US Struggles for Rare Earth Independence Amidst Chinese Dominance
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US Struggles for Rare Earth Independence Amidst Chinese Dominance
- The United States produced 51,000 metric tons of rare-earth in 2025, up from 45,500 in 2024, but this remains a fraction of China's 270,000 metric tons in 2025.
- In October 2025, China introduced new export controls on rare earth elements, which were temporarily suspended until November 2026.
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The United States is actively working to reduce its reliance on China for rare earth elements, which are critical for various industries including defense, electronics, and renewable energy. China currently dominates the global rare earth supply chain, accounting for 69% of rare-earth mining production in 2025 and an even higher percentage of processing and magnet manufacturing.
In response to US tariffs, China introduced two waves of export controls on rare earth elements in April and October 2025. The second wave of these controls, which would have required foreign companies to obtain a license to export products containing Chinese-sourced rare earth materials or those produced using Chinese technology, was suspended until November 2026. This suspension followed a US decision in November to withdraw tariff threats against China in return for a year-long ceasefire on export controls.
Despite increased domestic production, with the US mining 51,000 metric tons of rare earth in 2025, its net import reliance for rare-earth compounds and metals rose to 67% in 2025, up from 53% in 2024. The US remains entirely dependent on imports for certain heavy rare-earth elements and magnets. To counter China’s dominance, the US has invested significantly in domestic rare earth projects and sought to secure supplies from allies. For example, the US International Development Finance Corporation (DFC) committed $62.8 million to four African rare-earth projects in Malawi, Angola, Madagascar, and South Africa as of August 2026. Additionally, the Pentagon signed an agreement with MP Materials, the largest US producer of rare earth metals, in 2025 to invest $400 million and acquire up to a 15% stake. However, challenges remain, including the technical complexity of scaling up production and the higher prices of US rare earths compared to Chinese alternatives.