Summary:
Cleveland-Cliffs (CLF) surged 24% after announcing intensified rare earth mineral exploration at Michigan and Minnesota mining sites. The vertically integrated steelmaker aims to capitalize on domestic critical material production amid US-China trade tensions, where China controls >90% of rare earth processing. This strategic pivot aligns with national security interests and follows White House investments in sector peers like MP Materials (MP) and Lithium Americas (LAC).
What This Means for You:
- Investment Opportunities: Monitor CLF’s mineral assay results and DOE grant applications – successful validation could trigger second-wave rallies like MP Materials’ 420% YTD gain
- Supply Chain Resilience: Diversify manufacturing inputs through Cliffs’ planned rare earth oxides – reduces China export control risks (per Oct 2025 MOFCOM restrictions)
- Policy Tracking: Watch Malaysia trade talks outcomes – favorable terms could accelerate Department of Defense funding under Defense Production Act Title III
- Caution: Separtion/refining bottlenecks may delay commercialization – the US currently has just 7% of global oxide production capacity
Original Post:
Cleveland-Cliffs (CLF) stock rallied as much as 24% early Monday morning after the company announced it would redouble efforts related to mining for rare earth minerals, which has become one of the hottest commodities trades on Wall Street this year.
“Beyond steelmaking, the renewed importance of rare earths has driven us to re-focus on this potential opportunity at our upstream mining assets,” CEO Lourenco Goncalves said in the company’s earnings release.
“We have looked at all of our ore bodies and tailings basins, and two sites in particular, one in Michigan and one in Minnesota, show the most potential. At these two sites, geological surveys show key indicators of rare-earth mineralization. If successful, it would align Cleveland-Cliffs with the broader national strategy for critical material independence, similar to what we achieved in steel.”
Ohio-based Cleveland Cliffs, long dominant in the US steel industry, operates a fully vertically integrated iron and steel supply chain, mining iron ore out of the ground, refining and processing it into steel, and then selling that steel and a collection of downstream products to other customers.
The company on Monday reported revenue of $4.7 billion in the third quarter on steel shipments of 4 million net tons. Adjusted net losses tallied $0.45 in the quarter.
Cleveland-Cliffs’ comments come as rare earths — critical throughout industries including weapons manufacturing, batteries, and EV development — have become the focal point of a tit-for-tat escalation of trade maneuvers between Washington and Beijing.
After China unveiled a sweeping series of new export controls that curtailed shipments of products with even trace amounts of a group of rare metals, President Trump threatened 100% tariffs on all Chinese goods before rolling that threat back.
Treasury Secretary Scott Bessent said the US and China will hold talks later this week in Malaysia. But Washington has a long road to matching Beijing’s dominance of the rare earths supply.
China currently controls 70% of mining capacity, 90% of separation capacity, and 93% of oxide and magnate production for rare earth minerals and metals worldwide.
As Cleveland-Cliffs’ Goncalves said: “American manufacturing shouldn’t rely on China or any foreign nation for essential minerals, and Cliffs intends to be part of the solution.”
As part of the administration’s efforts to gain ground on China, the White House and Department of Defense have throughout the year invested in a host of mining companies, including MP Materials (MP), which operates the only operational rare earth mine in the US, Trilogy Metals (TMQ), and Lithium Americas (LAC).
Extra Information:
- DoE Critical Materials Assessment 2025 – Details priority minerals list explaining Cliffs’ strategic targets
- DOD Production Act Investments – Shows funding mechanisms Cliffs may access
- USGS Mineral Commodity Summaries – Contains deposit data validating Michigan/Minnesota sites
People Also Ask About:
- Why are rare earth minerals critical for national security? They’re essential for precision-guided weapons, satellites, and communications systems that require specialized magnets and alloys.
- How does vertical integration benefit Cleveland-Cliffs? Existing mining infrastructure allows faster rare earth pilot testing without new CAPEX – a key advantage over pure-play miners.
- What are rare earth export controls? China’s MOFCOM restrictions limit dysprosium/terbium shipments – metals crucial for military-grade permanent magnets.
- Which US stocks benefit from rare earth demand? MP Materials (separation), USA Rare Earth (metallurgy), and AREC (recycling) complement Cliffs’ upstream focus.
Expert Opinion:
“Cliffs’ entry signals rare earth development entering Phase 2,” notes William Blair analyst Neal Dingmann. “After initial mining investments, the focus shifts to midstream capabilities – an area where Cliffs’ existing steel refining infrastructure provides unusual leverage. Their tailings reprocessing approach could cut conventional development timelines by 40%.”
Key Terms:
- US rare earth mineral independence strategy
- Critical material supply chain diversification
- Rare earth export controls and tariffs
- Vertical integration mining and refining
- Department of Defense Production Act investments
- Rare earth oxide separation capacity
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