US Government Interest Grows in Victory Metals’ Rare Earths Supply

Why Is Victory Metals Attracting US Government Attention?

The global rare earths market is currently experiencing unprecedented supply constraints, creating a strategic opportunity for Victory Metals (ASX: VTM) to position itself as a key alternative supplier outside of China. With China controlling approximately 85% of rare earth processing worldwide according to IMF's “Critical Minerals Outlook 2024,” the geopolitical implications are significant for Western nations seeking supply chain security.

Victory Metals' North Stanmore project in Western Australia has garnered substantial attention from the US government due to its potential to diversify global supply chains for critical minerals energy transition currently subject to Chinese export restrictions. These restrictions, formally implemented by China's Ministry of Commerce in July 2024, have accelerated Western nations' search for alternative sources.

North Stanmore's Strategic Resource Profile

Victory Metals has established itself as one of the few Australian companies with a declared gallium oxide resource, significantly strengthening its diversified critical minerals portfolio. The company's resource estimate showcases impressive numbers:

• 247.5 million tonnes at 520 parts per million total rare earth oxide (inferred and indicated)
• 4,788 tonnes of gallium oxide added to the resource in April 2025
• Multiple critical metals currently subject to Chinese export restrictions
• Successful recovery of these metals during mixed rare earth carbonate (MREC) metallurgical testing

What makes this resource particularly valuable is the recovery of gallium oxide as a cost-effective by-product during the MREC processing workflow. Gallium is a crucial component in semiconductor manufacturing, particularly for 5G technologies, power electronics, and military radar systems—applications the U.S. Department of Defense considers strategically vital.

“The presence of gallium strengthens Victory's diversified critical minerals portfolio and positions it as an alternate supplier of metals currently under tight global supply due to Chinese export restrictions,” noted industry analysts at SmallCaps in their July 2025 assessment.

US Government Strategic Interest

The company's rare earths project has garnered attention at the highest levels of US government, positioning Victory as a potential key player in securing non-Chinese supply chains. This interest aligns with the U.S. Defense Production Act Title III provisions, which specifically target critical minerals supply chain security.

Victory Metals' development timeline coincides with the Department of Defense's 2025 rare earth stockpiling targets, making North Stanmore a project of potential national security significance for the United States.

How Is US Government Support Manifesting for Victory Metals?

Export-Import Bank Financing Support

In a significant development for the company, Victory Metals has received formal US government backing through a Letter of Interest (LOI) from the Export-Import Bank of the United States (EXIM). This represents a major vote of confidence in the strategic value of the North Stanmore project.

Key aspects of this support include:

• Potential project financing support of up to $292 million for North Stanmore development
• Recognition as one of few Australian critical minerals developers to attract high-level international government-backed support
• Eligibility for loan guarantees under the Defense Production Act Title III

This level of support is not unprecedented but remains rare. In 2023, Lynas Rare Earths (ASX: LYC) received similar EXIM backing as part of the U.S. Department of Energy's “Critical Minerals Loans Report” initiative, underscoring the strategic importance of rare earth development outside China.

The EXIM Bank's involvement in an Australian project highlights the transnational nature of critical minerals security, with the U.S. government willing to support allied nations' development of these resources to ensure diversified supply chains.

Strategic Partnership Opportunities

This US government interest has accelerated Victory's discussions with key stakeholders throughout the supply chain:

• US and international downstream partners seeking secure material sources
• Major original equipment manufacturers dependent on critical minerals
• Defense-aligned industries seeking secure supply chains independent of Chinese control

“The funding enabled acceleration of discussions with US and international downstream partners, major original equipment manufacturers, and defence-aligned industries,” according to SmallCaps' July 2025 report.

The EXIM Letter of Interest signals the beginning of a due diligence process that typically involves rigorous project evaluation, environmental impact assessments, and economic viability studies—all indicators of serious U.S. government commitment to the project's development.