A little-known start-up backed by Donald Trump Jr. has secured a multi-million-dollar loan from the Pentagon to boost domestic production of rare-earth magnets, a key component in defense and emerging technologies.
Vulcan Elements Lands Record Defense Loan
Vulcan Elements, a U.S.-based rare-earths company supported by Trump Jr.’s 1789 Capital venture firm, is set to receive a $620 million loan from the Defense Department. The funding is part of a broader $1.4 billion government investment in the sector, marking the largest loan ever issued by the Pentagon’s Office of Strategic Capital, according to the Financial Times.
Since January, four companies within 1789 Capital’s portfolio—including stakes in SpaceX and Anduril—have collectively received contracts worth $735 million under Trump’s administration.
Ethics Concerns Raised
The deal has drawn scrutiny from ethics experts. “Presidents are expected to avoid even the appearance that they are using their office to financially benefit themselves or their family,” said Kedric Payne, an ethics attorney.
“While we do not know for certain if, or how, the president may have influenced this loan, it falls under the cloud of conflicts of interest we have seen throughout his administration.”
Applications and Strategic Importance
Vulcan Elements produces rare-earth magnets essential for:
- Defense systems
- Satellites
- AI data centers
- Semiconductor fabrication
- Consumer electronics
- Industrial motors and power tools
The company emphasizes efficiency, cost competitiveness, and supply chain transparency, claiming its approach reduces production costs without compromising performance.
Vulcan Elements’ mission is to strengthen U.S. and allied security while supporting a “resilient future” for critical magnetic technologies. The company partners with firms in the U.S. and allied countries, including the UK, Australia, and Japan.
Trump’s Commentary
President Donald Trump previously highlighted the importance of magnets for emerging technologies, though his remarks drew attention for their unusual description of the materials’ properties.
Support and Transition
Vulcan Elements says it will continue producing and innovating magnets while honoring existing contracts. Its focus remains on technical excellence, supply chain transparency, and delivering solutions critical to both commercial and defense sectors.
