Highlights
- The U.S., EU, and allies are investing billions in non-Chinese rare earth supply chains:
- U.S.: DOE's $134M funding
- EU: €3B ReSourceEU initiative
- Trump-brokered DRC-Rwanda peace accord opening Central Africa's minerals to Western investment
- Asia's initiatives for critical minerals independence:
- South Korea launched a Resource Security Control Tower
- India approved $816M for domestic magnet production
- Japan increased cooperation with the U.S.
- ASEAN nations pledged greater mineral access to American supply chains
- China's recalibrated export strategy:
- Authorized commercial magnet exports
- Maintains strict controls on oxides and processing technology
- Western buyers are paying up to 4x premiums for non-Chinese dysprosium
- Shift towards security-driven pricing
Table of Contents
North America
United States
Federal Funding
The U.S. Department of Energy announced a Notice of Funding Opportunity of up to $134 million (opens in a new tab) to enhance domestic rare earth supply chains. This program will fund projects to recover and refine rare earth elements (REEs) from unconventional feedstocks (mine tailings, e-waste, etc.), aiming to reduce reliance on foreign sources and strengthen U.S. energy security.
Supply Partnership
USA Rare Earth (USAR) disclosed that its newly acquired UK subsidiary Less Common Metals (LCM) has signed a supply agreement to provide rare earth materials to Solvay SA (Belgium) and Arnold Magnetic Technologies (U.S.). The deal secures an ex-China source of high-quality rare earth alloys for permanent magnet production, supporting supply chains in sectors like defense, automotive, and clean energy. USAR completed the $100 M acquisition of LCM in November, and LCM’s alloys will also feed USAR’s Oklahoma magnet factory slated for Q1 2026 commissioning. USAR’s stock jumped ~25% on the news, reflecting investor optimism.
First substantial project involving blockchain tracking and certification of rare earth supply chain
While Rare Earth Exchanges (REEx) may have been overly critical, nonetheless, the deal between ReElement Technologies and SAGINT Inc. shows real potential for traceability of rare earth element molecule—from mine to downstream product. CEO Mark Jensen emphasized the defense market needs such capability now. We suggested SAGINT was smart to link into the ReElement nascent supply chain to quickly elicit the right requirements.
Phoenix Tailings
REEx interviewed Phoenix Tailings CEO Nicholas Myers the week before, with upbeat news that the American venture is now refining 200 tons of rare earth elements, with imminent scaling. Markets should watch Phoenix Tailings—could they emerge as a major American rare earth refinery?
Tactical Resources Corp. announced the effectiveness of its registration statement with the U.S. SEC
In support of its proposed business combination with Plum Acquisition Corp. III, a SPAC, which would result in Tactical becoming a Nasdaq-listed U.S. rare earth development company. The deal, pending shareholder and regulatory approvals, is scheduled for a shareholder vote on December 16 (Tactical) and December 22 (Plum). Tactical is advancing its Peak Project in Texas, a rare earth tailings site with the potential for rapid oxide production via a modular, clean-processing pathway. The company also secured $140 million in financing from Yorkville Advisors—$40 million in convertible debt and a $100 million equity facility—to accelerate development and strengthen U.S. critical mineral independence.
Morgan Stanley upgraded MP Materials to Overweight this week
Citing its emerging role as the U.S. rare earth supply chain solution. With China tightening exports and the Pentagon doubling down on non-Chinese sourcing, MP stands as the only vertically integrated, operational rare earth platform in the United States—from mining at Mountain Pass to planned magnet production.
The firm's recent joint venture in Saudi Arabia and DoD-backed domestic buildout give it global reach and political tailwind. But the upgrade comes with pressure: MP must now execute flawlessly across multiple fronts—ramping separation capacity, building alloy and magnet facilities, and meeting defense-grade standards. As the company shoulders America’s strategic ambitions, investor enthusiasm is rising—but so are expectations. Delivery risk is now measured in both quarterly earnings and national security.
Canada
Processing Plant Investment
Ucore Rare Metals secured up to C$36.3 million (opens in a new tab) in Canadian government funding to develop a rare earth processing facility in Kingston, Ontario. This package includes ~C$26 M from Canada’s Critical Minerals Infrastructure Fund and C$10 M from a regional development program. The funding will support Ucore’s plan to use its proprietary RapidSX technology for rare earth separation, bolstering North America’s midstream capacity and reducing dependence on Chinese processing. The investment reflects Canada’s strategy to build out domestic REE refining infrastructure as part of a broader critical minerals push.
Europe
EU Supply Chain Initiative
The European Commission unveiled “ReSourceEU,” a €3 billion strategy to de-risk and diversify EU supply chains for rare earths and other critical minerals. The plan will back 25–30 strategic projects (via European Investment Bank funding and other tools) to boost extraction, processing, recycling, and magnet manufacturing in Europe. Notably, the EU signaled it may legally require companies to diversify away from China if voluntary measures fall short – a strong warning to industries heavily dependent on Chinese REE supplies. This initiative comes as Europe seeks to curb vulnerability to supply shocks after China’s recent export restrictions on REEs.
EU makes trek to Aclara mine in Chile, South America.
Europe is awakening and may seek to accelerate the competing with USA, in addition to China. REEx expects ex-China ecosystems to form—some competitive some cooperative.
Policy and Industry Moves
Alongside funding measures, the EU is tightening export rules (e.g. proposed bans on scrap metal exports) and pooling demand to support non-Chinese suppliers. European firms are also ramping up involvement in rare earth processing: for example, Belgium’s Solvay has begun modest production of magnet-grade oxides in France and recently agreed to supply U.S. magnet makers (Noveon and Permag) with NdPr, Dy/Tb, and samarium oxides. (Solvay indicated these initial contracts are limited in volume but demonstrate Europe’s growing role in REE midstream and could scale up with additional government support.)
Australia
New Rare Earth IPO
Barkly Rare Earths, a junior explorer in Australia’s Northern Territory, launched an A$8 million IPO (initial public offering) this week to fund drilling at its Tennant Creek rare earth project. The project is an early-stage 40 Mt @ 2,100 ppm TREOsand-hosted deposit, notable for a high proportion of magnet metals(~34% NdPr, yielding ~714 ppm magnet REO). Barkly touts the loose sand geology as a potential low-cost mining advantage, though metallurgy is unproven and significant further investment will be required to advance the project. The IPO is backed by a strong technical team (including ex-Arafura MD Gavin Lockyer) to lend credibility, but investors are cautioned that the project remains very early-stage with considerable development risk.
Critical Minerals Pact (In parallel with U.S. efforts)
Australia itself agreed to a critical minerals investment deal with the U.S. worth $3 billion, aimed at expanding mining and processing of REEs and other critical minerals in Australia. This underscores Australia’s role as a key non-Chinese source of rare earths. However, analysts note challenges: Australia currently has only two operating rare earth mines and faces high costs and environmental hurdles in developing refining capacity. The government will need to balance the influx of funds against these practical constraints as it seeks to become a major REE supply hub for allies.
Latin America (Central & South America)
Brazil Project Acquisitions
Two Australian companies struck deals in Brazil to acquire and develop rare earth deposits:
Power Minerals (ASX: PNN) completed the acquisition (opens in a new tab) of a Brazilian rare earth project (a hard-rock carbonatite prospect)
Now owning 100% after paying $500,000 in cash plus $1 million in stock to the seller. PNN has been drilling shallow targets on the property and believes it holds a large carbonatite system; the company plans deeper drilling this month and aims to delineate a maiden resource by Q1 2026.. Notably, PNN decided not to proceed with a separate U.S. rare earth project, signaling a focus on advancing the Brazilian asset.
Core Energy Minerals (ASX: CR3) signed a binding agreement with Rio Tinto to acquire 100% of the Itambé rare earth project in Bahia state, Brazil.
Itambé spans a 327 km² area in an emerging ionic clay rare earth district. The purchase price is modest (~A$0.2 million plus future work commitments), as Rio Tinto divests this early-stage prospect. CR3 simultaneously raised ~A$2.75 M to fund exploration at Itambé and its other critical mineral projects. These deals reflect growing international interest in Brazil’s REE potential, given the country’s large reserves; the U.S. DFC and others have already funneled funding into Brazil’s advanced rare earth project (Serra Verde) earlier this year to secure a non-Chinese supply.
Northern Africa & Middle East
U.S.–Saudi Rare Earth JV
Saudi Arabia is set to host a major new rare earth refining joint venture. Last month, U.S.-based MP Materials announced it would build a rare earth separation plant in Saudi Arabia in partnership with the U.S. Department of Defense and Saudi miner Ma’aden. Under the agreement, Ma’aden will own 51% of the JV and MP+DoD will hold 49%.
The planned facility will process both light and heavy rare earth concentrates (sourced from Saudideposits and imports) into separated oxides. Those oxides will feed downstream magnet manufacturing in the U.S. and Saudi Arabia and be available to allied nations.
This deal, announced during the Saudi Crown Prince’s visit to Washington, comes on the heels of a broader U.S.-Saudi critical minerals partnership. It leverages Saudi Arabia’s strategy to diversify its economy (Vision 2030) and tap its Arabian Shield minerals, as well as the Pentagon’s push to develop alternate REE supply chains. MP’s involvement (with U.S. financing support) means minimal capital risk for the company, and analysts see this as positioning MP to secure more non-Chinese magnet supply deals going forward.
Regional Outlook
(No significant rare earth-specific deals were reported in North Africa this week, though the region’s phosphate producers, like Morocco’s OCP, continue to explore REE extraction from phosphogypsum. In the Middle East, Gulf countries such as the UAE are likewise surveying their mineral endowments for REEs, but Saudi Arabia currently leads with the above joint venture.)
Sub-Saharan Africa
Central Africa Peace Accord
As REEx reports, a landmark peace agreement was brokered on December 4 between the Democratic Republic of Congo (DRC) and Rwanda, with significant rare earth and critical mineral implications. The “Washington Accords,” mediated by President Trump, link the cessation of conflict in eastern DRC to U.S. access to the region’s strategic minerals.
The deal stipulates ceasefire commitments, withdrawal of Rwandan troops, and the dismantling of militias, in exchange for U.S. support and American companies gaining rights to invest in and offtake critical minerals (including rare earth elements, cobalt, copper, tin, tungsten, and tantalum) from DRC and Rwanda. Trump stated, “Everybody’s going to make a lot of money,” emphasizing the intent to reduce U.S. dependence on China’s rare earth dominance.
If the ceasefire holds, this accord could unlock one of the world’s largest untapped rare earth areas for Western firms; however, skeptics note the agreement’s success hinges on on-the-ground realities. (Notably, fighting by the M23 rebel group continued even on signing day, underscoring enforcement challenges.)
The deal has drawn criticism from human rights voices who argue it prioritizes resource access over justice, but it represents a bold geopolitical move to integrate African rare earth resources into U.S.-aligned supply chains.
African Project Financing
Outside of geopolitics, African rare earth developers secured increased backing as they progress toward production. Harena Rare Earths (Madagascar) and Pensana Rare Earths (Angola) both announced plans to list on U.S. markets to tap American investor interest. Harena received approval this week to join the OTCQB market, citing strong U.S. demand for its Ampasindava project, which aims to produce ~5,000 tpa TREO by 2028 (requiring ~$143 M investment).
Pensana, already listed in London, is pursuing a Nasdaq listing in 2026; it has started construction on its Longonjo project (targeting 20,000 tpa of mixed rare earth carbonate by 2027) and is seeking a $160 M loan from the U.S. EXIM Bank to help finance development. Pensana also recently partnered with German magnet manufacturer VAC to establish a U.S.-linked magnet supply chain using Longonjo’s output.
Additionally, the U.S. Development Finance Corp (DFC) has been actively supporting African REE ventures – for example, it provided funding for the Rainbow Rare Earths/Bosch Siemens Phalaborwa project in South Africa (recovering REEs from mine waste). These moves indicate a concerted effort by Western agencies and investors to develop non-Chinese rare earth supply sources in Africa, from greenfield mines to processing and magnet production.
Asia (Non-China)
South Korea
The Korean government set up a high-level “Resource Security Control Tower” – a new interagency council to oversee critical minerals strategy. Launched by the Industry Ministry, this council will monitor supply risks and coordinate responses across government and industry for materials like rare earths needed in EVs, batteries, and semiconductors.
The move marks a shift in Korea’s stance from passively managing import dependence to actively bolstering supply chain security. Korea signaled three priority actions: stockpiling heavy rare earths (especially during China’s export curbs), funding domestic magnet manufacturing (e.g. support for local NdFeB alloy and magnet plants), and partnering with allied sources in the U.S., Australia, and ASEAN to develop upstream projects.
This follows Korea’s recent critical minerals stockpile budget increases and overseas joint ventures, and is a direct reaction to intensifying U.S.–China rivalry and China’s rare earth export restrictions.
India
India’s government approved a major incentive program to jump-start domestic rare-earth permanent magnet production. The Union Cabinet on Nov 26 cleared a ₹72.8 billion (~$816 M) scheme to establish an integrated manufacturing ecosystem for sintered Neodymium-Iron-Boron (NdFeB) magnets.
India currently imports virtually all its permanent magnets (over 53,000 tons in FY2025) for industries like EVs, aerospace, and electronics. The new program will award grants to set up 6,000 tpa of magnet capacity across up to five facilities (allocated via competitive bidding) with the goal of ending import reliance by 2030.
Officials stated that with these plants, India’s magnet import dependence “will practically reduce to zero,” drastically improving self-sufficiency. This initiative complements India’s broader critical minerals efforts (e.g. recent partnerships to develop REE extraction from monazite sands and joint research with the U.S. on critical materials).
Japan & Southeast Asia
The United States deepened critical mineral ties in Asia (opens in a new tab) this week beyond Korea. In Japan, a high-profile agreement was signed committing U.S.–Japan cooperation on rare earths and other critical minerals.
The pact involves identifying supply chain gaps for EV motors, batteries, defense systems, etc., and coordinating investments, strategic stockpiling, and rapid-response teams to mitigate disruptions. This comes as both nations seek alternatives to Chinese rare earth processing (China controls ~70%+ of global capacity).
Meanwhile, at the ASEAN summit, leaders of Malaysia, Vietnam, Thailand, and Cambodia agreed with the U.S. to facilitate greater American access to their critical mineral resources. These Southeast Asian agreements are mostly non-binding MOUs, but they signal a shift: countries in the region are positioning to supply materials (like rare earth oxides, alloy feedstock, etc.) into U.S.-centric supply chains, in exchange for investment and industrial support.
Collectively, the flurry of deals across Asia (Japan, Korea, ASEAN, India) highlights a regional alignment with U.S. efforts to diversify rare earth supply chains away from China. DTEC MMT a Malaysian company is actively building a list ofAmerican corporate buyers.
While REEx cannot confirm mine or for that matter state in Malaysia, based on some unfolding confidential data, we suggest growing potential. Could this venture emerge as a liaison between Trump’s emerging rare earth policy and Malaysia?
China (Market & Policy)
This week, China quietly authorized the commercial export of certain rare earth permanent magnets, signaling a calibrated easing within its broader export control regime.
While restrictions on rare earth oxides and separation technologies remain firmly in place, the Ministry of Commerce confirmed that qualified companies may now apply for export licenses to ship finished NdFeB and SmCo magnets abroad under a commercial framework. This move appears designed to maintain global market leverage while deflecting criticism that China is weaponizing rare earths. Industry insiders suggest the policy shift aims to stabilize relationships with key trading partners like the EU and South Korea, even as China tightens control over upstream and midstream segments. The licensing process remains opaque, and case-by-case approvals are likely, but this marks a notable—if cautious—step in China’s evolving rare earth strategy.
Domestic Market
In the Chinese domestic rare earth market, prices were relatively stable this week, with most products oscillating in a narrow range amid soft demand. Suppliers have been reluctant to sell at lower prices, but downstream buying interest is subdued due to recent liquidity tightness and ample inventories—the link (opens in a new tab).
For example, Praseodymium oxide held around RMB 610,000/ton (≈$84,000/t) in early December. Minor declines were seen in heavy RE oxides like terbium as end-users stuck to small, “hand-to-mouth” orders. Overall, the market mood in China is cautious – participants are awaiting clearer signals (such as year-end government stockpiling or the next quota announcement) before any major price moves.
Production in China remains high after quota increases earlier in the year, which has kept a lid on prices despite export curbs.
Western buyers are paying up to $870,000 per metric ton for dysprosium oxide—nearly quadruple China’s domestic price of $230,000 to $270,000 per ton.
This extreme pricing gap reflects just how constrained the non-Chinese market for heavy rare earths has become. Outside of Lynas, whose dysprosium is largely locked into supply deals with Japanese customers, the only Western commercial source is Neo Performance Materials’ facility in Estonia. With limited availability and rising geopolitical urgency, Western buyers seeking assured, non-China supply are forced into a premium market where access—not just price—is the defining factor.
Recent export disruptions have made consumers acutely aware of supply risks, shifting the conversation from “lowest cost” to “secure cost.” Long-term offtake contracts are being negotiated with floor prices high enough to underpin new mines and refineries outside China.
For instance, Canada’s Neo Performance Materials, which opened Europe’s first magnet plant in Estonia, reported that customers will pay 15–20% more for its non-China magnets, if not more in some cases (heavies) as cited above. Now Korea’s LG and Samsung are sourcing Vietnamese-made magnets at a premium to hedge against Chinese export volatility.
While such premiums squeeze margins for end-users, many firms conclude it’s preferable to pay the hidden “cost” of supply interruptions. Analysts estimate NdPr prices in the $75–$100/kg range may be necessary to incentivize enough new non-Chinese production to meet growing global demand.
Thus, the rare earth market is entering a new phase where security of supply is built into contract terms and pricing, potentially raising costs but improving resilience in the supply chain.
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