In 1937, the Army guarded the first shipments of a critical resource, U.S. gold, as they were transferred into Fort Knox.

Nearly 90 years later, Washington is confronting a similar challenge with a very different resource.

The Army has selected REalloys (NASDAQ: ALOY) to build a facility that will process dysprosium and terbium at Utah’s Tooele Army Depot. Those two rare earths help keep high-performance magnets functioning in weapons, radar, sonar and electric motors.

Gold was sent to Fort Knox because the United States was unsure it could protect it from foreign threats. Rare earths now raise a comparable 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.”

According to the International Energy Agency, 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.

The Army has spent decades buying equipment that depends on those magnets. Now it has chosen one of its own bases for domestic processing of dysprosium and terbium 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, making the Tooele award more than a routine land deal.

REalloys won the dysprosium and terbium site at the 43,000-acre Tooele Army Depot.

The structure of the arrangement is straightforward: the Army keeps the land, while REalloys brings the capital, builds the facility and operates it.

That gives REalloys a different starting point for a new processing project. The company does not have to begin by identifying and securing an industrial site. The Army has already chosen one and tied it directly to a U.S. defense priority.

The Army also selected 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 under harsh conditions.

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 demonstrated the impact of that control when it placed seven heavy rare earths under export controls, along with related metals, compounds and magnets.

The effects spread quickly. U.S. and European manufacturers struggled to obtain magnets, and some reduced production or temporarily halted factory lines, according to the IEA.

Mining more ore alone could not restart those lines. Companies still needed someone to separate the material, refine it and convert it into magnet-ready products. At Tooele, the Army is targeting the part of the chain that mining alone cannot solve.

What REalloys Already Has in Place

REalloys has been producing rare-earth metals in Ohio for years and has now secured 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 reached a supply agreement with the Saskatchewan Research Council (SRC).

REalloys secured 80% of 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 per year. The expansion would also raise high-purity neodymium-praseodymium metal output from 400 tonnes to 600 tonnes.

REalloys says SRC could begin sending 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 convert dysprosium and terbium oxides into metals before they are turned into alloys at REalloys’ Ohio facility.

One Day Later, REalloys Announced $100 Million in Financing

The Army announced its conditional award for the Tooele project on June 25. REalloys closed a $100 million financing the following day.

The filing says the proceeds are for working capital and general corporate purposes, not specifically for Tooele.

Still, the Army arrangement makes the roles in the deal clear. The Army would provide the land. REalloys would provide the construction funding.

REalloys would finance and build the plant. The $100 million gives the company additional capital to work across Ohio, Saskatchewan and, if the Army finalizes the lease, Utah.

The 2027 Deadline Is Approaching

The Army’s partnership agreement comes as the Pentagon’s January 2027 sourcing deadline approaches.

On January 1, 2027, a new DFARS rule is set to take effect 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 need to trace each magnet’s origins back to the beginning, including the rare earth materials and every processing step behind them.

REalloys expects SRC to send its first qualification material in late 2026, just before the expanded rule takes effect. SRC aims to begin commercial production in early 2027.

REalloys says Tooele could enter development in 2027 and begin initial operations by or before 2028.

REalloys is not the only company 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 used in defense, electrification and advanced manufacturing.

Among the largest names 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 structurally higher copper demand. With large mining operations in Peru and Mexico, the company highlights how global electrification and grid expansion will require significant copper supply for decades.

Smaller developers are also attracting attention. NioCorp Developments (NASDAQ: NB) is advancing its Elk Creek project in Nebraska, targeting niobium, scandium and titanium, materials used in aerospace, defense and high-strength steel alloys. Idaho Strategic Resources (NYSE: IDR) is expanding its rare earth portfolio alongside its producing gold assets, positioning itself within the broader push to build 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 the company and the Army continue negotiating the historic deal, 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 selected Tooele for dysprosium and terbium with REalloys leading the project.

Fort Knox became a symbol of how seriously the United States guarded its gold. Tooele could mark the moment the military began treating rare-earth processing in the same way, as critical infrastructure to be secured on its own bases.

The United States can already mine rare earths, but it still needs companies that can separate, refine and convert them into usable material closer to home.

At Tooele, the Army has chosen REalloys for that job.

By Charles Kennedy