USA Rare Earth Inc. (USAR) shares surged 5.32% in pre-market trading on Monday, riding a wave of enthusiasm that swept through the rare earth sector. The rally was triggered by reports that the Trump administration is considering taking a stake in Critical Metals Corp, which is developing a major rare earths project in Greenland.

According to a Reuters report, Trump administration officials have discussed acquiring an interest in Critical Metals Corp, potentially giving Washington a direct stake in the largest rare earths project in Greenland. This move aligns with the administration's broader strategy to secure U.S. interests in critical mineral production, following recent investments in companies like Lithium Americas and MP Materials.

The news has sparked a sector-wide rally, with several rare earth companies seeing significant pre-market gains. Critical Metals led the pack with a staggering 90% increase, while other players in the space, including USA Rare Earth, also benefited from the positive sentiment. This development underscores the strategic importance of rare earth elements in global economics and geopolitics, particularly as the U.S. seeks to reduce dependence on foreign sources for these critical materials.