Highlights
- European Commission President symbolically demonstrates Western cooperation in rare earth magnet production at G7 summit.
- Despite emerging projects in Estonia and USA, Western rare earth supply chains remain heavily dependent on Chinese inputs and infrastructure.
- Critical challenges include:
- Lack of downstream integration
- Limited heavy rare earth separation capabilities
- Uncertain OEM demand
At the G7 economic resilience summit in Canada, European Commission President Ursula von der Leyen made a symbolic gesture, holding up a rare earth permanent magnet manufactured in Estonia from Australian feedstock by the Canadian firm Neo Performance Materials, as a symbol of transatlantic cooperation in rare earths. The message: the West is making progress toward de-risking supply chains long dominated by China.
According to Fastmarkets' Caroline Messecar, the magnet came from Neo’s Narva, Estonia plant—the most advanced EV traction motor magnet production facility in the Western world. Built in under two years with EU Just Transition funding, the plant has already produced 18,000 sample magnets. Messecar highlights this milestone as emblematic of ongoing efforts to re-establish Western control over rare earth value chains.
Von der Leyen sharply criticized China for weaponizing its near-monopoly over rare earth supply and urged continued diversification. Neo CEO Rahim Suleman echoed this, calling the Narva magnet a result of "thoughtful public policy" and multilateral coordination.
However, this coverage omits several crucial realities we address below.
Missing in Action
While Caroline Messecar’s dispatch from the G7 offers a photogenic moment of geopolitical defiance—a rare earth magnet hoisted like a modern-day talisman—it glosses over the brittle scaffolding beneath the West’s rare earth ambitions. Neo’s Narva plant may sparkle as a milestone, but it remains tethered to upstream Australian feedstock and utterly dependent on China’s absence rather than the West’s independence. The deeper industrial reality is that heavy rare earth separation, metallization, and recycling infrastructure in Europe and North America is still in its infancy—patchy, fragile, and woefully behind the curve. Without integrated heavy REE capabilities, the “made-in-Europe” claim is aspirational at best, and strategically hollow at worst.
Even more troubling is the article’s omission of America’s uneven and halting role. It overlooks what has been a longstanding glaring gap in U.S. policy implementation. Where magnet production remains in its infancy and Defense Production Act authorities—long dormant—are only now being tentatively reawakened under Trump’s recent executive orders.
However, regardless of the urgency now being promoted, as this media has continuously reported, the industrial machinery of national resilience still sputters, hampered by bureaucratic inertia and underwhelming follow-through.
But there are bright spots, such as the treasure trove that is MP Materials. The Las Vegas-based company is constructing its first fully integrated NdFeB magnet plant in Fort Worth, aiming for ~1,000 tons per year, with NdPr metal production already underway. USA Rare Earth (USARE) plans a magnet plant in Oklahoma, targeting 600–5,000 tons per year from early 2026. That company, Rare Earth Exchanges (REEx), learned in an interview with the CEO that it will target the small to midsize market.
Yes, the U.S. government is indeed invoking Defense Production Act powers and funding magnets and separation initiatives (e.g., MCEIP funding to MP Materials and other projects), and much more will be needed.
And while Messecar notes the West’s project scarcity, she sidesteps the uncomfortable truth: almost every Western magnet project still leans on Chinese supply chains for critical inputs like dysprosium and terbium—the heavy lifters in high-performance magnets. Worse still, there’s no interrogation of downstream integration. Where are the binding offtakes?
Where is the OEM alignment? Without committed demand from automakers, defense primes, and turbine giants, even the best-funded Western projects risk becoming expensive footnotes rather than industrial footholds.
China remains dominant in heavy rare earths (dysprosium/terbium) and magnet production (~90% share).
Food for Thought
While Messecar provides a snapshot of growing Western cooperation in rare earth magnet manufacturing, the article’s celebratory tone overshadows the structural fragilities and critical missing links in the non-Chinese supply chain. As REEX has consistently reported, symbolic milestones must translate into scalable, self-sufficient systems spanning exploration, separation, alloying, magnetization, and recycling. Otherwise, Western economies remain exposed to geopolitical disruption and industrial vulnerability.
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“Critical challenges include:
Lack of downstream integration
Limited heavy rare earth separation capabilities
Uncertain OEM demand”
The reasons that the prime RE wannabees are having so much difficulty advancing their sp over time. The lack of clarity with regard to their place in any transparent mine to processing to metals to magnets to OEM US/ROW value chains. This should become much clearer for some over the next 2-3 years, along with RE pricing mechanisms (beyond Chinese) as well as some wannabee initial cash flows.
GLTA REI