Highlights
- China’s dominant control of rare earth mining and refining represents a strategic geopolitical tool, not just a market dynamic.
- Investors need a comprehensive geostrategic approach that evaluates rare earth investments beyond simple stock listings.
- Solving critical rare earth supply gaps requires coordinated government efforts, substantial midstream refining investments, and strategic exclusion of Chinese-dominated pathways.
Many online news sources attempt to guide retail investors through the rare earth element (REE) sector. However, we often see key elements missing, information separating hype from reality. At Rare Earth Exchanges (REEx), our mission is to provide critical, unvarnished insight into the rare earth supply chain—from upstream mining to midstream refining, downstream magnet manufacturing, and recycling, along with a deeper understanding of the unique geopolitical and economic drivers linked to this fascinating investment sector.
China’s Weaponized Dominance
Many popular media outlets, including those tracking, mining, and investing in China, acknowledge the country’s 70% share in mining and 90% dominance in rare earth refining, but generally treat this monopoly as a neutral market dynamic, rather than the coercive geopolitical tool it truly is. REEx emphasizes that China’s state-backed enterprises are not profit-maximizing businesses—they are instruments of national strategy, geopolitical and economic control.
Export controls imposed in April 2025 on key elements such as terbium, dysprosium, and scandium are not market fluctuations; they are deliberate acts of economic pressure meant to suppress non-Chinese competitors and secure long-term downstream dominance. Much of the investor media may briefly cite these controls. Still, they omit the critical context, leaving readers unprepared for the real volatility in this space: not price swings, but political sabotage.
Stock Lists Without Strategy
Often, media sites will offer an exhaustive list of rare earth stocks—from blue-chip players like MP Materials and Lynas to dozens of microcap explorers. However, little to no evaluation is offered beyond market capitalization and ticker symbols. There is no discussion of which companies control midstream processing, or whether they are exposed to Chinese toll refiners. See the REEx NdPr rankings for examples of our direction.
No mention of solvent extraction capacity. No critical lens on offtake agreements, government funding, or project viability.
Such a listicle approach turns a strategic sector into a high-risk investment. Investors should ask:
- Can the company refine its oxides, or does it ship to China?
- Is there integration from mine to magnet, or only upstream drilling?
- Is the company backed by defense funding or DOE tax credits?
- What is its exposure to China’s price manipulation?
- What are the unfolding policies in the USA and the West that will support sustainable supply chain resilience over time?
Retail investors deserve more than watchlists—they deserve a geostrategic filter.
ETFs: Diversified Exposure or Trojan Horse?
ETFs, such as REMX, SETM, and DMAT, are featured prominently in the article. But again, mind the critical nuance. The Global X Disruptive Materials ETF (DMAT) includes Chinese state-owned firms, such as China Northern Rare Earth, the very actors driving global rare earth dependency. Investing in this ETF could mean directly funding the monopoly Western governments are scrambling to dismantle.
Diversification does not mean immunity. When a single state actor dominates the underlying ecosystem, ETFs can create the illusion of safety while embedding structural risk.
Recycling, Circularity, and the Mirage of Alternatives
Investor and mining media may refer to recycling and deep-sea mining as emerging supply solutions. While REEx tracks these developments closely, investors should be wary of overstated timelines and underdeveloped capacity. Today, less than 5% of rare earths used in magnets are sourced from recycling. Deep-sea mining remains decades away from being scaled up and is fraught with regulatory hurdles.
The critical supply gap will not be solved by technology alone. It will require:
- Allied government coordination
- Massive investment in midstream refining
- Transparent pricing and offtake contracts
- Strict exclusion of Chinese-dominated pathways
Look Beyond the Hype
Investing in rare earth elements is not about finding the next hot ticker—it’s about understanding the collision of industrial policy, resource nationalism, and strategic materials. For that, investors must dig deeper.
At REEx, we track not just who’s drilling, but who’s building the supply chains of the future.
About Rare Earth Exchanges
Rare Earth Exchanges (REEx) is the leading media and intelligence platform tracking the full rare earth supply chain—from upstream mining to advanced downstream applications. We deliver strategic insight for investors, governments, and industry leaders navigating the critical minerals economy.
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