April 30 (Reuters) - Japan's Sumitomo ( SSUMF ) and

impact investment fund Builders Vision have invested in

U.S.-based rare earths processing startup Phoenix Tailings, the

latest move by manufacturers to boost production of the critical

minerals outside of China.

Rare earths are a group of 17 metals used to make magnets

that turn power into motion for electric vehicles, cell phones

and other electronics.

The existing standard to refine these minerals, known as

solvent extraction, is an expensive and dirty process that

gradually became unpopular in the United States after it was

developed in the 1950s but one that Chinese companies have

mastered.

China's exports of rare earths have ground to a halt,

fueling a scramble across the West for replacements. Phoenix

says its process can produce rare earths from mined ore or

recycled equipment with little to no emissions.

Sumitomo's ( SSUMF ) Presidio venture arm, along with Builders Vision,

Yamaha Motor ( YAMHF ), and venture capital funds Envisioning

Partners, MPower and Escape Velocity, joined a $33 million

tranche for Phoenix's Series B funding round, which closed on

April 25, the company said.

Phoenix declined to disclose each investor's funding.

The company will use the funding as part of its construction

of a $13 million facility in Exeter, New Hampshire, that can

produce 200 metric tons of rare earths annually initially and

should open later this year.

The company last December closed a first tranche of its

Series B round worth $43 million, bringing the total round to

$76 million.

A $10 million Series A funding round closed in August 2021.