Key takeaways
- Cyclic Materials raised USD 75 million in Series C funding, bringing total capital raised to USD 162 million.
- Rare earth recycling is emerging as a near-term solution to Western rare earth supply chain vulnerabilities.
- Cyclic’s hub-and-spoke model and hydrometallurgical process aim to deliver scalable, energy-efficient rare earth elements (REE) recovery.
- Long-term success will depend on consistent feedstock sourcing and logistics execution.
- National security demand could provide structural support for domestic rare earth recycling.
The Lux Take: Strategic partnerships and circular feedstock opportunities
Clients should engage Cyclic Materials for codevelopment opportunities; companies generating REE-containing waste, such as magnet scrap or end-of-life (EoL) equipment, should explore circular feedstock supply partnerships with Cyclic. Its recent commercial traction and partnership network sets it apart from peers, but successful execution on logistics and consistent feedstock sourcing will be critical as the company scales to meet rising REE demand.
Series C investment to scale rare earth recycling infrastructure
Cyclic Materials has raised USD 75 million in a Series C funding round, marking a pivotal moment in the scale-up of REE recycling infrastructure in North America. The round was led by T. Rowe Price, with participation from the Canada Growth Fund and returning backers including Microsoft and Amazon. This late-stage growth capital positions Cyclic Materials as a leading contender in the global race to localize REE supply chains. The new funding brings its total raised to USD 162 million. Lux recently highlighted Cyclic Materials as a key player to watch in its webinar “Tech Innovation in 2026: Themes and Technologies to Monitor.”
REE supply chain risks and the case for recycling
REEs like neodymium, praseodymium, dysprosium, samarium, and terbium are essential to high-performance permanent magnets used in EV motors, robotics, wind turbines, and advanced defense systems. Today, Chinese companies command an overwhelming share of the global rare earth supply chain, producing over 85% of refined REEs and controlling most downstream magnet manufacturing capacity. In recent years, China has also tightened restrictions on exports of key REE separation technologies and alloying equipment, bolstering its dominance in the global magnet value chain.
The inability to access refined REEs at scale could significantly slow industrial and defense-related progress for Western nations. While the U.S. government has recently taken stakes in miners and refiners, digging new mines and building centralized refineries will take at least a decade and entail high environmental impacts associated with traditional extraction and processing technologies. As a result, recycling REEs from EoL products and magnet production waste has emerged as a viable short-term path to building secure, domestic supply chains — particularly for heavy REEs, which are geologically scarce outside China.
Lessons from battery recycling: Risks for rare earth recycling startups
The closest analog to rare earth recycling is the battery recycling sector, which has seen recent setbacks despite early promises. Several startups raised significant funding to scale fast but ran out of funds before reaching scale. Meanwhile, supply chain and technical issues, including feedstock delays, policy reversals, and operational hazards, slowed execution.
EoL magnet feedstock is not as abundant as battery waste. Currently, ~1% of all rare earth magnets are recycled globally. Recovery from small magnets in electronics is inefficient, while larger magnets in EV motors, wind turbines, and magnetic resonance imaging machines are difficult to collect and refurbish. Moreover, North America hosts very few magnet manufacturers, limiting access to production scrap. Cyclic must overcome the collection and supply chain challenges that thwarted battery recycling startups.
Like battery recyclers, Cyclic operates a hub-and-spoke model where regional spoke facilities automate the mechanical disassembly of e-waste and magnets from EoL products, followed by centralized chemical processing at a hub using its hydrometallurgical flowsheet. The first spoke, coming online in Arizona in Q2 2026, will process 25,000 tonne/y of magnet feedstock, producing about 250 tonne of mixed rare earth oxides (mREOs) at a centralized hub. Cyclic also recently announced it will spend USD 82 million to build a commercial processing hub in South Carolina to process its rare earth “black mass” into 600 tonne/y of mREOs, expandable to 1,800 tonne/y. This is still a fraction of the 10,000 tonne/y the U.S. needs just for defense applications.
Outlook: Why Cyclic Materials may succeed in rare earth recycling
Cyclic’s momentum stems from core advantages in scalability of its technology, initial strategic partnerships, and diversified revenue channels.
Technology
Unlike battery recycling, Cyclic’s disassembly process avoids complex steps, and its hydrometallurgical process avoids unique reagents or thermal processing steps that are less efficient. Rather, its flowsheet is energy efficient, producing 97% pure mREOs using 90% less water than having to mining rare earths.
Strategic partnerships
Cyclic’s current partnerships suggest a distributed feedstock acquisition strategy. It has secured long-term agreements with Solvay (REO offtake), Glencore (copper), and Vacuumschmelze (10-year agreement to recycle 100% of production scrap from its South Carolina facility). Other feedstock partners include Synetiq (EV motors), Vattenfall (wind turbines), and Lime (micromobility e-motors). However, to avoid the pitfalls battery recyclers faced, Cyclic’s long-term success will depend on a consortium of OEMs, scrap processors, e-waste programs, and logistics providers to build predictable volume.
Revenue diversity
While REOs represent the best bet for long-term profit, Cyclic also sells copper, aluminum, and steel recovered during preprocessing. Its Arizona spoke will produce 1,000 tonne/y–1,500 tonne/y of copper, worth ~USD 13 million at current prices. Its 250-tonne REO offtake to Solvay could yield at least USD 20 million in revenue, validating the commercial viability of its model.
National security implications
Unlike with battery recycling, a compelling aspect of Cyclic’s (and other REE recyclers’) positioning is national security, particularly as U.S. defense firms scramble to secure these critical minerals crucial to missiles, radar systems, and electronic warfare. Cyclic could emerge as a strategic supplier of last resort for defense procurement contracts — a critical buffer when mainstream commercial demand dips.
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