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Recently, the US Treasury Secretary came back from a southern state brandishing a small piece of metal, declaring it was the initial rare-earth magnet made in the US in a quarter of a century.

The official stated that this was a sign the US is overcoming “China's dominance on our industrial pipeline.” Because of a recently opened rare-earth mineral processing center in South Carolina, he added, “The nation is regaining its autonomy.”

Countering Beijing's Control in Essential Minerals

Ending Beijing's processing and manufacturing dominance in these minerals, which are essential for advanced electronics, batteries, and armaments, is a key goal for the federal government. Through trade measures and other strategies, the US is counting on returning the industry back to US soil.

Such measures led Beijing to limit rare-earth exports to the US and motivated the administration to sign deals with Australia, Malaysia, another nation, and Japan.

Although the US and China have now brokered a trade truce on rare earths, Beijing—with approximately 70% of worldwide extraction and over 90% of global processing capacity—has a head start that will be difficult to diminish.

“Rare earths are used in EV engines but also in guidance systems that have obvious applications for the defense department,” says an industry expert. “Any device that has a decent magnet in it requires rare earths.”

No Easy Fix for US Independence

There’s no easy fix for the US to reset its dependence on imports from China of minerals critical to national security, chip manufacturing, and the transition from fossil fuels to wind and solar. Data from official sources, the US imported the vast majority of the rare earths it consumed in 2024.

For some rare-earth minerals such as a key element, used in semiconductors, and another mineral, essential to military applications, China's control over processing reaches 99%. These elements are found in magnets crucial to EV motors and generators in renewable energy, along with uses in cellphones, high-intensity lighting, and nuclear reactors.

Long-Term Efforts and Global Deposits

Initiatives to cut the US’s reliance on Chinese production of rare-earth minerals may require a long time. Experts note that “Rare earths” is somewhat of a misnomer because they’re relatively abundant in the earth’s crust, but many deposits, including those in Eastern Europe, where a deal was made earlier this year, are only in the early stages of mining.

“It’s not that there’s a shortage itself, it’s that China can control how much is sent abroad,” an analyst said, adding that securing export licenses from China can be a complex and time-consuming endeavor.

The Arctic region, another focus of US attention, and Brazil, are additional nations with substantial rare-earth deposits. Domestically, there are deposits in the West, the Midwest, and the central US, with the biggest active site operating at Mountain Pass, the state, not far from Las Vegas.

Government Initiatives and Investment

Recently, the US Department of Defense became the major investor in a mining company, with intentions to open a new “integrated” plant, called a new facility, to produce magnets essential for F-35 fighter jets, drones, and submarines.

Across the continent, estimated reserves of rare earths were calculated at 3.6m tons in the US and more than 14m tons in the northern neighbor—significantly lower than the 44m tons believed to be in the Asian giant.

Following government funding in the steel industry and US chipmakers, the federal agency said it was ready to make targeted funding in strategic resource firms.

“The US is up against government-backed investment because Beijing is selecting these as priority areas that they want to invest in,” a senior official said during a address this spring.

He floated that the US could utilize a national investment pool to accelerate production. “Why wouldn’t the richest nation in the world not possess the biggest state investment fund?” he asked.

Historical Obstacles and Prospects

US efforts to promote domestic production have floundered in the past when China lowered prices, rendering unsupported rare-earth development unprofitable against China’s lower cost of production and long-term strategic outlook.

In the past, an industry leader stated before a congressional panel that “nations that fund in battery capacity and supply chains now are poised to lead this sector for generations to come. There is still time for the US but immediate steps are required.”

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

“Soon, we’ll have an abundance of essential resources that supply will exceed demand,” a top leader told reporters. That came eight months after a demand for payment in the form of minerals from Ukraine. More recently, the authorities in Asia agreed to a contract with an US firm, securing rights to minerals such as antimony and copper.

Prospects for Success

However, is America able to close its shortfall and weaken Beijing's grip on rare-earth global networks? “America has implemented really significant steps so far,” a specialist says. The US, he adds, cannot be “self-reliant in the short term because it takes time to bring a mine online and build refining capacity.”