Defense Logistics Agency

The Nation’s Combat Logistics Support Agency

Small Business Innovation Research 

Securing Resources for US Defense & Commercial 

Industries 

TOPIC NUMBER:

DLA 161-003

TOPIC TITLE:

Economically 

Recovering Rare 

Earth Materials

CONTRACT 

NUMBER:

SP4701-17-C-0042

SBIR COMPANY 

NAME:

Urban Mining 

Company

Austin, TX

TECHNICAL 

PROJECT 

OFFICE:

DLA Strategic 

Materials

PUBLISHED:

May 2018

DOMESTIC CAPABILITY FOR MAGNET PRODUCTION

Urban Mining Company: How A U.S. Company Uses

Unconventional Resources To Meet A Strategic Defense

Need

With support from the Defense Logistics Agency Small Business Innovation Research Program,

Texas-based Urban Mining Company further developed their Magnet-to-Magnet (M2M®)

technology for using recycled materials to manufacture high performance magnets.

Rare-earth elements (REEs) are key materials used in thousands of high-tech devices.

Neodymium-iron-boron (NdFeB) magnets contain REEs and are essential components for

missiles, smart bombs, UAVs, and aircraft. NdFeB magnets enable the miniaturization of

guidance, propulsion and power systems due to their weight to magnetic power ratio. Design of

many current and future defense systems are based around motors and generators whose

reduced size and weight and increased efficiency and performance can only be achieved using

NdFeB magnets.

It was the mission of DLA in the context of strategic materials to support the development of a

technological solution for NdFeB magnets that offered a high performance, low-cost alternative

and immediate impact.
M2M® uses waste magnetic materials recovered from

“end-of-life” applications to manufacture new high

performance magnets. First, the company uses processes

it has developed for extracting magnets from recycled

hard disk drives, air conditioners, wind turbines, MRI

machines, hybrid electric vehicles (HEV) and more. Then,

magnetic materials are reduced and milled down into

powders before re-processing into new magnets without

melting the magnetic alloy phase. M2M® works by

engineering the grain boundaries of NdFeB magnets. All

sintered magnets are made up of tiny grains of magnetic

Nd2Fe14B embedded in a matrix of rare-earth rich ‘grain

boundary’ material. During the milling process employed

during M2M®, the magnetic grains are removed from the

grain boundary phase and the ‘GBM alloy’ replaces it with

a new boundary during the heating (sintering) process.

This new grain boundary has a carefully tailored

composition that grants recycled magnets their superior

magnetic and physical properties.

Urban Mining Company uses a sustainable, domestic

source to address critical demand for NdFeB magnets.

M2M® requires a small amount of ‘virgin’ rare-earth inputs

(~3%) to produce high performance magnets. This

innovation places UMC largely outside of the traditional

‘mining-refining’ supply chain, as M2M® obtains ~97% of

the material it uses to make magnets from domestic

source NdFeB present in end-of-life appliances already

located on US soil. M2M® recycling insulates UMC and its

customers from REE price fluctuations and supply

restrictions, and grants the company a decisive cost

advantage and its customers a more stable low-cost

solution.

“Collaboration with DLA and defense partners has been

key and must continue to address this issue. Our

technology is truly a paradigm shifting breakthrough in

terms of how we all view resources,” said CEO Scott Dunn.

Our final product is superior in performance where it

counts – high temperature. And because there is no

“performance tradeoff”, our technology opens the way for

truly closed-loop systems. This potential introduces the

concept that customers are not merely ‘purchasing’

magnets; they are ‘investing’ in the long-term stability and

availability of their own REEs/NdFeB supply chain made

possible by magnet-to-magnet recycling.”

Despite their importance to industry and defense, REEs

mining, refining and magnet manufacture are largely

controlled by China. Past supply crises (2010-2012), where

China restricted REEs production and exports, raised the

prices of REEs and NdFeB magnets by up to 3000%. Price

volatility and supply restriction of NdFeB magnets would

require significant R&D expenditure as the subcomponents

of many defense systems would have to be redesigned or

phased out. And such alternative designs would also result

in reduced performance. The ‘booms and busts’ in REEs

prices are directly caused by market-interventions, such as

export tariffs enacted by the Chinese Government and may

be deliberately contrived to maintain dominance in this

sector. For the US, future reductions in REE/NdFeB magnet

supply for geopolitical or other reasons are likely. Chinese

high-tech industries are increasingly given preferential

access to REEs per Made In China 2025 with the aim of 70%

of all materials containing REEs exported from China to be

in the form of finished goods. In fact, many analysts predict

that China will become the world’s largest importer of REEs

by 2025. This sets the stage for future, long-term

REE/NdFeB magnet supply crises. However, investing in

and creating the capacity to produce REEs and NdFeB

magnets in the west to neutralize geopolitical vulnerability

will take at least a decade and hundreds of billions of

dollars according to GAO.

It was the mission of DLA in the context of strategic

materials to support the development of a technological

solution for NdFeB magnets that offered a high

performance, low-cost alternative and immediate impact.

Urban Mining Company (UMC) offers a solution that does

NOT require re-trenching of the entire REE supply chain in

the US as the technology is ‘standalone’. M2M® works by

recovering domestic source NdFeB alloy from end-of-life

devices already located in the US. The resulting recycled

magnets have superior magnetic and physical properties to

the starting NdFeB materials. Using end-of-life materials

allows UMC significant cost advantages while making use of

an abundant domestic source. Thanks in part of DLA

support, M2MTM process currently functions at a

manufacturing readiness level of ~7-8. The design,

construction, and installation of UMC’s fully commercial

manufacturing plant for establishing strategic domestic

capacity is underway in San Marcos, TX.

Sponsored by the DLA of DoD

Made in the USA