10/15/2025, 7:02:35 PM | China | United States | European Union
Military & Defense
Export restrictions from China are spurring major US and European investments to build domestic rare-earth processing, refining and recycling capacity.
China’s recent export curbs on several critical rare earths—erbium, europium, holmium, thulium and ytterbium—alongside earlier controls on neodymium, have accelerated Western efforts to onshore supply and processing.
The measures exposed concentration risks: China mines roughly 69% of rare earths, processes 88% of concentrates and refines about 90% of metals globally. 2025 is emerging as an inflection year, with tariffs and trade tensions driving record public and private investment to build alternative capacity in the US and Europe.
The US has moved quickly: the Department of Defense struck a public–private deal with MP Materials that includes over $400 million of capital and purchase commitments. USA Rare Earths plans to acquire UK refiner Less Common Metals for roughly $220 million, and Noveon Magnetics announced a multi-year magnet supply agreement with General Motors. These deals aim to integrate mining, refining and magnet production to reduce external dependence.
Europe is advancing via financed separation plants and recyclers: Carester secured €216 million to build a separation plant, while Solvay and magnet makers Vacuumschmelze and Neo Performance Silmet expand regional supply chains.
Key challenges remain: price volatility, limited heavy rare earths outside China and Myanmar, and the need for technology and recycling advances—such as grain-boundary engineering, novel casting and improved magnet recycling—to lower reliance on scarce elements.
Market forecasts anticipate rare-earth magnet demand rising about 69% by 2036, driven by EVs, robotics and energy systems.