Mining Maelstrom: Why Rare Earths Are Making Headlines
Over the past several years, news reports have grown more intense about the precarious global supply of rare earth minerals. Yet outside scientific and national security arenas, many people may not fully understand the importance of rare earths. What are these mysterious materials and why are they receiving so much attention?
Essential Elements of Everyday Life
Rare earth minerals are crystal structures that contain rare earth elements (REEs), which play a critical role in the global economy and national security. REEs include 17 elements on the periodic table—the 15 lanthanides, along with yttrium and scandium.
These elements support many aspects of modern life. They help light flat-screen televisions, computer monitors, mobile phone displays, and stadium scoreboards. REEs also improve the optical quality of digital cameras, assist in petroleum refining, and remove impurities from steel.
Why Rare Earth Elements Matter
Rare earth magnets can support hundreds of times their own weight, making them ideal for applications where space is limited. Manufacturers rely on these magnets in medical equipment, renewable energy systems, computer hard drives, audio earbuds, smartphones, and automotive technologies.
Defense systems also depend heavily on REEs. Radar, lasers, missile guidance systems, drones, nuclear submarines, and fighter jets all incorporate rare earth materials to function effectively.
Are Rare Earths Actually Rare?
Despite their name, rare earth elements are not scarce in nature. Nearly all REEs occur more frequently in the Earth’s crust than silver, gold, or platinum. Cerium, the most abundant REE, appears more commonly than copper and lead.
What makes REEs “rare” is not their abundance, but the difficulty of finding them in concentrations large enough to mine profitably.
Why Rare Earths Are Difficult to Extract
Rare earth elements do not occur independently like gold. Instead, they exist within mineral compounds, often mixed with other REEs. Extracting usable materials requires a complex, costly, and highly specialized process that depends on advanced facilities, equipment, and technical expertise.
Simplified Extraction Process
- Mining mineral ore that contains REEs
- Separating waste from valuable minerals
- Extracting REEs and separating them as oxides
- Converting oxides into metals
- Combining metals to create alloys and magnets used in finished products
One industry insider compared the process to “designing a chemical system that sorts blue M&Ms from the rest and then extracts the cocoa from the candy.”
Environmental Concerns
The separation process generates significant waste, which often contains radioactive materials. Improper disposal can contaminate water supplies and threaten both wildlife and human health, making environmental safeguards essential.
A Global Struggle for Control
Until the 1990s, the United States played a leading role in refining rare earths. Since then, China has emerged as the dominant force in the industry. Today, China controls approximately 60% of global mining, 91% of refining, 87% of oxide separation, and 94% of magnet production.
China benefits from high-quality mines, inexpensive chemicals, a skilled workforce, and a willingness to manage toxic mining waste. According to The Wall Street Journal, these advantages have allowed China to maintain overwhelming control of the supply chain.
U.S. Production vs. Global Supply
The U.S. Geological Survey estimates that the United States produced about 45,000 metric tons of rare earth oxides in 2024, valued at roughly $260 million. In comparison, China produced approximately 270,000 metric tons during the same year.
Although the United States ranks second in production, it ranks seventh in known reserves. China leads in reserves as well, followed by Brazil, India, Australia, Russia, Vietnam, and Greenland. Globally, estimated rare earth reserves exceed 90 million metric tons.
Market Pressure and Trade Tensions
Over time, the United States has attempted to revive domestic production of critical minerals, including rare earths. Under the Biden administration, the government provided hundreds of millions of dollars in financing to boost processing capacity. Environmental regulations, permitting delays, and China’s market influence have slowed progress.
China suppresses competition by flooding global markets with low-cost magnets and limiting exports during trade disputes. After President Trump announced Liberation Day tariffs, China restricted magnet exports worldwide.
Exports dropped 45% in April and 74% in May year over year—the steepest decline since 2012. Shipments to the United States fell 59% in April and 93% in May, forcing at least one automaker to temporarily shut down operations.
In June, both nations reached an agreement that allowed U.S. manufacturers to receive enough magnet supplies for six months.
U.S. Dependence on a Single Mine
Currently, the United States mines about 12% of the global rare earth supply, primarily from one mine in California’s Mojave Desert. U.S. companies export nearly two-thirds of this material to China for processing and magnet production before shipping the finished products back to the United States.
Enter the Department of Defense
In mid-July, the Department of Defense announced a commitment of hundreds of millions of dollars to the company operating the California mine. This funding will increase processing and magnet production capacity tenfold. The Pentagon has also offered purchase and price guarantees to protect the company from market manipulation.
Combined with other rare earth projects across the country, some industry experts believe the United States could reduce its reliance on China within three to five years.
Looking Ahead
Whether that goal becomes reality remains uncertain. The rare earth industry remains complex, expensive, and environmentally sensitive. Still, reducing China’s dominance in mining, processing, and magnet production appears essential to strengthening supply chains and national security. ensure the continuing economic strength and security of both the
United States and countries around the world.
1–3) U.S. Geological Survey, November 2014, American Geosciences Institute, 2025
4–5, 9, 12)The Wall Street Journal, July 15, 2025
6) Investing News Network , February 5, 2025
1, 7, 11, 13) The Wall Street Journal, March 24, 2025
8) The Wall Street Journal, April 25, 2023
10) U.S. Geological Survey, January 2025
12) The Wall Street Journal, June 19, 2025 and July 10, 2025
14) The Wall Street Journal, July 10, 2025 and July 15, 2025
Ready to Why Rare Earths Are Making Headlines?
Contact ETCPA today to discover the right bookkeeping solution for your business:
+1 718-261-9600
[email protected]
Forest Hills, NY (Corporate Office)