MP Materials at Canaccord Genuity: Strategic Growth and Partnerships

On Tuesday, 12 August 2025, MP Materials (NYSE:MP) presented at Canaccord Genuity’s 45th Annual Growth Conference, offering insights into its strategic initiatives and operational progress. The company, a key player in rare earth production, highlighted its advancements in production capabilities and partnerships, while also addressing challenges in refining operations and supply chain vulnerabilities.

Key Takeaways

• MP Materials is targeting 60,000 tons of upstream production, with a current output of over 50,000 tons annually.
• The company aims to produce 6,075 tons of refined NDPR, with sequential growth averaging 25% since 2023.
• Strategic partnerships with the Department of Defense and Apple are crucial for supply chain security and recycling initiatives.
• MP Materials is expanding magnet production facilities, with significant offtake agreements secured.
• The company is confident in meeting heavy rare earth sourcing needs, with a new refinery expected online by 2026.

Financial Results

• MP Materials reported over 13,000 tons of production in the last quarter, contributing to a baseline earnings power of $650 million pro forma.
• The company is focused on improving concentrate quality and addressing material handling bottlenecks to enhance refining operations.
• Upstream production capabilities could significantly boost potential earnings, though these are not included in the current baseline.

Operational Updates

Upstream Production:

• Producing over 50,000 tons annually, with a focus on optimizing concentrate quality.

Midstream Production:

• Refining operations started at the end of 2023, with a target of 6,075 tons of refined NDPR.
• Expected sequential growth of 10-20% next quarter, addressing material handling challenges.

Downstream Production:

• Committed 1,000 tons of initial production to GM, with further expansion contracted with Apple.
• A new 7,000-ton plant has a complete offtake agreement with the Department of Defense.

Recycling Initiatives:

• Partnering with Apple to develop recycling facilities for NDPR and heavy rare earths.

Future Outlook

• MP Materials plans to reach 60,000 tons of REO in concentrate and build out 10,000 tons of magnets.
• The company is focused on execution, expanding recycling operations, and reducing heavy rare earth content through technological advancements.
• Continued collaboration with the Department of Defense is pivotal for strategic growth.

Q&A Highlights

• MP Materials will have the only refinery outside of China by 2026, enhancing its heavy rare earth sourcing capabilities.
• The company is not in a rush to sign new customer agreements due to existing visibility into returns and strategic partnerships.

For a deeper understanding, readers are encouraged to review the full transcript.

Full transcript - Canaccord Genuity’s 45th Annual Growth Conference:

George Enricas, Sustainability Analyst, Canaccord Genuity: Hello everyone. I’m George Enricas, one of Canaccord Genuity’s sustainability analyst. Thank you for coming to our forty fifth annual growth conference. And I think we’re maybe or the market’s most excited about having MP with us today. Thank you so much for joining Ryan Corbett, CFO of the company, Martin Sheehan from Investor Relations.

You’ve been up to a lot recently. Been very, very busy. Maybe very quickly just to focus on the three stages of the business. Stages one, stages two, stages three. We won’t get into the deals that you’ve announced maybe till later, but the stage one of your business is getting to 40,000 tons a year, which you’ve done.

Is it well, yeah, upstream 60 k eventually.

Ryan Corbett, CFO, MP Materials: Yes.

George Enricas, Sustainability Analyst, Canaccord Genuity: Getting to 40, eventually to 60. Maybe walk us through sorry. I was having a technical issue.

Ryan Corbett, CFO, MP Materials: Gotta turn it on.

George Enricas, Sustainability Analyst, Canaccord Genuity: Good. 40 to 60. So can you just talk us through the path in getting to 60 level of confidence, time frame, etcetera?

Ryan Corbett, CFO, MP Materials: Yeah. No problem. Thanks for having us. Happy to be here. Right now, we’re actually producing our LTM is is just north of 50.

So we’ve made some pretty big strides there. You know, I think, in the quarter we just reported last week, you know, we had an outstanding quarter north of 13,000 tons of production. You know, the team has done a really unbelievable job focusing on, some of the lower capital intensity, more optimization pieces of upstream 60 k in the last several quarters, and so we’ve been able to, you know, make a lot of progress there. Interestingly, we’ve continued to drive incremental production out of stage one while we’ve shifted our focus really more towards focusing on concentrate quality more than just quantity. You know, we’ve pushed in the last quarter, you know, while production was was really excellent, our highest overall average grade of concentrate that we’ve ever produced.

And that, I think, over time, will have positive implications for the the midstream section of the business as well. And so, you know, upstream 60 k is one where, as we’ve laid out, you know, as you mentioned, some of the deals we’ve recently done, we laid out sort of a a framework of what we think our baseline earnings power is of the business at $650,000,000 pro form a for a lot of these deals that we’ve we’ve recently announced. You know, one thing that is very clear upside to that is upstream 60 k. We didn’t include any of the potential earnings power in that in that baseline number, and so it’s something that we continue to execute on. But for the short term, we’re really focused on con quality, but I think over time, you know, there’s a lot of upside.

George Enricas, Sustainability Analyst, Canaccord Genuity: What does that do to your mine life as you move to 60 k of production?

Ryan Corbett, CFO, MP Materials: The great thing about what the team’s been able to achieve is really it’s neutral to positive despite the incremental production because the vast majority of what we’ve been able to achieve is from recovery. So we’re feeding the same amount of material from the mine into the concentrator. This has really almost all been driven on, overall recoveries. And so as we look out, you know, and and we’ve, you know, planned the mine for our 6,000 tons of of oxide production, you know, we don’t need to increase feed rates and aren’t planning to increase feed rate to get there.

George Enricas, Sustainability Analyst, Canaccord Genuity: Maybe focusing now on stage two Sure. Which is getting to the refined NDPR. You have the stated goal of 06/1975. I still remember that number. I

Ryan Corbett, CFO, MP Materials: I don’t know why we didn’t just round down to 6,000, but that 6,075 is the target.

George Enricas, Sustainability Analyst, Canaccord Genuity: We still use it in our model. Can you just talk about progress there, timeline of maybe getting to that 6,000? What bottlenecks, if any, that you’re seeing at this point in this? Sure.

Ryan Corbett, CFO, MP Materials: Yeah. So, you know, Michael guided the Street in the last call to 10 to 20% sequential growth, which, you know, if you sort of zoom out and look at what we’ve done, we really started the refining operation at the very end of 2023. And if you look at sequential growth and sort of average it out, and as those of you that follow the story know, we have semiannual plant, shutdowns, and so it’s not a straight line. There’s usually, you know, progress and a slight step back or, you know, leveling off and then forward progress. But if you average out our sequential growth since we started, we’ve averaged at about 25% sequential growth.

So if you just play that out and compound that, you know, if all we do is continue to execute on on the trajectory that we’ve been executing on, you know, we’ll be there in the, you know, pretty near term. We’ll be there by the end of next year. Of course, in any plant, it is really a brownfield certainly more than a greenfield, and so we had you know, a great head start, if you will. But with any plant of this complexity and scale, there’s always a two steps forward, one step back, as you dial in recovery, throughput, and uptime and get all of those levers right in order to maximize production. And so, you know, with the 10 to 20 that we expect next quarter, that’s with taking some of, the incremental downtime that Michael talked about in July in order to dial in some of these improvements to the NDPR finishing circuit that that he talked about on the call.

And those are the types of things that you sort of don’t see under the hood when all you report is a headline number. Right? If you take a couple of weeks of downtime or a week of downtime to achieve and implement some of these improvements, you don’t necessarily see exactly where we’re run rating after that. And so there’s always that two steps forward, one step back. And so to your question on, what are the bottlenecks that we’re seeing, I think fundamentally at this point, given what we’ve been able to execute and now feeding north of 50% of our upstream feedstock into the refining circuits, there’s no doubt about our ability to produce at scale at this point.

It’s really just a matter of when exactly do we get to 06/1975. What we are seeing in terms of the issues that we are tackling at this point is it’s mostly materials handling. If you think about our operation, it’s a highly complex operation, twenty four seven, three sixty five, and you’re dealing with solids, solutions, slurries, wet solids, dry solids, you name it. And so it’s almost a good thing that the type of issues that we’re dealing with at this point are mostly interprocess material handling and things where we need to drive better mechanical reliability in those areas. And there are very clear pathways to do that.

Michael and his team have been doing an excellent job, and we’ve got a lot of confidence in the team to get there.

George Enricas, Sustainability Analyst, Canaccord Genuity: So it’s not a science problem.

Ryan Corbett, CFO, MP Materials: That’s exactly right. There’s always room to improve, but in terms of what we see of feeding the refining circuits versus what we’re getting out the other end, the the yields and the ability to produce at scale, you know, absolutely are working how we intended them to and are aligned with all of the underlying assumptions that set us on that 6,000 target.

George Enricas, Sustainability Analyst, Canaccord Genuity: Is there let’s just say a pipe breaks somewhere. Is there any supply chain issue? Does any stuff come from China, for example, that’s hard to get?

Ryan Corbett, CFO, MP Materials: It’s a good question. At this point, we have been anticipating the shift in our business away from the Chinese market for some time, and so we have absolutely controlled for any of the supply chain challenges or any material coming out of China. As it relates to a pipe breaking and and having supply chain issues, it’s not normally exactly that, but there are, you know, challenges that you know, talking about these, implementation of upgrades. Right? Some of those upgrades, once we identify them, we have to go through the process of a short engineering cycle, production, etcetera, and that’s generally done in The US, you know, but some of that has some time attached to it.

One of the great things about our recent agreement with the Department of Defense is, you know, given the criticality of what we do and the criticality of, you know, magnets going into, you know, the the vast end uses that they do go into and the fact that we are vertically integrated, Our business now has what’s called a DX rating, something called the defense priority allocation system, where it’s something that a lot of, businesses don’t really even know about, but any private business, public business operating in The United States is subject to, this. It’s it’s run by actually the Department of Commerce in partnership with the Department of Defense, but it requires the businesses prioritize, production of products used in the defense industrial base. And so we now have the highest rating that’s possible amongst the various ratings. And so, you know, we we use this as a tool and work with our vendors to be able to accelerate timelines for any, you know, potential things that we need. So particularly as we think about the downstream growth that we see in building out our 10x facility, it’s a really important tool to be able to prioritize our products to be able to get things moving as quickly as possible.

George Enricas, Sustainability Analyst, Canaccord Genuity: Now the 6,075 tons was based on 40,000 of concentrate. Sure. If you get to when you get to 60, does that over time translate into 9,000 tons of NDPR?

Ryan Corbett, CFO, MP Materials: So you know? And and we got this this question in a lot of different ways on on the last earnings call. And, you know, I think the way Michael described it is, you know, the capacity of Mountain Pass is not unlimited, but, like, your math is right. If we’re doing 60,000 tons of REO in concentrate, in theory, we could do 9,000 tons of NDPR oxide. I think the thing that’s fascinating about the place that we’re at in this business is with the 40s of upstream product, we absolutely are going to get to that 6,000 tons over time.

We’ve got that increment from upstream 60 k that can generate a lot of value. And, you know, as we talked about, that that is not captured in sort of our baseline earnings framework. The other piece that’s really exciting from a production standpoint is our announcement on on scaled recycling. And so, you know, that’s another opportunity for us to to grow NDPR oxide production. And so we recently announced Apple as our foundational recycling customer, And so that’s another lever for us over time.

You know, that facility will get built out, you know, in in the not too distant future to be able to satisfy, the requirements for for NDPR and heavies for Apple at our independence facility to make them their magnets completely from recycled feedstock, which we think is, you know, a really awesome addition to the business. And so there are a lot of levers over time for us to be able to to grow production.

George Enricas, Sustainability Analyst, Canaccord Genuity: So not to put you on the spot, but in theory, over, you know, ten, fifteen years, give you a lot of time to figure this out.

Ryan Corbett, CFO, MP Materials: Okay.

George Enricas, Sustainability Analyst, Canaccord Genuity: You can get from six maybe to nine, and then maybe on top of that, you have this recycling business that can bring you even beyond those levels.

Ryan Corbett, CFO, MP Materials: Yeah. I think that’s right. And and look. If you think about the opportunity set in front of us, we’ve talked about 10,000 tons of magnets, which in theory, depending on the type of magnet, making gross over generalizations, 10,000 tons of magnets is 5,000 tons of oxide. So what that tells you is we’ve still got a pretty significant midstream business that can support the market, can support our external customers that are super important to us.

You know, Japanese, South Korean markets are our largest markets right now, and we’ll continue selling into those markets. But, you know, what it does spell is an ability to grow midstream and an ability to grow downstream over time. And so we certainly have our plate full executing on, you know, the items that we’ve laid out and getting to 10,000 tons of magnets and executing on all of our agreements with DOD and Apple and, you know, first and foremost, General Motors, is coming, you know, into production at the end of this year. But, you know, we are we have established what we feel is a very strong and exciting platform for us to really accelerate growth even beyond what we’ve laid out. And so as you know, as a management team, we are execution focused.

We wanna execute first and then explain the upside later. And so our view is that, you know, we need to continue to make great forward progress on all of these initiatives that we’ve laid out. But as we move forward on those, I think there are great opportunities for us to to grow even further. We’re we’re at the Growth Conference. So

George Enricas, Sustainability Analyst, Canaccord Genuity: You are. You’re building an enormous magnetics facility. Well, multiple ones. One in Fort Worth, one at a location that I think hasn’t been disclosed yet. Correct.

Okay. You’re going from 1,000 to 3,000 at Independence.

Ryan Corbett, CFO, MP Materials: That’s right.

George Enricas, Sustainability Analyst, Canaccord Genuity: And then an additional 7,000 at this location. What I found incredibly fascinating about the deal that you struck with the DOD is that they’re basically committed to buying the set this is the 7,000 tons

Ryan Corbett, CFO, MP Materials: That’s right.

George Enricas, Sustainability Analyst, Canaccord Genuity: Unless you find another commercial partner.

Ryan Corbett, CFO, MP Materials: That’s right.

George Enricas, Sustainability Analyst, Canaccord Genuity: And our math, not yours, would suggest that independence is already call you know, about 50% plus this is our math again, has already been allocated to GM and Apple, which leaves a lot of room to negotiate contracts with others, but not too much, right, because capacity is quickly filling up. So how do you approach new commercial agreements? Whether you know, this is our spec whether it’s Tesla, GE, Lockheed, etcetera. Yep. Like, what kind of expectation should we think just in terms of margin profile, commercial agreement, etcetera?

Ryan Corbett, CFO, MP Materials: Sure. So one clarification. On independence, you know, the first thousand tons, you know, is committed to GM. What we’ve said is we’re going to get that facility to 3,000 tons, and with the Apple agreement, the vast majority of that expansion is already contracted. So I would say your 50% is low.

So the great thing about Independence also is it’s modular, and so, you know, we view that facility as effectively sold out. And so at this point, you know, of course, you can always, you know, increase, you know, volumes one way or the other, but in general, you know, from the major capital investment that needs to go into it versus the returns we’re gonna get out on the other side, you know, we feel great about independence. And then to your point on 10 x, we have a 100% offtake. And so we are not in a rush to announce more headlines on customers unless and until we have the deals that we think are right. An example is with Apple, we’ve been working quietly behind the scenes with Apple for five years on optimizing recycling technology in order to bring us to this point, and if we had signed a deal in 2020, it might have looked a lot different than the deal we just signed.

And so, you know, we have always been, methodical in approaching, you know, customer relationships from a win win perspective. You know, we think that there is tons of opportunity for us to announce more over time, but from a fundamental business perspective, we’ve got visibility into our returns at this point, and so I think kind of what you’re getting at is anything incremental, you know, will will be better than the baseline economics that we’ve laid out. You know, what I think despite all the attention that, you know, some of the recent deals have gotten, I still think it’s underappreciated, frankly, writ large how critical the magnet supply chain is and how close The US industrial economy came to really like, I I don’t wanna, you know, blow it out of proportion, but near collapse. I mean, we have we had auto factories actually shut, and there were a lot more that were very, very close to shutting from the export restrictions from China. And so, undoubtedly, with a new 7,000 ton plant coming online, there are tons of customers that want to secure their supply chain.

And I think the great thing about what we did with the Department of Defense is their focus is first and foremost on ensuring the defense industrial base is taken care of, but you can imagine that one of the reasons we decided to go all the way to 10,000 tons as soon as possible is a focus on ensuring economic national security as opposed to pure defense. It’s really being able to play offense. And so, you know, I I think, absolutely, there is a lot of opportunity for the, you know, the names that you mentioned to to, you know, be a part of our story in the not too distant future. And so, you know, at this point, we’re really heads down in execution mode, and the pipeline of customer interactions is absolutely gigantic given, all the things that I talked about. I mean, you know, you you had businesses that designed their supply chains around, you know, assuming that magnets would flow freely forever despite knowing for a very long time that there’s a single point of failure in China, and that game is over.

And so, you know, I think from that perspective, there’s a lot of opportunity for us over time.

George Enricas, Sustainability Analyst, Canaccord Genuity: I just find it fascinating that you think it’s underappreciated. In other words, this was a come to Jesus moment for many companies that realized that they couldn’t operate without

Ryan Corbett, CFO, MP Materials: Unquestionably. And I think the thing that’s so interesting about it too is what we ended up trading here in this detente with China is, you know, China sending us magnets, which, you know, again, with all due respect to us, it’s not AI chips. Right? And we’re sending them AI chips in exchange. Right?

And so, you know, we can never let the country be in that position again. And, you know, I think that we are leading the charge to make sure that never happens again. And so, you know, in addition to having, you know, our our shareholders as our major stakeholder here, you know, our country and our government, we cannot let that be the case again. And it really was at that point. I mean, you know, you had major industrial manufacturers, automotive, a and d, you know, consumer electronics.

I think making very clear to this administration, if we continue on this track without some sort of daytime, we’re in we’re in deep trouble. And so, you know, I think we are a major solution to that problem over time. You know, you saw auto factories shut in May. You know, these restrictions went in place in April, which tells you, you know, how tightly, you know, the supply chain was running from a just in time perspective. And I think the thing that I’ve started to see that I find so fascinating too is OEMs from all industries not having realized even that certain parts had magnets in them.

We had one OEM come to us and say, I didn’t know this piece had a smurium cobalt magnet in it at all. It’s one of those things where when the product is freely available, subsidized, You didn’t have to pay that close of attention. And I think, again, the the game has totally changed. And it actually presents some really unique opportunities, not just from contracting and and, you know, establishing long term relationships with some of these really important, you know, American and global companies, but it’s an opportunity for us to change the way magnets are made, sourced, spec ed, etcetera. What we’ve seen in particular is, you know, as some of these OEMs have gotten smarter about what has magnets in them and what exactly do the magnets look like that are in these various parts of the of their of their products, it’s really then taking another, you know, layer deeper and saying, why is the magnet spec to perform at 200 degrees c when this application never sees over a 120?

And, you know, that is an opportunity for for us to really drive more standardization in the magnet market. And frankly, it’s one of the reasons that, you know, one thing I’m sure we’ll talk about that we haven’t yet is heavy worth content. You know, it allows us to have great visibility into significantly reducing that. And so overall, you know, it makes me extremely bullish NDPR. It makes me realize that, you know, we will be in a great position to be able to grow our magnet business, while lowering the heavy worth content purely from dialing in specifications, let let alone a lot of the r and d that’s going on that has allowed us already within our existing spec to pull heavies out of out of the mix.

George Enricas, Sustainability Analyst, Canaccord Genuity: That was my next question about about heavies.

Ryan Corbett, CFO, MP Materials: I know you well. Yeah. By now.

George Enricas, Sustainability Analyst, Canaccord Genuity: We get it all the time. Yep. People wanna know how you’re gonna solve that riddle, so to speak. Mean, you were already starting to build refining capacity in Mountain Pass the time I was there. Feedstock, refining capacity, how confident are you you can ramp that up?

Ryan Corbett, CFO, MP Materials: Sure. Yeah. And so for some of the reasons that I just laid out, we don’t view that as a bottleneck over the medium and long term. In in the immediate short term, you know, we’ve obviously prepared for this moment for a long time. We have stockpiles of the materials that we need for the immediate launch of production at Independence.

And so, you know, we’re well covered from from the immediate term perspective. And then in 2026, we will have our refining capacity come online. You know, you hear lots of people out there say, like, oh, we’re, you know, we’re a light worth deposit, and then there are heavy worth deposits. I hate to break it to them. Heavy rare earth deposits don’t exist.

Every single deposit that has rare earths in them generally has more lights than heavies. Always. I’m gonna say generally, it’s always. And so, you know, for example, you know, we have 15.7% NDPR in our elemental distribution. We still have 1.7% heavy rare earths, and 1.7% of a really big number is a much bigger number than 3% of a really small number.

That is sort of the misunderstanding about heavy berths where they’re sourced. I think fundamentally what we see is we are covered from our own production from Mountain Passor for the launch of Independence and covering the the GM agreements as they grow. With Apple, we also have this recycling capability, and the feedstock that we’ll be bringing in also is another source of of heavier earth content. And so that agreement is also well covered. So independence, you know, from a heavy earth perspective is is is well covered.

You probably also saw in our transaction agreements with the Department of Defense that were, you know, filed, when we announced them. We are approaching this together with DOD as our partner in sourcing more heavy rare earth rich feedstock to feed into mountain pass to serve the 10 x facility. And so there really are no major ex China sphere of influence. Actually, there are no ex China sphere of influence producers of heavier earths out there, refiners. We will have the only refinery outside of that sphere of influence, and it will be online, you know, in in the short term in 2026.

And so that puts us in a great position to be able to be the refiner of choice for projects out there that do have, you know, potential heavy rich feedstocks, but they don’t have the mine life or the economics to support building out a full refining capability. You know, in the same way that you saw us in the early days start with an upstream product that was sent overseas for refining, That is probably the most thoughtful way to bring some of these projects to bear over time. And so, you know, we expect to see a lot of opportunities to bring heavy rare heavy rare earth rich feedstocks into the fold of Mountain Pass and use that to, to to to, satisfy 10 x demands. And that’s, you know, on top of some of the items I mentioned before, which is if you think about the biggest use cases of magnets, as we look forward. You know, Jim mentioned on the earnings call, you know, we’re sitting here at the precipice of, you know, the next big thing, which is the physical manifestation of AI, robotics, etcetera.

And you actually heard, you know, Elon Musk talk about on his earnings call a couple of calls ago, I think the q one call, that the ramp in Optimus was interrupted because of an inability to source rare earth magnets. So it tells you how important these things are to robotics and some of these future facing industries. The great thing about some of these applications is some of them have no heavies in them. And so I actually think the overall mix of, you know, heavies as a proportion of the bill materials in Magnus writ large is actually declining. And so it’s it’s something that a lot of people like to talk about, but from our perspective between r and d mix and the refining capacity that we’re bringing to bear, you know, we think this is well covered for us.

George Enricas, Sustainability Analyst, Canaccord Genuity: It’s a great place to

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