USA Rare (USAR) Earth Falls 12.7% as Govt Picks Foreign Firm for New Deal

We recently published 10 Stocks Facing Selling Pressure Ahead of Christmas. USA Rare Earth, Inc. (NASDAQ:USAR) is one of the biggest losers on Monday.

USA Rare Earth dropped its share prices by 12.73 percent on Monday to finish at $14.87 apiece, mirroring the drop in the industry and the broader market, after the Trump administration selected a non-US-based firm as a partner to ramp up zinc production in the US.

According to Reuters, the Trump administration, through a joint venture company it formed with US-based strategic investors including JPMorgan, acquired a 10 percent stake in Korea Zinc for $2 billion, as well as a 40 percent ownership in the latter’s $7.4 billion mineral smelter in Tennessee.

The site is said to be capable of producing 540,000 tons of zinc minerals annually.

USA Rare Earth, Inc. (NASDAQ:USAR) investors took the news in a negative light, especially as the latter has been trying for months to lure the government’s backing through a potential investment.

In October this year, it can be recalled that USA Rare Earth, Inc. (NASDAQ:USAR) confirmed that it was in talks and close communications with the US government for a potential partnership, following the latter’s investment support in its counterparts, namely Lithium Americas and MP Materials.

The investment forms part of its efforts to speed up the production and capture the growing demand of rare earth minerals in the US.

USA Rare Earth, Inc. (NASDAQ:USAR) is currently developing a mine site in Sierra Blanca, Texas, and a magnet production facility in Stillwater, Oklahoma.

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Disclosure: None. This article is originally published at Insider Monkey.