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Recently, a top US official came back from a southern state holding up a small piece of metal, declaring it was the initial rare-earth magnet made in the US in 25 years.

He remarked that this was proof the US is breaking “China's dominance on our industrial pipeline.” Because of a recently opened rare-earth mineral manufacturing plant in South Carolina, the official continued, “America is reclaiming its self-sufficiency.”

Countering Beijing's Control in Essential Minerals

Reducing China’s processing and manufacturing dominance in these materials, which are essential for advanced electronics, batteries, and armaments, is a major focus for the American leadership. Through trade measures and other approaches, the US is counting on returning the industry back to American shores.

These measures prompted Beijing to limit rare-earth exports to the US and motivated US leaders to sign deals with an ally, Malaysia, another nation, and Japan.

Although the US and China have since reached a temporary agreement on rare earths, Beijing—with approximately 70% of global mining and nearly all of global processing capacity—holds an advantage that may prove challenging to erode.

“Rare earths are used in EV engines but also in guidance systems that have obvious applications for the military,” says an industry expert. “Anything that has a decent magnet in it uses rare earths.”

No Easy Fix for American Self-Sufficiency

There’s no easy fix for the US to reset its reliance on imports from China of minerals critical to national security, semiconductor production, and the transition from traditional energy to wind and solar. Data from official sources, the US brought in the vast majority of the rare earths it consumed in 2024.

For some rare-earth minerals such as dysprosium, used in semiconductors, and another mineral, critical for defense systems, Chinese refinement dominance rises to almost total. Dysprosium and terbium are found in magnets crucial to electric engines and generators in renewable energy, along with uses in mobile devices, high-intensity lighting, and energy plants.

Extended Timelines and International Resources

Initiatives to reduce the US’s dependence on China's output of rare-earth minerals could take years. Experts note that “These minerals” is somewhat of a misnomer because they’re not that uncommon in the earth’s crust, but many deposits, including those in Eastern Europe, where a deal was signed earlier this year, are only in the initial phases of mining.

“It’s not that there’s a shortage per se, it’s that Beijing can control how much is exported,” a specialist explained, noting that obtaining permits from China can be a complex and time-consuming endeavor.

Greenland, a key area of US attention, and Brazil, are additional nations with significant rare-earth resources. Domestically, there are deposits in California, Wyoming, and Missouri, with the biggest active site operating at Mountain Pass, California, not far from a major city.

Government Initiatives and Investment

Recently, the Pentagon took on the role of the major investor in a mining company, with intentions to open a new “mine-to-magnet” plant, named 10X, to make magnets essential for military aircraft, drones, and submarines.

Across the continent, estimated reserves of rare earths were calculated at millions of tons in the US and additional millions in Canada—significantly lower than the 44m tons believed to be in the Asian giant.

Mirroring direct investment in other sectors and domestic technology firms, the federal agency announced it was prepared to make direct investments in critical mineral companies.

“The US is up against state capital because Beijing is selecting these as priority areas that they want to invest in,” a cabinet member stated during a speech in April.

He suggested that the US could utilize a sovereign wealth fund to speed production. “How could the wealthiest country in the world have the largest state investment fund?” he asked.

Historical Obstacles and Future Outlook

American attempts to promote homegrown output have struggled in the past when Chinese producers lowered prices, rendering unsubsidized rare-earth development uneconomic against Asia's competitive pricing and far-sighted planning.

Five years ago, a market expert testified before a US Senate committee that “those who invest in energy storage and supply chains today are poised to dominate this sector for the foreseeable future. It is not too late for the US but action is needed now.”

Five years on, a race to build international partnerships around rare earths is accelerating.

“Soon, we’ll have an abundance of essential resources that you won’t know what to do with them,” the President informed the media. This followed eight months after a demand for compensation in the form of natural resources from Ukraine. In September, the government of Pakistan agreed to a contract with an American company, giving it access to minerals such as key metals.

Prospects for Success

But, can the US make up its shortfall and loosen China’s hold on rare-earth global networks? “The US has taken major measures already,” a specialist comments. The US, he adds, cannot be “self-reliant in the short term because it requires years to bring a mine online and build refining capacity.”