White House RE Tariff A Joke?; Peak's Bargain-Sale; Ucore's Strange Bedfellows; Metallium: Caught Red-Handed?; and a lot more
Rare Earth 20 September 2025 #182
Note
We tried to keep it short, but nonetheless it has become long. Too much is going on.
Fat hope
There was big, boastful talk, pathetic nonsense about rare earth in Ukraine of all places, even insinuation of rare earth cooperation with Russia (an eudialyte trap, just like Greenland is). Russia is conveniently simply copying and pasting Neo’s facilities in Estonia anyway.
But when it comes to actual, real, tangible and present opportunities like the advanced project of Peak Rare Earths there is hardly a whimper in the West. One lonely white knight appeared with a lowball offer.
Why? Perhaps because everybody who is in charge tacitly seems to hope that China will turn around 180 degrees, supply all the world indiscriminately with unlimited amounts of rare earths and all will be well?
China’s possible rare earth objective
The direction that China may want to be taking is to produce rare earths only for self-consumption (which of course includes downstream export products) and cap rare earth exports at the never officially abandoned target of max 30,000 t, likely including 20,000 t of uneconomic lanthanum and cerium compounds.
These 30,000 t would be >40% less than currently.
How this could work
China producing rare earth only for self-supply was the official announcement of MIIT to the European Commission’s Raw Materials Group at a meeting in Beijing 11 years ago, just after China had had to lift all its rare earth export restrictions and price controls because it had lost the relevant WTO case.
Starting 2025 the revamped state-quota for rare earth includes everything, also rare earth produced raw material imports, China may be able to do just that. On top of that it may do so in secret as the quota along with everything else rare earth has become a “national security” matter. Basically childish, but it is what it is.
China’s Ministry of Industry & Information Technology has announced that China is already close 30% of world manufacturing. Going forward China will continue trying to reap an ever larger share and this certainly includes the objective to bring ever more rare earth dependent downstream manufacturing home to China.
It won’t work
The Nikkei reported that global EV battery capacity is already 3 times global demand and that this triple overshoot won’t change until 2030. China is 70% of that global capacity, which makes China’s share of global battery capacity equal to two times the size of global battery demand.
In rare earth permanent magnets China’s capacities are also twice global demand. Is this Xi Jin Ping Thought on Supply Side Reform at work? If so, then we can’t wait to see what is next.
In steel Xi Jin Ping Thought-based Supply Side Reform has been a failure.
What is the dependence?
The dependence on China in rare earth finished products and rare earth containing components is much, much more consequential than in any of China’s historical products like silk, porcelain or gun powder:
The economic impact of rare earths - including kick-on effects - could easily be a double digit percentage of world GDP.
Rare earth elements are to industry what vitamins are to the human body: tiny in quantities, yet indispensable.
China unquestionably dominates the rare earth market in all aspects, be it as a producer, as a researcher and developer, or as a consumer.
The lion’s share of the much hyped “global rare earth market” is China alone.
No modern economy can do without free and unrestricted access to rare earths and their downstream products. We have just seen India’s PM Modi eating humble pie in China owing to India’s spectacular failure to get something meaningful going in rare earths.
Consequently the West must do-it-yourself and also actively employ replacements, as one just can’t rely on China.
Opportunity
Ostensively China’s rare earth raw material imports and related mine development have opened an opportunity for the West to also use these resources.
Japan’s Lynas has proven that it is possible not only to compete profitably with China. The company even achieves a large part of its revenue by selling to China - our data suggest that Lynas’ Chinese customers may be good for around 50% of Lynas revenue.
But that also means that China has its finger on the Lynas kill-switch. Expect China to gingerly play with the switch, depending on Japan and by extension Lynas behaving well.
The road ahead
The current hype of rare earth permanent magnets clouds the view on the fact that there are uncounted dependencies on every single one of the 17 (minus one: promethium is extinct) rare earth elements.
Happily China committed the error of putting 7 rare earth elements under ill-conceived restrictive export licensing. This is a wake-up call for foreign governments that ALL rare earths are of vital importance, not only the much-hyped 4 “magnet rare earths”. We are not sure if the current US administration has heard the explosions. The EU seems to be on a good way, provided it can deregulate.
China may continue to dominate, but not like it does now.
Comedians at work
White House latest Tariffs on Rare Earths
Annex III says:
All products that are properly classified in the provisions of the Harmonized Tariff Schedule of the United States (HTSUS) that are listed in this Annex are potentially eligible to be exempted from duties imposed by Executive Order 14257, as amended, as determined by the Secretary of Commerce and the United States Trade Representative for each trading partner that has concluded an agreement on reciprocal trade, based on the scope and nature of the trading partner’s commitments under that agreement.
and:
A subheading marked with “Pharma” includes only non-patented articles for use in pharmaceutical applications.
Annex III lists:
2805.30.00 Rare-earth metals, scandium and yttrium, whether or not intermixed or interalloyed with no scope limitation.
2846.90.20 Mixtures of rare-earth oxides or of rare-earth chlorides
with scope limitation “Pharma”.
2846.90.40 Yttrium-bearing materials and compounds containing by weight more than 19% but less than 85% yttrium oxide equivalent with scope limitation “Pharma”.
2846.90.80 Compounds, inorganic or organic, of rare-earth metals, of yttrium or of scandium, or of mixtures of these metals, nesoi with no scope limitation.
We are pretty certain that no patient would survive an IV drip with >19% yttrium.
One just can’t stop marveling at the ingenuity and fabulous rare earth competence of politicians. Truly inspired leadership.
EU firms brace for more shutdowns due to China rare earth controls despite summit promise
European firms are expecting more shutdowns and suffering losses as Beijing continues to hold a tight grip on rare earth exports despite a July agreement to fast-track shipments to the bloc, the European Union Chamber of Commerce in China said on Tuesday.
"Irrespective of the agreements and commitments reached at the EU-China summit on the 24th of July, we continue to see significant bottlenecks for our members," Jens Eskelund, the chamber's president, told reporters.
During a July summit between European Commission President Ursula von der Leyen and Chinese President Xi Jinping, China agreed to fast-track licences for critical raw materials for European companies, although it fell short of EU’s wish for China to grant licences for a longer period or to scrap them for exports to the bloc.
Perhaps the EU should not have accepted the license requirements as such and should have questioned the flimsy base the license requirements are built on.
US Lawmaker Wants Trump to Restrict Chinese Flights Over Rare Earths Access
-The chair of a U.S. House of Representatives committee on China on Thursday called on the Trump administration to restrict or suspend Chinese airline landing rights in the U.S. unless Beijing restores full access to rare earths and magnets.
Another potential escalation. What would happen to US-owned airlines slots at China airports?
India explores rare-earth deal with Myanmar rebels after Chinese curbs
State-owned miner IREL and private firm Midwest Advanced Materials - which received government funding last year for the commercial manufacturing of rare-earth magnets - were among those involved in the discussions, the sources said.
New Delhi hopes to test the samples in domestic labs to ensure they contain sufficient levels of heavy rare earths that can be processed into magnets used in electronic vehicles and other advanced equipment, according to the people.
This is almost comical. And it is of concern that Reuters don’t get it at all.
The operators of the Kachin mines are national Chinese, and:
their sole and single customer for 100% of rare earth output is China.
their sole and single supplier of more than a million tons per year of mining chemicals is also China.
Both trades are streamlined through China Rare Earth Group.
India can replace neither in meaningful volumes.
Apart from the above slight hinderances there is cost. The KIA may be looking for a higher commission from India and the Chinese “bosses (老板)” in Myanmar may be looking for higher-than-China-prices from India for their product, too.
So, if anything should work out then it it will certainly need to base on India paying premium prices. India is not known for paying premiums.
On the other hand India could become a partial outlet for quantities that China does not take from Myanmar. In order to continue exerting full control this would force China to buy whatever the Chinese bosses in Myanmar can produce - with implications for the rare earth supply-demand balance in China and related necessary quota adjustments. Squaring the circle?
Related
Taiwan Shows Interest in Buying Rare Earth Minerals from India: TAITRA Dy Director
Speaking with ANI, Keven Cheng, Deputy Director of TAITRA, said that Taiwan is keen on sourcing rare earth minerals from India. Rare earth elements are vital for sectors like electric vehicles, renewable energy, and defence.
"We have the technology to make some products, but we need the materials in India so that we can work together," Cheng told ANI on the sidelines of the Taiwan Expo 2025.
India is believed to hold around 6.9 million metric tons of rare earth reserves, making it the world's third-largest reserve holder. This vast resource, if fully tapped, could position India as a key long-term supplier.
This must be somewhat related to India’s pivot to Myanmar discussed above.
India’s own rare earth resources are mostly beach sand monazite, i.e. heavy mineral sands along its coast line. Thanks to the inert bureaucracy at work at IREL and at KABIL, rare earth progress is painfully slow.
Basically India has it all but somehow can’t get anything going. That is why India’s PM Modi talked to Xi about rare earth and permanent magnets. But he did not sit through Xi’s military parade marking China’s newly invented victory in World War II.
India is playing a sophisticated strategy balancing the US, China, Taiwan and Russia.
Vietnam
Rare Earth Technology Institute strengthens cooperation with South Korea in rare earth technology field
Recently, within the framework of the Vietnam-Korea Joint Research Cooperation Project on Rare Earth Elements, the Institute of Rare Earth Technology (ITRRE) collaborated with a delegation of senior experts from the Korea Institute of Geoscience and Mineral Resources (KIGAM), Korea Mineral Resources Corporation (KOMIR) and Hanyang Scientific Equipment Industry Co., Ltd. to assess the progress of the Vietnam-Korea Joint Research Cooperation Project on Rare Earth Elements and agree on the cooperation plan for the next stage.
So the Vietnam rare earth plan to eventually produce >60,000 t separated rare earths by 2030 seems to be progressing.
We reported about Vietnam’s Decision 866/QD-TTG grand plan for rare earths on 3 September 2023.
Straits Times News Analysis
Will the US catch up to China on rare earths?
This is a typical assortment of stereotypes and misinformation which is floated in the largely rare-earth-virgin media.
The write up confuses rare earth ores, finished rare earth products and rare earth permanent magnets, also a classic. It is like not discriminating between iron ore, steel billets and cold-drawn seamless steel tubes.
Lets dive in:
"An F-35 fighter jet, for example, uses over 400kg of rare earth metals”.
This myth originates from a 2010 Report to Congress. Experts sincerely doubt this number.
Rare earth applications only need really tiny quantities of rare earths to achieve full functionality of the respective application.
"Some submarines need more than 4,000kg of rare earths.”
When submerged it is difficult for a submarine to operate a diesel engine because it would suck the air out of the submarine in no time.
Therefore submerged submarines will run on electric engines. These electric engines contain rare earth permanent magnets, the strongest permanent magnets known to man. Then the flaps, steering, actuators, pumps and uncounted small electric motores are certainly enabled by rare earth permanent magnets, so are the torpedoes/missiles.
The 4,000 kgs mentioned may well be referring to the total weight of these magnets, which only contain about 32% of rare earths, the rest being iron.
Then there may be some other small quantities of rare earths contained, such as “Terfenol-D” for sonar as well as diesel injection and some small quantities for sensors and all kinds of instruments.
"There is a good chance that Mr Trump’s call goes unheeded because Europe also imports large amounts of rare earths from China, which has the world’s biggest rare earth deposits.”
The US Geological Survey has been continuously publishing China’s rare earth reserves as 44 mio t, which would be the world’s largest.
Before the current USGS estimate China’s reserves had been put at mere 27 mio t. This may also have been a generous assessment, as Chinese experts at the time kept warning of potential depletion of China’s rare earth reserves.
Ca. 80% of China’s reserve estimates base on the largest rare earth mine in the world, Bayan Obo near Baotou. However, this is not a rare earth mine per se, it is an iron ore mine and rare earths appear as a by-product of the iron ore mine tailings.
“...Europe also imports large amounts of rare earths from China, which has the world’s biggest rare earth deposits.”
Actually, 80% of China’s rare earth exports to the EU in 2024 (and US ca. 60%) are the two elements lanthanum and cerium.
These are used for the production and consumption of fossil fuels. They are priced ~US$0.65/kg for La and ~US$1.60/kg for Ce.
Actually, as regards Europe’s “large” rare earth imports, the decarbonisation of the economy is NOT driven by import of rare earths. It is driven by imports of finished products and components that contain rare earths - from China.
The EU even exports rare earth products from the small factory in Estonia which bases on Russian raw material, to be replaced with Brazilian raw material. Anyway, small.
"In 2024, for instance, China produced 270,000 tonnes of these crucial metals versus only 40,823 tonnes in the US.” This is partly patently false and partly misleading.
The Chinese production quota for rare earth oxides in 2024 was indeed 270,000 t. But this quota based on rare earth oxides produced from China-domestic raw materials. Rare earth oxides produced in China based on imported raw materials did not count against the quota.
In 2024 China imported nearly 180,000 t of direct rare earth raw materials and ca. 7 mio t of indirect rare earth raw materials from abroad of varying rare earth contents. The Straits Times rare earth number of 270,000 t is at least 100,000 t short of real China output 2024.
Further, the US commercially produced no rare earth oxides, excluding small quantities from experimental processes and a token quantity from MP Materials’ work-in-progress, which MP Materials exported to China and Chinese transplants in South East Asia.
"The US got a taste of the power China wields on rare earth supplies immediately after Mr Trump announced duties as high as 145 per cent on Chinese goods on April 2. Two days later, China responded by restricting rare earth exports.” This is not a correct correlation.
Years ago China announced that it does not wish to aid the production of weapons that can threaten China.
Subsequently it identified 7 rare earths of which
all are suitable for defense applications,
the US are the world’s largest importer,
a major share of US imports is for defense contractors.
China put the 7 rare earths under dual use export licensing.
Export from China for civil applications are ok, for defense not ok.
In this licensing China refers to nebulous “commitments under international non-proliferation agreements” and “domestic law”.
This being so, China can’t possibly make these 7 rare earth subject to trade negotiations or a trade deal as this would imply China’s commitments to international agreements and compliance with its own laws were for sale. Unthinkable. See also: “China will never reach agreement at expense of principles, companies: commerce ministry”
The US-side is less principled. US product-specific export restrictions are negotiable for reaching a trade agreement.
In view of a forthcoming trade “deal” with China also democracy and US allies are negotiable for the current US administration. In order to cater to China’s demands, the current US administration canceled US$400 mio in military aid to democratically ruled Taiwan. China’s revisionists seek to annex Taiwan based on what some view as a highly creative version of history.
Thai factory demand brisk as firms flee China
WHA Corp, Thailand’s biggest factory developer, is building new industrial parks in Thailand and Vietnam to meet demand from Chinese manufacturers rushing to relocate production abroad and dodge a US-China trade war.
Chinese electronic parts and appliance makers say they intend to shift production to Thailand and Vietnam, chief executive officer Jareeporn Jarukornsakul said.
The company, whose clients include the Chinese carmakers BYD and Great Wall Motor, and the appliance maker Haier Smart Home, is accelerating land acquisition to meet the wave of factory relocations, according to Ms Jareeporn.
It is constructing six new projects in Thailand on about 4,000 acres, she said. WHA is also developing three new industrial complexes in Vietnam with a total area of 1,340 acres, she said.
Thailand is emerging as a beneficiary of escalating trade tensions with foreign direct investment surging as manufacturers look to sidestep the 30% US tariff on many Chinese products. Thai shipments to the US face a duty of 19%.
Related
China’s Broad Economic Slowdown Raises Stimulus Expectations
Expansion in fixed-asset investment in the first eight months of the year decelerated sharply to 0.5%, the worst reading for the period on record except for the pandemic year of 2020.
With a boom in exports cooling off, many analysts and investors expected a downshift in China’s economy during the final months of 2025 after it clocked growth of 5.3% in the first half. The extent of the deceleration in China, set to be the top contributor to global growth over the next five years, will matter to a vulnerable world economy that’s slowing under pressure from Donald Trump’s tariffs.
Those who gloat when China struggles should be reminded that China’s economy fires global growth. One could envision theoretical conditions under which China’s economy suffers from a prolonged recession while the rest of the world still has economic growth. But we are not there yet and today China has arguably its most effective government of its history.
Also Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era - which basically is copy/paste of vanilla Marxism-Leninism - absolutely requires economic growth.
Real growth, not Mao-era fake growth numbers to satisfy political postulates, while millions statistically well-fed people were actually starving to death.
Chinese Rare Earth Mines Proliferate in Eastern Shan State, Rights Group Warns
Nineteen new Chinese-operated rare earth mines in territory controlled by the ethnic National Democratic Alliance Army (NDAA) in eastern Shan State pose an unacceptable threat to human health and the environment, the Shan Human Rights Foundation (SHRF) has revealed.
Contaminated water from the mines, which were spotted on satellite images and recent video footage, drains into the Lwe River, a tributary of the Mekong, the rights group said.
Its findings indicate a sharp rise in rare earth mining over the past four years, with satellite images from early 2021 showing only three mines in the area.
Currently, sixteen of the mines, which are run by Chinese nationals, are in operation and another three under construction.
All employ the hazardous “in-situ leaching” method to extract rare earths from the mountain soil…
“Ammonium sulfate and ammonium formate are directly injected into the soil to extract rare earths, a process that devastates not only the land but also groundwater,” SHRF spokeswoman Ying Leng Harn told The Irrawaddy.
She cited a Thai university study of a former rare-earth mining site in Myanmar’s Kachin State, which found that the soil remained contaminated more than 10 years later and that local residents were suffering from blood-related diseases.
The SHRF said most of the mines are located at 4,000 to 5,000 feet above sea level about 4 km from the Chinese border. Water from the mining sites drains into the Nap stream, which flows southward into the Lwe.
They lie within Shan State’s Special Region 4, which has been controlled by the NDAA since it signed a ceasefire with the Myanmar military in 1989.
Zung Ting, a Kachin environmentalist, said that the impact of rare earth mining is severe as forests on mountaintops are cleared first, and once digging begins, the whole mountain becomes riddled with holes like rats’ nests.
He said that when acid water is poured into the soil, microorganisms that keep the land fertile die off, leaving the soil layers damaged, while the untreated toxic wastewater that is dumped directly into downhill streams and rivers destroys aquatic ecosystems.
He added that the death of fish and other species collapses food chains, while poisoned water absorbed by crops threatens food supplies and the health of local communities.
Landslides, floods, and other, more frequent natural disasters follow, the environmentalist warned.
The ammonium sulphate/bicarbonate consumption of each deposit can be as high as 150,000 t per year. Of course supplied from China.
How junior rare earth miners in the West can still still seriously propose in-situ leaching of ion-adsorption clay deposits with ammonium sulphate/ammonium bicarbonate escapes us. Apart from the instant full dependence on ammonium sulphate supplies from China.
Relevant government departments in the respective countries could follow China and issue an outright ban on using ammonium compound solutions for in-situ mining.
Brazilian Critical Minerals is the only western junior rare earth miner with an ion adsorption clay deposit who has done away with ammonium sulphate from the very beginning and works with the alternative magnesium sulphate.
Is AI slop Killing the Internet (and misleading rare earth stakeholders?)
Many people seem to rely on AI when it comes to complicated rare earths. We have had almost exclusively bad experience when challenging AI with rare earth questions. Patrick Boyle explains, why.
If it does not know, AI makes stuff up. AI bases on the treasure trove of universal truth and scientific fact - data from the internet.
McKinsey
Powering the energy transition’s motor: Circular rare earth elements
Magnet production could consume an estimated 176 kt of REEs in 2035. Meanwhile, the REE value chain is expected to generate about 40 kt of preconsumer scrap, originating from magnet design and manufacturing steps, as well as 41 kt in postconsumer scrap from various end uses reaching end of life.
The “176 kt of REEs in 2035” translate to 550,000 t of NdFeB magnets. China reaches this capacity in 2026. It includes replacement capacity, but at this time it is what it is.
Outside China and Japan there is no NdFeB production of scale. All “preconsumer scrap” from NdFeB production is already being recycled. It is natural part of ongoing magnet production that ca. 30% of rare earth input is recycled material.
Different from “preconsumer scrap” that occurs during NdFeB magnet production, “postconsumer scrap” collection will be highly problematic. NdFeB magnets in consumer devices can be tiny. The average NdFeB magnet weight imported to the US in 2024 was 19 grams.
By contrast, scrap from postconsumer sources will likely be geographically diverse, although true supply could remain limited to only a few kilotons because of recovery challenges related to already-collected magnets.
Is that consultant lingo for “close to impossible”?
Although these applications will likely remain relevant over the next ten years, scrap from BEV drivetrains, industrial motors, and wind turbines could reach a similar magnitude, providing a new pool of larger magnets containing higher shares of valuable heavy REEs.
Point taken. But, as the report shows in its graphs, we are talking about 2050. At this time the NdFeB magnet is 40 years old. Its predecessor, SmCo, had been replaced after only 20 years, except for defense and other high temperature applications. What exactly makes us believe that the NdFeB magnet will still be of relevance in 2050?
The secondary REE recycling value chain faces constraints for both collection of postconsumer material and recovery of REE magnets. Given that most end uses for REE magnets in the next ten years will be in applications with notoriously low collection rates, such as electrical and electronic equipment from consumer appliances and electronics, there is significant potential to improve collection.
Do these “collection improvements” come free of charge? Or what are the cost?
Even if REE magnet collection is improved, materials will likely not be recovered across most applications, especially those with small or medium-sized magnets.
Self-defeating.
We don’t know what the purpose of this report should be.
