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Rare Earth Supply Shortage May Threaten Trillion-Dollar Assets. Here Are Rare Earth Companies to Watch Besides MP and USAR

Background: The recent US-China trade war has spread from resource sector. On October 9, China's Ministry of Commerce and General Administration of Customs issued several announcements implementing export controls on rare earth-related items, technologies, and key equipment. Subsequently, Trump described the rare earth control as an "act of hostility" and stated that he would use this as a reason to reimpose a 100% tariff (or higher) on Chinese goods and impose controls on the export of Chinese technology/software. The recent rise in the rare earth sector not only reflects the short-term trade war's risk-averse logic but also signifies the geostructural changes in resource output in the long term.

Introduction to Rare Earth Elements: Why Are Rare Earths Called the 'Vitamins of Manufacturing'?

Rare earths refer to 17 elements on the periodic table whose atomic structure gives them special magnetic properties. Commonly used in manufacturing, inexpensive light rare earth elements such as lanthanum and cerium; relatively expensive light rare earths such as praseodymium and neodymium; and costly heavy rare earths such as terbium and dysprosium are often used in magnetic materials. These elements are extensively used in electric vehicles, wind power equipment, nuclear reactors, and military weapons. From Apple iPhones to Tesla motors, rare earth elements are essential, thus their supply impacts the security of trillion-dollar stock market assets.

Rare Earth Reserves, Mining, and Processing Shares among China, USA, Canada, and Australia:

According to statistics compiled by Mining.com, China holds over 40% of the world's rare earth reserves, accounts for 60%-70% of the mining volume, and nearly 90% of the processing/refining capacity. The United States holds about 2.1% of the world’s reserves. Although mines like Mountain Pass contribute significant output, most of it is still sent to China for processing due to a lack of domestic processing capacity. The United States is now seeking to develop its own rare earth supply chain. In July, the U.S. Department of Defense announced an investment of $400 million in MP Materials, the company that owns the only operating rare earth mine in the U.S.

Key Companies & Events in the U.S. Rare Earth Industry:

In recent years, U.S. rare earth companies have increased mining of rare earth minerals and have cooperated with other countries' rare earth magnet materials and processing plants through acquisitions, among other strategies. Besides the well-known MP and USAR, other companies are also expanding their rare earth strategies. For example:

$Energy Fuels (UUUU.US)$ currently owns the only licensed and operational White Mesa Mill rare earth refining facility in the U.S. The company is adopting a "light rare earths first, heavy rare earths to follow" expansion route, utilizing existing facilities to first achieve commercial production of NdPr (approximately 1,049 tons annually), then introducing terbium (13 tons) and dysprosium (48 tons) separation capabilities by 2026, and plans to significantly expand to a total capacity of approximately 6,294 tons of NdPr, 80 tons of Tb, and 288 tons of Dy by 2028. This strategy aims to build a core domestic supply of rare earth separation and magnet materials, supporting future critical material needs in electric vehicles, motors, and defense sectors.

$NioCorp Developments (NB.US)$ : NioCorp is advancing the Elk Creek project in Nebraska, USA, a large-scale rare earth and scandium mining project, poised to become a significant domestic source of rare earth supplies.

American mining firm $Critical Metals (CRML.US)$ has entered into a decade-long deal with Canadian company $Ucore Rare Metals Inc (UCU.CA)$ , agreeing to provide 10,000 tons of heavy rare earth concentrate from Greenland's Tanbreez project to Ucore's Louisiana-based facility, which benefits from U.S. government funding. The plant, having secured federal funding support including $18.4 million from the Department of Defense, aims to produce 2,000 tons of high-purity rare earth oxide in the coming year and increase its output to 7,500 tons annually by 2028.

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