Rare earth minerals are fast becoming the choke point of the 21st-century economy. These 17 elements, with names like neodymium, dysprosium, and terbium, sit behind the global race for clean energy, AI, defence superiority, and technological independence. They are the engines inside electric vehicles, the torque in wind turbines, and the precision in missile systems. And they’re running out—or at least, they’re running into the hard edge of monopoly control, led by China.
Neodymium-Iron-Boron (NdFeB) magnets—tiny but immensely powerful—are now essential for smartphones, drones, electric vehicles, and renewable power systems. The permanent magnets made from rare earths are up to ten times stronger than conventional magnets and crucial for miniaturised, high-efficiency devices. For instance, each offshore wind turbine requires approximately 600 kilograms of rare-earth magnets. An average electric vehicle can carry up to two kilograms. That might sound small until you multiply it by millions of units.
The economic value is enormous. According to Adamas Intelligence, global demand for rare earth magnets was valued at over $18 billion in 2023, with projections of reaching $45 billion by 2035. Yet this booming market remains anything but free.
In 1985, China discovered vast reserves of rare earths in the Bayan Obo mine in Inner Mongolia, now the world’s largest rare earth deposit. Over the next decades, Beijing pursued a deliberate strategy: keep prices low, drive competitors out, and dominate processing and refining. The plan worked. By 2010, China supplied 97% of global rare earths.
That same year, following a maritime dispute with Japan, China cut exports. The price of dysprosium jumped from $260/kg to over $3,400/kg in under six months. It was a wake-up call. The U.S., EU, and Japan suddenly realised how exposed they were. Yet more than a decade on, China still controls around 70% of rare earth mining and over 90% of global refining capacity.
In contrast, the United States, once a leading producer of rare earths, allowed its only significant facility, the Mountain Pass mine in California, to decline until a partial revival in 2017. Even now, Mountain Pass sends its concentrate to China for processing. That’s how deep the dependency runs.
Elsewhere, Australia’s Lynas Corporation has tried to fill the gap with operations at Mount Weld, one of the richest rare earth deposits discovered in 1988. But refining outside China remains a global bottleneck. Projects in Canada, Vietnam, Tanzania, and Greenland remain in a state of development limbo due to environmental hurdles and market uncertainty.
Meanwhile, African nations like Burundi and the Democratic Republic of Congo are becoming the new frontiers, rich in rare earth potential but politically unstable. Western firms are rushing to secure stakes, but critics warn that this mirrors the same exploitative dynamics seen in the extraction of cobalt and coltan.
Rare earths are not traded like other commodities. There is no global futures market. Pricing is opaque, negotiated privately, and heavily shaped by industrial policy. This makes them ripe for strategic manipulation. As recently as 2023, China passed new export laws requiring disclosure of end-use, effectively tightening control over global supply chains.
There are efforts to break free. The U.S. Department of Defence is co-funding rare earth projects on home soil. The EU’s Critical Raw Materials Act aims to build domestic capacity. Japan has invested in recycling rare earths from used electronics. The concept of “urban mining”, recovering rare earths from waste, offers a future lifeline, although it currently supplies less than 1% of global demand.
According to the International Energy Agency, demand for rare earths used in electric vehicles (EVs) and wind turbines is expected to rise by up to 700% by 2040. As countries scramble to hit net-zero targets, this demand will collide with supply limits. The result? Delays, inflation, and potential conflict.
Rare earths are no longer obscure technical inputs. They are economic weapons, strategic currencies, and geopolitical bargaining chips. China knows it. The West knows it. And the rest of the world is watching.
The struggle over rare earths is not just about mining, it’s about sovereignty, security, and survival in a world built on magnets.
Looking ahead, Trump has expressed a keen interest in Ukrainian rare earth minerals. This echoes a significant moment in history during the U.S. occupation of Afghanistan, where trillions of dollars worth of untapped mineral reserves were discovered after the Taliban's removal. While oil has traditionally been viewed as the lifeblood of economies, it's the minerals that truly drive geopolitical dynamics. The conflicts of the 21st century have frequently revolved around commodities not just subject to market manipulation for the generation of wealth, but also pivotal in determining the trajectories of future growth.
Instead of fixating solely on Earth’s mineral wealth, we should be prepared for a time when the competition shifts to the cosmos. This new space race will not be about the militarisation of space; rather, it will focus on securing the vast mineral resources available on celestial bodies through space mining. This forward-thinking approach represents the future we need to embrace, steering us away from the cycle of endless conflicts over limited terrestrial resources. By looking beyond our planet, we can unlock new potential and secure a more sustainable future.