- China controls 90% of global rare earth processing capacity
- US mines produced only 15% of America's needs in 2023
- Terbium prices surged 24% since March export restrictions
- Two new mining projects could launch by 2026
The strategic minerals powering smartphones, electric vehicles, and advanced weapon systems have become the newest front in the US-China trade war. When Beijing imposed export controls on seven heavy rare earth elements this April, manufacturers from Detroit to Silicon Valley faced sobering realities about supply chain vulnerabilities. While the Mountain Pass mine in California processes nearly 5,000 tons of light rare earths monthly, experts confirm it can't produce the heat-resistant heavy elements critical for military jet engines.
Recent price spikes reveal the immediate impact of China's economic countermeasures. Benchmark Mineral Intelligence reports terbium - essential for maintaining magnetic properties at extreme temperatures - now trades at $933 per kilogram, up nearly a quarter since spring. This volatility has spurred unprecedented collaboration between Washington and mining startups, with the White House fast-tracking permits through Executive Order 13953. However, industry leaders caution that developing domestic processing infrastructure remains a $2.1 billion challenge.
Three critical insights emerge from the scramble:
- Green energy transitions could stall without dysprosium supplies for wind turbines
- Automakers may face 12-18 month delays in EV production lines
- Recycling programs currently recover less than 3% of rare earth waste
In southeast Nebraska, NioCorp Developments Ltd. exemplifies the opportunities and hurdles facing new projects. The company's Elk Creek site holds North America's largest known niobium-scandium deposit, with exploratory drilling set to begin this August. CEO Mark Smith notes that while the $1.1 billion initiative could supply 35% of US heavy rare earth demand, securing Export-Import Bank financing requires proving deposit viability through 3D seismic mapping.
Defense contractors maintain discreet stockpiles, but Lockheed Martin's F-35 program illustrates the sector's delicate balancing act. Each fifth-generation fighter contains 920 pounds of rare earth materials, primarily in guidance systems and radar-absorbent coatings. Pentagon analysts confirm that alternative suppliers in Australia and Brazil currently lack the refining capacity to replace Chinese exports at scale.
Market projections suggest the current strategy of storing unprocessed ores may buy 18-24 months for technological catch-up. MP Materials' decision to halt Chinese shipments of Mountain Pass minerals reflects this stopgap approach, with the company accelerating its $200 million processing plant expansion. Meanwhile, Montana's Sheep Creek project tests innovative bioleaching techniques that could reduce traditional refining costs by 40%.
As battery manufacturers report antimony shortages and automakers hedge against terbium scarcity, industry watchers emphasize that true supply chain security requires more than new mines. Developing a skilled workforce for mineral separation facilities and establishing cooperative agreements with NATO allies' mining operations remain critical next steps in this high-stakes resource race.
