While China’s buying and selling companions similar to India and the U.S. are looking for various sources to scale back dependency, knowledge reveals that China’s dominance in uncommon earths stems not solely from useful resource availability however extra so from its longstanding power in mining and analysis capability.
Rare earth parts (REEs), regardless of the title, are usually not significantly scarce. According to the International Energy Agency (IEA), they comprise 17 metals, usually grouped into mild uncommon earths (LREEs) — together with lanthanum, cerium, praseodymium, neodymium, samarium and europium — and heavy uncommon earths (HREEs) similar to gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, lutetium, scandium and yttrium. Promethium will not be included within the record as it’s radioactive and doesn’t happen in mineable portions.
They are vital elements in clear power applied sciences similar to electrical autos and wind generators, in addition to in defence functions. Rare earths are additionally important for high-tech gadgets together with smartphones and onerous drives.
Although uncommon earth deposits exist in nations similar to Brazil, Australia, and India, China holds practically half of the worldwide reserves. Chart 1 reveals country-wise share (in %) of worldwide reserves of uncommon earths (as per U.S. Geological Survey 2025)
It can be the world’s largest producer, contributing over 60% of worldwide manufacturing within the final 5 years. Chart 2 reveals the country-wise share of the estimated international mine manufacturing of uncommon earths within the final 5 years
Beyond extraction, China dominates the worth chain with round 92% of worldwide refining capability, in line with the IEA. Moreover, within the final 5 years, China has been the most important exporter, supplying near 30% of worldwide demand. Chart 3 reveals the country-wise share of the estimated international mine manufacturing of uncommon earths within the final 5 years
Charts 1, 2 and 3 set up China’s dominance throughout reserves, manufacturing, and exports.
In April, amid escalating U.S.-China commerce tensions, Beijing imposed export restrictions on seven uncommon earth parts. The transfer focused parts utilized in neodymium–iron–boron (NdFeB) magnets — important for clear power applied sciences — in addition to these vital to ceramics, phosphors, metal, optical glass, fibres, and aerospace functions.
Chart 4 reveals the sector-wise demand for uncommon earth parts underneath export controls introduced by China in April
China’s choice to curb uncommon earth exports, amid tit-for-tat tariffs, dealt a major blow to the U.S., which stays closely depending on Chinese provide.
Chart 5 reveals the key importers of China’s uncommon earth. Figures in % present their share in China’s exports
The U.S. is the second-largest importer of Chinese uncommon earths, after Japan. India, too, is closely depending on China for its uncommon earth imports. Since 2021, greater than 75% have come from China.
Under China’s interim measures introduced final month, Chinese firms should now function inside government-set quotas for numerous minerals and procure approval to commerce in uncommon earths. This will not be the primary time China has tightened its uncommon earth commerce. It has already prohibited export of instruments and strategies used to extract and separate uncommon earths, and in December 2023, it banned the export of processing expertise.
China’s monopoly over uncommon earths can be bolstered by its sturdy analysis base. A examine discovered that China leads the sector of rare-earth analysis, contributing practically 30% of all revealed papers. The U.S. and Japan adopted with shares of 10% or much less, whereas India accounted for about 6%.
In parallel, China has elevated funding for mineral exploration, allocating about $14 billion yearly since 2022, in line with the IEA. The company notes that this marks the best three-year stretch of funding prior to now decade.
The knowledge for the charts have been sourced from the U.S. Geological Survey, UN COMTRADE, the International Energy Agency, AP and Reuters
