Tearing Free from China's Domination Over Scarce Earth Elements
In a bid to lessen the reliance on China's near-monopoly in rare earth element (REE) supply and processing, significant efforts and progress are underway globally.
Australia's Role as a Global Leader
Australian companies like Victory Metals and Lynas Rare Earths are at the forefront of this movement. Victory Metals' North Stanmore project exploits a clay-hosted heavy rare earth deposit with simpler, low-cost processing to produce high-value elements like dysprosium and terbium. Lynas has expanded production and downstream processing, notably building a magnet manufacturing plant in Malaysia and commercially producing heavy rare earth oxides such as dysprosium oxide outside China, milestones achieved in 2024–2025[1][3][5].
Western Expansion of Processing and Magnet Manufacturing
Neo Performance Materials in Europe has re-established rare earth separation and magnet manufacturing facilities, bringing decades of Western institutional knowledge back and demonstrating the economic viability of mid-stream and downstream rare earth processing outside China. This fosters supply chain diversification for critical technologies like electric vehicles and renewables, addressing strategic vulnerabilities[2].
United States Initiatives and Investments
The U.S. Department of Defense has accelerated the “mine-to-magnet” strategy, investing hundreds of millions of dollars, including $258 million in Lynas to open a production facility in Texas. The U.S. is also collaborating internationally via the Minerals Security Partnership, involving allies Japan, South Korea, India, Australia, and others, to jointly develop mining, processing, and secure supply chains. Despite producing about 15% of global REEs domestically (e.g., Mountain Pass mine), the U.S. has historically relied on China for processing; progress is ongoing to establish domestic midstream and downstream capabilities[4][5].
International Collaborations and Market Shifts
Japan and the European Union are undertaking joint procurement efforts and forming public-private partnerships to diversify rare earth supplies. Chinese companies continue acquiring overseas projects at premiums, indicating China’s determination to maintain dominance, but the global trend strongly favors diversification and building independent capacity[3][4][5].
Looking Ahead
There is also talk of a plant in Nebraska at NioCorp's Elk Creek deposit, further evidence of the global commitment to reducing dependence on China's rare earth supply chain monopoly. Key milestones in recent years include commercial production of heavy rare earth oxides, re-establishment of separation capabilities, and significant investment in downstream manufacturing, signaling meaningful progress in this direction[1][2][3][4][5].
The technology-driven mining operations of companies like Victory Metals and Lynas in Australia are contributing to an increased defi (diversification) of rare earth element (REE) supply chains. Neo Performance Materials in Europe is demonstrating the economic feasibility of mid-stream and downstream rare earth processing technology outside China's dominance to foster technology-driven supply chain diversification for critical technologies.
