Shares in major Australian rare earth producers have experienced a sharp sell-off following unconfirmed reports that the Trump administration may retreat from plans to implement government-backed "price floors" for critical minerals.
Lynas Rare Earths (ASX:LYC) saw its stock tumble 11% in early trading, while Iluka Resources (ASX:ILU)—already grappling with soft mineral sands pricing—dropped 15%.
The volatility stems from a reported shift in Washington, where senior officials allegedly informed industry executives that domestic projects must achieve financial viability independently rather than relying on federal price guarantees.
In mid-2025, a landmark US Department of Defense plan to set a price floor of US$110 per kilogram for neodymium and praseodymium triggered a massive rally, nearly doubling the share prices of companies like Lynas.