In this episode of the Rare Earth Exchanges podcast, hosts Dustin Olsen and Daniel O’Connor discuss the current state of trade relations, particularly focusing on tariffs imposed by the U.S. on China and their implications for the rare earth sector. They explore the impact of these tariffs on supply chains, the strategic vulnerabilities faced by the U.S., and the need for a robust industrial policy to compete with China’s dominance in the rare earth market. The conversation also touches on recent discoveries of critical minerals in Kazakhstan and lithium in California, highlighting the importance of global collaboration in securing these resources.
Chapters
00:00 Introduction and Seasonal Changes
00:56 Impact of Tariffs on Trade Relations
05:06 Supply Chain Disruptions and Rare Earth Elements
08:09 Economic Strategies and Industrial Policy
12:28 Geopolitical Tensions and Resource Control
17:33 New Discoveries in Rare Earth Deposits
21:39 Future Prospects and Closing Thoughts
Listen to the REEx Podcast
(opens in a new tab)Transcript
Dustin Olsen (00:01.176)
Hi everyone, welcome back to the Rare Earth Exchanges podcast. You’ve got me, course, Dustin and Daniel. How you doing, Daniel?
Daniel O’Connor (00:09.636)
doing well, doesn’t it? It’s starting to warm up in these parts of the country, as you know, and that always feels great, doesn’t it?
Dustin Olsen (00:17.943)
Yes, I feel like I can shake off that winter burr and get outside and enjoy the great Utah mountains.
Daniel O’Connor (00:24.304)
The winter burr.
Daniel O’Connor (00:29.262)
Yes, the winter burr is transitioning to the spring sizzle because in Utah it goes from cold to sort of wet and then hot pretty quickly.
Dustin Olsen (00:39.278)
Yeah.
Dustin Olsen (00:49.132)
Yep. Yeah. We almost skipped spring around here. Some, some years, you know.
Daniel O’Connor (00:52.29)
Yeah, we do. Yeah, we’re… You gotta be pretty sturdy out here.
Dustin Olsen (01:00.302)
Yeah, ready for anything.
Daniel O’Connor (01:01.164)
Mm-hmm Speaking of anything there’s a lot going on. was thinking we could we could first you know our growing Viewer base we can update them on what’s going on with these tariffs and how they may impact the sectors that we monitor
Dustin Olsen (01:04.834)
So.
Dustin Olsen (01:18.21)
Yeah, let’s dive in because it is a hot topic.
Daniel O’Connor (01:21.902)
Yes, so you know as of today this is our understanding you know obviously there’s trade tensions you know recently it’s coming to a head between the United States and China. So remember President Trump had created these tariffs across the world and then the other day there was a bond sell-off and so
President Trump very quickly dropped the tariffs except for a 10 % standard tariff across the board, dropped the rest of the world tariffs except for China, Dustin. And for China, Trump announced a substantial increase, frankly, on Chinese imports, raising the rate from 104 % to 125 % actually yesterday.
This is part of a broader strategy. The official statement is to address trade imbalances and concerns over China’s trade practices. And of course, we know what the rare earth sector
that Trump is spot on with that. mean, it’s not a free market. It’s run by, we report on this all the time, it’s run by state-owned companies that are basically intertwined with government. And they’re using these very important commodities to extract more leverage on the market from us and others. So some other updates based on what we’ve learned today.
Today, the 10th, the White House clarified that the tariffs on Chinese goods were increased to 145%, not the previously stated 125%. That’s what we have from Holland and Knight. And this led to significant volatility in the financial markets. Okay, so it’s getting crazy out there. Remember these stock market swings?
Daniel O’Connor (03:25.966)
China’s tariffs and export control. So where we’re at with China, have retaliatory tariffs in response to our tariff hikes, United States tariff hikes. China imposed additional tariffs on US goods, raising the rate from 34 % to 84%. Okay. So effective today. And that was meant to essentially counter the US measures.
Now I’ll say, of course, China sells much more stuff to us than we sell to them. some people over here might say, so what? But there’s still a lot of sectors that sell agricultural, coal, you name it. Now let’s talk about the export restrictions on rare earths. China implemented export restrictions on certain rare earths on April 4th, and we reported that.
These restrictions were designed to limit the supply of critical minerals essential for various high tech and defense applications. Essentially leveraging its dominant position in the rare earth market as a strategic response to the United States actions and we sort of were expecting this. Now we reported that these were just outright export restrictions.
But there is some nuance there, Dustin. They do allow for exemptions and a process of essentially applying and filling out a bunch of paperwork. think there’s ways to get through it, but around it or to get access, but it requires much more bureaucracy now, okay? So what is the impact on the rare earth market and then we can get into some of our news.
The imposition of export controls by China, Dustin, on rare earth elements, one, it’s more supply chain disruption. So these restrictions are gonna cause disruption in our supply chains. And that’s across electronics, renewable energy, defense, and other sectors, okay?
Daniel O’Connor (05:48.368)
Probably going to increase prices a constrained supply You know can lead to definitely a boost in prices and rare earth materials globally that impacts manufacturing costs and product pricing and Then it again exposes strategic vulnerabilities You know countries dependent on Chinese rare earths and that’s again a lot
may face strategic vulnerabilities prompting efforts to diversify supply chains, which is what we’re seeing in the United States. Any questions so far? I have a little bit more than we can move on to the news. Any questions?
Dustin Olsen (06:31.694)
Nope. I don’t have any questions. was honestly, the thought that kind of came to my mind was like, tariffs aren’t a bad thing, right? think tariffs, when applied properly can help the state fund certain, you know, domestic projects. but, yeah, it’s, yeah, it’s very interesting. think hopefully the goal is to diversify our supply chain.
So we’re not entirely dependent on one country or another. So I think I say this loosely, as long as we’re moving in that direction, we’re going in a good direction. But.
Daniel O’Connor (07:15.352)
Yeah, I mean, think you and I were talking about this earlier. know, tariffs, a lot of economists will say they’re not very good. It’s better to have free trade agreements where you just have a flow back and forth, less friction.
You know, I think Trump has a point. mean, again, people say, well, we need free trade. And then if you look at what China does with its rare earth elements, it’s anything but free trade. They completely control it. There’s not even a market. The market’s a black box. So and it’s used as a strategic weapon. Now I get it. If you’re over there, you think, OK, we use what we have at our disposal to try to build a wealthier society.
But again, when we went over to China in the early 70s, Richard Nixon did, and opened it up, the premise was is that we’re going to trade together, right? And we’re going to embrace capitalism versus sort of communistic controlled capitalism.
And so that’s what we’re really up against. And that’s why we really say, we really are not in a position to compete with what they’re doing because we have a very different system with different milestones and deliverables in terms of delivering value. We have a quarterly system, we have to drive value for shareholders.
Whereas over there, it’s the government controlling it and they have a very long time horizon. So it’s apples to oranges. So that’s why we need more industrial policy over here if we want to actually compete with them. Okay.
Daniel O’Connor (09:05.648)
And we write about that quite a bit. Now, industrial policy is not something you see much in the United States because it’s sort of considered, you know, that’s something a socialist society will do. So, but we’re in a kind of a quandary and it’s going to get worse. mean, again, if China cuts off everything, you’re going to feel it. You’re going to feel it. It’s going to be palpable and.
it will get next level.
Yeah.
Dustin Olsen (09:40.16)
Yeah, I, if, if we were to be cut off, right? We can’t do anything. I feel like it’d be worse than what we experienced during COVID times. We had all of those shortages. like it’s one thing to have a shortage. It’s one thing to not have it at all. and to me, that’s, that’s really scary. I thought what we saw on COVID and the way people responded over just toilet paper.
Daniel O’Connor (09:59.706)
Thank you.
Daniel O’Connor (10:03.661)
Thank
Dustin Olsen (10:09.996)
You know, imagine if that was a whole lot more things. so.
Daniel O’Connor (10:15.588)
Well, imagine if it’s defense products, all of a sudden we’re at a disadvantage compared to the Chinese military.
Dustin Olsen (10:18.188)
See.
Dustin Olsen (10:35.118)
Mm-hmm.
Daniel O’Connor (10:35.312)
Right
Dustin Olsen (10:38.218)
Yeah, it doesn’t sound great. anyway, what else is on your, what else stood out to you in the news?
Daniel O’Connor (10:39.216)
So,
Daniel O’Connor (10:44.464)
service.
Daniel O’Connor (10:48.592)
slowing down a little bit. I have a couple different articles that we can go over. Does that make sense?
Daniel O’Connor (11:03.844)
Dustin.
Daniel O’Connor (11:08.346)
You there, Dustin?
Daniel O’Connor (11:43.105)
Excellent. So Dustin, I was thinking I would now review a few news items that we covered this week.
Was that me or you?
Daniel O’Connor (11:50.224)
to stream.
Dustin Olsen (11:53.28)
Yeah, let’s do it.
Daniel O’Connor (11:55.297)
Okay. One was the Critical Minerals Institute. They released a strategic list of 23 minerals deemed essential for global technological, economic, and defense resilience, emphasizing an urgent need for transnational corporations. So not just individual nations, but multiple nations together as part of a supply chain.
reason.
Dustin Olsen (12:24.29)
Mm-hmm.
Daniel O’Connor (12:25.441)
And the list addresses geopolitical tensions in major mineral supply chains. And importantly, it emphasizes the importance of aligning US industrial and defense policy with emerging minerals. An important reality to consider. So this list again is 23 minerals.
Let me reboot. Can you save?
Daniel O’Connor (12:44.196)
Let me try to reboot. Going slow, the browser’s going slow.
essential for global technological, economic, and defense resilience.
It’s importantly, it is from Tracy Hughes, who runs an investment news online news site. We spoke with her before, very nice woman and very supportive of what we’re trying to do. Her feature was called Breaking the CMI Critical Minerals List 2025, a strategic blueprint for global technology, defense and economic security. Okay.
Hughes, she states that, know, collaboration is key. Collaboration across industries, Dustin, and borders is no longer optional. So it’s not about nations putting up, you know, ramparts and being on their own and being protectionists. They got to open up. And again, the list co-authored by Alistair Neal, who’s the CMI director.
The list is a pragmatic response to rising geopolitical tensions, electrification, so new types of energy vehicles, etc. Driven demand and growing concern over China’s stranglehold on critical mineral supply chains. So there’s that China stranglehold again.
Daniel O’Connor (14:26.653)
Implications for US industrial strategy are profound, know, semi-tangent conductors to AI infrastructure to energy transition infrastructure to national defense. These minerals are the lifeblood of the 21st century economy. So, you know, again, they’re calling for resilience in the supply chains. But what does that mean? Right. That’s a it’s a topic that
It’s easy to talk about, right? So global interdependence is absolutely vital. And we suggest, based on review of this article, a more nuanced understanding of US industrial and policy responses is paramount, right? Because you need to have a clearer assessment of how, at least in this country, the United States, what our current refining is.
mining and processing capabilities, along with any pending legislation of federal incentives to help contextualize this report. So what we’re saying is you need more. So we are working on our projects directory where you’re going to have just about every rare earth mining in the world in the rare earth exchanges website. That’s something you’re working on Dustin, pretty exciting.
Dustin Olsen (15:52.814)
You know, very exciting. Yes, it’s coming. It’s a work in progress.
Daniel O’Connor (15:57.013)
Yep, but for those of us that are interested in this stuff, it’s fascinating, okay? Because not only we have the countries, we have the product that they’re pulling out, contacts, but we’re even gonna get into other things, okay, about these facilities, these locations, these sites, okay? So, but back to competition again, it’s one thing you know what the critical minerals are, you have the mining, but again, Dustin, you need the refining.
You could do some recycling. You need to be able to process. You need to be able to understand resource substitution. If China blocks off minerals, what are you going to do? You got to have a plan, right? So all of these things are very, very important right now, and it’s going to get more intense. We’re being told by experts in the field that we speak to that we haven’t seen anything yet.
Dustin Olsen (16:56.91)
We haven’t seen anything yet. gosh. Famous last words right there. And we’ve seen a lot. It seems like anyway.
Daniel O’Connor (17:02.24)
Yeah.
Daniel O’Connor (17:06.337)
We’ve seen a lot.
Dustin Olsen (17:10.378)
Yeah. yeah. So I would agree, you know, like I think as a global community, you know, share the love, spread it out, you know, utilize kind of everyone’s resources to, so that we can all thrive. Like that makes a lot of sense. but yes, this, phrase, this China’s stranglehold
on not just the United States, but on many other countries, right? It’s a big deal. And I think we’re all feeling it as of late. So.
Daniel O’Connor (17:50.325)
Yeah. And President Trump is.
let’s just say driving towards this outcome. I mean, it’s on a collision course.
Dustin Olsen (18:06.796)
You think so? Collision course? He’s only got four years, Daniel.
Daniel O’Connor (18:08.811)
Bye.
Daniel O’Connor (18:13.033)
I think we’re going to have a collision course before his four year term is up. I think there’s, you know, with China, I think, but I could be wrong. I hope I’m wrong. Maybe Trump will go over there and do a deal with them.
Dustin Olsen (18:29.198)
Well, with their tariffs at 145 % right now, someone’s gonna be asking for a deal.
Daniel O’Connor (18:34.497)
Yeah, you would think but don’t forget they have a whole treasury behind them
Dustin Olsen (18:36.781)
You
Dustin Olsen (18:42.51)
It’s true.
Daniel O’Connor (18:43.329)
Right. So, you know, we also covered this 90-day suspension. So, when I talk about that, that we dropped the 90-day extension. We put a pause on the tariffs, except for China. Right.
Dustin Olsen (19:06.2)
Yep, it’s a very revealing power play right there.
Daniel O’Connor (19:10.399)
Yes, yes. And you know wanted to talk about Baogang Group. They own Northern Rare Earth Group. Northern Rare Earth Group is the largest rare earth conglomerate in the world. They’re owned by Baogang Group and the Chinese government.
Okay, so we review their news quite a bit to get some insight into what’s going on over in China. Now of course, there’s propaganda over there, right? So you have to be able to read through some of the…
spin for lack of a better word.
Dustin Olsen (19:57.218)
Yeah.
Daniel O’Connor (19:57.345)
So one is Baogang Group. Again, they own Northern Rare Earth. They’re making a 1 billion yuan investment. I’m not sure what that is in the US, couple hundred million, I think. This marks a large share transaction in Inner Mongolia. That’s where this big mine is. The acquisition represents China’s industrial strategy to deepen vertical integration.
and control over rare earth supply chain. So it’s called two rare earth base china. There’s the rare earth. We pull it out of the, we mine it, we pull it out of the ground, we separate it, we refine it, and then we produce these value added components, whether they’re magnets or what have you, assemblies, components, parts, right?
But what they’re trying to do now is they’re saying we’re going to go deeper into industry. We’re going. We’re not just going to make the magnets. We’re going to integrate into new forms of steel. We’re going to integrate into defense space. We’re going to integrate into health care. So you can see that they’re tightening up their consolidated power in the rare earth market. Do you see what I’m saying?
Dustin Olsen (21:15.534)
Yes, that’s also an interesting move. But I’d be curious to get your take. Do think it’s a move out of their long time playbook or is it a reaction? they reacting to what’s going on?
Daniel O’Connor (21:40.971)
Well, yeah, I mean, I think again, they would say we started this.
Dustin Olsen (21:48.974)
Of course they would.
Daniel O’Connor (21:50.025)
Right? And in some ways we did start this round. However, Northern Rare Earth Group has been playing this game with the Communist Party for years now. you know, again, it’s apples to oranges. We’ve got two different classes of organization. We can’t just compete with our sectors are owned by investors, right?
either publicly traded or privately held, they’re subject to the forces of the market, capital markets, etc. Whereas the Chinese companies, they’re publicly traded, but that’s, you know, kind of window dressing compared to what they really are.
Dustin Olsen (22:39.254)
Yeah. Yeah. mean, I think you said it perfectly. It’s apples to oranges. It’s, it’s hard to draw comparisons when things just aren’t played the same way, you know?
Daniel O’Connor (22:51.743)
Yes, it’s the rules aren’t the same. So they never started, they’ve always been that way for years and so they’ve never been fair. So we’re at a disadvantage. That’s why we’re trying to diversify.
our supply chain so we can get material from Brazil and ship it through other companies and into the United States or Canada or wherever but not China.
Dustin Olsen (23:25.856)
Yeah, gosh, yeah, it just sounds like that collision course you’re talking about. Just easier said than done.
Daniel O’Connor (23:35.231)
This is an assumption I could be off, it feels like it’s coming in. speak with people and they say it’s going to come. There’s going to be some collision course. So, because I don’t think Donald Trump is going to.
Daniel O’Connor (23:55.147)
give up with the Chinese head. I just don’t think that’s going to happen. I could be wrong.
Dustin Olsen (24:03.436)
He would have to be really, really pressured, I think, to give in or double back or anything, especially with what he’s done yesterday and today, right? He’s looking for a power bargaining chip, if that’s what he’s gonna come to. So.
Daniel O’Connor (24:29.109)
Yeah, that makes sense. That really makes sense. So, I mean, again, I think we’ve spoken about this. I think that the mindset is good, but is it the right tools? Is it the right effect? Is it the right mix of things? I don’t know. It seems to be getting a little bit out of control, but you never know.
Dustin Olsen (24:54.062)
Yeah.
Daniel O’Connor (24:54.279)
So I want to talk about Kazakhstan for a minute because they had a big discovery that was reported last week. They found what they say is the largest rare earth metals deposit containing one million tons of critical elements.
discovery high position strategically ahead of the European Union and Central Asia Summit, highlighting geopolitical resource importance. And again, this is sort of all part of that China Belt Road Initiative where they’re building, you know, freeways and trucker lanes and ports where it’s relevant so that they can have their footprint over the shipping and things like that and business.
Kazakhstan is looking for foreign investment. So Dustin, not sure if you’re in the market, but Kazakhstan is looking for some money. And you know, that’s something that maybe one of our audience could help with.
Dustin Olsen (25:53.55)
you
Dustin Olsen (26:06.115)
Yeah.
Daniel O’Connor (26:09.281)
I will just say that this announcement came from their ministry of industry And it’s in the Cara Conda region Cara Conda region Excuse me and the topic the deposit contains An estimated 1 million tons of critical elements including cerium Lanthium lanthanum neodymium
Dustin Olsen (26:09.445)
Daniel O’Connor (26:39.697)
and yttrium. Pending further verification, the total resource estimate could exceed 20 million tons.
Dustin Olsen (26:51.938)
That’s quite the find to be sure. Right. But as we’ve talked before though, on this show, you know, in reference to Greenland, right? You can have it in the ground, but how do get it out? What’s it going to cost? How long is it going to take? You know, we’ve to get a mine up and going 10 plus years. Right. So.
Daniel O’Connor (26:54.592)
Yeah.
Daniel O’Connor (27:18.719)
Well, I think, okay, so you’re right. Yes. And theoretically you could, you can move a lot faster, but I just think there’s, I don’t know, there’s a certain culture, what have you. There’s environmental regulations. There’s, but this group is looking for, for investors. And it’d be interesting because Kazakhstan is, you know, over obviously west of China. It’s sort of in between Europe and Asia.
Right? So it would be interesting if American companies could go over there and do business with them.
Dustin Olsen (27:56.802)
would be interesting.
Daniel O’Connor (27:57.855)
Yeah, for sure, for sure. I just want to see if there’s anything else. I mean, that’s pretty much it for this. think it’s good opportunity and another project in our database.
Dustin Olsen (28:00.078)
for sure.
Dustin Olsen (28:07.692)
Yeah.
Dustin Olsen (28:15.946)
Absolutely. There’s, mean, just to kind of maybe round out the show here really quick. mean, another, discovery that was made was beneath the Salton Sea, just outside of California, right? The, lithium discovery.
Daniel O’Connor (28:31.583)
Yeah, yeah, that’s… The lithium is… Give me one second, I would like to talk about that.
Now these claims Dustin, it’s hard, you know, we have to verify it through third parties, right? It’s, you know, just because the media says that it’s X, Y or Z doesn’t mean so. You need to verify it. It’s, it’s declaring, $540 billion worth of lithium. and again, that’s not rare earth. This is more of a critical mineral type of category.
Dustin Olsen (28:48.696)
Mm-hmm.
Daniel O’Connor (29:10.625)
The Salton Sea, I don’t know if you’re, are you familiar with the Salton Sea, Dustin?
Dustin Olsen (29:15.532)
I’m not. I actually had to look it up when I saw this come through. was like, salt and sea.
Daniel O’Connor (29:19.105)
It’s a very strange, bizarre place. It’s pretty much unen- I mean, there’s very few folks living there. There’s- It’s a huge, like, saline lake. was, like, part of an inland sea at some point, I believe. And it’s- But it’s pretty much vacated. However, there are some edgy little towns there, including one. I think it’s called Slab City, where everything is free.
Nobody pay, you know, they just parked their car there and they live there and they have their own community, their own rules. It’s sort of interesting. There’s YouTubers that go over there. Um, so if, mean, if, if in fact there’s this much lithium, that’s again, under the ground, that’s a huge deal. But again, the same questions come, I mean, in the short to intermediate run, you know, what are you going to do? How are you going to get it out? You know, there’s all these questions, right?
Dustin Olsen (30:18.263)
Yep.
Daniel O’Connor (30:19.883)
But lithium…
Dustin Olsen (30:20.748)
Yeah, it’s…
Dustin Olsen (30:25.922)
Yeah, go ahead.
Daniel O’Connor (30:26.569)
No, you go ahead, Dustin.
Dustin Olsen (30:29.058)
Yeah, just, it’s, it’s great to see the discovery. think, yes, it can be exciting to, to talk about like, Hey, we got lithium here or we got other reverse, right? but this is the major roadblock that we have of great. It’s there, but how do we get it? And once we get it, what do do with it? Send it to China.
Daniel O’Connor (30:53.333)
Yeah, I mean, yeah, and again, lithium is not a rare earth, so it’s not refined the same way. And, you know, we probably have more capacity over here, but it’s still, you know, people, it’s valuable and people are trying to access it. It’s a lithium rich basin. So Southern California, the Salton Valley or Imperial Valley, I’m sorry, there’s agriculture too, it’s dry, but then there’s some,
aquifers I think and I think they get some of the water from the Colorado River if I’m not mistaken and so this complex where they have this rare earth is just part of a broader domestic puzzle because you know up in Nevada is what they call a claystone reserves in the McDermott caldera that’s a huge swath of territory up in northern Nevada into Idaho okay
leave.
They can produce a lot. mean, if you brought all this stuff online, it would be compelling, but there’s a lot of work to do, as you can only imagine. So it’s still very early days, and it’s great that there’s an announcement, and it shows promise for the future.
And if the Chinese shut us completely off tomorrow, it wouldn’t help us.
Dustin Olsen (32:25.698)
Yeah, so it’ll be interesting to see how they move forward with that, that discovery and if they can at all. great, Daniel. Well, if you’re to put into perspective everything we talked about today, what would you say?
Daniel O’Connor (32:32.821)
Yes.
Yes, for sure, for sure.
Daniel O’Connor (32:43.051)
today.
You know, I would say that we’re, it’s fairly clear, at least to me, and I don’t know if you agree, Dustin, but we’re, we’re in a trade war. It’s primarily against China. You know, it was initiated by President Trump, but it’s always been there. So President Trump would just say, Hey, I’m just, these guys have been playing unfairly for years. And I have to agree with them when it comes to rare earths.
He’s correct. Okay.
Daniel O’Connor (33:25.941)
Dustin? Yeah, sorry, I lost you. President Trump’s correct when it comes to things like rare earth elements. They haven’t played fairly. They’re using it as a geological weapon.
Dustin Olsen (33:34.7)
Yeah. So, you’re good.
Daniel O’Connor (33:42.689)
So that’s about it today. I mean, think we’re in a war. We’re in an economic war.
Dustin Olsen (33:51.286)
Yeah, that’s it.
Dustin Olsen (33:58.05)
Yeah, we really are and things are heating up. So as our experts have indicated to us, it’s just the beginning and there’s more to see. So, so with that, we’ll wrap up our show and we’ll see you guys next week.
Daniel O’Connor (34:53.057)
Maybe you can just work some magic and just pull that one out.
Daniel O’Connor (35:14.913)
Yeah, mean, I’m trying, but it’s, it’s unfortunately,
Daniel O’Connor (35:23.97)
I’m gonna have to, I’m gonna have to, yeah, it’s, I don’t know what’s wrong.
Daniel O’Connor (35:45.449)
right right you know i mean the problem is i’m just trying to back in here so let’s see
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