Highlights
- China controls nearly 90% of global rare earth refining capacity, with significant leverage in the global market.
- Non-Chinese producers like Lynas Rare Earths, MP Materials, and others are actively developing alternative rare earth supply chains.
- Western governments are supporting strategic rare earth projects to reduce dependency on Chinese production.
China controls nearly 90% of global rare earth refining capacity in 2025, including a near-monopoly on heavy rare earth elements (HREEs) like dysprosium and terbium. Through state-led consolidation, major players like China Rare Earth Group and China Northern Rare Earth dominate the supply chain from mine to magnet. China produces over 300,000 tonnes of NdFeB magnets annually, compared to the U.S.'s 1,000-tonne target. Chinese export controls on rare earth oxides and alloys have introduced supply risk for global manufacturers. These structural advantages give Beijing significant leverage.
The Principal Non-Chinese Producer—Down Under
Lynas Rare Earths leads outside China, operating the Mt Weld mine in Australia and a separation facility in Malaysia. Lynas supplies 5,000-6,000 tonnes/year of NdPr oxide and is expanding with a new U.S. facility targeting light and heavy RE separation. Iluka Resources is building Australia’s first integrated refinery (Eneabba) with 17,500 t/y capacity, while Arafura’s Nolans project aims to produce 4,440 t/y NdPr oxide by 2025. Australia is cementing its role as the #2 refining hub.
United States: Rebuilding Capacity
MP Materials has restarted Mountain Pass operations and produced 1,300 t of NdPr oxide in 2024. Its Fort Worth, Texas magnet plant will soon deliver 1,000 t/y NdFeB magnets using U.S.-sourced rare earths. However, MP lacks heavy rare earths. Energy Fuels, via White Mesa Mill in Utah, is producing mixed rare earth carbonates and small quantities of NdPr oxide. Its partnership with POSCO International aims to create a Korea-linked, non-Chinese supply chain.
Emerging Non-Chinese Players
- South Korea: SEONG-AN and Seonglim Advanced are producing NdPr metal and NdFeB magnets from U.S. feedstock.
- Japan: Major magnet manufacturers rely on imported oxides, largely from Lynas and China, but are expanding recycling efforts.
- Europe: Neo Performance's Silmet plant in Estonia remains the EU's only commercial separator. Its new magnet plant in Narva (2,000 t/y) and partnerships with U.S. producers create EU-US supply links. Pensana (UK), REEtec (Norway), and others are building new refineries.
Outlook and Geopolitical Considerations
China’s refining and magnet dominance remains strong but faces growing competition. Western governments are backing projects to secure strategic supply chains. Lynas, MP Materials, Iluka, Arafura, and Neo are the most advanced challengers.
Heavy rare earth processing remains the biggest gap, though Energy Fuels and USA Rare Earth are pursuing solutions. If current projects succeed according to at least some bullish estimates China’s market share could drop from ~90% to ~75% by 2028, but Rare Earth Exchanges suggest industrial policy is likely necessary.
The race is on to diversify before the next supply shock hits.
We would suggest that Lynas is moving forward strongly in HRE processing (maybe leading the ROW with its own mine as well) and offers the US potential supply in HRE mine to oxide. Then don’t forget ASM who is producing metals/alloys already in S. Korea and if the CEO is correct, may well be ‘invited’ to open such a chokepoint facility in the US as well.
Questions – What has happened to Pensana and its claims over the last two decades re., building a processor in the UK -no strategic support at all in the recycling focused UK. Then, where is REEtec after the collapse of its Vital Metals supply chain and LKAB some years away?
(Transparency – we hold both Lynas and ASM). GLTA REI
Considering there are approximately eight or perhaps 9 different already-public refinement technologies in the research stage within the U.S. (some under development for a decade already), with most being *far* more advanced, efficient (re: recovery rates), and which do *far* less environmental damage than the technologies the U.S. sold to China in the 1990s (including just to name a few: membrane filtration technologies, Flash Joule Heating; peptide targeting; supercritical CO2 and even supercritical Hydrogen; and others); plus 3 of those have already proceeded to the pilot plant / commercial viability test stage. I’m sure Australia is making similar strides. It would seem that an update to this article might be a worthwhile effort and would potentially result in a better resource for all. While I personally greatly appreciate the fact the U.S., Australia and others weren’t willing to devastate their own environments, we can certainly see the result: China on the one hand for the next few years may have an ever-decreasing choke hold on rare earths finished products. However in the long run, for that short term gain they have devastated entire areas and cities and countless people with contamination. Some of the pictures that have come out of China seem almost like scenes from an Armageddon movie. Still, clearly the broader industry hasn’t been standing still; in fact recently I read an alliance in the EU recently also stepped up to further ongoing research on more efficient, effective and environmentally-responsible refinement techniques. Methods which, no doubt, China will eventually “acquire” one way or another unsurprisingly.