Core Insights - Apple has signed a $500 million agreement with MP Materials to supply rare earth magnets, reflecting strong support for the only operating rare earth mining company in the U.S. [1][2] - The U.S. government recently announced it would become the largest shareholder of MP Materials, marking a significant turnaround for the company [1][4] - The deal ensures a stable supply of rare earth magnets for Apple, which is crucial for its products, including electric vehicles and various electronic devices [2][3] Group 1: Agreement Details - The agreement guarantees Apple a stable supply of rare earth magnets, with analysts noting that the cost of supporting U.S. magnet production is minimal compared to the long-term risk of losing critical component supplies [2] - Apple will prepay $200 million to MP Materials for magnet supply starting in 2027, with production taking place at MP's Texas facility using recycled magnets from California [2][3] - The deal is part of Apple's broader commitment to invest $500 billion in the U.S. over four years, which includes establishing a large AI server farm in Texas and creating approximately 20,000 R&D jobs nationwide [3] Group 2: Market Context - Rare earth elements, consisting of 17 metals, are essential for manufacturing magnets that convert electrical energy into motion, used in various applications from smartphones to military weapons [2] - MP Materials is expected to begin commercial magnet production at its Texas facility by the end of this year, which will supply magnets for a significant portion of Apple's product lines [3] - The U.S. Department of Defense has invested $400 million in MP Materials, acquiring a 15% stake and committing to purchase products at double the current market price for a duration of 10 years [4]