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

Scientifically speaking, rare earth minerals are the crystal structures that contain rare earth elements (REEs), resources that are crucial to the global economy and national security. REEs are 17 elements on the periodic table — the 15 elements known as “lanthanides” plus yttrium and scandium. Their unique properties facilitate many aspects of everyday life, from lighting up flat-screen televisions, computer monitors, cell phone screens, and stadium scoreboards to improving the optical quality of digital cameras. They help refine petroleum and remove impurities from steel. Magnets made from rare earths — which can support hundreds of times their own weight and are therefore beneficial when space is limited — are used in medical equipment, clean energy technology, computer hard drives, audio earbuds, smartphones, and automotive systems. Rare earths are also used in defense applications and weapons, including radar, lasers, missile systems, drones, nuclear submarines, and fighter jets.¹

Despite their name, REEs are not rare in terms of abundance. In fact, nearly all REEs occur more frequently in the Earth’s crust than silver, gold, and platinum. Cerium, the most prolific REE, is more common than copper and lead.²

What makes REEs rare is that they are difficult to locate in large enough concentrations to profitably mine. Moreover, they don’t exist on their own, like gold, but are contained within minerals, sometimes in combination with one another. They must be extracted and converted to usable materials through a complex and costly process that requires highly specialized production facilities, equipment, knowledge, and skills.³ The following is a simplified description of that process:⁴

• The mineral ore containing REEs is mined.
• Waste is separated from the minerals, and then the REEs are extracted from the minerals.
• REEs are separated as oxides (chemical compounds), and the oxides are converted into metals.
• Metals are combined to create alloys and magnets, which are then used in products.

One industry insider compared it to ” … designing a chemical process to sort out blue M&Ms from the rest of the M&Ms and then extracting the cocoa from those candies.”⁵

A significant concern is that the waste generated during the separation can often be radioactive, and if not properly disposed, can contaminate water supplies, threatening both wildlife and humans.⁶

A struggle for control

Until the 1990s, the United States was a major refiner of rare earths; however, since that time, China has emerged as the industry leader by a huge margin.⁷ The Asian nation controls about 60% of worldwide mining, 91% of refining, 87% of oxide separation, and 94% of magnet production.⁸ According to The Wall Street Journal, China benefits from some of the world’s best mines, cheap chemicals, a large and well-trained workforce, and “a stomach for handling toxic rare-earth mining waste.”⁹

The U.S. Geological Survey reports that an estimated 45,000 metric tons of rare earth oxides, valued at $260 million, were produced in the United States in 2024. By comparison, China produced 270,000 metric tons. While the United States ranks second to China in terms of production, it ranks 7th in terms of reserves. China leads the pack in this arena as well, followed by Brazil, India, Australia, Russia, and Vietnam. Greenland rounds out the top eight. Globally, it’s estimated that more than 90 million metric tons of rare earth reserves exist.¹⁰

Through the years, the United States has attempted to revive domestic mining of critical minerals, including rare earths. Under the Biden Administration, for example, hundreds of millions of dollars in financing were granted to help boost processing; however, projects have been stymied by environmental and permitting issues, as well as China’s ability to control market forces.¹¹ The country quells competition by flooding the market with magnets, driving prices down to unsustainable levels, and influences trade negotiations by limiting exports.

For instance, after President Trump announced the Liberation Day tariffs last spring, China imposed controls on magnet exports worldwide. Exports fell 45% in April on a year-over-year basis, and 74% in May — the biggest decline since 2012 and the lowest export level since the Covid pandemic. Exports to the United States fell 59% in April and a mammoth 93% in May, forcing one auto manufacturer to temporarily shut down operations. In June, an agreement was reached that permitted U.S. manufacturers to receive enough magnet supplies for six months.¹²

Currently, the United States mines about 12% of the world’s supply of rare earth minerals, most of which come from a singular mine in California’s Mojave Desert. However, U.S. companies have had to export about two-thirds of their material to China to be processed and turned into magnets, which are then shipped back the United States.¹³

Enter the Defense Department

In mid-July, the Department of Defense announced it was committing hundreds of millions of dollars to the company that owns that California-based mine, which will help it increase processing and magnet production tenfold. The Pentagon has also provided purchase and price guarantees to help the organization remain viable regardless of China’s actions. Overall, the total financial support will amount to billions. In combination with other rare earth magnet projects occurring throughout the United States, some industry observers believe that this program could theoretically relieve the nation’s reliance on China in as little as three to five years.¹⁴

Whether or not that holds true remains to be seen. The rare earth industry is complicated and expensive, and poses significant environmental risks that need to be carefully addressed. But it seems that breaking China’s hold on rare earth mining, processing, and magnet production is necessary to help ensure the continuing economic strength and security of both the United States and countries around the world.