US start-up Hertha Metals has broken ground on a $100 million plant in Conroe, Texas, that will make about 10,000 tonnes a year of high-purity iron, mainly for American rare earth magnet producers.
At a glance
- The Chalyx plant is expected to start in late 2027, with magnet-grade iron from early 2028.
- NdFeB magnets are roughly 70% iron by weight.
- Hertha's single-step process turns iron ore and natural gas directly into high-purity iron or liquid steel.
Background
Neodymium-iron-boron (NdFeB) magnets, used in electric vehicles and wind turbines, need very pure iron. Most of that iron is currently made in China. Hertha Metals, based in Texas, raised a $133.65 million Series A in September, including a $65 million equity investment from the US government.
What happened
Hertha Metals broke ground on its first commercial plant, called Chalyx, in Conroe, Texas, next to its Pi100 pilot plant, Chemical Engineering and MINING.COM reported. The roughly $100 million plant is designed to make about 10,000 tonnes a year of steel-grade and magnet-grade high-purity iron.
The plant is expected to start in late 2027, with magnet-grade iron production beginning in early 2028. Pittsburgh-based CV Engineering is the engineering, procurement and construction management partner.
How the process works
Hertha's single-step process feeds iron ore and natural gas into one furnace. Depending on the chemistry, it produces either liquid steel or high-purity iron, and it can use low-grade ore fines that blast furnaces cannot.
The company claims costs about 25% lower than the blast furnace route, and emissions about 50% lower on natural gas. It will use iron ore mainly from Minnesota's Iron Range and Texas natural gas, and reports 99.95% purity at its pilot plant.
Why it matters
The first priority is supplying US rare earth magnet makers. NdFeB magnets are roughly 70% iron by weight, and about 94% of that iron is currently made in China, Chemical Engineering estimated. Hertha is qualifying as a supplier with major US magnet producers.
"Successful commercial operations here will lay the foundation for our first 500,000-ton-per-year steel mill," CEO Laureen Meroueh said.
Our read
Outlook: neutral. A 10,000-tonne specialty plant is tiny next to global iron ore demand and will not affect prices.
What to watch
- Construction progress toward a late-2027 start.
- Supply agreements with US rare earth magnet makers.
- Plans for Hertha's proposed 500,000-tonne steel mill.
For information only, not investment advice.
Iron price in India
metalscost.com India reference price as of 2026-10-16.
Detailed analysis
Timeline
- 2026-09-30: Hertha Metals announces a $133.65 million Series A.
- 2026-10-12: Hertha breaks ground on its Chalyx plant in Conroe, Texas.
Demand Drivers
US magnet makers need non-Chinese high-purity iron for NdFeB magnets.
Government Policies
The US government invested $65 million in Hertha to build a domestic magnet supply chain.
What could lift prices
- Demand for non-Chinese magnet materials is rising.
- Hertha's process can use low-grade ore fines.
What could weigh on prices
- The plant is small relative to global iron demand.
- New process technology carries scale-up risk.
Country impact
| Country | Impact | Reason |
|---|---|---|
| United States | High | The plant would create a domestic source of magnet-grade iron. |
| China | Medium | It currently makes most of the iron used in NdFeB magnets. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Steel | Neutral | Hertha's process offers a lower-emission route to iron and steel. |
| Electric Vehicle Manufacturing | Positive | US magnet supply chains for EV motors could become less reliant on China. |
Who gains, who loses
- US magnet makers: They gain a possible domestic source of high-purity iron.
- Chinese high-purity iron suppliers: They could lose some US customers over time.
Other ways this could play out
- If Chalyx starts on time, Hertha could supply magnet-grade iron from early 2028.
- If the process struggles to scale, the timeline could slip.
Price risks
- Scale-up problems with a new process.
- Delays in qualifying with magnet producers.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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