What Are Rare Earth Minerals And Why China's Grip Has Nations Racing For Alternatives

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From missiles to smartphones, rare earth minerals power the modern world. But China's dominance has triggered a global race for alternatives
Why Are Rare Earth Minerals In The News?
In June 2025, rare earth minerals became a flashpoint in US-China relations once again. In early April, China suspended export licences for several key rare earth elements, including neodymium and dysprosium, citing national security and environmental concerns. These minerals are critical to technologies ranging from electric vehicle motors to advanced missile systems. The move drew sharp condemnation from US President Donald Trump, who labelled it a strategic weaponisation of essential materials.
Following weeks of negotiations, China in June agreed to temporarily resume exports to the United States under a six-month licensing arrangement.
This move reminded the world just how reliant major economies are on China for these seemingly obscure but critically important elements. That a handful of elements could hold such sway over global supply chains has sparked renewed attention on rare earths.
What Are Rare Earth Elements?
Rare earth elements (REEs), also commonly referred to as rare earth minerals (REMs) in industry contexts, comprise a group of 17 chemically similar metals: the 15 lanthanides on the periodic table, along with scandium and yttrium. Despite the misleading name, these elements are not especially rare in nature. What makes them 'rare" is the difficulty of finding them in concentrations high enough for economical extraction, and the complexity of separating them from each other.
Their value lies in their unique physical and chemical properties, such as high magnetic strength, conductivity, and luminescence, which make them indispensable in a wide range of modern technologies. Without REEs, the world would struggle to manufacture smartphones, power clean energy solutions, or advance military technologies.
Key Uses And Applications
Rare earths are embedded deep in our modern lives. They are essential for technologies ranging from the mundane to the cutting-edge. Smartphones and flat-screen TVs rely on europium and terbium for colour and brightness. Wind turbines and electric vehicles use neodymium and dysprosium in their permanent magnets. Military-grade night vision, radar systems, and precision-guided munitions all depend on rare earths to function reliably.
Even in medicine, these elements are crucial: magnetic resonance imaging (MRI) machines use gadolinium, and various REEs help in producing contrast agents and laser surgery equipment. Their versatility across industries has earned them the label of 'industrial vitamins"—used in small amounts but critical for end-product performance.
Global Distribution: Where Are They Found?
Although rare earths are scattered across the planet, few countries have succeeded in harnessing them at scale. China dominates the landscape, particularly with the Bayan Obo mine in Inner Mongolia, which is the largest rare earth deposit globally. Australia, through Lynas Rare Earths, has emerged as a significant non-China producer. The United States is home to the Mountain Pass mine in California, which has seen a revival in recent years, though it still depends on China for refining.
India, meanwhile, holds considerable untapped reserves, especially in monazite sands found along the coastal regions of Odisha, Andhra Pradesh, Kerala, and Tamil Nadu. Other countries with potential include Brazil, Vietnam, Russia, and Canada, but infrastructure and policy limitations have held back their development.
The China Factor: Monopolising The Supply Chain
China's dominance in rare earths isn't due to geology alone; it's the result of long-term strategic planning. Over the decades, China built a vertically integrated industry encompassing everything, from mining and refining to magnet manufacturing. By offering low costs and lax environmental regulations, it pushed competitors out of the market.
In addition to subsidising its domestic industry, China cornered the market by acquiring processing rights abroad and investing in foreign mines. Today, it controls about 85 to 90 per cent of global rare earth refining capacity. And when geopolitical tensions rise, Beijing does not hesitate to flex its mineral muscles, halting exports to Japan in 2010, and imposing restrictions on the US in 2025, as recent examples.
Ukraine's Untapped Potential
Ukraine, too, has become a focal point in rare earth geopolitics. The country holds promising deposits of rare earth elements, particularly in regions like Kirovohrad and Zhytomyr. Though these reserves remain largely undeveloped due to the ongoing war, they have caught the attention of the United States for one major reason: the minerals could provide a long-term hedge against dependence on China. In early 2025, US President Donald Trump proposed linking continued military and financial aid to long-term access to these mineral reserves. Arguing that rare earths were vital to US national security and worth hundreds of billions, Trump framed the deal as a necessary exchange for the billions already committed to Ukraine's defence.
The Extraction And Refining Challenge
Processing rare earths is as much a chemical challenge as a logistical one. These elements are often found mixed together, requiring sophisticated techniques to separate and purify them. Moreover, the extraction process often generates toxic and radioactive waste, making it both environmentally hazardous and politically controversial.
Western nations once had thriving rare earth industries but gradually offshored them to China due to high costs and environmental opposition. Now, as geopolitical risks rise, there's renewed urgency to reshore these capabilities despite the regulatory and financial hurdles involved.
India faces similar challenges. Although rich in monazite sands, the country lacks large-scale refining units and downstream industries that can turn raw material into usable components like magnets or phosphors. Most of its output is processed abroad or remains untapped.
Supply Chain Risks And The Global Push For Diversification
The Covid-19 pandemic, the Russia–Ukraine war, and China's export restrictions in April 2025 on key rare earth elements have collectively underscored the vulnerability of global supply chains, bringing rare earths into sharper strategic focus. In response:
In March 2025, the United States invoked the Defence Production Act to support domestic mining, refining, and separation infrastructure for rare earths.
The European Union finalised the Critical Raw Materials Act in late 2024, setting 2030 targets of at least 10 per cent domestic extraction, 40 per cent processing, and 25 per cent recycling, while limiting reliance on any single country to 65 per cent.
Japan has expanded efforts to recycle rare earths from electronics and industrial waste, reflecting growing concerns over supply-chain security.
Private companies such as Apple (through its 'Daisy" disassembly robot) and Tesla (via rare-earth-free motor research and alternative sourcing strategies) are investing heavily in urban mining and material substitution.
Within the Indo-Pacific, Quad nations—India, Australia, Japan, and the United States—are collaborating on critical mineral development, sustainable sourcing, and end-to-end supply chain resilience.
India's Position: Potential Vs Preparedness
India has long held a geological advantage in rare earth elements, particularly through monazite-rich beach sands along its eastern and southern coasts. However, policy constraints and institutional bottlenecks have limited its ability to capitalise on this potential. The sector remains dominated by IREL (India) Limited, a public sector enterprise under the Department of Atomic Energy (DAE), which oversees the exploration and processing of monazite due to its thorium content.
Under current regulations, monazite is classified as a 'prescribed substance" under the Atomic Energy Act, 1962, which effectively bars private players from mining it. In addition, restrictions on the export of unprocessed rare earths—requiring clearances from both the DAE and the Directorate General of Foreign Trade—further dampen commercial incentives.
Recognising the strategic urgency, the government introduced a Critical Minerals Strategy in 2023 and has accelerated exploration through the Geological Survey of India (GSI) and Mineral Exploration and Consultancy Limited (MECL). Production-linked incentive (PLI) schemes aimed at boosting electric vehicle and electronics manufacturing are indirectly creating demand for rare earth-based components such as magnets, batteries, and phosphors.
However, without reforming mining laws, enabling responsible private-sector participation, and investing in large-scale refining and magnet-making infrastructure, India risks remaining a supplier of raw material rather than a stakeholder in the rare earth value chain.
Environmental And Ethical Concerns
China's rare earth industry has caused severe environmental damage in regions such as Inner Mongolia, particularly around the Baotou area, where years of rare earth processing have produced toxic sludge ponds and radioactive tailings. The tailings dam near Baotou—often referred to as the 'rare earth lake"—has contaminated soil and water, exposing nearby communities to long-term environmental and health risks.
Additionally, human rights concerns have surfaced regarding the use of forced labour in China's Xinjiang region, with some allegations linked to industrial supply chains, including critical minerals. Meanwhile, illegal and unregulated rare earth mining in Myanmar, especially in the Kachin state, has raised alarms over deforestation, land degradation, and labour exploitation—much of it feeding into Chinese processing facilities.
As countries like India and others work to scale up rare earth production, there is a growing international consensus that new supply chains must prioritise not just security and self-reliance, but also environmental and ethical sustainability. Ethical sourcing, community consultation, and cleaner refining technologies will need to become non-negotiable pillars of any responsible rare earth expansion.
The Future Of Rare Earths
The next chapter in rare earths will be shaped by innovation as much as geopolitics. Research is underway into synthetic substitutes for rare earth magnets, while recycling initiatives are gaining momentum under the banner of circular economy. Deep-sea mining, though highly controversial, also looms as a potential game-changer, with rich deposits found on the ocean floor.
India, the US, the EU, and others are now treating rare earths not just as resources but as strategic assets. Control over them could define technological sovereignty for decades to come.
The Geopolitics Of The Periodic Table
Rare earth minerals are no longer viewed merely as industrial inputs, they have become strategic commodities essential to national security, advanced manufacturing, and clean energy transitions. Their limited availability in extractable forms, complex processing requirements, and widespread applications have turned them into a focal point of global competition.
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China's long-standing dominance over refining and supply has exposed systemic vulnerabilities, prompting countries around the world to diversify their sources and invest in alternative supply chains.
For India, this global push presents both a challenge and a window of opportunity. With policy reforms, enhanced investment, and greater international cooperation, India could position itself as a meaningful player in the rare earth ecosystem. However, bridging the gap between potential and preparedness will require focused, time-bound efforts.
About the Author
Karishma Jain
Karishma Jain, Chief Sub Editor at News18.com, writes and edits opinion pieces on a variety of subjects, including Indian politics and policy, culture and the arts, technology and social change. Follow her @kar...Read More
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tags :
rare earth elements US-China ties
Location :
New Delhi, India, India
First Published:
June 12, 2025, 11:20 IST
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