Highlights

• Rainbow Rare Earths is developing low-cost rare earths extraction at the Phalaborwa site with potential geopolitical significance.
• President Ramaphosa reportedly pitched rare earth supplies to Donald Trump during a White House visit, highlighting the project's strategic importance.
• The project shows technical promise but lacks full funding and confirmed offtake agreements, requiring investor caution.

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A recent BusinessLive (opens in a new tab) article by David McKay throws a spotlight on Rainbow Rare Earths’ Phalaborwa project in South Africa (opens in a new tab) after President Ramaphosa reportedly offered up rare earth supplies to Donald Trump during a May White House visit. According to Rainbow CEO George Bennett, the Phalaborwa site—an ex-phosphogypsum stack in Limpopo—was the unspoken star of that conversation. Investors are now wondering: is this a geopolitical goldmine or PR-grade hopium?

Let’s Separate the Rare Earths from the Red Flags

Factually, Rainbow Rare Earths (LSE: RBW) is indeed developing the Phalaborwa project with a focus on extracting magnet rare earths like NdPr, Dy, and Tb from waste dumps. The company holds a 100% interest in the project and touts its low-cost, low-environmental-impact model as a competitive edge. It has published a Preliminary Economic Assessment (PEA), and is progressing toward a definitive feasibility study.

It is also true that South Africa is not a major global rare earths player—hence the eyebrow-raising nature of Ramaphosa’s pitch. According to the USGS, South Africa doesn’t even make the top ten in REE reserves. That said, Phalaborwa is a brownfield site, and Rainbow’s metallurgy has shown promise in extracting separated oxides—a potential differentiator.

Bias, Speculation, and the “Washington Post” Wink

The article leans heavily on anecdotal claims—e.g., that The Washington Post “namechecked” the project or that someone whispered to Trump about it. No citation is provided.

That raises two questions: (1) was this actually covered by major U.S. outlets, and (2) if so, was it promotional puffery or grounded in U.S. procurement policy?

There’s also subtle promotional bias in quoting Rainbow’s CEO without pressing for financing updates. As of July 2025, Rainbow has not secured full funding or confirmed offtake agreements—major hurdles for realizing cash flow. Yet this detail goes unmentioned in the BusinessLive write-up.

Conclusion: Real Promise, But Watch the Smoke

Phalaborwa is technically sound and geopolitically relevant. But the leap from a gypsum dump in Limpopo to White House trade leverage is a stretch—unless Rainbow signs serious downstream partners or secures U.S. DFC or DoD funding. Until then, investors should enjoy the headline... but read the fine print.

Source: David McKay, “Phalaborwa rare earths project could reap big profits,” BusinessLive, July 31, 2025.