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Tribal Nation Backs Rare Earth Magnet Plant with $150M for U.S. Supply Chain
• The Shakopee Mdewakanton Sioux Community is providing $150 million in debt financing to Niron Magnetics for its first large-scale plant in Sartell, Minnesota.
• The 287,000-square-foot facility aims to produce 1,500 tons of rare earth-free magnets annually and create up to 175 jobs when operational in 2027.
• This investment builds on a decade-long partnership, with the tribe first investing in 2016 due to shared values of environmental stewardship.
• Niron is separately pursuing up to $150 million in federal financing from the Department of Defense's Office of Strategic Capital for the same project.
In a significant move to bolster domestic supply chains for critical technologies, the Shakopee Mdewakanton Sioux Community (SMSC) has committed $150 million in debt financing to Niron Magnetics. The capital will underwrite the construction, equipment, and operational startup of Niron’s first commercial-scale manufacturing plant in Sartell, Minnesota. This facility represents a strategic step toward onshoring the production of permanent magnets, vital components for electric vehicles, wind turbines, and defense systems, without relying on rare earth elements.
The forthcoming 287,000-square-foot plant is designed to consolidate material synthesis and magnet manufacturing under one roof, with an annual production capacity target of 1,500 tons. The project is anticipated to generate as many as 175 skilled jobs upon its projected operational launch in 2027. This financing extends a substantial, decade-long investment relationship between the Dakota tribal nation and the Minneapolis-based innovator. SMSC was an early investor in Niron in 2016 and participated in a later 2023 financing round, a history that the company cited as foundational to this latest agreement.
"The partnership with Niron is a testament to our Dakota values, particularly our commitment to being good stewards of the earth," stated SMSC Chairman Cole Miller. He emphasized that the tribe recognized Niron's potential to benefit both the local Minnesota community and the broader transition to sustainable technology from its earliest stages. Concurrently, Niron is seeking additional financial support, having secured a conditional commitment in August for up to $150 million in a 20-year direct loan from the U.S. Department of Defense’s Office of Strategic Capital.
The federal loan remains contingent on standard procedures, including due diligence and Niron securing a minimum level of equity. Company officials clarified that the tribal and federal financings are separate endeavors. Specific financial terms of the SMSC loan, such as interest rate and maturity, alongside the total project cost, were not disclosed. This dual-financing approach underscores the high-stakes, strategic nature of establishing a resilient U.S. magnet supply chain, reducing dependence on overseas sources for a commodity essential to the modern economy and national security.