Highlights

• Western nations are pursuing REE reshoring while China's dominance begins to decline.
• Analysts warn of industry ignorance regarding complex REE separation technologies and infrastructure requirements.
• The rare earth market extends beyond electric vehicles, demanding deep technical understanding for long-term investment value.

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In a scathing new report titled “The Essence of Rare Earths: Dispelling the Myths (opens in a new tab)”, Hallgarten & Company analysts Christopher Ecclestone and Sergei Shulin argue that while rare earth elements (REEs) are finally receiving long-overdue political recognition, deep industry ignorance still threatens supply chain rationality and investor clarity.

The report identifies a critical contradiction: Western panic is fueling state-backed efforts to reshore REE supply chains just as China’s dominance—especially in Heavy REEs like terbium and dysprosium—begins to wane. Yet, government-led initiatives are often “giving razors to monkeys,” funding politically appealing projects like Arafura while lacking coherent industrial end-use strategies. Hallgarten singles out Australia’s contradictory approach: supporting a company it doesn’t consume from, while mulling price supports for minerals outside domestic demand.

The analysts emphasize that the EV slowdown, often painted as negative, is in fact creating a much-needed “breathing space” to establish alternate REE sources. However, they warn that a blind obsession with NdPr magnets comes at the expense of strategic planning for overlooked elements, such as erbium, gadolinium, and even cerium and lanthanum—metals with growing utility but little investment attention.

Critically, the report pulls no punches on Western ignorance of the incredibly complex chemistry and infrastructure behind REE separation. Technologies require not only cascaded solvent extraction with hundreds of steps per element, but also local availability of specialized resins, extractants, pumps, and reverse osmosis systems—often unavailable or controlled by China.

Key Data Highlights

• Terbium and dysprosium prices surged in 2025, reaching $1,147/kg and $300/kg, respectively.
• China's REE dominance persists due to the high heavy REE content in domestic monazite and ion-adsorbed ores.
• Global REE production is increasing—particularly in Myanmar and the U.S.—but heavy REE supply remains bottlenecked by Chinese-controlled separation facilities.

Unanswered Investor Questions:

• Can Western nations develop the full stack of REE processing, including extractant manufacturing and waste handling, without China?
• What is the real risk of Chinese pricing manipulation derailing non-Chinese REE projects midstream?
• Are state-backed stockpiling plans rationalized by actual demand forecasts for lesser-known REEs?

REEx urges investors to treat this report as a wake-up call. The REE market is not just a play on EVs. It’s a deep, technical battlefield—one where knowledge, not hype, drives long-term value.

Rare Earth Exchanges is committed to investor clarity in both the rare earth element supply chain and critical mineral markets.