Highlights
- China controls 80-90% of rare earth processing and magnet production, using pricing as a strategic geopolitical weapon.
- Western governments and companies are urgently developing an ‘ex-China’ rare earth market with transparent pricing mechanisms.
- New platforms like Rare Earth Exchanges (REEx) are pioneering efforts to create independent pricing indices and market transparency.
Rare earth elements (REEs) – the 17 obscure metals vital for electric vehicle motors, wind turbines, smartphones, and defense systems – have quietly become a geopolitical pressure point. When Beijing tightened export controls on rare earth magnets earlier this year, Western automakers and defense contractors felt an immediate jolt: supply chains were thrown into chaos, assembly lines idled, and panicked buyers suddenly clamored for non-Chinese sources as cited by this outlet, Reuters (opens in a new tab) and others. The episode underscored how China’s near-monopoly on rare earth mining and processing has turned pricing power into a strategic weapon – and why a transparent “ex-China” market for rare earths is desperately needed. China today accounts for roughly 80% of global rare earth processing and 90% of magnet production, giving Beijing de facto control over prices and supply. Now, a new front is opening in the trade war: an urgent push by governments and companies to build an independent rare earth supply chain and pricing system outside of China.
China’s Tight Grip on Pricing
Inside China, rare earth prices are guided by state-influenced mechanisms rather than free-market trade. Beijing has established two spot exchanges: the Baotou Rare Earth Products Exchange in Inner Mongolia, which focuses on light rare earths, and the Ganzhou Rare Metal Exchange in Jiangxi, which specializes in heavy rare earths. These physical exchanges, launched in 2014 and 2019 respectively, were meant to centralize trade and bolster China’s influence over pricing. However, they operate under strict state-owned oversight, as part of China’s broader strategy of consolidating its rare earth industry under state control per Rare Earth Exchanges (REEx).
There is no active futures market for rare earths in China – the Shanghai Futures Exchange has mulled REE contracts, but none exist to date. In practice, prices on the Chinese exchanges remain opaque and guided by policy: government production quotas, export restrictions, and even official “guidance” to industry can move prices more than supply-demand dynamics as we have reported. For example, in 2022 Chinese authorities intervened to cool an overheating rare earth market – an official directive to “guide product prices to rationality” was swiftly followed by a sharp price decline as discussed in investor disclosures and industry reports (opens in a new tab).
Several Chinese-language or China-based commodity sites, notably Asian Metal (opens in a new tab) and Shanghai Metals Market (opens in a new tab) (SMM), publish daily rare earth price benchmarks. These indices are widely referenced – in fact, the Asian Metal Index is essentially the world’s primary public price reference for rare earth oxides. But even Chinese industry insiders acknowledge it “is not a reflection of free market dynamics” and is heavily influenced by Chinese government and enterprise actions.
In other words, the “market price” for rare earths, as seen on Asian Metal or SMM, is largely whatever China’s state-directed system says it is on a given day. This model has helped Beijing keep prices low enough to deter rival producers – and high enough when needed to reward domestic players – creating big challenges for any would-be competitors outside its borders.
China’s dominance is not just a matter of geology or refining capacity, but deliberate strategic national industrial policy, ultimately directed by the Communist Party of China’s interests. For decades, Beijing’s lax environmental rules and subsidies undercut foreign mines; then it imposed export quotas and tariffs to tighten its grip as reported (opens in a new tab) by the Center for Strategic and International Studies (opens in a new tab) (CSIS).
In 2010, a Chinese embargo on rare earth shipments to Japan sent global prices skyrocketing, providing a preview of the leverage at hand. More recently, during the U.S.–China trade war, China demonstrated its growing influence. In mid-2023, Beijing announced export permits would be required for certain magnet-related rare earths, causing shipments to slow to a trickle. Following the latest trade tiff after President Donald Trump’s Liberation Day (April 2025), Chinese magnet exports to the U.S. had plunged 93% year-over-year, forcing some U.S. and European factories to halt production. Although a tentative trade truce in June 2025 led to exports resuming, the message was clear: China can disrupt global industries by throttling its rare earth supply, and the world has limited insight into its pricing decisions. As a U.S. rare earth executive lamented, “the Asian Metal price” remains the de facto benchmark but is effectively a tool of Chinese policy.
The Nascent “Ex-China” Market and Its Mysteries
For Western governments, investors and manufacturers, these realities have made one thing evident – an “ex-China” rare earth market must emerge. In fact, Salt Lake City, Utah-based Rare Earth Exchanges LLC was launched in January 2025 to help facilitate and ultimately ensure an Ex-China rare earth market emerges by more effectively and efficiently directing investment into the entire rare earth supply chain.
Ensuring reliable supply is one side of the challenge; the other is establishing transparent pricing mechanisms outside of China’s shadow. At present, pricing for rare earths outside China is shrouded in secrecy. There is no London Metal Exchange or NYMEX for rare earths, no public spot market where global prices are discovered.
Instead, the tiny handful of non-Chinese producers (Australia’s Lynas, America’s MP Materials, a few others) sell material through bilateral contracts with customers, behind closed doors. Opacity reins over transparency. A network of intermediaries, consulting firms, financial brokers, and the like facilitates and helps structure these deals—a lucrative practice for some.
The terms of these off-take agreements – volumes, pricing formulas, duration, take-or-pay clauses – are overwhelmingly confidential, leaving outsiders and even many industry players guessing. As Nasdaq’s commodities desk notes, “unlike prices for gold and silver, rare earth elements prices are hard to come by, as there is no widely used public exchange for rare earths.” Specialized publishers like Fastmarkets or Argus compile price assessments based on surveys of traders and consumers, but these are available only to subscribers and reflect relatively few data points and don’t factor in entire supply chain dynamics. Benchmark Minerals tossed its hat in the ring as well.
In short, it’s a contract-driven market with almost no transparency, akin to an underground network where each deal might be unique, or at least have bespoke elements.
How are these contract prices determined? According to industry insiders, most Western supply deals still take cues, at least up to the recent times, from the Chinese market. It is common for contracts to be indexed to a Chinese price benchmark – for example, a customer might agree to pay a certain percentage of the Asian Metal index price for neodymium-praseodymium (NdPr) oxide, averaged over a prior month or quarter. Some contracts include floors or collars to buffer extreme Chinese price swings. “In the absence of an independent benchmark, everyone references the Chinese price in one form or another,” explains one rare earth consultant. That means when China’s domestic price slumps (often due to state subsidies or deliberate oversupply), Western producers see their realized prices dragged down as well – one reason projects outside China have struggled to stay profitable. The Asian Metal Index price for NdPr oxide languished around $50–60 per kilogram for much of 2023-24, a level at which no new Western mine could break even, according to Reuters (opens in a new tab).
Lynas Rare Earths, the largest non-Chinese producer, reported an average selling price of A$60.2 per kg (~US$40) for its mixed REO product in mid-2025, reflecting a basket dominated by lower-value oxides. This opacity and Chinese linkage persisted until a supply scare flipped the script in 2025.
The recent magnet export crisis in 2025 has, for the first time in years, given a glimpse into nascent ex-China pricing – and it comes at a premium. With the Chinese magnet supply suddenly uncertain, Western buyers signaled they will pay more for non-Chinese material to secure supply. One rare earth executive told Reuters (opens in a new tab) that automakers were prepared to pay around $80 per kg for NdPr oxide from non-Chinese sources, roughly a 30% premium over the prevailing Chinese price of ~$62. This was virtually unheard of before. Procurement managers, long conditioned to squeeze pennies, are begrudgingly accepting that paying a premium now may be better than facing a production shutdown later. Ryan Castilloux (opens in a new tab), head of Adamas Intelligence, notes that a sustained NdPr price in the $75–$100+ per kg range is likely needed to spur enough new Western production to meet growing demand according to a Reuters entry.
Indeed, analysts at Australia’s Barrenjoey (opens in a new tab) argue prices may need to rise as high as $120–$180/kg to justify a wave of new rare earth mines globally, as cited by Reuters (opens in a new tab). These figures underscore how undervalued rare earths have been under China’s watch – and how an open market price, if one existed, might be markedly higher than the “China price” we’ve taken for granted.
Still, the current reality is that ex-China rare earth pricing remains a black box. Deals are ad hoc, and even the U.S. Department of Defense – which has become an active player – is essentially setting prices through negotiation rather than market discovery. In July 2025, the DoD struck a landmark deal with MP Materials (operator of the Mountain Pass mine), not only taking a 15% equity stake, but also guaranteeing a price floor of $110/kg for NdPr oxide as reported by REEx. This floor is nearly double the Chinese market price (around $50–55 at the time) – a dramatic statement that the U.S. government is willing to bankroll higher prices to ensure domestic supply. “This is a game changer for the ex-China industry,” Castilloux said of the deal (opens in a new tab), noting it delivers “a much-needed surge in magnet production capacity” by making non-Chinese production economically viable. The DoD essentially acknowledged that free-market pricing (as dictated by China) was too low to sustain Western supply, and intervened to create an artificial price signal. Whether this $110/kg ends up as a broader benchmark remains to be seen – for now, it applies only to MP’s output – but it underscores how in flux and opaque the pricing landscape is outside China. Most contracts elsewhere likely fall somewhere between the Chinese spot price and the new highs buyers are grudgingly accepting, but precise data is scarce.
Aside from Lynas’s quarterly average and occasional anecdotes, there is little public transparency. This lack of price discovery creates a vicious circle: investors are wary of funding new rare earth projects when they can’t gauge what price they might receive, and buyers are skeptical without market references – so the market stays small and closed. “It’s all murkier than it should be,” admits one European magnet manufacturer. “We know what Chinese prices are every day, but what’s the price for non-Chinese material? There is no screen to check that.”
Steps Toward Transparency: New Benchmarks and Exchanges
Recognizing this gap, industry groups and new platforms have begun laying the groundwork for transparent rare earth pricing outside China. A significant development came in mid-2025 when UK-based Benchmark Mineral Intelligence, a leading critical-minerals price reporting agency, launched a set of ex-China rare earth price assessments. The firm now publishes praseodymium-neodymium (NdPr) oxide prices CIF (cost, insurance, freight) Europe and North America, among other grades, as part of its weekly price bulletin – “a key milestone in price transparency for REE supply outside of China,” Benchmark declared via LinkedIn (opens in a new tab). This initiative aims to provide independent benchmark prices for Western producers and buyers to reference, much as Benchmark (and rivals like Fastmarkets (opens in a new tab) or Wood MacKenzie (opens in a new tab)) do for lithium and cobalt. The move was spurred in part by the U.S. DoD–MP Materials deal – a signal that large customers want reliable non-China benchmarks. REEx itself is working on price tracking, along with transparent rankings for investors of all of the supply chain players, from upstream and midstream to downstream magnet, component and assembly makers to recycling technology and even R&D innovators.
While it will take time for these assessments to gain traction (market participants must report data and actually transact at arms-length for the prices to be meaningful), it’s an important first step. The launching of Rare Earth Exchanges or “REEx” itself is part of that movement in the West and in the United States.
Over time, such indices could evolve into the basis for futures contracts orexchange-traded products in rare earths, analogous to how lithium is nowdebuting on major exchanges. For now, no Western exchange trades rare earth futures, but the conversation has started. The Intercontinental Exchange ( (opens in a new tab)ICE) recently partnered with Benchmark to launch lithium futures. This model could, in a few years, be extended to rare earths if pricing becomes robust and trusted.
Perhaps the most novel effort in building an ex-China market is coming from information platforms that combine industry news, data analytics, and community engagement. We represent the first of such platforms: REEx, which was explicitly created to increase transparency and connectivity in this opaque sector. REEx provides real-time news reporting on the global rare earth market, covering everything from Chinese policy moves to new project developments, along with expert analysis and a podcast featuring interviews with industry leaders. By disseminating timely information in English, it helps international investors and policymakers better understand a market that Chinese-language or Chinese-centered sources have long dominated. REEx is also pioneering algorithmic rankings of rare earth projects worldwide – essentially a data-driven evaluation of mining and processing projects based on criteria such as resource size, stage, economics, and ESG factors. These independent rankings (covering both light and heavy rare earth projects with processing/refining as well as magnet/component/assembly producers in process) give investors and end-users an apples-to-apples view of potential new supply sources, helping them identify which emerging mines might become viable alternatives to Chinese supply. In doing so, such tools chip away at the information asymmetry that has plagued the sector.
Crucially, REEx has ambitions to develop a pricing index tailored to the ex-China market. And in fact, it is accumulating the intelligence along with the development of systems to make that a reality. While still in its early stages, the vision is to compile transaction data, contract info, and perhaps user-submitted pricing in a way that could yield a trusted index for rare earths sold outside China. This is no simple task – it requires cooperation from companies to share data and a robust methodology to account for different product grades – but if achieved, it could be transformative. Imagine a transparent index for NdPr oxide delivered in the U.S. or Europe, akin to a metals index, updated regularly. This would allow buyers and sellers to negotiate contracts based on a published “Western price” rather than peering at Asian Metal or SMM and applying mysterious adjustments. It could also facilitate the use of hedging instruments in the future. The REEx comprehensive approach – combining news, market sentiment (via forums), project data, and eventually price indices – aims to create the ecosystem needed for a functioning ex-China market. As one REEx Chief Business Officer, John Parkinson, (opens in a new tab) put it, “You need more than just a price ticker – you need context and credibility around that price. We’re trying to build both the information network and the trust, so that an ex-China price can emerge and be believed.”
Policy support is reinforcing these grassroots efforts. The U.S. government’s involvement in MP Materials effectively sets a price floor (at this point ostensibly for one company) and signals long-term demand. The DoD and Department of Energy are funding not only production but also data-sharing and stockpile transparency initiatives as part of securing critical minerals. In allied countries, similar moves are afoot: Japan and the EU are funding rare earth separation plants and mandating reporting to create more open markets. All these steps contribute pieces to a more transparent puzzle.
Outlook: Breaking China’s Spell
Creating a truly transparent pricing system for rare earth elements outside of China is a daunting endeavor – but it is underway. The stakes go beyond just dollars per kilogram: without transparent pricing, investment will lag, and the West’s quest to diversify rare earth supply could stall. Conversely, a robust ex-China price discovery mechanism will draw capital to new projects by showing that producing rare earths can be profitable on market terms, not just with government subsidies. It also arms end-users – from EV makers to defense firms – with knowledge to plan and hedge their raw material costs. As automakers and other buyers become willing to pay a premium for non-Chinese rare earths, those prices need to be openly reported and standardized.
REEx notes, however, the more intelligent American and Western industrial policy in the short to intermediate term, the better the chances of a market accelerating sooner rather than later.
The rare earths industry is often described as opaque and “relationship-driven,” but it is slowly transitioning into an era of greater transparency and market-based behavior. Platforms like ours—REEx are fostering an informed community of stakeholders, while price reporting agencies are carving out non-China benchmarks. These developments complement the physical investments in mines, separation facilities, and magnet factories across the U.S., Europe, and Asia in places like India (now the world’s fourth largest economy), which is also dependent on Chinese refineries and magnet producers.
It is telling that the U.S. DoD – traditionally a buyer, not a market-maker – felt compelled to engineer a price mechanism ($110/kg NdPr) to jump-start the market. That may be the first of several creative interim solutions until true price discovery takes hold. Only time and the unfolding actions of market players will tell.
For now, anyone trying to answer “What’s the price of rare earths outside China?” must rely on fragments: the Asian Metal indices (with all their caveats), the occasional Lynas or MP investor update, consultant whispers, and now fledgling prices from expensive consultancies and data brokers from Benchmark to Wood Mackenzie (opens in a new tab). It’s not ideal. But five years ago, even those fragments were hard to come by – and China’s dominance went totally unquestioned. Today, spurred by geopolitical urgency, investors, policymakers, and industry executives are paying close attention and demanding clearer answers. They recognize that transparency is not just about fairness, but about national security: you can’t build a stable supply chain on hidden prices.
As the ex-China rare earth market develops, expect much more rigorous reporting and possibly the birth of new exchanges or trading platforms dedicated to critical minerals. Rare earths may never be traded with the volume of copper or gold, but a more liquid and open market is within reach, especially if they are combined with other critical minerals—a far bigger sector with many of the same asymmetric information challenges, not to mention Chinese dominance in many cases.
In the coming years, a combination of Western government support, private sector innovation, and industry collaboration could finally crack the pricing puzzle. The ultimate goal is to let market forces – rather than China alone – set the value of these strategic resources. And as REEx has recommended, the West will need to embrace forms of industrial policy inthe years ahead to bolster the probability of successfultransition.
Achieving that will neutralize one of Beijing’s powerful levers and foster a more resilient global tech supply chain, driven by market forces as opposed to a communist imperative. The journey has begun from opaque contract prices whispered behind closed doors, toward an era where a posted price for ex-China rare earths can be cited in boardrooms and policy briefings alike. The world is watching closely, calculators in hand.
Sources: Rare Earth Exchanges data repository, Chinese rare earth exchanges and state influencerareearthexchanges.comiluka.com (opens in a new tab); U.S. DoD–MP Materials $110/kg price floor dealreuters.com (opens in a new tab)reuters.com (opens in a new tab); China’s 80–90% supply chain dominanceainvest.com (opens in a new tab); Premiums paid for non-Chinese supplyreuters.com (opens in a new tab); Benchmarklaunching ex-China price assessmentslinkedin.com; Rare Earth Exchanges analysis and datarareearthexchanges.comrareearthexchanges.com; Reuters and Nasdaq reports on market opacitynasdaq.com (opens in a new tab)reuters.com (opens in a new tab).
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