The 17 Hidden Elements Shaping the World’s Markets

Rare earth minerals, 17 chemically similar elements, are a crucial component in modern technology. Found in everyday objects from electric vehicles to smartphones, these elements build up the foundation to a major transition in a more efficient society. Despite their name, rare earths are actually commonly found around the world. What actually makes them “rare” are the challenges faced in extraction processes and damages it can bring to the environment. Taking dominance in the industry, China, the world’s largest supplier of rare earths, accounts for 62% of the total rare earth production and over 90% of processings. China’s recent announcement of their latest move in restricting critical rare earth exports raised global concerns in the world’s economic development and environmental effects.

What are rare earths and why do they matter?

Rare earths is a distinct category of minerals that are essential in the production of magnets in the auto, electronic, and defence industries. They consist of 17 metal abundant elements found throughout the Earth’s crust, with particular emphasis on neodymium and praseodymium.

In the vast developing world today, the global demand for rare earths continues to grow. The unprecedented rise of electric vehicles, renewable energy infrastructures, and advanced technology has made these elements a necessity for the modern world. They serve as a cornerstone in technologies, from tiny chips in smartphones to batteries for EVs and enormous semiconductors for artificial intelligence, rare earths.

Beyond the story, mining these elements requires heavy chemical usage that can leave behind toxic waste and has caused several environmental disasters. The high production cost has made these minerals rare, far from satisfying the high demand.

The Global Production Chain of Rare Earths

In 2024, rare earth production was on a high rise again, jumping from 132,000 metric tons from 2017 to 390,000 metric tons. Taking the lead, China has a rare earth production of over 270,000 metric tons in 2024 and has a reserve of 44 million metric tons. It dominates the production of the vast majority of the 17 rare earth metals, for its outputs are heavily concentrated in light rare earths, specifically magnets neodymium and praseodymium.

Coming after, the United States holds rare earth production of 45,000 metric tons that year. These minerals are primarily coming from Mountain Pass mine in California, which produces high-purity neodymium and praseodymium (NdPr) oxide. Ranked third, Myanmar, has a production of 31,000 metric tons. However, due to reports criticizing minerals carried out by unregulated small-scale miners, Myanmar’s rare earth industry is plagued with controversy.

Source: Statista

Recent Turning Point

In October of this year, China announced new restrictions on rare earth exports, barring citizens from contributing to mining overseas and requiring foreign foreign entities to obtain a license from Beijing in order to export any products containing over 0.1% of domestically-sourced rare earths. Adding on to this, China has expanded the restriction from only raw materials to intellectual property and technology. As the source of supply for rare earths becomes unstable, these minerals are becoming a weapon in the ongoing competition for technological and economic dominance.

The Future of Rare Earths

Over the long term, China’s restrictions will have lasting impacts on global rare earth trade. By tightening controls on rare earth exports, China pushes U.S. and European countries to take actions to alienate this scarcity in their supply chain development, promoting local supply chain developments. However, this is not an easy shift, as the risks in rare earth production remain high, imposing several challenges in these countries, constraining their technological development.

In the near term, global end users face major uncertainty with the supplies and prices. It creates an unfavorable situation for these nations. In response, countries have imposed policies to balance out this disadvantage; for instance, the U.S. has raised their tariffs to an incredibly high level for Chinese imports. As a crucial component in the tech sector, this supply downturn poses threats for nations striving for dominance in the tech industry and global economy.

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Image Source: Rick Bowmer/AP/NPR