The Office of Strategic Capital has announced a joint $700 million conditional loan commitment with Vulcan Elements and ReElement Technologies to expand domestic Neodymium Iron Boron, or NdFeB, magnet production.
Hear keynote speaker Emil Michael at the Potomac Officers Club’s 2026 Defense R&D Summit on Jan. 29, where top defense leaders, researchers and innovators will explore the technologies shaping future warfighting. Register now!
How Will Vulcan Elements & ReElement’s OSC Loan Impact US Magnet Supply Chain?
The funding will expand U.S. capabilities in advanced rare earth element separation, metallization and magnet production, the Department of Defense said Friday. Vulcan will receive $620 million and ReElement $80 million to expand domestic manufacturing. The loans will enable the companies to produce up to 10,000 metric tons of NdFeB magnet material in the coming years, addressing a significant gap in the U.S. magnet supply chain.
How Are the OSC Loans Funded & Supported?
The conditional loans are funded through the One Big Beautiful Bill Act, which authorizes up to $100 billion for critical minerals projects. Under the agreement, the Department of Defense will receive warrants from Vulcan and ReElement. The Commerce Department’s CHIPS Program Office also signed a preliminary, nonbinding letter of intent for $50 million in equipment purchase incentives and will receive $50 million in equity from Vulcan Elements.
Remarks From DOD R&E Under Secretary Emil Michael
“These OSC conditional commitments build on the swift and decisive actions taken by the Trump Administration to secure a domestic supply chain for the magnets used in chip manufacturing, drones, electric vehicles, fighter jets, industrial motors, nuclear submarines, and satellites,” said Emil Michael, under secretary of defense for research and engineering.
