STILLWATER, Okla. — Oct. 12, 2026 (The Oklahoma Post)
USA Rare Earth shares closed Friday at $12.56, more than $4.50 below the $17.17 a share the federal government agreed to pay for its stake in the company.
The stock (Nasdaq: USAR) has lost about 26% over the past month and sits about 71% below its 52-week high of roughly $44. The decline now reaches taxpayers, who became shareholders under a deal finalized in June.
What the Government Bought
In January, Commerce’s CHIPS Program Office signed a letter of intent with USA Rare Earth worth about $1.6 billion. The package includes:
- $277 million in federal funding, in exchange for 16.1 million shares of common stock at $17.17 each
- Warrants for about 17.6 million more shares, also at $17.17
- A $1.3 billion senior secured federal loan at market rates
The company said the arrangement would give Washington an ownership stake of 8% to 16%, depending on whether the warrants are exercised. Unlike the government’s earlier deal with rival MP Materials, this one included no price floor or guaranteed purchases. The deal was finalized on June 3, with funding released in phases as the company hits milestones.
When the deal was announced, USAR traded near $25, and early coverage described an implied paper gain of roughly $490 million for the government.
The Paper Loss Today
At Friday’s closing price of $12.56, the 16.1 million shares the government agreed to buy for about $277 million are worth roughly $202 million; a paper loss of about $74 million, or 27%.
The warrants are also underwater. They only have value if USAR trades above $17.17.
Private investors who joined alongside the government fared worse. The $1.5 billion private placement that was a condition of the federal deal sold 69.8 million shares at $21.50 each. At Friday’s close, those shares are down about 42%.
These are paper losses. The government has not sold, and the value will rise or fall with the stock. Mean very little to the government. Means the world to a day trader.
Stillwater and Oklahoma Taxpayers Have a Stake Too
Washington is not the only government backing the Stillwater plant. The city of Stillwater and the state of Oklahoma did not buy stock, so the falling share price does not directly cost them money. Instead, they gave the company cash incentives and tax breaks in 2022, when it chose a vacant building at 100 W. Airport Road for its magnet factory. Those incentives depend on the company keeping its promises.
City of Stillwater via Will Joyce: $7 million in cash, plus tax breaks. In June 2022, the Stillwater City Council, acting as the Stillwater Economic Development Authority, approved a tax increment financing agreement providing up to $7 million in upfront development financing, according to the company’s SEC filings. The company had received the full $7 million by 2025. The deal also returns 90% of the new property taxes the plant generates back to the company, and the authority approved a five-year property tax exemption in November 2023. USA Rare Earth paid $9.9 million in cash for the building, with the city listed as first lien holder.
In exchange, the company agreed to invest about $140 million in the facility, hit employment and median-pay targets, begin certain phases of development by March 31, 2026, and complete them by June 30, 2027. If it defaults, the authority can terminate the agreement and demand the $7 million back in full. As of Dec. 31, 2025, the company’s annual report said the required investment and employment obligations had not yet been met.
State of Oklahoma: $1.2 million paid, up to $2.8 million more. In April 2022, the Oklahoma Department of Commerce awarded the company $1.2 million from the Governor’s Fund to renovate the building. The money was paid in full and must be repaid if the company falls short on investment, headcount or pay standards. The state also accepted the company into the Quality Jobs Program, which can rebate up to 5% of new payroll for up to 10 years, capped at about $2.8 million. As of 2025, the company had not yet become eligible to claim those rebates.
All told, local and state taxpayers have put in about $8.2 million in cash so far, plus tax breaks and potential future rebates.
When the deal was announced in 2022, Stillwater Mayor Will Joyce called the factory a big win for the city, and Gov. Kevin Stitt said it would help diversify the state’s economy. The plant was then expected to start production in 2023 with 100 jobs. Commercial production began in 2026, and the company reported about 140 employees in Stillwater as of August.
The key local deadline is June 30, 2027, when the Stillwater buildout must be complete under the city agreement. Goal-line moved again.
Why the Stock Keeps Falling
The Oklahoma Post found no company-specific announcement behind the past week’s decline. The broader pressures identified in our earlier reporting continue:
- Dilution. The Serra Verde acquisition, completed Sept. 3, added about 126.8 million new shares. Those shares were registered for resale in mid-September, creating an overhang.
- A sector-wide selloff. In the month to Sept. 28, MP Materials fell 21% and the main rare earth ETF fell 17%, as hopes of easing U.S.-China tensions cut the premium on domestic producers.
- Leadership change. Thras Moraitis became CEO on Oct. 1, the company’s third chief executive in about two years.
- No Stillwater magnet sales yet. First sales from the Oklahoma plant are targeted for year-end.
An upcoming date could move the whole sector: China’s yearlong suspension of its October 2025 rare earth export controls is set to expire Nov. 10.
Since The Oklahoma Post Began Reporting
The table below tracks 16 Oklahoma Post reports on USA Rare Earth since February 2025. Measured against Friday’s close of $12.56, the stock trades below where it stood on the day of every Oklahoma Post report since August 2025. It trades above where it stood for the first two.
The steepest drops follow the two biggest moments of investor enthusiasm. Shares closed at $26.72 the day the Commerce Department deal was announced in January and at $28.19 the day MP Materials filed its lawsuit in May. Both have since lost more than half their value. From the stock’s highest close, $38.68 on Oct. 13, 2025, it has fallen about 68%.
Closing prices from Yahoo Finance historical data. *The Feb. 11, 2025, figure is the price of Inflection Point Acquisition Corp. II, the blank-check company that merged with USA Rare Earth and began trading as USAR in March 2025. †Published on a weekend or market holiday; figure is the prior trading day’s close.
The Conflict-of-Interest Questions
The deal has drawn scrutiny in Congress since it was announced.
In March, Rep. Zoe Lofgren, the top Democrat on the House Science Committee, called the deal “highly concerning” in a letter to Commerce Secretary Howard Lutnick. She objected to terms that, she argued, would let the government keep its equity stake even if it never delivered the funding. She also objected to the deal’s reliance on a private stock sale led by Cantor Fitzgerald. Yes, that Cantor Fitzgerald: the firm Lutnick ran for more than 30 years, now led by his sons.
Picture the trade every insider understands. Sell at $12. Buy back at $6. Insiders who got founder shares for less than a penny win either way. If Washington’s dealmakers spoke plainly, the motto would write itself: we will all be stinking rich. Taxpayers who paid $17.17 and institutions that paid $21.50 are not in on the joke.
In July, Sens. Elizabeth Warren, Ron Wyden and Chris Van Hollen joined Lofgren in a new probe, writing to Cantor and USA Rare Earth about potential conflict-of-interest and bribery-law concerns. They asked for answers by July 23. USAR shares fell 8% the day that probe was reported.
Cantor has said it had no role in the company’s negotiations with or financing from the government. Then-CEO Barbara Humpton told Reuters in April that shareholders should not be concerned about the deal’s terms, and noted that Cantor had worked with the company since it went public in 2025.
Who Signed Off
No single official caused the stock’s slide. But every public dollar behind USA Rare Earth traces to a specific decision by a specific government and to the officials who championed it.
In Stillwater: Mayor Will Joyce. The $7 million incentive was approved in June 2022 by the Stillwater City Council, sitting as the Stillwater Economic Development Authority, with Joyce as mayor. Joyce, who has led the council since 2018 and began a third term this year, publicly backed the project at its announcement, saying the company’s arrival would be a catalyst for economic development. The plant he helped land was promised for 2023 with 100 jobs. It began commercial production in 2026 and has yet to report a magnet sale.
Meanwhile, anyone who drives Stillwater knows the roads and intersections the city has not fixed. Land that once ringed the city as open green space has given way to industrial development.
In Washington: the Trump administration. The federal stake was negotiated by the Commerce Department under Secretary Howard Lutnick, President Donald Trump’s appointee, as part of the administration’s push to take equity stakes in critical-minerals companies. The administration agreed to buy in at $17.17 a share. That stake is now about $74 million underwater on paper. Lutnick’s former firm, now run by his sons, was placement agent for the private stock sale required to close the deal.
The $1.5 Billion Sale
The federal deal leaned on a second transaction. USA Rare Earth closed a $1.5 billion private stock sale on Jan. 29, selling about 69.8 million shares at $21.50 each to institutional investors. Cantor Fitzgerald was lead placement agent. Moelis was co-placement agent. Completing the sale was a condition of the Commerce Department’s investment, according to Lofgren.
The sale was anchored by Inflection Point, the investment firm behind Michael Blitzer’s blank-check company that took USA Rare Earth public in March 2025. Blitzer is now the company’s executive chairman and a significant shareholder.
Cantor’s ties to Blitzer predate the federal deal. Cantor was lead underwriter of the initial public offering of Blitzer’s Inflection Point Acquisition Corp. II in May 2023, while Lutnick ran the firm.
The company has disclosed about $50 million in total costs for the private sale, according to Quiver Quantitative. How much of that went to Cantor has not been made public. Lawmakers have asked Cantor to disclose its fees.
Who Paid What
A May 13 SEC filing registered about 94.4 million shares for resale, including 26.7 million shares from the January sale. Those shares were not registered when the sale closed, according to the company’s announcement. The May filing clears the way for them to be sold on the open market.
The same filing shows how differently insiders and the public bought in. Selling stockholders acquired their shares at prices ranging from less than a penny to $21.50, according to the filing. Inflection Point’s sponsor entity holds 3.1 million founder shares it acquired for about $0.004 each, roughly $12,500 in all. At Friday’s close of $12.56, those shares are worth about $39 million.
The filing lists two other Inflection Point funds among the sellers. Inflection Point Fund I holds about 5.8 million shares. Inflection Point Freedom Fund holds 15,734.
The institutional buyers who paid $21.50 are down about 42%. Retail investors who bought near the stock’s peak above $38 have lost more.
Operational Questions at Round Top
The financial questions sit on top of an operation that has not yet proved it can deliver.
USA Rare Earth’s own annual report classifies Round Top, its West Texas deposit, as an “exploration stage property” with no mineral reserves disclosed. The definitive feasibility study, the benchmark that shows whether a deposit can be mined at a profit, is not finished. The company has said since December 2025 that it expects to complete the study by early 2027 and begin commercial production in late 2028. Even a favorable study would leave years of construction before the mine reaches commercial volume.
The Wheat Ridge, Colorado, plant is a demonstration facility, not a commercial separation plant. Its test runs were scheduled to conclude this month, and their data feeds the feasibility study. Separating rare earth elements is as technically demanding as mining them, and the company does not yet perform that step at commercial scale in the United States.
Executives Out the Door
In June, USA Rare Earth disclosed it had ended its relationship with General Counsel David Kronenfeld, effective Aug. 7. The company gave no reason. His separation agreement includes a $170,625 cash payment, six months of base salary.
A month later, the company announced that CEO Barbara Humpton would retire Oct. 1, about a year after she took the job. Her replacement, Thras Moraitis, came from Serra Verde, the Brazilian mining company USA Rare Earth was buying. The move shows where the company’s center of gravity now sits. Its only producing mine is in Brazil, its CEO ran that mine, and Serra Verde’s chairman, Mick Davis, now sits on its board. Under U.S. financing terms, that mine’s output can no longer be sold to China.
Taxpayer Money Goes to Brazil
USA Rare Earth’s most valuable operating asset is not in Oklahoma or Texas. It is a mine in Minaçu, a small town in the central Brazilian state of Goiás and it has become a political fight in Brazil.
The company completed its purchase of Serra Verde Group in early September, the deal that added about 126.8 million shares to its stock count. Serra Verde’s Pela Ema mine began commercial production in 2024. The company describes it as the only producer outside Asia of all four magnetic rare earths at scale.
The mine is still ramping up. Phase one is targeted to reach about 6,400 metric tons of rare earth oxides a year by the end of 2027, Serra Verde President Ricardo Grossi told Jornal Opção in April. He declined to disclose current output, calling it commercially confidential. The mine employs about 360 people.
A mine that was never Brazilian. Serra Verde was founded in 2010 with foreign capital from Denham Capital, the Energy & Minerals Group and Vision Blue Resources, led by former Xstrata CEO Mick Davis, according to Poder360. Before Washington got involved, Poder360 reported, the mine sold its output to China’s Shenghe Resources under long-term contracts, which ended after U.S. financing arrived. Davis now sits on USA Rare Earth’s board, and Serra Verde’s former CEO, Thras Moraitis, now runs the company.
Follow the money. Three separate federal commitments are tied directly to the Brazilian mine, totaling about $1.6 billion.
The first is a loan of up to $565 million from the U.S. International Development Finance Corporation, 22% more than the agency’s board first approved. Serra Verde said the money would refinance existing debt on better terms and expand production at Minaçu. It called the loan’s terms commercially confidential. The deal also gives the U.S. government an option to take a minority stake in Serra Verde. The Financial Times reported in April that the loan dictated where the minerals could be sold to the United States and aligned countries, not China.
The second is $750 million from the Department of War, put into a special purpose vehicle that will buy 100% of Serra Verde’s phase one output for 15 years. The Pentagon raised its commitment from $500 million. The contract is take-or-pay, meaning the buyer pays whether or not it takes delivery. It also sets guaranteed floor prices for magnetic rare earths, including what the company calls the industry’s first floor prices for dysprosium and terbium. If market prices fall below those floors, the government-backed buyer still pays the floor. The company has not disclosed who owns the vehicle or how its $1.55 billion in total capital is split.
The third is a federal forward purchase of at least $300 million of rare earth products over five years.
Brazil versus Stillwater. Compare that with what the Commerce Department deal sets aside for the Oklahoma plant. Of Commerce’s $277 million in direct funding, $70 million is earmarked for Stillwater $50 million for the magnet plant and $20 million for metal making. Another $350 million of the $1.3 billion federal loan is set aside for Stillwater. The single largest share of both, $682 million, goes to the Round Top mine in Texas.
USA Rare Earth also paid $300 million in cash and about 126.8 million new shares to Serra Verde’s owners.
That means three federal agencies now have money riding on USA Rare Earth: Commerce, the Development Finance Corporation and the Department of War. It also means phase one’s output is committed to a government-backed buyer, not directly to the Stillwater plant. The company’s announcement says only that Serra Verde can begin supplying material into the U.S. market. It does not say how much, if any, will reach Oklahoma.
The backlash. In April, the Rede Sustentabilidade party and Congresswoman Heloisa Helena asked Brazil’s Supreme Federal Court to suspend the sale, arguing it violated national sovereignty, Correio Braziliense reported. In June, Brazil’s attorney general’s office asked the court to reject the case, saying the issue belongs with Congress and regulators. No ruling has been reported.
Brazil’s antitrust agency, CADE, opened a review on May 11 into whether the deal should have been submitted for prior approval and whether the parties closed it before clearance, a violation known as gun jumping. No decision has been reported.
A new law. On Sept. 16, two weeks after the deal closed, President Luiz Inácio Lula da Silva signed Brazil’s National Policy for Critical and Strategic Minerals without vetoes. It creates a council under the presidency that can approve or block changes in corporate control of critical-minerals companies, and it favors processing inside Brazil. Whether the council can reach a deal that already closed has not been settled publicly.
At the signing, Lula accused unnamed opponents of kneeling before the United States and promising to hand over Brazil’s rare earths raw and cheap. Ronaldo Caiado, while governor of Goiás, had signed a cooperation agreement with the United States on mapping the state’s mineral resources.
For Stillwater, the stakes are plain. The company’s mine-to-magnet strategy now runs through a foreign mine whose output is contracted to someone else, under a government that has just given itself the power to review who controls it.
Should the Government Own Stock?
USA Rare Earth is one of about half a dozen companies, including MP Materials, Lithium Americas and Trilogy Metals, in which the federal government has taken direct equity stakes over the past year.
Supporters argue the stakes are a national-security investment. China processes nearly all of the world’s heavy rare earths, used in fighter jets, missiles and electric motors, and has used export controls as leverage. They say taxpayers should share in the upside if the companies succeed.
Critics come from both parties. Some free-market conservatives object to Washington picking winners and holding shares in private companies, calling it a form of state capitalism. Democrats have focused on transparency and potential conflicts of interest. And as USAR’s price shows, a government stake can lose value as easily as it can gain.
What to Watch
- Whether Commerce answers lawmakers’ questions about Cantor Fitzgerald’s role
- First magnet sales from Stillwater, promised by year-end
- Third-quarter results, the first under CEO Moraitis
- China’s Nov. 10 export-control deadline
- Selling of newly registered Serra Verde shares
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EDITOR’S NOTE:
Sources
The federal deal
Deal terms and the $21.50 private placement price: Engineering News / Reuters
Shares and warrants at $17.17 and the 8% to 16% stake: The Motley Fool
Implied $490 million gain at announcement: Il Sole 24 Ore / Financial Times
No price floors and other federal equity stakes: E&E News
Congressional scrutiny
Rep. Zoe Lofgren’s letter to Lutnick, March 2026: Kitco / Reuters
Humpton defends the deal, April 2026: Kitco / Reuters
Warren, Wyden, Van Hollen and Lofgren letter, July 2026: Capitol Releases
Cantor’s response and the June deal finalization: The Wall Street Journal via Tiger Brokers
USAR falls 8% on the probe report: TechNews / MoneyDJ
The private sale and Blitzer
$1.5 billion private sale at $21.50, Cantor and Moelis as placement agents: USA Rare Earth 8-K exhibit, Jan. 29, 2026
About $50 million in total private-sale costs; Cantor’s share undisclosed: Quiver Quantitative
Resale registration, insider purchase prices and Inflection Point holdings: USA Rare Earth S-3, May 13, 2026
Blitzer’s blank-check company prices its IPO: Renaissance Capital
Cantor as lead underwriter of the 2023 IPO: SPAC Research
Stillwater and Oklahoma incentives
Stillwater TIF agreement and Governor’s Fund award: USA Rare Earth 10-K, fiscal 2025
$7 million received and $140 million investment requirement: USA Rare Earth 10-Q, third quarter 2025
90% tax increment rebate and 2026–2027 deadlines: USA Rare Earth 10-K, fiscal 2024
Five-year tax exemption approved Nov. 14, 2023: USA Rare Earth prospectus
Quality Jobs Program eligibility: USA Rare Earth prospectus supplement
City approves $7 million incentive, 2022: Stillwater News Press via Enid News & Eagle
$9.9 million building purchase and Joyce on the incentive, 2022: Southwest Ledger
Stitt and Joyce announce the plant and its 2023 production target: KOSU
City listed as first lien holder: Greater Oklahoma City Chamber
Company and market
Serra Verde share issuance and resale registration: Quiver Quantitative
September rare earth sector decline: 24/7 Wall St.
CEO transition completed Oct. 1, 2026: USA Rare Earth 8-K
Stillwater employment and production targets: MarketBeat
China export-control timeline and Nov. 10 expiry: Skillings Mining Review
USAR daily closing prices, February 2025 to October 2026: Yahoo Finance
Round Top classified as exploration stage with no reserves: USA Rare Earth 10-K, fiscal 2025
Feasibility study timeline: USA Rare Earth news release, Dec. 10, 2025
Wheat Ridge demonstration run scheduled to end October 2026: Tiger Newspress
General counsel’s departure and severance: USA Rare Earth 8-K, June 16, 2026
Brazil
Serra Verde purchase completed: Poder360
Phase one target, confidential output and Minaçu employment: Jornal Opção
DFC loan of up to $565 million and minority stake option: Engineering News
DFC loan used to refinance debt; terms confidential: Jornal Opção
Department of War $750 million, offtake terms and $300 million forward purchase: USA Rare Earth 8-K exhibit, Aug. 24, 2026
Commerce funding and loan by project: USA Rare Earth 8-K, June 3, 2026
Serra Verde’s foreign founders, Chinese sales contracts and the DFC loan: Poder360
Department of War commitment and 15-year offtake terms: Pulse 2.0
Supreme Court challenge to the sale: Correio Braziliense
Attorney general’s opposition and the CADE review: CNN Brasil
Critical minerals law and the new council: Poder360
Lula’s remarks at the signing: eixos
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