compounds and magnets.
The effects rippled out quickly. U.S. and European manufacturers struggled to find magnets, and some cut production or temporarily stopped factory lines, according to the IEA.
Mining more ore could not restart those lines either. Companies still needed someone to separate it, refine it and turn it into magnet-ready material. That’s why, at Tooele, the Army is going after the part of the chain that mines alone cannot fix.
What REalloys Already Has in Place
REalloys has been making rare-earth metals in Ohio for years and has now locked in processed material from Canada.
At Euclid, Ohio, REalloys produces rare-earth metals and magnet materials for the Defense Logistics Agency, the Department of Energy’s Ames National Laboratory and industrial customers, according to its latest quarterly filing.
In Canada, REalloys struck a supply deal with the Saskatchewan Research Council (SRC).
REalloys secured 80% of the annual production from SRC’s upgraded capacity and agreed to invest about $21 million in the expansion.
At full production, SRC expects the upgraded facility to produce up to 30 tonnes of dysprosium oxide and 15 tonnes of terbium oxide a year. The expansion would also lift high-purity neodymium-praseodymium metal output from 400 tonnes to 600 tonnes.
REalloys says SRC could send high-purity dysprosium and terbium oxides for customer testing as early as the fourth quarter of this year.
SRC separates and refines the material in Canada. The Tooele plant would then bring dysprosium and terbium oxides to convert them into metals before it’s turned into alloys at REalloys’ Ohio facility.
One Day Later, REalloys Announced $100 Million in Financing
The Army announced its conditional award for the project in Tooele on June 25. REalloys closed a $100 million financing the next day.
The filing directs the proceeds to working capital and general corporate purposes, not specifically to Tooele.
However, the Army deal makes their roles in the unprecedented agreement clear.
The Army would provide the land. REalloys would provide the construction money.
REalloys (NASDAQ: ALOY) would finance and build the plant. The $100 million secured through financing gives the company more capital to work across Ohio, Saskatchewan and, if the Army finalizes the lease, Utah.
The 2027 Deadline Is Closing In
The Army’s partnership agreement comes amid the Pentagon’s January 2027 sourcing deadline.
On January 1, 2027, a new DFARS rule is set to go into effect which will set new rules for neodymium-iron-boron magnets sold under covered defense contracts.
The rule bans rare earth material if China or another named country mined, refined, separated, melted or produced it, with limited exceptions.
That means defense suppliers will have to trace each magnet’s origins back to the beginning, starting with the rare earth materials and every processing step behind it.
REalloys expects SRC to send its first qualification material in late 2026, just before the expanded rule takes effect. SRC aims to start commercial production in early 2027.
REalloys says Tooele could enter development in 2027 and start initial operations by or before 2028.
REalloys is not alone in benefiting from Washington's renewed focus on critical minerals. As the U.S. works to rebuild domestic supply chains, investors are also paying closer attention to companies producing copper, niobium and other strategic metals essential for defense, electrification and advanced manufacturing.
Among the largest players is Freeport-McMoRan (NYSE:FCX), one of the world's biggest copper producers. Copper demand continues to rise alongside electric vehicles, power grids and AI-driven data centers, making established producers increasingly important to America's long-term industrial strategy.
Southern Copper (NYSE:SCCO) is another major beneficiary of the structural growth in copper demand. With large mining operations in Peru and Mexico, the company highlights how global electrification and grid expansion will require vast amounts of reliable copper supply for decades to come.
Smaller developers are also drawing interest. NioCorp Developments (NASDAQ:NB) is advancing its Elk Creek project in Nebraska, targeting niobium, scandium and titanium—critical materials used in aerospace, defense and high-strength steel alloys. Meanwhile, Idaho Strategic Resources (NYSE:IDR) is expanding its rare earth portfolio alongside its producing gold assets, positioning itself within the broader effort to establish a more resilient U.S. critical minerals supply chain.
What REalloys Has to Do Next
The Army made the Tooele award conditional, and REalloys still needs a completed lease.
But while REalloys and the Army are still negotiating the historic deal, the importance of securing rare earth materials produced at home has clearly become a top priority for Washington.
The Army has never hosted commercial mineral processing on a U.S. installation before. Now it has picked Tooele for dysprosium and terbium with REalloys leading the charge.
Fort Knox became a symbol of how seriously America guarded its gold. Tooele could mark the moment the military began treating rare-earth processing the same way, as critical infrastructure it needs to secure onto its own bases.
America can already mine rare earths, but it still needs the companies that can separate, refine and convert them into usable material and do that work closer to home.
At Tooele, the Army has chosen REalloys for that job.
By. Charles Kennedy
